Tag Archives: bankruptcy

Sandy Hook Families Lawsuit Against Remington Allowed to Proceed

In a landmark decision the Connecticut Supreme Court this week reinstated a lawsuit filed by Sandy Hook school-shooting victims against Remington, one of the nation’s largest gun manufacturers.

Families of nine victims and one survivor of the Newton, Connecticut school shooting sued Remington Outdoor Co. Inc. and other defendants, including a gun wholesaler and a local retailer, alleging wrongful marketing and unethical advertising under the Connecticut Unfair Trade Practices Act (CUTPA). In the narrow 4-3 ruling, justices dismissed a case against the defendants based on negligent entrustment.sandy-hook-families-lawsuit-against-remington-allowed-to-proceed.jpg

Some are hailing the decision as a landmark victory against gun violence. Since passage of the The Protection of Lawful Commerce in Arms Act (PLCAA)  (15 U.S.C. §§ 7901 through 7903,) gunmakers have enjoyed near complete immunity for liability over gun violence. With certain specific exceptions, the PLCAA immunizes firearms manufacturers, distributors, and dealers from civil liability for crimes committed by third parties using their weapons.

Our Massachusetts product liability attorneys note this claim illustrates the many ways in which a product liability lawsuit can hold manufacturers accountable. However, this particular lawsuit has a narrow, treacherous pathway to success as Remington will almost certainly appeal to the U.S. Supreme Court, which must decide whether to allow state consumer law to trump federal protections in place to protect gunmakers.

State Consumer Protections vs. Federal Immunity from Liability

The New York Times reports Connecticut Supreme Court justices heard the case in November 2017, where they peppered Remington representatives with questions about advertisements that touted the AR-15 semiautomatic rifle as being able to “single-handedly” overcome “forces of opposition.” Examples of advertising for the high-capacity firearm included slogans like “Consider your man card reissued.”

Plaintiff attorneys contended it was dangerous marketing of an assault rifle sure to appeal to troubled young men. On December 14, 2012, Adam Lanza, 20, killed his mother in their Newton home, before shooting his way into the elementary school, where he went on a killing spree with a Bushmaster AR-15 before taking his own life.

“Congress did not intend to immunize firearms suppliers who engage in truly unethical and irresponsible marketing practices,” the court’s majority opinion noted. Connecticut law “does not permit advertisements that promote or encourage violent, criminal behavior.”

Congress has passed laws aimed at shielding a number of American industries from liability over injury or death caused by their products, including the airplane manufacturing and rental car industries.

The General Aviation Revitalization Act of 1994 limited liability for manufacturers of general aviation aircraft. Production of private aircraft by companies like Cessna and Mooney had declined from 18,000 in 1978 to fewer than 1,000 in the late 1980s. A number of companies struggled to remain financially solvent and blamed the cost of product liability litigation for drastically curbing construction. It’s the reason that to this day private aviation enthusiasts know there are very few small planes on the secondary market that were manufactured in the late 1980s or early 1990s. The vast majority of today’s used airplanes were manufactured in the heydays of the 1970s. Curbing manufacturer liability did not stem the tide, as Mooney and countless others have ceased production or gone out of business.

More recently, the Graves Amendment (49 U.S.C. § 30106) passed in 2005 and aims to shield rental car companies from the vicarious liability associated with traffic collisions involving rental vehicles. Vicarious liability alleges the owner of a vehicle acted inappropriately (via negligent entrustment or some other means) in allowing their vehicle to be used by an at-fault party. You will note similar argument was just rejected by the Connecticut Supreme Court in the case against gun manufacturers.

There have been many challenges to these immunity laws. However, in few cases have state laws been permitted to trump such federal immunities.

Seeking Damages from Gunmakers

The Connecticut  justices ruled the lower court was correct in dismissing the lawsuit based on PLCAA, but the judge was incorrect not to let the case proceed on the CUTPA allegations. The case was originally filed in 2014 in state court, before being moved to federal court. A federal judge then returned it to state court. State Superior Court Judge Barbara Bellis had initially allowed the case to proceed to trial before ultimately dismissing it based on the broad immunity offered gunmakers under federal law.

Industry watchers expect Remington to appeal the case to the U.S. Supreme Court. The Connecticut Supreme Court ruled Connecticut consumer law could be applied under the PLCAA and it will now be up to the nation’s highest court to decide whether to allow such a loophole in federal protections granted to gunmakers.

U.S. Sen. Richard Blumenthal called the decision “a ‘wow’ moment in American legal history, and compared it to the initial lawsuits filed decades ago against big tobacco, which ultimately resulted in a $246 billion settlement.

“It breaks open the seemingly impenetrable shield — unjust and unfair — enjoyed uniquely by the arms manufacturers,” Blumenthal told the Hartford Courant. 

The case has been vigorously contested by Remington and gun-rights organizations, including the National Rifle Association. As our Massachusetts product liability lawyers have written previously, being forced into litigation typically forces these companies and organizations to release a treasure trove of documents that are often more damning than reaching a large settlement.

Remington had argued the alleged violation of Connecticut Trade Practices Act were legally insufficient and that the state’s consumer law did not recognize damages for personal injury or wrongful death.  In 2014, it built a new plant in Huntsville, Alabama, to manufacturer the AR-15 style sei-automtic rifle. The case had been delayed after Remington filed for bankruptcy protection last year. It emerged from bankruptcy in May 2018 after just three months as part of a reproved restructuring involving nearly $1 billion in debts. Established in 1816, it is America’s oldest gunmaker.

The case is DONNA L. SOTO, ADMINISTRATRIX (ESTATE OF VICTORIA L. SOTO), ET AL. v. BUSHMASTER FIREARMS INTERNATIONAL, LLC, ET AL.

If you are the victim of Massachusetts product liability, call the Law Offices of Jeffrey S. Glassman for a free and confidential appointment — 1-888-367-2900.

FDA Recalls, Market Withdraws, and Safety Alerts

More Blog Entries

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Recent Government Shutdown Cost U.S. Economy Billions and Impacts Bankruptcy Law

The recent U.S. government shutdown ended up costing the American economy billions, according to a report from CNN.com, which was published on March 27, 2019. This shutdown began in December of 2018 and ended in January of 2019. President Trump wanted $5.7 billion in government funds to be earmarked for the construction of a southern border wall and the Senate failed to initiate a final vote that would add those funds to a CR (continuing resolution). A CR is a stopgap measure for funding. The result of this political impasse was a 35-day shutdown which caused a lot of hardship and impacted a lot of different industries. How did it impact bankruptcy law? This news roundup will give you an overview.

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Photo by M. B. M. on Unsplash

The U.S. Department of Justice was impacted

When the lapse in federal funding went into effect during late December of 2018, a partial shutdown started. During the shutdown, The U.S. Department of Justice, including USTP (U.S. Trustee Program) was impacted. USTP plays a prominent oversight role in many bankruptcy cases. USTP was founded via the Bankruptcy Reform Act of 1978. It was a pilot project which was initiated in eighteen judicial districts. Since USTP has broad administrative, enforcement, litigation and regulatory powers, which are designed to boost the bankruptcy system’s efficiency and integrity, slashing of staff during the shutdown triggered delays.

Judges were also under pressure

With a skeleton crew consisting of one-third of the regular staffing level, the pace of processing some types of bankruptcy cases slowed down. Judges who presided over bankruptcy cases were negatively impacted, as they had to operate with smaller numbers of employees. The negative impact on consumers and Chapter 13 and Chapter 7 trustees was not significant. Bankruptcy filings were still accepted in most districts during the shutdown. Delays were largely centered on bankruptcy litigation cases.

New legislation is in the offing

In early March of this year, Representative Tim Ryan (Democrat – Ohio) moved to protect workers from the brutal financial impact of corporate bankruptcy claims. He announced plans to reintroduce a piece of legislation from two years ago, which would clearly define employee claims during bankruptcy as administrative costs. This means that these costs would be covered in full. If Ryan’s plans are successful, workers will receive all payments, just as others who earn money taking apart dwindling companies do. He was strongly influenced by tales of woe from government workers, many of whom suffered serious financial problems due to the government shutdown.

Other factors also inspired Tim Ryan. Ryan’s new initiative was presented after a group of Democrats (Tim Ryan, Tulsi Gabbard and Bernie Sanders included) got together during mid-summer to ask Toy “R” Us owners for answers, following the toy shore chain’s bankruptcy. Many Toys”R”Us workers struggled to make ends meet after they were paid off. Elizabeth Warren, who is a Senator, asked for the same answers from the former head of the Sears department store chain, which had also filed for bankruptcy in October of 2018.

Government agencies and courts are back up and running

While the American economy has taken heavy hits due to the shutdown, the courts are up and running, and bankruptcy laws haven’t changed as a result, although they might in the future, if Tim Ryan has his way. The shutdown did lead to lower staffing levels at government agencies and courts. Skeleton crews coped as well as possible, but there were delays, primarily for bankruptcy litigation. Now that government agencies and courts have full staffing levels, everything has normalized. Any person or company that is considering bankruptcy should seek out legal counsel. A good attorney will make the process as streamlined and stress-free as it can be.

Edward Lott, Ph.D., M.B.A.
President and Managing Partner
ForLawFirmsOnly Marketing, Inc.

Ed can be reached at (or visit his website)
edl@forlawfirmsonly.com
855-943-8736 ext. 101
www.ForLawFirmsOnly.com

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