Business and Society Review
104:4 347–354
The Case of the Contested
Firearms
GEORGE BRENKERT
“Our lawyers are handling the current case,” said Bob Graham,
CEO of Magnum Industries, a major gun manufacturer doing business across the United States. “I want you to come up with some
overall plan as to where we should be going. Start with a clean
slate. What should we be doing with regard to manufacturing and
marketing in our handgun division? Should we try to defend our
current practices? What about altering them? In what ways? What
are our responsibilities and to whom?” Those were the marching
orders given to John Diller, Senior VP for Marketing. Diller had
been recently been hired by Graham in the hope that he could help
the beleaguered firm find a way out of its current difficulties. These
difficulties had been brought upon them by increasing numbers of
law suits filed against them and public charges which accused
them of everything from crass indifference to moral culpability in
the deaths and injuries of those caused by handguns.
Magnum had been very successful in recent years in the development and marketing of new firearms. Though Magnum offered a
full range of firearms, including hunting rifles and target pistols,
this market had leveled off. In response, several years ago, it had
introduced two other models that had attracted special attention.
One was a small, semi-automatic pistol, the Defender, which had
a barrel length of only 2.75 inches and an overall length of 5
inches. It was easily concealable, lightweight, and powerful. The
other was a special model, the Wildfire, which they advertised as
George Brenkert is the Director of the Connelly Program in Business Ethics at Georgetown
University in Washington, DC.
This case was presented at the annual meeting of the Society for Business Ethics, August 6,
1999, Chicago, IL.
© 1999 Center for Business Ethics at Bentley College. Published by Blackwell Publishers,
350 Main Street, Malden, MA 02148, USA, and 108 Cowley Road, Oxford OX4 1JF, UK.
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“the gritty answer to tough problems.” With a 40 round detachable
magazine, a combat-style trigger guard, and surfaces specially
treated to resist fingerprints, it had captured the imagination of
movie makers, gun magazines and chat rooms on the Internet.
There was no doubt that these two models had helped shore up
their sales in recent years. But it was these two models that were
under attack by the anti-gun lobby and their lawyers. These
attacks had not been numerous and had been dismissed by most
gun makers as unlikely to succeed until lately. Now the situation
seemed to be changing.
THE LEGAL AND MORAL COMPLAINTS
What had particularly caught the attention of Magnum (and that
of all other gun manufacturers) was the verdict of a federal jury in
New York City that had found nine gun makers collectively liable
for several shootings, even though plaintiff lawyers could not
prove what brand of gun had been used in any of the cases. The
jury had determined that the manufacturers were liable because
of their negligent marketing and distribution of handguns. Even
though the manufacturers were ordered to pay only 13% of the full
amount, one of the plaintiffs was awarded an eye-popping $3.95
million.1
The jury found that manufacturers had oversupplied their products in states with weak gun laws, leading to illegal sales in those
with strict regulations, like New York.2 Elisa Barnes, the plaintiff’s
chief lawyer in this case, claimed that “the gun makers made no
attempts to keep their products from falling into criminal hands,
like requiring wholesalers not to supply dealers suspected of selling
the weapons to questionable buyers.” “They don’t care” asserted
Michael Feldberg, attorney for one of the plaintiffs.3 In describing
the overall situation, Ms. Barnes said: “This huge pool (of handguns) is like toxic waste. It’s been sent down the river by different
companies.”4
Now Chicago, New Orleans, Miami, Atlanta, Newark (N.J.), Cleveland (Ohio), and Bridgeport (Connecticut) had filed similar suits;
Philadelphia, Baltimore, and Los Angeles also had lawsuits under
consideration. Chicago’s action sought $433 million in damages,
claiming that gun manufacturers have created a public nuisance
GEORGE BRENKERT
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and burdened the city with extra costs for public hospitals as well
as extra police and fire protection.5
No one was denying that most large cities continue to be faced
with high levels of violent crime. Many of these crimes are committed with firearms that are possessed and used illegally. Firearms
were used to commit 69% of all homicides in 1995 and 68% in
1996. In 1995, there were 35,957 deaths attributable to firearms.6
The high level of gun violence has had a particularly drastic impact
on young persons; homicide is the second leading cause of death for
youths aged 15–19.
In 1997, in Chicago alone, there were 8,866 robberies, 4,390
aggravated batteries and 3,963 aggravated assaults in which handguns were used. That same year, only 147 robberies were committed in the city with a firearm other than a handgun. Overall,
approximately 87% of firearms used in all crimes in Chicago are
handguns. A recent survey showed that 45% of persons arrested in
the city obtained their guns in the illegal firearms market. Although
most major cities faced the same general set of problems, they
approached the legal issues in different ways.
The New Orleans suit, for example, raised a number of relatively
straightforward but disturbing issues. It claimed that gun manufacturers, by failing to incorporate appropriate safety devices to
prevent use by children and other unauthorized persons, had failed
to “personalize” handguns. The suit claimed that at least 30 patents
for personalized guns have been granted since 1976. Designs such
as combination locks, magnetic locks, radio frequency locks, and
encoded chip locks are among the devices patented in attempts to
limit the unauthorized use of handguns. Under the Louisiana product liability statute, a manufacturer can be held liable for damage
caused by a product that is unreasonably dangerous in design.
Under this doctrine, just as car manufacturers have been held
liable for failing to install seat belts and air bags, gun makers
should be liable for failing to install feasible safety systems.7 The
New Orleans suit alleges that guns that fail to incorporate safety
systems to prevent their use by children and other unauthorized
users are unreasonably dangerous in design. As a result, the
United States leads the world in the number of children who are
killed or injured by handguns, with “an average of more than four
accidental shootings of children under 15 occur[ring] each day, one
of whom dies every other day.”8
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Other cities, such as Chicago (and New York), have taken a more
aggressive and less traditional approach to litigation, arguing that
gun manufacturers oversupply guns in nearby suburban communities. These guns then end up in Chicago, a city with one of the
strictest gun control laws in the nation. This is a result, the City of
Chicago contends, of the sales practices of dealers in surrounding
communities as well as the manufacturing and marketing practices
of the gun manufacturers.
Many of the firearms illegally possessed in Chicago were purchased in a way that should have put the defendant dealers on
reasonable notice that the buyer was not obtaining firearms for
his own lawful use. For example, Stanley Malone, a resident of
Bellwood, Illinois, purchased fourteen pistols from Bell’s Gun &
Sport Shop and from Suburban Sporting Goods between August,
1994 and June, 1996. He purchased the majority of these firearms
to resell to gang members, making a profit of about $60 per firearm (“a straw purchase”).9 Other individuals made similar multiple
purchases of handguns over similar periods of time. Sales clerks
often made recommendations to undercover police officers regarding means of purchasing the guns to avoid investigation by the
Bureau of Alcohol, Tobacco, and Firearms and other authorities.
Clerks frequently disregarded comments about how these “buyers”
wanted to settle scores with someone. In short, the City of Chicago
claims that the practices of dealers in the surrounding communities
have caused a large underground market for illegal firearms to
flourish within its city limits, making it easy for Chicago residents to
obtain firearms in clear violation of the “spirit” of the law.
The role of manufacturers and distributors in this process, the
City of Chicago claims, is to knowingly oversupply or “saturate” the
market with handguns in areas where gun control laws are less
restrictive, knowing that they will be resold in jurisdictions where
they cannot be sold legally. By shipping large numbers of firearms
to these jurisdictions, the gun manufacturers enhance their profits
while disclaiming any knowledge of or responsibility for where their
products end up or how they are used. They also distribute substantial quantities of firearms through low-end retailers such as
pawn shops and gun stores known to be frequented by criminals
and gang members. They choose not to supervise, regulate, or standardize their network of distributors and dealers because such
practices would limit sales in one of their most lucrative markets.
GEORGE BRENKERT
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In addition, gun manufacturers are alleged to design and advertise their products to appeal to illicit buyers (both directly
and indirectly), including those who wish to use them for criminal
purposes. Among the design features of these handguns are: 1) surfaces that offer “resistance to fingerprints”; 2) short barrel lengths
and overall lengths; 3) lightweight, detachable magazines; and
4) semi-automatics that can be easily modified to fully automatic.
Some models tout the fact that they do not have a hammer, meaning
that they are easier to withdraw from a pocket (for quick firing) without snagging on clothing. Advertisements include descriptions of
guns as “assault-type pistols” that “deliver more gutsy performance
and reliability than any other gun on the market.” Another is advertised as being “[c]onsidered the ultimate hideaway, undercover,
backup gun available anywhere.” The manufacturer, the S. W.
Daniels Corporation, marketed this 9-millimeter semiautomatic pistol as the “weapon of choice of the drug lords of the 80s.”10 Another
manufacturer called one of its products the “Streetsweeper.”11
THE GUN INDUSTRY AND THE NATIONAL
RIFLE ASSOCIATION
Although they rarely dispute the magnitude of crime problems in
major cities, the “pro-gun” sector takes issue with the legal and
moral claims made against gun makers. To most gun manufacturers
the legal reasoning and arguments above have seemed sophistical
and dangerous. The National Rifle Association has held that “this
is the beginning [of an attempt] to accomplish . . . through the back
door . . . what could not be accomplished through the legislative front
door—the elimination of private gun ownership in America.”12
The attempt to control the misuse of guns in this manner is
fraught with other problems as well, according to the pro-gun
group. “What’s next,” Wayne Lapierre, spokesman and CEO of the
NRA asked, “blaming car manufacturers instead of drunk drivers. . . . Under this theory of law you could eliminate virtually every
manufactured product in America.”13 Ralph Boyd, a lawyer who
advises gun industries, agreed. “The auto industry makes vehicles
that exceed . . . the lawful speed limit in any jurisdiction. What
would stop someone from using this type of legal theory from saying, ‘Hey, you know those commercials that show cars speeding
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across the countryside, making tight turns on mountains, zipping
around pylons on race courses? Why isn’t that negligent marketing? Why isn’t the auto industry responsible for all the accidents
resulting from excessive speed?’”14
Of course the gun industry has sought innovation in style, weight,
size, capacity, and speed so as to boost its sales.15 It is merely
responding to the increased competition it faces and the softening
of its markets. In general, it feels that its responsibility ends once
its product are sold to licensed distributors. “The job of policing
gun runners should be left to the Bureau of Alcohol, Tobacco and
Firearms, which has never required manufacturers to track their
products to the street.”16 Since it considers these lawsuits to pose
significant dangers to legitimate rights, the NRA has introduced legislation in at least 20 states that would preclude local governments
from suing gun manufacturers and distributors. The latest bill,
proposed in Florida, is the toughest, making it a felony for any local
official to file a lawsuit of this type.17
Besides, gun makers argue, someone ought to raise some questions about the ethics of the lawyers and cities who have brought
legal suits against them. Outside of the case in New York, they have
little reason, based on the present and past record, to believe that
these suits will succeed. Indeed, they have with remarkable consistency been rejected. Instead, they are using these suits to apply
financial pressure, or coercion, against the gun makers to pay the
cities what amounts to extortion. And yet there have been few
complaints raised against such moral tactics. Defenders of the gun
makers see this as simply another example of individuals failing to
take responsibility for their own behavior and seeking Big Brother,
or rather some big law firm, to do for them what people will not do for
themselves. It is the morals and lawful behavior of individuals which
needs to be addressed in our society, not that of the gun makers.
DILLER’S DILEMMA
In light of all these charges and countercharges and with significant
legal threats in clear view, Magnum needed a coherent plan regarding both its response to the suits and the operation of its business in
this new environment. John wondered what he should recommend.
The theories of public nuisance, of product liability, and of collective
GEORGE BRENKERT
353
liability advanced in the lawsuits seemed to extend well beyond their
past applications. Besides, this was not simply a legal challenge to
gun makers. Strong moral charges against the gun manufacturers
were also part of the situation they faced. Magnum had to be prepared for all these charges. John wondered whether society and the
gun manufacturers had responsibilities for the actions of other
adults. How far back up the commercial path should responsibility
be pushed and under what conditions? Should Magnum alter its
design or marketing of the Defender or the Wildfire? John worried
that he would have to have some idea how to answer these questions when he made his recommendation to Graham regarding both
their immediate response to this legal situation and their long run
approach to producing and marketing firearms.18
NOTES
1. Chris Hawke, “Jury Finds Gun Maker Negligence Responsible for
Shooting,” Agence France Press, Feb. 12, 1999. The case was that of Hamilton v. Accu-Tek, No. 95-0049.
2. Joseph P. Fried, “9 Gun Makers Called Liable for Shootings,” New
York Times, Feb. 12, 1999.
3. Ibid.
4. Tom Hays, “AP-Gens-on-Trail,” AP Online, Feb. 12, 1999.
5. Resa King, “Firepower for the Antigun Lobby,” Business Week, Feb. 1,
1999.
6. David Kairys, “Legal Claims of Cities Against the Manufacturers of
Handguns,” Temple Law Review 71 (Spring 1998), 2.
7. “Background Information on New Orleans Lawsuit Against Gun Industry,”
http:/www.handguncontrol.org/legalaction/noqa.htm, Hand Gun Control,
Feb. 19, 1999.
8. Kairys, 2.
9. Cf. City of Chicago and County of Cook v. Beretta et al.
10. Daniel Wise, New York Law Journal, January 7, 1999.
11. Kairys, 4.
12. Chris Hawke, “NRA Concerned About Gun Suit Verdict,” United
Press International, February 12, 1999.
13. Ibid.
14. Laura Mansnerus, “Cities’ Suits Against Gun Makers Raise Complicated Legal Issues,” Star Tribune (Minneapolis, MN), February 14, 1999.
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15. Cf. King.
16. Cf. Hays.
17. Sharon Walsh, “NRA Pushing to Block Gun Suits,” Washington Post,
Feb. 26, 1999.
18. Thomas M. Jones gave me insightful help in preparing this case.