A divided Fifth Circuit panel has ruled that the federal laws blocking a direct handgun sale to an out-of-state buyer violate the Second Amendment. The September 18 opinion in Elite Precision Customs v. ATF reverses a Texas district court and enters judgment for a gun shop and its fellow plaintiffs. The court's answer is clear. What dealers should do next is not.Most readers who have bought a handgun from a dealer in another state know the existing routine. The seller ships the gun to a federal firearms licensee in the buyer's home state. That second dealer handles the transfer and usually charges a fee. The buyer cannot simply walk into the out-of-state shop, pay, and take the handgun home. The plaintiffs challenged the federal barrier to that direct sale.The law the buyers challengedThe case centers on three parts of 18 U.S.C. § 922. Subsection (a)(3) generally stops an unlicensed person from bringing home a firearm acquired outside the person's state of residence. Subsection (a)(5) generally restricts transfers between unlicensed residents of different states. Subsection (b)(3) restricts what a licensed dealer may sell or deliver to a nonresident.Congress made an exception under (b)(3) for certain in-person rifle and shotgun sales, provided the transaction complies with the laws of both states. It did not make the same exception for handguns. Taken together, the three provisions prevent a Texas dealer from handing a handgun directly to an otherwise eligible buyer who lives in Arizona or New Mexico, the buyers' home states in this case. A transfer through a dealer in the buyer's home state remains possible under the longstanding procedure.That extra stop is not theoretical for the plaintiffs. Elite Precision Customs is a licensed Texas manufacturer and dealer that says it would make direct sales to nonresidents. Freddie Blish lives in Arizona; Tim Herron lives in New Mexico. Herron told the court that the home-state dealer route has cost him $30 to $40 per transfer and delayed delivery. Firearms Policy Coalition joined them as a plaintiff.The district court dismissed the challenge. In its view, the restriction did not implicate the Second Amendment's plain text, so there was no need to examine historical regulations. The Fifth Circuit disagreed and, rather than send the case back for that historical analysis, decided it on the record already briefed by both sides.A condition of sale, or a purchase ban?Judge Jerry Smith wrote the majority opinion, joined by Judge Kurt Engelhardt. Their starting point was the court's earlier Reese v. ATF decision: a right to keep and bear arms implies a right to purchase them. The government argued that the interstate rules merely regulate the manner of sale. After all, a buyer can still obtain the handgun by involving a dealer back home.The majority was not persuaded. A workaround does not make a direct purchase possible, it said. No amount of waiting lets a nonresident complete that transaction at the selling dealer's counter. That distinction matters because the Fifth Circuit has upheld an extended background-check period in a different case, McRorey v. Garland. The majority treated a delay with a defined end differently from a categorical bar on a particular kind of sale. It also noted the added fee and the fact that no receiving dealer is required to take the transfer.The court did not hold that every condition on a commercial firearm sale is unconstitutional. It rejected the argument that calling this restriction a condition, rather than a ban, ends the Second Amendment inquiry.The history did not carry the government's argumentUnder the Supreme Court's Bruen framework, once the majority found the purchase restriction covered by the Second Amendment, the government had to show a historical tradition that justified it. The government offered 18 laws and regulations, reaching from the colonial period into the early nineteenth century.Some restricted arms exports during war or dealt with government-issued guns. Others concerned trade across colonial boundaries or with Native American tribes. A third group addressed inspection, recordkeeping, or product quality. The majority said those examples did not do what the modern handgun rule does: prohibit an otherwise lawful peacetime sale to a resident of another state within the same country. It also discounted a Dutch-era New York restriction whose full text has not survived.The opinion explicitly disagrees with the Second Circuit's 2025 decision in United States v. Vereen, which upheld a comparable federal restriction. The Fifth Circuit said the Second Circuit drew too loose a comparison between colonial border controls and modern interstate commerce. Two federal appeals courts have now reached different answers on substantially similar questions. That conflict is important, but it does not turn either panel opinion into a nationwide Supreme Court ruling.Judge Catharina Haynes dissented. Her dissent is short: she agreed with the district court that the challenged provisions were constitutional and would have affirmed. The panel's judgment was 2–1, not unanimous.What a buyer should take from itThe Fifth Circuit reversed the dismissal and rendered judgment for the plaintiffs. It did not rewrite the Gun Control Act, publish a revised Form 4473, or answer how dealers should handle every combination of state laws. The court addressed the federal prohibition on direct interstate handgun purchases formed by these provisions. It did not wipe out background checks, prohibited-person rules, or state requirements for buying, receiving, and possessing a handgun.The paperwork has not caught up. As of September 20, ATF's published dealer guidance still describes the home-state FFL transfer as the way to sell to a nonresident and reserves direct over-the-counter sales for qualifying rifles and shotguns. Further court review and agency instructions are also possible. The opinion alone is a poor substitute for a dealer's current compliance advice.The court rejected the categorical federal barrier to buying a handgun directly from a dealer across a state line. It did not settle what happens at a particular dealer counter tomorrow. Whether a sale can actually happen depends on what the courts and ATF do next, along with the laws of the states involved. Until those pieces are clear, expect dealers to be careful. They have more at stake than a transfer fee.