By Jeremy Pelofsky
WASHINGTON (Reuters) - The U.S. gun industry on Wednesday sued to block requirements that weapons dealers along the border with Mexico report multiple sales of semi-automatic rifles, escalating the fight with the Obama administration.
The Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF) last month ordered more than 8,000 gun dealers in Texas, Arizona, New Mexico and California to report such sales to try to stem the "iron river" of guns flowing to violent Mexican drug cartels.
Starting August 14, dealers are required to report sales of two or more rifles to the same person at one time or during any five business days for semi-automatic weapons greater than .22 caliber and with the ability to accept a detachable magazine.
Two Arizona gun dealers backed by the National Rifle Association, one of the most powerful lobbying groups in the United States, filed a lawsuit in Washington, as did the National Shooting Sports Foundation which represents the firearms industry.
They argued that the ATF was authorized by the Congress to require reporting such information only for handgun and revolver sales, not for semi-automatic rifles purchases. They also said it would unfairly burden the gun sellers.
"It will not affect drug cartels and it won't prevent violence along our borders," said Chris Cox, executive director of the NRA's Institute for Legislative Action. The group is funding the lawsuits on behalf of the Arizona gun dealers.
"It will only divert scarce law enforcement resources from legitimate criminal investigations and squander them on policing law-abiding retailers," Cox said.
The gun dealers and groups asked the courts to block the ATF from imposing the requirements. Failure to comply can result in losing their licenses to sell firearms.
About 8,500 gun dealers would be subject to the reporting requirement. Some 36,000 reports of multiple handgun sales were made from the four border states in fiscal 2010, according to the ATF.
Attorney General Eric Holder told reporters that the regulations were legal and necessary to halt guns going to the drug cartels.
"We will vigorously oppose that lawsuit," Holder said. "We think that the acts that we have taken (are) consistent with the law and that the measures that we are proposing are appropriate ones to stop the flow of guns from the United States into Mexico."
One agency official pointed to another part of the federal gun control law to support the collection of sales records for multiple semi-automatic rifles as legal.
The reporting requirement is one prong of the Obama administration's effort to stop gun trafficking from the border states to Mexico where violence has killed tens of thousands since 2006.
One ATF operation to track guns going to Mexico from Arizona has become a full-blown scandal for the administration because agents said they were not allowed to follow guns beyond the initial purchaser. As a result dozens of the weapons have shown up at crime scenes in Mexico.
(Additional reporting by James Vicini, Editing by Jackie Frank)