Saturday November 17, 12:08 am Eastern Time

In Victory for Gun Makers, 3rd Circuit Shoots Down New Jersey Nuisance Suit

Shannon P. Duffy (The Legal Intelligencer) --

In a major victory for gun manufacturers, the 3rd U.S. Circuit Court of Appeals on Friday upheld the dismissal of a suit brought by Camden County, New Jersey, that accused gun makers of creating a "public nuisance" and sought to recoup the governmental costs associated with gun-related crimes.

"Whatever the precise scope of public nuisance law in New Jersey may be, no New Jersey court has ever allowed a public nuisance claim to proceed against manufacturers for lawful products that are lawfully placed in the stream of commerce," the unanimous three-judge panel said in an unsigned, per curiam opinion in Camden County Board of Chosen Freeholders v. Beretta USA Corp., et al.

In the suit, Philadelphia attorneys David Kairys of Kairys Rudovsky Epstein & Messing, along with Peter Nordberg and Eric L. Cramer of Berger & Montague, argued that the gun manufacturers' conduct -- the marketing and distribution of handguns -- created and contributed to the widespread criminal use of handguns in Camden County.

The suit invoked three theories of liability -- negligence, negligent entrustment and public nuisance.

It requested several forms of relief, including compensation for the additional costs incurred by the county to abate the alleged public nuisance -- costs borne by the county's prosecutor, sheriff, medical examiner, park police, correctional facility and courts -- and an injunction requiring the manufacturers to change their marketing and distribution practices.

Lawyers for the manufacturers argued that the county had failed to state any valid claims and that, even if it had, damages were barred by the municipal cost recovery rule.

The defense lawyers also said the claims were barred by New Jersey's product liability statute, the Dormant Commerce Clause and the Due Process Clause.

DISTRICT COURT RULING

U.S. District Judge Jerome B. Simandle of the District of New Jersey rejected all three of Camden County's theories of liability and dismissed the suit.

Simandle dismissed the two negligence claims after finding that "proximate cause" was lacking. He also found that the public nuisance claim was defective because the county had not alleged "the required element that the defendants exercised control over the nuisance to be abated."

On appeal, Camden County dropped the two negligence claims and pursued only the public nuisance claim.

It alleged that the manufacturers' conduct endangered public safety, health and peace, and imposed inordinate financial burdens on the county's financial resources.

In their brief, the plaintiff's lawyers argued that the gun manufacturers "knowingly facilitated, participated in and maintain a handgun distribution system that provides criminals and youth easy access to handguns."

The manufacturers, they argued, release into the market substantially more handguns than they expect to sell to law-abiding purchasers, and that they continue to use certain distribution channels despite knowing that they lead to criminal end-users.

The plaintiffs also complained that manufacturers don't limit the number, purpose or frequency of handgun purchases, and never supervise sales or require their distributors to do so.

They also argued that the manufacturers design, produce and advertise handguns in ways that facilitate sales to and use by criminals, and that they receive significant revenue from the crime market, which in turn generates more sales to law-abiding persons wishing to protect themselves.

SEVEN-STEP CHAIN

In response, defense lawyers argued that the factual allegations amounted to an "attenuated" chain of events.

To link the manufacturers to the nuisance of gun crimes, they said, the county has to take seven steps:

• The manufacturers produce the firearms.

• They sell the firearms to federally licensed distributors.

• Those distributors sell them to federally licensed dealers.

• Some of the firearms are later diverted by unnamed third parties into an illegal gun market, which spills into Camden County.

• The diverted firearms are obtained by unnamed third parties who are not entitled to own or possess them.

• Those firearms are then used in criminal acts that kill and wound county residents.

• And finally, this harm causes the county to expend resources to prevent or respond to those crimes.

As a result, defense lawyers said, the manufacturers are six steps removed from the criminal end-users. And the fourth link in this chain, they said, consists of acts committed by intervening third parties who divert some handguns into an illegal market.

Now the 3rd Circuit has sided completely with the gun manufacturers.

Although the opinion is published, it was issued unsigned. The three judges on the panel are U.S. Circuit Judges Anthony J. Scirica, Samuel A. Alito and Maryanne Trump Barry.

PUBLIC NUISANCE REJECTED

The decision flatly rejected the plaintiff's theory of public nuisance liability.

A "public nuisance," the court said, is defined as "an unreasonable interference with a right common to the general public." But for the interference to be actionable, the court said, "the defendant must exert a certain degree of control over its source."

Traditionally, the court said, the scope of nuisance claims "has been limited to interference connected with real property or infringement of public rights."

Camden County, the court said, was asking for an extension of the claim beyond the scope that has been recognized by New Jersey's or any other jurisdiction's courts.

"To extend public nuisance law to embrace the manufacture of handguns would be unprecedented under New Jersey state law and unprecedented nationwide for an appellate court," the court said.

"The courts have enforced the boundary between the well-developed body of product liability law and public nuisance law. Otherwise, if public nuisance law were permitted to encompass product liability, nuisance law would become a monster that would devour in one gulp the entire law of tort," the panel wrote. "If defective products are not a public nuisance as a matter of law, then the non-defective, lawful products at issue in this case cannot be a nuisance without straining the law to absurdity."

The court also noted that similar tort actions against handgun manufacturers around the country have been routinely rejected.

And even if public nuisance law could be stretched far enough to encompass the lawful distribution of lawful products, the court found that Camden County "has failed to allege that the manufacturers exercise sufficient control over the source of the interference with the public right."

The plaintiff's lawyers argued that proximate cause, remoteness and control are not essential to a public nuisance claim. Instead, they said, conduct that merely contributes to the source of the interference can be sufficient.

The 3rd Circuit panel disagreed, saying "the relevant case law shows that, even if the requisite element is not always termed 'control,' the New Jersey courts in fact require a degree of control by the defendant over the source of the interference that is absent here."

The panel devoted its final paragraphs to a discussion of federalism and comity.

"Public nuisance is a matter of state law, and the role of a federal court ruling on a matter of state law in a diversity case is to follow the precedents of the state's highest court and predict how that court would decide the issue presented.

"It is not the role of a federal court to expand or narrow state law in ways not foreshadowed by state precedent. Here, no New Jersey precedents support the County's public nuisance claim or provide a sound basis for predicting that the Supreme Court of New Jersey would find that claim to be valid. While it is of course conceivable that the Supreme Court of New Jersey may someday choose to expand state public nuisance law in the manner that the County urges, we cannot predict at this time that it will do so."