March 28, 2013
The D.C. Circuit (Rogers, Tatel, and Brown, JJ.) has denied the government’s request for a stay of the district court’s injunction of the new registration regime for paid tax-return preparers. The court did not give an elaborate explanation, simply stating that “[a]ppellants have not satisfied the stringent requirements for a stay pending appeal.” Thus, the court did not indicate whether the government fell short because its motion was not sufficiently convincing that the district court was likely to be reversed on the merits or because it did not make a sufficiently compelling case of irreparable harm.
In any case, it is now likely that the government will not be able to implement the regulatory scheme in full at this time, but will remain bound by the injunction until the D.C. Circuit rules on the merits of its appeal in due course (and, of course, even after that if it is unable to persuade the D.C. Circuit to reverse). The government does still have the option of asking the Supreme Court to stay the district court’s order pending resolution of the appeal in the court of appeals. It is unusual for the government to ask the Court for that kind of relief, and for the Court to grant it, but pursuing that route remains a possibility if the government feels strongly enough about the adverse consequences of leaving the injunction in place for the time being.