A federal court on Wednesday invalidated much of the Biden Administration's fuzzy new "engaged in the business” rule, which stood to criminalize the face-to-face sale of personally owned firearms.

In the NRA-backed challenge to the rule, Butler v. Bondi, the U.S. District Court for the Northern District of Alabama this week held that the ATF had overreached its authority in a 2023 rule change updating the definition of what it means to be "engaged in the business" as a firearms dealer.

Long ambiguous, the 31-page Biden-era rule on the subject is even more murky but authoritarian-leaning, with the White House at the time going so far as to say, "The final rule clarifies that even a single firearm transaction may be sufficient to require a license if there is other behavior to suggest commercial activity."

The rule even went as far as to say that sales didn't have to net a profit for the seller.

The now-successful Butler challenge to the rule was brought by two gun owners who said that they used to sell firearms they no longer want to "free up funds to purchase newer or more technologically advanced models as finances permit," but were fearful to continue to do so in light of the new rule.

U.S. District Judge Corey L. Maze, a 2019 appointment to the federal bench by President Trump, held that the ATF exceeded its statutory authority by issuing the rule. Maze issued a permanent injunction against the ATF and the Justice Department enforcing several provisions of the rule against the plaintiffs in the case – including all members of the NRA – and entered a declaratory judgment to that effect.

"To sum up, Congress decided that a person is not engaged in the business of dealing in firearms unless he deals firearms as a regular course of trade or business," said Maze. "Regular means repeated or often. So regular business requires more than one firearm transaction involving a single firearm. Because the Final Rule says single transactions involving one firearm may be prohibited in some cases, it exceeds ATF’s statutory authority."

Maze also took exception to the rule's allowance on guns sold without earning a profit, pointing out that the 1968 Gun Control Act, passed by Congress, specifically has a "proof of profit" baked into it when it comes to determining if those selling firearms are "engaged in the business" of doing so.

"Congress showed that the GCA does require proof of profit for other firearms transactions," said Maze. "ATF cannot remove that requirement, only Congress can. The court thus finds that by eliminating a proof of profit requirement for all cases except those involving criminal purposes or terrorism, ATF exceeded its statutory authority."

Maze has scheduled a conference on Oct. 15 with the parties in the case to discuss the remaining unanswered counts in the suit.

As for the prospect that the Justice Department will continue to appeal the matter, with the "engaged in the business" rule already reportedly on the chopping block for the White House, remains to be seen.