Article II Gun Shop, Inc. v. Gonzales

• Decision Date: 20 March 2006
• Docket Number: No. 05-2800.,05-2800.
• Parties: ARTICLE II GUN SHOP, INC., d/b/a Gun World Plaintiff-Appellant, v. Alberto GONZALES, Defendant-Appellee.
• Court: U.S. Court of Appeals — Seventh Circuit

441 F.3d 492

ARTICLE II GUN SHOP, INC., d/b/a Gun World Plaintiff-Appellant, v. Alberto GONZALES, Defendant-Appellee.

No. 05-2800.

United States Court of Appeals, Seventh Circuit.

Argued January 11, 2006.

Decided March 20, 2006.

Richard E. Gardiner (argued), Fairfax, VA, for Plaintiff-Appellant.

Donald R. Lorenzen (argued), Office of the United States Attorney, Chicago, IL, for Defendant-Appellee.

Before FLAUM, Chief Judge, and EASTERBROOK and MANION, Circuit Judges.

FLAUM, Chief Judge.

Article II Gun Shop, Inc., doing business as Gun World ("Gun World") had its federal license to sell firearms revoked by the Bureau of Alcohol, Tobacco, and Firearms ("ATF"), based on allegations that Gun World willfully violated several reporting requirements of the Gun Control Act of 1968, 18 U.S.C. § 921 et seq. ("Act"). Gun World challenged ATF's revocation decision in federal district court, pursuant to 18 U.S.C. § 923(f)(3). The government filed a motion for summary judgment, which the district court granted. Gun World appeals. For the following reasons, we affirm the opinion of the district court.

I. Background

Gun World has been a federally licensed firearms dealer since 1978. Barry Soskin ("Soskin") is Gun World's corporate president, secretary, treasurer, and sole director and stockholder. He has held these positions since the store opened in 1978.

ATF inspected Gun World in 1981, 1998, and 2000 for compliance with the Gun Control Act and its implementing regulations. After each inspection, ATF cited Gun World with violations of the Act, including violations of the Act's recordkeeping requirements. The Act requires a firearms dealer to fill out a "Form 4473" ("Form") whenever a firearm is sold. See 27 C.F.R. § 478.124(c)(2). The Form is used to record identifying information about gun purchasers and the firearms they purchase, which allows firearms to be traced and prevents transfer to persons prohibited from possessing firearms. See id. The 1981 inspection report showed that Gun World failed to properly complete 30 Forms. The 1998 inspection report showed that Gun World failed to properly complete 34 Forms and failed to properly maintain an acquisition and disposition book. See 27 C.F.R. § 425(e). The inspector who conducted the 1998 inspection discussed the violations with Soskin and the corrective actions Gun World would need to take.

The 2000 inspection report documented more violations: two separate straw sales; at least fifteen occasions on which Gun World knowingly and willfully failed to obtain and record information required on the Forms; at least forty-nine occasions on which Gun World knowingly and willfully transferred firearms to legal aliens without obtaining required documentation; and at least fourteen occasions on which Gun World knowingly and willfully failed to record sales or dispositions of firearms in the acquisition and disposition book within seven days of a transfer.

On May 18, 2000, ATF's Chicago Area Supervisor, Nicholas Scouffas, warned Gun World that ATF was contemplating revoking Gun World's licence. On May 31, 2000, Gun World was given an opportunity to conference with ATF and present evidence in support of its position that its license should not be revoked. At the conference, Gun World promised to take corrective actions to prevent further violations. According to the government, however, Gun World continued to violate the Act after the May 31 conference.

On July 22, 2002, ATF issued Gun World a notice that its license was being revoked. The revocation was based on the 2000 inspection report and the store's history of violations. Gun World requested a hearing to review the revocation, pursuant to 18 U.S.C. § 923(f)(2). The hearing took place on January 29 and 30, 2003. The hearing officer sent ATF a report summarizing the evidence introduced at the hearing and his findings of fact, conclusions and recommendations. Richard Alexander ("Alexander"), ATF's Chicago Field Division Director of Industry Operations, concluded from the hearing officer's report that Gun World had willfully violated the Gun Control Act. On May 5, 2003, ATF issued a final notice of revocation to Gun World.

Gun World filed a petition with the district court, seeking de novo review of ATF's decision. See 18 U.S.C. § 923(f)(3). ATF filed a motion for partial summary judgment. ATF sought summary judgment based on ATF's finding that Gun World knowingly and willfully failed to complete fifteen Forms, in violation of 18 U.S.C. § 922(m). The district court "disregard[ed] the other violations for which Gun World was cited during the 2000 inspection and . . . decide[d] whether the Form 4473 violations alone authorized ATF to revoke Gun World's license." Gun World did not deny that the fifteen violations occurred, but only that they were "willful."

Alexander, the ATF director who approved the revocation of Gun World's license, signed a declaration on February 24, 2005, stating that he would have revoked Gun World's license based solely on the Form 4473 violations. Alexander's declaration was based on the record of the proceedings before the ATF, the hearing officer's report, the evidence considered by the hearing officer, and the initial and final notices of revocation.

The district court granted ATF's motion for summary judgment, and Gun World appeals.

II. Discussion

Gun World raises three issues on appeal. First, Gun World argues that the district court erred by admitting into evidence ATF's 1981 and 1998 inspection reports, because the reports were not certified or sworn copies, as required by Federal Rule of Civil Procedure 56(e). Second, Gun World maintains that the district court should not have considered the 1981 ATF inspection report, because there is a five-year statute of limitations for any forfeiture proceeding. Third, Gun World argues that its violations of the Gun Control Act were not "willful," because Gun World did not act with the intent to disobey or disregard the law. We are not persuaded by these arguments.

A. The 1981 and 1998 ATF Inspection Reports.

The district court based its decision in part on copies of 1981 and 1998 ATF inspection reports. The reports were attached as exhibits to the affidavit of Thomas Karmgard ("Karmgard"), an ATF attorney. Gun World argues that the district court should not have looked to these reports to evaluate the willfulness of the violations committed in 2000, because the reports were not "sworn or certified copies," as required by Federal Rule of Civil Procedure 56(e). Federal Rule of Civil Procedure 56(e) requires that, in cases involving summary judgment, "[s]worn or certified copies of all papers or parts thereof referred to in an affidavit shall be attached thereto or served therewith." According to Gun World, "because the [1981 and 1998 inspection] reports themselves are not sworn or certified copies, they are not available to support a motion for summary judgment," regardless of whether they were sufficiently authenticated pursuant to Federal Rule of Evidence 901(b)(1).

In response, the government maintains that the reports need not be sworn or certified copies, because ATF did not revoke Gun World's license based on these reports; instead, it based the revocation on the 2000 report, as Alexander stated in his declaration. Additionally, the government maintains that even if the reports should not have been admitted, the error was harmless because Soskin admitted under oath that Gun World had been cited by ATF in 1981 and 1998 for violations of the Act.

The district court found that the reports were admissible, and that Karmgard's personal knowledge of the matters underlying the reports was unnecessary to lay a foundation for their admissibility. Instead, Karmgard's affidavit authenticates the reports as records of ATF. See FED. R. EVID. 901(b)(1). The district court also pointed out that Gun World does not dispute that the reports attached to the affidavit are accurate copies of the originals.

The district court properly considered the reports. The government submitted Karmgard's sworn affidavit in support of its motion for summary judgment. The affidavit authenticated the reports by establishing that they are public reports, kept in a public office, where reports of that type are kept. See FED. R. EVID. 901(b)(1)(7) ("Public records or reports. Evidence that a writing authorized by law to be recorded or filed and in fact recorded or filed in a public office, or a purported public record, report, statement, or data compilation, in any form, is from the public office where items of this nature are kept."). Karmgard, as an agent of ATF, was competent to make such a statement. He swore to the authenticity of the documents attached to his affidavit, including the 1981 and 1998 reports. It was not necessary that he swear to personal knowledge of facts contained in the reports. Public records and reports are admissible as an exception to the hearsay rule, once their authenticity is established. See FED. R. EVID. 803(8).

Gun World emphasizes that there is a distinction between a document's authenticity and its admissibility, and argues that while the reports were properly authenticated, they still are not admissible. Gun World is correct that a document is not admissible simply because it has been authenticated. "To be admissible, documents must be authenticated by and attached to an affidavit that meets the requirements of Rule 56(e) and the affiant must be a person through whom the exhibits could be admitted into evidence." Scott v. Edinburg, 346 F.3d 752, 760 n. 7 (7th Cir.2003) (quoting 10A Charles Alan Wright et al., Federal Practice & Procedure § 2722, at 379-80 & 382-84 (1998)). Those requirements have been met in this case: the reports were authenticated by Karmgard's affidavit; the reports were attached to his affidavit, which met the requirements of Rule 56(e); and Karmgard is a person through whom the reports could be admitted into...