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Cavalry Arms leaving firearm business.

Discussion in 'Black Rifle Forum' started by Mr. Blandings, Feb 21, 2010.

  1. Mr. Blandings

    Mr. Blandings

    Jun 20, 2001

    2/15/2010 Press Release

    Dear Friends and Loyal Customers:

    As you may be aware, we have been engaged in an ongoing dispute with the ATF for the past two years. While Cavalry Arms has at all times tried its best to run a lawful and honest shop, unfortunately, some regulatory compliance mistakes were made. We have now come to the point where we feel it is in our best interest to close our FFL and to cease all firearms operations. The owner of Cavalry Arms, Shawn Nealon, has elected to leave the firearms business and concentrate on firearms accessories instead. We are currently in negotiations with another company for that company to purchase the CAV-15 product line. Rest assured that any resulting purchase agreement will address the issue of providing service and support with regard to existing CAV-15 firearm products. We will continue to manufacture quality plastic components, grow our Medical products line, and work to bring new innovations to the relevant markets. Over the next several weeks we will be conducting a wind-down of our firearms manufacturing and FFL operations. Accordingly, please do not send us any firearms for repair or replacement. Instead, such issues should be addressed to the ultimate purchaser of our assets. Due to our limited personnel resources, during this transition/operation wind-down period, the final processing and shipping of firearm receivers already in our inventory will be our first priority.

    We deeply appreciate your patience and understanding and anticipate that the relevant asset purchaser will begin operations in March of 2010. We sincerely thank you for your prior and ongoing support during these troubled times and look forward to better years ahead.

    Thank you,
    Cavalry Arms

  2. faawrenchbndr

    faawrenchbndr DirtyThirty fan CLM

    Nov 24, 2005
    That dude has had problems for years. If you can not keep the paperwork
    straight, you do not belong in the business!

  3. Deployment Solu

    Deployment Solu Kydex Crafter

    Jul 18, 2007
    I agree, but is sad to see yet another choice disappear.


    Feb 2, 2005
    Thomasville, NC
    Easy to say, but they make the rules so convoluted that its hard for those that are above-board to keep it straight. Like Ayn Rand talked about in 'Atlas Shrugged'; you make enough rules and make them hard enough to follow, and everyone becomes a criminal.

    Hate to see it happen, but it was inevitable. Cav Arms was a small-time manufacturer and didn't supply anyone but civilians, so they were an easy target.

  5. SigPro2022


    May 15, 2007
    I hate to see a business shut down by the governmental papertrain. That said, I have a CAVarms lower, and have never really cared for it. It sits virtually un-used in the corner of my safe while my mil-spec guns get the use.
  6. faawrenchbndr

    faawrenchbndr DirtyThirty fan CLM

    Nov 24, 2005
    I agree,....but this was NOT his first issue with records.
  7. NeverMore1701

    NeverMore1701 Fear no Evil Platinum Member

    Jun 25, 2004
    Amarillo, Tx
    Seeing as I think the ATF and all their rules can go jump in a lake, I'm siding with Cav on this one.

    And their superlight lowers are nice, not anything else out there like that.
  8. KalashniKEV


    Sep 24, 2003
    Actually, I believe the issue was with the receiver halves being molded off site and finished in the factory. ATF said it was a receiver and needed to be treated as such once the parts left the mold.
  9. faawrenchbndr

    faawrenchbndr DirtyThirty fan CLM

    Nov 24, 2005
    Whatever the case may be,......he crossed a "thin gray line" and got busted.
    Good thing he only lost the license and He's not in jail.

    There is a LOT more to this story that we're not hearing.
  10. crazymoose

    crazymoose Nonentity

    Feb 9, 2005
    At least they'll still make furniture.
  11. djegators


    Mar 1, 2009
    Tampa, FL
    I'm sure we will never know all the details. I am curious if it was a technical screwup, or intentional rules breaking. I know what the public media version will be.
  12. Vic777


    Jan 23, 2006
    Sad, if you analyze what you say .... A real artist can't survive because he has trouble paying his pound of flesh to the leaches. In a perfect world the transactions would be between buyer and seller only ... the Government thieves would not exist.
  13. TimP

    TimP 1 Proud Infidel

    Jan 17, 2003
    I personally know everyone at cav arms. They are good people, but there is only so much time, effort and money you can put in to fighting the ATF.

    it is sad that the Govt usually wins because they have seemingly unlimited resources to stay on your case about whatever they decide to make an issue of.

    I am an insurance agent, and the company I work for is a darn-fine company, but everytime we are audited by the state, the auditors find something that we are not in compliance with. Either through an honest mistake on our part, or a law/rule change that we were not aware of.

    Point being, if you deal with the Govt, you are ALWAYS wrong.
  14. RMTactical

    RMTactical CLM

    Oct 7, 2000
    Behind an AR-15
    Yeah, this is sad. It is too bad that our govt is screwed up the way it is and they have the time and resources to go screw with gun companies. Yeah, maybe they "screwed" up in the governments eyes, but that doesn't make it right. There are too many regulations for business as it is... and I am not even talking firearms companies. The govt should be encouraging people to start companies, not putting them out of business.
  15. KalashniKEV


    Sep 24, 2003
    I don't know... you could put me in the middle as I'm not outraged nor am I sorry to see them go.

    It's unlikely that we'll ever have the details of the case, but if the rule was that reciever halves can't be molded off site, or need to be logged once they leave the mold, and they broke the rules then... ma a'salaama CavArms!
  16. ManNamedJed


    Aug 14, 2006
    Reno, NV
    Gonna put in an order for that lower I've been meaning to get!

    Sorry to see this is happening!
  17. beatcop


    Aug 13, 2003
    New England
    Gilbert firearms maker admits to illegal sale of weapons
    Complex gun regulations led to owner's violation, his attorney says
    by Robert Anglen - Feb. 22, 2010 12:00 AM
    The Arizona Republic

    A Gilbert firearms manufacturer will cease its gun operations after the company's owner pleaded guilty to illegally selling rifles, shotguns and handguns.
    Cavalry Arms Corp. says on its Web site that it has been "engaged in an ongoing dispute" with the Bureau of Alcohol, Tobacco, Firearms and Explosives, or ATF, for two years over "regulatory and compliance mistakes."

    But in federal court last week, owner Shawn Nealon admitted that he and his company illegally sold as many as 40 weapons to an out-of state buyer, and he voluntarily surrendered his federal firearms licenses, meaning Cavalry will no longer be able to import, manufacture or deal in weapons or ammunition.
    "This is not some individual setting up a stand at a gun show," U.S. Attorney Dennis Burke said Friday. "These are the preliminary steps that individuals take to get around federal laws in order to traffic in illegal firearms."
    Although none of the Cavalry guns has been linked to a crime, Burke said such cases are a particular concern for the agency.
    Illegal-firearms sales are steadily increasing in Arizona, with much of the market driven by demand in Mexico, said Burke, the U.S. attorney for Arizona.
    "The activity - southbound guns into Mexico - is very robust," he said. "We have (several) very active investigations going on now."
    Nealon's lawyer, Mark Vincent of Chandler, called the charges against his client ridiculous.
    "This is by no means a great victory for the government," he said, describing federal gun regulations as arcane. "In my opinion, no gun dealer in the United States could comply with the myriad of regulations. . . . It's almost impossible to determine what the law is."
    Vincent said as much as 90 percent of the government's original case against Cavalry was dismissed, leaving his client pleading guilty to selling to an out-of-state buyer.
    "It's a minor problem. . . . If that had been the only (charge), I don't know that they would have bothered with it," he said, adding: "Nobody was hurt. Nobody was almost hurt."
    Nealon faces up to five years in prison and a $250,000 fine when he is sentenced in April.
    But authorities say the bigger victory in this case is stripping Nealon of his firearms license.
    Cavalry's primary gun operation involved creating a polymer mold of a part for the AR-15 semiautomatic rifle. The "lower receiver," the piece between the barrel and the stock, contains the firing mechanism. It is defined by the government as a firearm. The receivers were sold to the public and to other manufacturers for commercial and law-enforcement use.
    According to a memo from Cavalry's lawyers included in court documents, Cavalry employed six people and sold as many as 6,000 receivers between 2000 and 2006.
    In a criminal complaint in 2008, ATF agents accused Nealon of illegal-weapons manufacturing for making the receivers. In addition, he was accused of illegal sales and export of other guns and possession of unlicensed firearms.
    "To cover up this widespread illegal activity, Cavalry Arms and Nealon have failed to keep records, falsified records and lied to ATF," the complaint states.
    The ATF cited violations dating to 2000, including failure to keep a weapons inventory, failure to conduct background checks on at least 25 purchasers and failure to report a multiple-handgun sale.
    Another problem: The ATF said Cavalry had outsourced the production of its molded receivers to an unlicensed company.
    Following a search of Cavalry's offices and Nealon's Mesa home in 2008, agents said Nealon had illegally sold weapons to out-of-state buyers, more than 40 of those to a California resident who often stored those weapons at Nealon's home.
    Those weapons included: nine 9mm handguns, five .45-caliber handguns, five .22-caliber handguns, five .223 rifles, three 12-gauge shotguns, two .38-caliber handguns, two .44-caliber handguns, a .380-caliber handgun, a .308 rifle, a 7.62x39mm rifle, a 5.45x39mm rifle and a .357 rifle.
    "Given Cavalry Arms' . . . willingness to falsify records to cover up illegal activities, including illegal sales, it is difficult, if not impossible, to determine exactly how many illegal sales Cavalry Arms and Nealon have made to out-of-state residents," the criminal complaint states.
    Nealon on Friday referred questions about the case to his lawyer. But he said Cavalry is not shutting its doors.
    He said the company will sell off its inventory of weapons, which it will be allowed to do with ATF oversight, and concentrate on developing firearm accessories and medical products.
    "The firearms portion of our business doesn't make up a large part of what we do," Nealon said.
    However, news of the shutdown prompted posts of outrage and well-wishes on Cavalry's Web page.
    "CavArms has some righteous dudes working there and the ATF has screwed you over since they don't have the guts to take on street and prison gangs," one person said in an online post.
    Burke had another take on the subject.
    "This isn't the first or the last time a defendant is going to try and redefine his culpability," the U.S. attorney said. "For the rest of the gun industry, it's a sign to other bad actors that we are going to focus on them."
  18. cmslone


    Dec 7, 2009
    I know there are two sides to every story, so I'll just keep it at that. But reading this document, it doesn't sound good. Years of lying and falsification according to the .doc. I'd almost even say the ATF seems lenient in this reading.
  19. eb07

    eb07 Sharkin'

    Feb 19, 2010
    Third Rock From the Sun
    Yep he screwed up he should be out of business right folks??

    I bet the people who did this will lose their jobs and go to jail right folks?

    god forbid you make paperwork errors..... the ATF wil shut you down and take away your livelihood.... I dont feel sorry for them one bit. Right folks?

    Yep shouldn't be in the business if you can't keep the paperwork straight ;)

    I am glad that you are all happy they are shut down. When they are all shut down.... then what?

    First they came for the Jews
    and I did not speak out because I was not a Jew.
    Then they came for the Communists
    and I did not speak out because I was not a Communist.
    Then they came for the trade unionists
    and I did not speak out because I was not a trade unionist.
    Then they came for me
    and there was no one left to speak out for me.
    Last edited: Feb 22, 2010