A local arms dealer is suing the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF), claiming the government agency failed to comply with federal law when it issued permits authorizing the Redmond business to import certain types of ammunition for resale.

The plaintiff, P.W. Arms, Inc. (PWA), located in the Sammamish Valley neighborhood of Redmond, filed its claim Dec. 18 2015.

According to court documents of PWA’s 25-page claim, the defendant, the ATF, issued the arms dealer with permits that would allow them to import 5.45 millimeter by 39 millimeter rifle ammunition — manufactured in Russia and former Soviet Bloc nations — for resale as sporting ammunition to FFLs in the United States.

FFL stands for federal firearms license and allows licensees to engage in a business pertaining to the manufacture or importation of firearms and ammunition or the interstate and intrastate sale of firearms. Holding an FFL to engage in certain such activities has been a legal requirement within the United States since the enactment of the Gun Control Act of 1968.

PWA’s claim document continues, stating that the ATF “subsequently and without notice repudiated its delegated legislative authority to reclassify this ammunition as illegal and ‘armor piercing’…despite the lack of a commercially available handgun capable of using this rifle ammunition, and despite the lack of evidence that the ammunition contained a projectile core made entirely of steel or from a combination of steel and tungsten alloys, iron, brass, bronze, beryllium copper, or depleted uranium.”

The PWA claim also seeks a judgement that the ATF “negligently and/or wrongfully approved PWA’s importation permit under the circumstances above and is liable for all damages actually and proximately caused by ATF’s negligent and/or wrongful acts and/or omissions in an amount to be determined at trial.”

The ATF issued PWA permits to import hundreds of million rounds of the 5.45 millimeter by 39 millimeter rifle ammunition — also known as 7N6 — from 2013-14. According to its PWA claim, this included permits that authorized PWA to import 100 million rounds of ammunition in February 2013 as well as another 50 million rounds in February 2014. Most of these rounds were imported for resale, the claim states.

In March 2014, following a delay in a shipment of ammunition, PWA was notified by the ATF that 7N6 rounds they had imported “cannot be imported unless it is for use by the United States, any department or agency of the United States, any State, or any department, agency, or political subdivision of a State.”

According to the PWA’s claim, the company incurred about $2.97 million in damages “caused by the actions of ATF for which defendant United States of America is liable. ATF denied the claim.”

One of the main requests PWA has for the courts is to reclassify the ammunition so it is not “armor piercing,” in order to facilitate PWA’s lawful wholesale distribution and trade of the ammunition in the United States for sporting purposes.

PWA is also requesting the courts order the ATF cover the damages and financial loss the company has experienced, including importation permits, interest charges, storage charges, loss of profit on the ammunition, loss of business reputation and all other related costs and expenses in the amount of $2,974,685.20, plus additional ongoing costs and expenses in an amount to be proven at trial; and PWA’s attorneys’ fees and costs.

The ATF, through the U.S. State Attorney’s office in Seattle, filed its response to the claim on Feb. 19.

In court documents, the defendant moved that the courts dismiss the plaintiff’s claim that the ATF was negligent in approving PWA’s permits.

The documents state that in filling out permit applications to import and resell the ammunition, PWA “generally described this rifle ammunition as having been manufactured by ‘Russian State Factories,’ or the equivalent for other countries, such as Bulgaria…but did not reference a metal core.” The ATF documents state that PWA alleges that “(a)t all relevant times” it has been common knowledge that such ammunition “contains a small steel insert that is part of the core of the projectile.” However, PWA did not disclose on its permit form that the ammunition it would be importing contained a steel core or that it was armor piercing.

In its response, the ATF filed two sets of documents totalling 70 pages. In those documents, it is stated that approval of the types of permits PWA applied for to import the ammunition is left to the discretion of the ATF examiner.

“Once the permits are conditionally approved…the permits can be revoked at any time…The approved permits in this case specifically stated that they did not authorize the importation of the ammunition if it fit the definition of armor piercing,” the documents read.

The papers continue, stating that once the imported ammunition reaches American soil, it is inspected and compared to the description on the original forms. If the description and goods do not match, ATF conducts another investigation and once the results are in, decision makers consider all of the information in order to revoke an original decision. In this case, the ammunition was found to be armor piercing.