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ATF v. ARES Armor More Than A War of Words
Monday, March 17, 2014
Around noon on Saturday, the ATF escalated what had to that point been a war of words with Oceanside, California-based Ares Armor.That's when ATF agents raided Ares' Oceanside location and seized what we've been told was as many as 6,000 of the Ares/EP Armory lowers that are at the heart of the matter. No Ares employees were arrested in the raid.

A YouTube video (http://www.youtube.com/watch?v=6gsmlJSpWvk) shows ATF Agents examining a computer on a sales counter while an irate female asks "would you want me bursting into your home?"

Following the raid, CalGuns issued a Facebook alert that said "We have confirmed that the ATF has searched multiple properties in the Ares Armor/EP ;owers matter and have seized customer lists." The notice went on to offer advice should the ATF come calling "Exercise your right to remain silent; Never consent to a search; Demand and attorney; Contact the Calgun Foundation's Help Hotline."

Since the Saturday raid, both outraged gun owners and gun rights groups have been asking how the ATF could possibly raid Ares after a temporary restraining order from Judge Janis Lynn Sammartino. That TRO, issued on Friday, supposedly stopped the ATF's actions against Ares.

Closer reading of the TRO, however, shows that Judge Sammartino's order "does not enjoin lawful criminal proceedings, including the application for or lawfully executed seizure of evidence and contraband pursuant to a search warrant issued by a United States Magistrate Judge."

The ATF has apparently acted on a legally issued warrant. That would be specifically permitted under the TRO.

But the plot has thickened as reports by both David Codrea and Dave Workmen over the weekend indicate Ares/EP may actually be caught up in what is a larger investigation of brothers Luiz Cortez-Garcia and Emiliano Cortez-Garcia.

The duo (both illegal aliens) have been charged with "unlawful manufacturing and sales of firearms, conspiracy to unlawfully manufacture and sell firearms, and several counts each related to the unlawful possession, manufacturing, and sale of short-barreled rifles, machine guns, and silencers."

According to Associate Press reports, the duo purchased components and assembled "hundreds" of illegal firearms. In none of the reports, however, does the ATF ever imply that either Ares or EP were involved in that criminal enterprise.

But Ares Armor is best known for its sale of what the industry calls "80% lowers". Those lowers are unfinished in the manufacturing process, needing approximately 20% more milling and machining before they're ready-to-use lowers for AR-15 pattern rifles. Under a long series of ATF rulings, the "80% lowers" are considered "raw" parts or "blanks" -an incomplete component not requiring serialization and a manufacturer's mark.

After the completion of that process, however, sale of those same lowers without a manufacturer's serial number would constitute an illegal arms sale.

Ares specializes in the sale of those lowers along with parts kits, milling jigs, and both component and finished upper assemblies. EP Armory

None of the other parts require serialization, and are not considered firearms. Only AR-15 pattern lowers-which contain the fire controls- are considered firearms -with or without the other completing component - if they are ready to accept installation of the completing fire control components.

The ATF, in a response to the restraining order, asserts that since Lycurgan, Inc. (the company that does business as Ares Armor) is not a federal firearms licensee, "it cannot legally engage in the business of dealing firearms, let alone ones that do not bear the required manufacturer's mark and serial number."

That only makes the disagreement even harder to comprehend because of the argument over what constitutes a "firearm".

Ares, says it is not a firearms dealer. Instead, the company maintains it is a parts and accessories supplier. Since 80% lowers are considered "in the raw" they are not firearms and are legal merchandise to be offered by Ares.

Now, it seems the ATF disagrees. Not only with Ares' assertion, but with longstanding rulings regarding 80% lowers.

Ares Armor makes it fairly obvious that complete firearms can be manufactured by individuals. That's not scored points with the ATF. Image from Ares Armor website.
Further complicating the question, the ATF isn't contending that all of the 80% lowers offered by Ares are, in fact, illegal. More on that below.

The fight came to a head last week when owner Demetrios Karras asked the federal courts for the temporary restraining order preventing the ATF from "raiding" his facilities.
According to Karras' statement to the court, he asked for protection under the law because the ATF had offered not to seek a warrant against Ares if Ares would:

a. Hand over all of EP Armory's 80% Lowers.
b. Turn over Ares Armor customer's private information to the BATFE.

"In exchange for turning over our customer's private information the BATFE said they would not 'raid' Ares Armor's facilities and would not pursue 'criminal' charges," the statement continues, "This made me feel as if I was being extorted."

The judge apparently agreed -at least to the point of issuing the TRO. It, however, didn't prevent the ATF from acting on suspicions of criminal activity. Since the ATF had implied it considered Ares to be selling firearms illegally, it proceeded with the raid on Saturday.

Additionally, the ATF contends Karras was wrong in going to the court because he had an "agreement...in place for the voluntary (surrender of the firearms,)." That, the ATF, contends, was while he was preparing a lawsuit and temporary restraining order "preventing ATF from taking possession of this contraband."

Karras makes no bones about the fact he did agree, but his statement characterizes the action as the only relief he had in order to "delay an impending and unjust raid against Ares Armor long enough to obtain legal protection under the law."

The ATF further contends that it "received no notice of either the complaint or the application for a temporary restraining order."

This isn't a simple case-because the ATF isn't really contending all 80% receivers are illegal. Instead, it is focusing on the polymer receivers manufactured by EP Armory. Although EP was raided last week the company's website makes no mention of the raid. All their categories of incomplete lowers, however, are now showing as "Out of Stock."

To better understand one portion of the ATF argument, you need to see one of EP Armory's 80% polymer receivers (below).

The argument isn't over the polymer, per se, it's over the fact there are two colors of polymer. The ATF says that proves the receivers were complete, then the second color inserted to get around the serialization rule.
As you can see, the polymer receiver has two colors. One, the ATF contends, was created as a complete injection- and therefore in need of serialization and manufacturer's marks- receiver. The second color was added into a complete receiver to offer give purchasers with limited machining skills the ability to simply drill out all of the second color and return the 80% receiver to its actual finished condition.

Looking at one of the receivers in question, it would seem the ATF's two color argument has some merit. EP officials disagree, saying the two-color process is achieved in a single step.

It might look like a pretty childish disagreement between a manufacturer, a retailer and the ATF - until you look at the fact the ATF initially only went after polymer lowers. Going after the aluminum blanks might upset the entire firearms industry.

At that point, there are some decidedly unresolved questions: Is the ATF moving against EP/Ares because:

a) is the BATFE moving against EP/Ares because they legitimately believe the manufacturing process argument, or,
b) are they moving on the two companies as part of a larger criminal investigation involving purchases of components and their illegal assembly into firearms, or,
c) is the ATF concerned that polymer lowers allow thousands of people without the tools and expertise to machine aluminum a means to purchase an 80% lower that requires only simple power tools (a dremel style tool and a power drill might finish the machining)- and complete a gun that does not appear in ATF records?

Not all Second Amendment advocates are speaking out on the matter- yet- but some very vocal gun rights advocates aren't keeping their positions secret. They believe the government to once again be moving against gun owners, even if there is a legitimate criminal investigation underway.

The privacy concern isn't without its merit. Should the ATF prevail in its argument and the judge lift her restraining order without condition would thousands of individuals who have purchased the polymer lowers, whatever their reason, suddenly find themselves subject of ATF scrutiny, and facing possible felony charges for possession of an unregistered firearm.

Ares has until noon pacific time tomorrow (Tuesday, March 18) to respond to the ATF's arguments against her restraining order.

It's a story that hasn't been on the radar long, but has the potential to impact-significantly- thousands of otherwise legal gun owners.

When I first reported on this story last Friday on NRA News Cam & Company, I made those listeners/viewers the same promise we've made- and kept- with our readers from our very beginning: we'll keep you posted.

--Jim Shepherd

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