[House Hearing, 109 Congress]
[From the U.S. Government Publishing Office]



                         PROTECTION OF LAWFUL 
                          COMMERCE IN ARMS ACT

=======================================================================

                                HEARING

                               BEFORE THE

                            SUBCOMMITTEE ON
                   COMMERCIAL AND ADMINISTRATIVE LAW

                                 OF THE

                       COMMITTEE ON THE JUDICIARY
                        HOUSE OF REPRESENTATIVES

                       ONE HUNDRED NINTH CONGRESS

                             FIRST SESSION

                                   ON

                                H.R. 800

                               __________

                             MARCH 15, 2005

                               __________

                           Serial No. 109-21

                               __________

         Printed for the use of the Committee on the Judiciary


    Available via the World Wide Web: http://www.house.gov/judiciary


                                 ______

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                       COMMITTEE ON THE JUDICIARY

            F. JAMES SENSENBRENNER, Jr., Wisconsin, Chairman
HENRY J. HYDE, Illinois              JOHN CONYERS, Jr., Michigan
HOWARD COBLE, North Carolina         HOWARD L. BERMAN, California
LAMAR SMITH, Texas                   RICK BOUCHER, Virginia
ELTON GALLEGLY, California           JERROLD NADLER, New York
BOB GOODLATTE, Virginia              ROBERT C. SCOTT, Virginia
STEVE CHABOT, Ohio                   MELVIN L. WATT, North Carolina
DANIEL E. LUNGREN, California        ZOE LOFGREN, California
WILLIAM L. JENKINS, Tennessee        SHEILA JACKSON LEE, Texas
CHRIS CANNON, Utah                   MAXINE WATERS, California
SPENCER BACHUS, Alabama              MARTIN T. MEEHAN, Massachusetts
BOB INGLIS, South Carolina           WILLIAM D. DELAHUNT, Massachusetts
JOHN N. HOSTETTLER, Indiana          ROBERT WEXLER, Florida
MARK GREEN, Wisconsin                ANTHONY D. WEINER, New York
RIC KELLER, Florida                  ADAM B. SCHIFF, California
DARRELL ISSA, California             LINDA T. SANCHEZ, California
JEFF FLAKE, Arizona                  ADAM SMITH, Washington
MIKE PENCE, Indiana                  CHRIS VAN HOLLEN, Maryland
J. RANDY FORBES, Virginia
STEVE KING, Iowa
TOM FEENEY, Florida
TRENT FRANKS, Arizona
LOUIE GOHMERT, Texas

             Philip G. Kiko, Chief of Staff-Genral Counsel
               Perry H. Apelbaum, Minority Chief Counsel
                                 ------                                

           Subcommittee on Commercial and Administrative Law

                      CHRIS CANNON, Utah Chairman

HOWARD COBLE, North Carolina         MELVIN L. WATT, North Carolina
TRENT FRANKS, Arizona                WILLIAM D. DELAHUNT, Massachusetts
STEVE CHABOT, Ohio                   ADAM SMITH, Washington
MARK GREEN, Wisconsin                CHRIS VAN HOLLEN, Maryland
RANDY J. FORBES, Virginia            JERROLD NADLER, New York
LOUIE GOHMERT, Texas

                  Raymond V. Smietanka, Chief Counsel

                        Susan A. Jensen, Counsel

                  James Daley, Full Committee Counsel

                   Stephanie Moore, Minority Counsel


                            C O N T E N T S

                              ----------                              

                             MARCH 15, 2005

                           OPENING STATEMENT

                                                                   Page
The Honorable Chris Cannon, a Representative in Congress from the 
  State of Utah, and Chairman, Subcommittee on Commercial and 
  Administrative Law.............................................     1
The Honorable Melvin L. Watt, a Representative in Congress from 
  the State of North Carolina, and Ranking Member, Subcommittee 
  on Commercial and Administrative Law...........................     3
The Honorable Steve Chabot, a Representative in Congress from the 
  State of Ohio..................................................     4
The Honorable Chris Van Hollen, a Representative in Congress from 
  the State of Maryland..........................................     6
The Honorable Howard Coble, a Representative in Congress from the 
  State of North Carolina........................................     7
The Honorable John Conyers, Jr., a Representative in Congress 
  from the State of Michigan, and Ranking Member, Committee on 
  the Judiciary..................................................     8
The Honorable Louie Gohmert, a Representative in Congress from 
  the State of Texas.............................................     8

                               WITNESSES

Mr. Rodd C. Walton, Secretary and General Counsel, Sigarms, Inc.
  Oral Testimony.................................................    10
  Prepared Statement.............................................    12
Mr. Dennis A. Henigan, Director, Legal Action Project, Brady 
  Center to Prevent Gun Violence
  Oral Testimony.................................................    13
  Prepared Statement.............................................    15
Mr. Bradley T. Beckman, Counsel, Beckman and Associates, Counsel 
  to North American Arms
  Oral Testimony.................................................    25
  Prepared Statement.............................................    26
Mr. Lawrence G. Keane, Senior Vice President and General Counsel, 
  National Shooting Sports Foundation, Inc.
  Oral Testimony.................................................    27
  Prepared Statement.............................................    29

                                APPENDIX
               Material Submitted for the Hearing Record

Prepared Statement of the Honorable Chris Cannon, a 
  Representative in Congress from the State of Utah, and 
  Chairman, Subcommittee on Commercial and Administrative Law....    55
Prepared Statement of the Honorable Cliff Stearns, a 
  Representative in Congress from the State of Florida...........    57
H.R. 1225, the ``Terrorist Apprehension and Record Retention 
  (TARR) Act of 2005''...........................................    59
GAO Report entitled ``GUN CONTROL AND TERRORISM: FBI Could Better 
  Manage Firearm-Related Background Checks Involving Terrorist 
  Watch List Records.............................................    62
The ARMS site description of FN's Five-seveN Pistol..............   105
H.R. 1136, the ``Protect Law Enforcement Armor (PLEA) Act''......   108
News Articles for the record offered by the Honorable John 
  Conyers, Jr., a Representative in Congress from the State of 
  Michigan, and Ranking Member, Committee on the Judiciary.......   113
Response to Post-Hearing Questions from a Minority Member to 
  Bradley T. Beckman, Counsel, Beckman and Associates, Counsel to 
  North American Arms............................................   133
Article submitted by Lawrence G. Keane, Counsel, Beckman and 
  Associates, Counsel to North American Arms.....................   138
Op-Ed Article from New York Daily News, Sunday, January 9, 2005, 
  submitted by Lawrence G. Keane, Counsel, Beckman and 
  Associates, Counsel to North American Arms.....................   144
Letter from Walter Olson, Senior Fellow, Manhattan Institute for 
  Policy Research to the Honorable Chris Cannon..................   145

 
                         PROTECTION OF LAWFUL 
                          COMMERCE IN ARMS ACT

                              ----------                              


                        TUESDAY, MARCH 15, 2005

                  House of Representatives,
                         Subcommittee on Commercial
                            and Administrative Law,
                                Committee on the Judiciary,
                                                    Washington, DC.
    The Subcommittee met, pursuant to notice, at 10:10 a.m., in 
Room 2141, Rayburn House Office Building, Hon. Chris Cannon 
(Chair of the Subcommittee) presiding.
    Mr. Cannon. Good morning, ladies and gentlemen. This 
hearing of the Subcommittee on Commercial and Administrative 
Law will now come to order to consider today H.R. 800, the 
``Protection of Lawful Commerce in Arms Act,'' which was 
introduced on February 15 by our colleague from Florida, Mr. 
Stearns. It currently has 157 cosponsors, including me.
    H.R. 800 addresses abusive lawsuits aimed at the firearms 
industry. It provides that a qualified civil liability action 
cannot be brought in any State or Federal court. Qualified 
civil liability action is defined as a civil action or 
proceeding brought by any person against a manufacturer or 
seller of firearms or ammunition for damages resulting from the 
criminal or unlawful misuse of such products.
    There are exceptions, however. The bill does not prohibit 
an action against a person who transfers a firearm or 
ammunition knowing that it will be used to commit a crime of 
violence or a drug trafficking crime or to commit an identical 
or a comparable State felony offense. It also does not prohibit 
an action brought against a seller for negligent entrustment or 
negligence per se.
    The bill also includes several additional exceptions, 
including one for actions in which a manufacturer or seller of 
a qualified product knowingly and willfully violates a State or 
Federal statute applicable to sales or marketing when such 
violation was a proximate cause of the harm for which relief is 
sought. Other exceptions under the bill include one for actions 
for breach of contract or warranty in connection with the 
purchase of a firearm or ammunition and an exception for 
actions for damages resulting directly from a defect in design 
or manufacture of a firearm or ammunition when used as 
intended. The bill also makes clear that only licensed 
manufacturers and sellers are covered by the bill.
    Tort law rests on a foundation of personal responsibility. 
A product may not be defined as defective unless there is 
something wrong with the product rather than with the product's 
use. However, in the last several years, some lawsuits filed 
against the firearms industry would hold it liable for actions 
of those who use their products in a criminal or unlawful 
manner. Such lawsuits threaten the historic connection between 
tort law and personal responsibility and have forced firearms 
manufacturers into bankruptcy, severely curtailing the recovery 
available for those asserting traditional claims of product 
manufacturing defects.
    While some of these lawsuits have been dismissed and some 
States have acted to limit them in one way or another, they 
continue to be aggressively pursued. In January, the Supreme 
Court refused to overturn a decision by the Ninth Circuit Court 
of Appeals permitting such frivolous lawsuit against a gun 
manufacturer for a crime committed by a third party. The 
strategy behind these lawsuits is no secret. One of the 
personal injury lawyers suing the firearms industry, John Cole, 
told the Washington Post, quote, ``The legal fees alone are 
enough to bankrupt the industry.'' Professor David Capel also 
stated that the cities suing the firearms industry, quote, 
``don't even have to win. All they have to do is keep suing. 
They'll kill the industry with the cost of defending all the 
lawsuits.''
    Lawsuits seeking to hold the firearms industry responsible 
for criminal and unlawful use of its products by others are 
attempts to accomplish through litigation what has not been 
achieved by legislation and the democratic process. As 
explained by one Federal judge, quote, ``The plaintiffs' 
attorneys simply want to eliminate handguns.'' Taking advantage 
of our currently unregulated court system, the personal injury 
lawyers are misusing the courts to limit the sale and 
distribution of firearms well beyond jurisdictional boundaries. 
A lawsuit in a single county of a State could destroy a 
national industry, denying citizens everywhere the right to 
keep and bear arms, a right guaranteed by the Constitution.
    Insofar as these lawsuits have the practical effect of 
burdening interstate commerce in firearms, Congress has the 
authority to act under the Commerce Clause of the Constitution 
as well as the Second Amendment. Such lawsuits also directly 
implicate core federalism principles articulated by the Supreme 
Court, which has made clear that, quote, ``one State's power to 
impose burdens on the interstate market is not only subordinate 
to the Federal power over interstate commerce, but it is also 
constrained by the need to respect the interests of the other 
States.''
    The direction of this slippery slope is obvious. If the 
judicial system is allowed to eliminate the firearms industry 
based on legal theories holding manufacturers liable for the 
misuse by others of its products, surely those theories will be 
applied to other industries whose products are capable of being 
misused. Knives, for example, are intended and used for non-
violent purposes. They are virtually indispensable for eating. 
Yet hundreds of thousands of violent crimes every year are 
perpetrated with knives.
    We have already seen multi-million-dollar lawsuits against 
the makers of hamburgers and steaks for causes--or for damages 
caused when people abuse those products and overeat. Surely the 
manufacturers of steak knives will be sued next when such 
knives are used for criminal purposes.
    Congress must begin to stem the slide down the slippery 
slope. It can do that by fulfilling its constitutional duty and 
exercising its authority under the Commerce Clause to prevent a 
few State courts from bankrupting the national firearms 
industry and denying all Americans their fundamental right to 
bear arms. We need to preserve the benefit of American-made 
weapons for our soldiers overseas who are so ably defending us 
all from terrorism. Let's not allow the American firearms 
industry to be bankrupted so we're left to rely on foreign 
countries to provide weapons for our own soldiers.
    I now yield to Mr. Watt, the Ranking Member of the 
Subcommittee, for an opening statement. Mr. Watt?
    Mr. Watt. Thank you, Mr. Chairman. I apologize to you and 
other Members of the Subcommittee for being a minute or two 
late. I actually was trying to get back on my schedule this 
morning and run for a change and that threw everything off, 
trying to get back on schedule.
    I guess I find it interesting that the first hearing that 
we are having this year allows me to quote a famous Republican 
former President. ``Here we go again.'' Here you go.
    Another year of trying to close the courthouse doors to 
innocent victims of preventable violence of any kind. Another 
year of radically altering and undermining our system of 
States' rights, which so many on this Committee have given so 
much and so much energy to saying that they support. Another 
year of trying to confer sweeping immunity to a single 
industry, the gun industry, in this case. Here we go again. 
Here we go again.
    I'd have to say, Mr. Chairman, that last year's debate on 
this bill didn't reveal to me any reason why individuals harmed 
by guns that were recklessly placed in the stream of commerce 
should not be allowed to seek a remedy from those responsible, 
including those whose negligent conduct--negligent conduct--
resulted in dangerous weapons landing in the hands of 
criminals. Nor was I convinced that there exists a national 
crisis that requires Federal intervention in this matter. 
States are and have been perfectly capable, through both their 
courts and legislatures, of developing tort principles and 
addressing gun policy at a local level.
    Finally, I didn't find anything in last year's testimony or 
any of the things that I have found out about this bill that 
would suggest to me why it would be necessary to single out for 
unprecedented protection the entire gun industry, even as the 
number of deaths and injuries from gun violence and accidental 
shootings has escalated. Under this bill, on one within the gun 
industry bears any responsibility, no duty of care for the 
misuse of dangerous weapons.
    When the industry acts responsibly, there should be no 
liability. I agree with that wholeheartedly. But when elements 
within the industry act without regard to the safety of our 
citizens, those harmed by such indifference or recklessness 
should be afforded a remedy.
    I don't know what happened to the concept of personal 
responsibility, corporate responsibility, our whole theory of 
negligence in this country. Our whole theory of tort law in 
this country is based on negligence, and I have no idea why one 
industry should be exempt from those theories that we have 
developed for so long. They are all about personal 
responsibility. That's what our whole negligence system is 
about.
    If any of our witnesses can today address these very basic 
and fundamental concerns about this bill, I'm still looking for 
enlightenment about it. But I believe that unless and until 
these three core issues are adequately addressed and 
substantiated, the Federal court, the Federal Government, has 
no jurisdiction for barring State courts from providing 
appropriate relief to victims of negligent conduct.
    We are off and running again. Here we go again, Mr. 
Chairman. I yield back.
    Can I just add one thing, Mr. Chairman? I want to put in 
the record some information here that is just astonishing to 
me. This is from the Smith and Wesson SEC filing,\1\ and I'm 
quoting this. ``In the 9-month period ended January 31, 2005, 
we incurred $4,535 in defense costs net of amounts receivable 
from insurance carriers relative to product liability and 
municipal litigation. For the 9 months ended January 31, 2005, 
we spent $4,150,000 on advertising.'' Put that into this 
calculus. Thank you, Mr. Chairman.
---------------------------------------------------------------------------
    \1\ The information referred to was not available to include in 
this hearing.
---------------------------------------------------------------------------
    Mr. Cannon. Without objection, that'll be included in the 
record.
    Would the gentleman yield to a question? How much did they 
spend on their insurance premiums, do you know? Does the filing 
reveal that?
    Mr. Watt. I have no idea, but probably no more than any 
other inherently dangerous product maker would be spending on 
their insurance. There are some risks of business. You have 
insurance on your automobile, probably a lot more than most 
people sitting around because people think that you are more 
vulnerable, you drive more, you expose yourself to more risks, 
you're more valuable, you're more important, and I suspect your 
insurance premiums are higher than most of the people sitting 
in this audience.
    Mr. Cannon. I drive very carefully, so I keep my premiums 
down. I don't think these guys control who sues them.
    We'd like to welcome Adam Smith from Washington, Steve 
Chabot from Ohio, Mr. Van Hollen from Maryland, and Mr. Coble 
from North Carolina. Does anyone other than Mr. Smith want to 
make an opening statement? Oh, and we've got the gentleman, Mr. 
Franks, from Arizona. Would anyone like to make an opening 
statement of any sort?
    Mr. Chabot. Mr. Chairman, if I could, just very briefly.
    Mr. Cannon. Let me, if you don't mind, I'm going to ask Mr. 
Smith to go first and then we'll come back to you.
    Mr. Chabot. Sure.
    Mr. Cannon. Would anyone else like to make a--Mr. Coble? 
Okay.
    Mr. Smith. It's more of a question just for the witnesses 
so that as they're testifying, they can hopefully address it, 
and we've sort of gotten this from the two opening statements.
    The big question for me is exactly what liability is left. 
I mean, the basic notion that if you sell a gun in a perfectly 
legal way and basically have no negligence in how you go 
through that process, then you should not then be liable if 
someone misuses it is something that I support. I think it is 
different, frankly, than what went on with the tobacco industry 
when they sold a product and misled the public for a good many 
years about the dangers. There's no misleading about the 
dangers of a firearm. As Mr. Watt himself said, it's fairly 
apparent how dangerous it is, so the person who's buying it 
knows that.
    But in the debate over this issue, I have heard so much 
conflicting information on what liability remains, you know, 
what negligence can be demonstrated by the person. Certainly, 
if they sell to someone who shouldn't have bought a firearm, 
someone who is disqualified through the law because they are a 
felon, mentally incompetent, or below the age of 18 or the 
normal categories, they should be liable.
    But there's one specific case that arose not far from my 
district, the sniper case out here. The gun that was used in 
those crimes was actually purchased in my district, or 
actually, I should say, actually came from a store in my 
district. It is still unclear how that got to be in the 
person's possession because the gun shop has no records. They 
have records that they had the guns and then, oops, they're 
gone. They have no records of how it actually got to be in 
somebody else's hands or even out of their store, for that 
matter.
    To my mind, that is at least enough of a case of negligence 
that you go to court. I mean, you'd have to hear from the jury 
and so forth. I do not want to exclude that company from 
liability when they had some number of guns that just went 
unaccountably missing. That is negligence, to my mind, 
depending on the facts. It's at least a case for the jury, 
let's put it that way.
    And if I could just get some kind of correct answer--I 
suspect that I'll get about five different contradictory 
answers--as to whether or not this bill would exempt people 
like that from liability when there was some clear evidence of 
negligence, and you can imagine a variety of other different 
negligent circumstances where it at least should be a question 
for the jury whether or not this negligence rose to the level 
of liability.
    I certainly agree with the Chairman's sentiment that if you 
sell a legal product without negligence, even if it's 
dangerous, it's like an automobile is a good analogy, if you 
use it poorly and get in the accident, it shouldn't be the 
liability of the manufacturer unless there was some negligence. 
But I'm just trying to figure out what the limits are. So if 
you could address that issue as you testify, that would be very 
helpful to me.
    Mr. Cannon. Thank you. The gentleman yields back.
    Mr. Chabot, you are recognized for 5 minutes.
    Mr. Chabot. Thank you, Mr. Chairman. I won't take the 5 
minutes. I'll be very brief. I just want to first of all 
commend you for holding this important hearing today and to 
reiterate my support for this really much-needed piece of 
liability reform legislation. I want to commend Mr. Stearns for 
offering it.
    It's really critical for a number of reasons. It'll protect 
really people's Second Amendment rights. You know, we give lip 
service to it all the time, but this is one thing, I think, 
when we can really stand up for the citizens' Second Amendment 
rights, and the firearms industry, I think, has been targeted. 
And even if you ultimately prevail in the lawsuit, the 
resources that you have to use up and the time, the attorneys' 
fees, court costs, all the rest, can be quite sigsnificant and 
it can drag on really interminably.
    And we also have--I think it's an example of some of the 
activist courts, too, in these cases. We have a judiciary which 
too often is rewriting the law and legislating from the bench, 
and I think this is an example where the activist courts have 
gotten too involved. As I mentioned before, even if you win as 
a defendant in one of these cases, you can lose.
    And you'll have a city which is essentially using what they 
might consider to be unlimited resources, but when you consider 
many of the cities right now which are in real financial 
straits, they'll get involved in one of these lawsuits and it 
just drags on and on and on, so you're utilizing the resources 
which could much better be used to fill potholes and do other 
things which the cities really ought to be about. Instead, 
they're suing an industry which I think has really been under 
assault for a number of years now.
    If citizens are going to be able to actually exercise their 
Second Amendment rights, they're going to have to be able to 
purchase these weapons and purchase firearms. When you have the 
assault that's been on a number of these companies for some 
time now, it really does infringe upon those Second Amendment 
rights.
    So I want to commend you for having this hearing, and 
again, strongly urge my colleagues to support this much-needed 
legislation. I yield back.
    Mr. Cannon. Thank you. Mr. Van Hollen, did you want to take 
5 minutes?
    Mr. Van Hollen. Thank you.
    Mr. Cannon. The gentleman is recognized for 5 minutes.
    Mr. Van Hollen. I thank you, Mr. Chairman, and I won't take 
the whole 5 minutes. I will be brief.
    It's a coincidence that the two new Members, at least on 
the Democratic side of the Committee here, are two Members who 
were involved, by coincidence, in the sniper shooting, because 
while the guns that were used in the sniper shooting may have 
been sold in Mr. Smith's district, they were used and with the 
result that many people were killed in the district I 
represent.
    I have attended over the last couple of years a number of 
memorial services for the victims. A number of memorials have 
been placed in public places in my Congressional district and 
other places around the Washington area in memory of the 
victims of those shootings.
    And I really have many of the same issues Mr. Smith asked 
about, although as I read the legislation, it's pretty clear 
that that case would not have been able to go forward, a case 
that was settled, a case where there was some payment of 
damages, I believe in the range of $2 million by the owners of 
the store and some monies paid by the manufacturer.
    If you look back in the record of this debate in the 
Senate, there was an effort in the Senate after the House 
passed the bill to attach an amendment that would have made it 
clear that under the circumstances of the sales of the guns 
used in the Sniper shooting that it could have gone forward. I 
think that those of us who have looked at the facts of that 
case believe that it was a situation where there was clearly 
reckless negligence, negligence on behalf of the gun store.
    And I, in reading this and having read the legal opinions 
of a number of law firms in town, I think it's quite clear that 
if this legislation passes in its current form, those victims 
would not have an opportunity to obtain justice and redress 
through the courts in this country and they would have had the 
courthouse door shut on them.
    It's ironic that this piece of legislation was actually 
being debated by the House of Representatives about the time 
the sniper shootings occurred and it was withdrawn at that time 
because people understood that the public wouldn't stand for a 
Congress passing a piece of legislation that took away the 
rights of the victims. And here we are a couple of years later 
when people think memories have faded and there is again, 
regrettably, in my view, a piece of legislation which I think 
is quite clear would shut the doors of justice to those 
victims.
    Thank you, Mr. Chairman.
    Mr. Cannon. Thank you, and Mr. Coble, did you want to--the 
gentleman is recognized for 5 minutes.
    Mr. Coble. Mr. Chairman, I will not take the 5 minutes. I 
thank you for recognizing me. But not unlike my friend from 
North Carolina, the Ranking Member, I want to apologize for my 
arrival and to furthermore, Mr. Chairman, apologize for my 
abrupt departure because I have an aviation hearing going on as 
we speak here.
    I just want to state for the record, Mr. Chairman, that if 
a manufacturer--strike that. It is my belief that if a 
manufacturer develops a lawful product and lawfully markets it 
absence negligence, I think that manufacturer should be held 
harmless. If, on the other hand, there is negligent conduct 
involved, then I think that manufacturer should have to answer 
to it.
    I don't mean to overly simplify it, but that's my position, 
Mr. Chairman, and I yield back.
    Mr. Cannon. I thank the gentleman for yielding back. This 
may be a moment in history. We've had four people speak and not 
go over the time. In fact, all of them were significantly under 
the time.
    Mr. Watt. Except the Chairman, of course. [Laughter.]
    Mr. Cannon. Oh, I didn't keep track. [Laughter.]
    The way I read the clock, it was okay. [Laughter.]
    But I only said four. I think you were under, too, which 
would make it five.
    Mr. Watt. I was under.
    Mr. Coble. Mr. Chairman, would you yield to me just a 
second?
    Mr. Cannon. I would certainly yield.
    Mr. Coble. I think you and the Ranking Member probably have 
wider latitude than the rest of us on your opening statements.
    Mr. Cannon. I thank the gentleman.
    The Committee is pleased to have the Ranking Member of the 
full Committee, Mr. Conyers of Michigan, with us. Did you want 
to make a statement, Mr. Conyers?
    Mr. Conyers. If I could, and I thank you very much----
    Mr. Cannon. The gentleman is recognized for 5 minutes.
    Mr. Conyers. --Mr. Chairman. Last week, the GAO issued a 
report which concluded that the FBI could better manage its gun 
buying records when matching them against lists of suspected 
terrorists. In particular, the GAO determined that information 
sharing procedures needed to be considerably improved in order 
to help Federal counterterrorism officials better track 
suspected terrorists who attempt to purchase firearms.
    Nor are we here to discuss the two assault weapons used in 
unrelated multiple shootings in February. One shooting involved 
a Tyler, Texas person and the other took place in Los Angeles, 
with assault rifles in both cases. The fact that both shootings 
occurred on the same day made the two stories even more 
newsworthy, but obviously, not deserving, unfortunately, of a 
Congressional response.
    Neither have we seen fit to respond to the requests from 
law enforcement officials to take appropriate Congressional 
action in response to recent introduction of the Five-Seven 
handgun, dubbed by some as the ``copkiller'' gun because it is 
easily concealable and can penetrate bulletproof vests of law 
enforcement officers. The Director of the International 
Brotherhood of Police Officers described this new weapon as an 
assault weapon that fits your pocket.
    And so in the minds of any, any one of the aforementioned 
public policy problems should take precedent over the one 
before us today because they pose grave risk to human life. And 
so the bill that purports to protect our court system, even 
though it's not--if or when a frivolous lawsuit is brought 
before----
    Well, I'll return my time, Mr. Chairman. But I think this 
is an incredibly important issue that is before your 
Subcommittee and I thank you for the opportunity to discuss it 
with you.
    Mr. Cannon. I thank the gentleman, and I'm now astounded 
that we've had, with possibly the exception of me, although I 
didn't look at the clock, everyone spoke for less than 5 
minutes and that will allow us to get on--we are joined by the 
gentleman from Texas, Mr. Gohmert. Did you want to speak, Mr. 
Gohmert?
    Mr. Gohmert. If I might.
    Mr. Cannon. The gentleman is recognized for 5 minutes----
    Mr. Gohmert. Thank you.
    Mr. Cannon. --recognizing the trend that we have in place, 
Mr. Gohmert.
    Mr. Gohmert. Thank you, Mr. Chairman. I very much 
appreciate that and I appreciate the individuals here and their 
testimony.
    It was mentioned about the shooting in Tyler, Texas. That 
happened right outside the courthouse where I worked for a 
decade and knew and loved so many of the people there. The 
weapon used by the individual regarding a domestic situation 
was used outside the courthouse and it was a semi-automatic 
weapon. It was not an automatic weapon. It should be noted that 
when we toss around the term ``assault weapon'' that any weapon 
could be an assault weapon, just like any knife, whether steak 
knife or 11-inch butcher knife, could be an assault knife. 
Every weapon, no matter what it is, could be an assault weapon.
    Congress did respond, at least this one did, immediately, 
within a day or two went to the floor of the House and gave a 
very moving, heartfelt, at least, tribute to Mark Wilson, who 
was the man that had the concealed carry permit who immediately 
put himself in danger by drawing a weapon he was lawfully 
allowed to have and firing at the individual, the murderer, and 
at least drawing his attention away from the others, and, I 
believe, saving the life of many other people there.
    And because Texas has a concealed carry permit and the 
actions of Mark Wilson and the prompt response by law 
enforcement after Mark, we did not have another Luby's like we 
had years before where nobody had a weapon when a crazy nut 
came in and started shooting wildly. Here, we had somebody and 
we had a citizenry and a law enforcement that were armed. They 
protected the public to minimize the damage that occurred 
there, and I thank God for Mark Wilson and law enforcement and 
for the laws that made that possible. Thank you.
    Mr. Cannon. That was only about two-and-a-half minutes, Mr. 
Gohmert. I am pleased. There has got to be some kind of record 
for this. I mean, this is an amazing thing. I would remind the 
Committee that, generally speaking, we want to get to witnesses 
more early, and so as we read our statements, we work with, the 
Ranking Member and me, to get issues in and we are going to try 
in future hearings to avoid these kinds of--or opening 
statements.
    But, of course, as the panel and others will recognize, 
these are very important issues. They are held very dearly by 
everyone here and so we recognize that it may be a slightly 
different case.
    We now turn to our panel of witnesses. Our first witness is 
Rodd Walton. Mr. Walton is the Secretary and General Counsel of 
Sigarms, Inc. He's also a major in the United States Army 
Reserve, Judge Advocate General Corps. Mr. Walton joined the 
military right out of high school in 1984 and he has been in 
the military for 21 years--hard to believe at your age. He 
recently came off a one-and-a-half-year tour of duty in the war 
on terror. In the American Bar Association, Mr. Walton serves 
as Chair of the Business and Commercial Law Committee--good. In 
the National Bar Association, Mr. Walton serves as Secretary of 
the Small Business Law Section.
    Our second witness is Dennis Henigan, the Legal Director of 
the Brady Center to Prevent Gun Violence in Washington, D.C., 
and the Director of its Legal Action Project. The Legal Action 
Project is a national public interest law program which 
provides pro bono legal representation to victims of gun 
violence and lawsuits against the gun industry. In addition to 
representing individual victims of violence, the Legal Action 
Project also has represented over two dozen municipalities in 
lawsuits seeking to recover the public costs of gun violence.
    Our third witness is Bradley T. Beckman of Beckman and 
Associates in Philadelphia. For roughly a dozen years, Mr. 
Beckman has been National Counsel for North American Arms in 
lawsuits brought by various municipalities. North American Arms 
is a Utah-based manufacturer of high-quality personal 
protection firearms that has been in business for over 30 
years. Welcome from Utah.
    Our fourth and final witness is Lawrence G. Keane. Mr. 
Keane is the Senior Vice President and General Counsel of the 
National Shooting Sports Foundation, Inc., the firearm 
industry's trade association. He's responsible for all of 
NSSF's legal, Government relations, and risk management 
functions. Mr. Keane also served on the Board of Directors of 
the Firearms Safety Education Foundation, Inc., a nonprofit 
501(c)(3) charitable organization dedicated to educating the 
public about firearms safety issues.
    Without objection, all Members will have 5 days within 
which to submit additional material for the record.
    Now, it is the practice of the Committee to swear in all 
witnesses appearing before it. If you would please stand and 
raise your right hand.
    Do you swear that the testimony that you are about to give, 
that you will tell the truth, the whole truth, and nothing but 
the truth, so help you, God?
    Mr. Walton. I do.
    Mr. Henigan. I do.
    Mr. Beckman. I do.
    Mr. Keane. I do.
    Mr. Cannon. The record will note that the witnesses all 
answered in the affirmative. Please be seated.
    Now, Mr. Walton, we would like to hear from you for 5 
minutes. I don't want to interrupt. We don't want to stop 
anybody's train of thought, but I'll tap my pencil on the 
podium here when you get at 5 minutes just so you're aware. 
There's a little timer in front of you that it's green for 4 
minutes, turns yellow for 1 minute, and then turns red at the 
end of the 5 minutes. You don't have to stop at that red light, 
but just be aware that we'd like to wind down, and then we'll 
have plenty of time for questions. Thank you.
    Mr. Walton?

          TESTIMONY OF RODD C. WALTON, SECRETARY AND 
                 GENERAL COUNSEL, SIGARMS, INC.

    Mr. Walton. Mr. Chair, thank you for having me here, and 
keeping with your time limit and the spirit of the meeting and 
being timely, I'll do my best.
    Chairman Cannon, Members of the Committee, my name is Rodd 
Walton. I'm Secretary and General Counsel of Sigarms and its 
affiliates and subsidiaries in the United States. I am here 
today to ask you to support H.R. 800.
    Since 1853, Sigarms and related companies, together with 
our predecessors, have been manufacturing small arms for 
military, law enforcement, and commercial use. Switzerland's 
Federal Ministry of Defense challenged a Swiss wagon factory to 
make a rifle for the Swiss army. Accepting the challenge, and 
after receiving the contract, the wagon company changed its 
name to Swiss Industrial Company--I'm not going to try to speak 
it in German, but it's currently world known as Sigarms. SIG 
brought our firearms industry to Virginia in 1985 and then 
moved to New Hampshire, where we call home today.
    The foundation and thrust of Sigarms' business has been and 
will continue to be support of military and law enforcement 
customers worldwide. The list of Sigarms' customers in the 
United States reads like a Who's Who of law enforcement. 
Sigarms pistols are carried by the Department of Homeland 
Security, the U.S. Coast Guard, the Federal Air Marshals, the 
U.S. Secret Service, State police agencies from Delaware, 
Massachusetts, Michigan, New Jersey, Virginia, as well as the 
Texas Department of Safety and the Texas Rangers, just to name 
a few. And, SIG Sauer pistols are carried by many in combat, 
most notably the U.S. Navy Seals. Today, about 65 percent of 
the output of the New Hampshire-based manufacturing facility is 
devoted to supplying firearms and training to military and law 
enforcement.
    Since 1988--excuse me, '98, we at Sigarms have been 
defending ourselves against a multitude of lawsuits brought by 
Government entities and organizations and individuals seeking 
to blame the firearms industry, including SIG, for criminal and 
wrongful misuse of firearms in the United States. To blame 
Sigarms for the criminal misuse of firearms that are lawfully 
manufactured and sold is unjust. It is also threatening to our 
very existence. We have been fighting for our very survival 
against these lawsuits, diverting time, money, and other of our 
limited resources to defend ourselves.
    As I walk through the plant, employees stop to ask me, 
``How's the war going?'' The war that the employees are asking 
about is not the Iraqi war. It's the war we are fighting 
against plaintiffs filing junk and frivolous lawsuits against 
the firearms industry, spurred on by plaintiffs' trial 
attorneys.
    Sigarms and many others in the industry have been fighting 
for 10 years now, beginning with Hamilton v. Accu-Tek, in which 
the plaintiffs claimed that we manufacturers negligently 
distributed firearms. While the jury found the case--some of 
the manufacturers to be liable, the verdicts were properly 
reversed on appeal. The same plaintiffs' lawyers decided to 
bring a similar case before the same trial judge. They brought 
the NAACP case based on similar theories that had already been 
rejected by the U.S. Court of Appeals. While we are resolved 
not to wear down, there is a cost to this war.
    Beyond these lawsuits draining our already fragile national 
economy and littering our already overburdened court system, 
this war is hindering companies like Sigarms from engaging in 
legitimate business, making lawful products. The existence of 
these lawsuits thwarts our ability to raise new capital, borrow 
money, establish credit, obtain insurance, attract new 
employees, and retain valued employees in the same manner that 
companies of other industries are able to do without these 
attacks.
    These lawsuits are dangerous, and not only to us as 
manufacturers of lawful products in other industries. Where 
will this end? Should General Motors be liable for an 
aggressive driver who crashes into another car? If the theory 
of these cases are widely applied, it could result in the 
bankruptcy of countless companies and the displacement of 
innumerable amount of American workers.
    I come here today to ask you to support H.R. 800. This bill 
would protect legitimate businesses, such as Sigarms, that 
provide hundreds of thousands of jobs for our citizens--
assemblers, polishers, tool and die makers, cafeteria workers, 
and people who fill our snack vending machines.
    If enacted into law, this Act would preempt State and local 
government entities and other parties from bringing aggregate 
lawsuits against the firearms industry as a way to circumvent 
our legislatures. It would promote interstate and foreign 
commerce of small arms. A majority of the States--in fact, over 
30--have passed legislation of some type that insulate the 
firearms industry from these types of lawsuits. However, we 
need and are seeking passage of Federal law that would afford 
protection to the industry on a national level.
    I think my time is about up, so I will yield to the chair. 
Thank you, sir.
    Mr. Cannon. Thank you very much.
    [The prepared statement of Mr. Walton follows:]

                  Prepared Statement of Rodd C. Walton

    Chairman Cannon, Members of the Committee, my name is Rodd Walton. 
I am Secretary and General Counsel of SIGARMS, Inc. and its affiliates 
and subsidiaries in the United States. I am here today to ask you to 
support H.R. 800.
    Since 1853, SIGARMS related companies, together with our 
predecessors, have been manufacturing small arms for military, law 
enforcement and commercial use. Switzerland's Federal Ministry of 
Defense challenged a Swiss wagon factory to make a rifle for the Swiss 
Army. Accepting the challenge and after receiving the contract the 
wagon company changed its name to the Swiss Industrial Company--
Schweizerische Industrie-Gesellschaft known worldwide as SIG. SIG 
brought our firearms business to Virginia in 1985 and then moved it to 
New Hampshire, where we call our home today.
    The foundation and thrust of SIGARMS business has been and will 
continue to be support military and law enforcement customers 
worldwide. The list of SIGARMS customers in the United States reads 
like a Who's Who of law enforcement. SIG SAUER pistols are carried by 
the Department of Homeland Security, The U.S. Coast Guard, The Federal 
Air Marshalls, The U.S. Secret Service, state police agencies from 
Delaware, Massachusetts, Michigan, New Jersey, Virginia as well as the 
Texas Department of Public Safety and the Texas Rangers just to name a 
few. And SIG SAUER pistols are carried by many in combat and most 
notably by the U.S. Navy SEALs.
    Today, approximately 65% of the output at the New Hampshire-based 
manufacturing facility is devoted to supplying firearms and training to 
military and law enforcement.
    Since 1998, we at SIGARMS have been defending ourselves against a 
multitude of lawsuits brought by government entities, organizations and 
individuals seeking to blame the firearms industry, including SIGARMS, 
for the criminal and wrongful misuse of firearms in the United States. 
To blame SIGARMS for the criminal misuse of firearms that are lawfully 
manufactured and sold is unjust. It also is threatening to our very 
existence. We have been fighting for our very survival against these 
lawsuits, diverting time, money and other of our limited resources to 
defend ourselves.
    As I walk through our plant, employees stop to ask me how the war 
is going. The war that our employees are asking about is not the Iraqi 
War; it is the war we are fighting against plaintiffs filing junk and 
frivolous lawsuits against the firearms industry, spurred on by 
plaintiffs' trial lawyers.
    SIGARMS and many others in the industry have been fighting for ten 
years now, beginning with the Hamilton v. Accu-Tek case, in which the 
plaintiffs claimed that we manufacturers negligently distributed our 
firearms. While the jury in that case found some of the manufacturers 
liable, the verdicts were properly reversed on appeal. The same 
plaintiff's lawyer decided to bring a similar case before that same 
trial judge. They brought the NAACP v. A.A. Arms, Inc. case based on 
similar theories that had already been rejected by the U.S. Court of 
Appeals. While we are resolved not to wear down, there is a cost to 
this war.
    Beyond these lawsuits draining our already fragile national economy 
and littering our already over-burdened court system, this war is 
hindering companies like SIGARMS from engaging in a legitimate 
business, making a lawful product. The existence of these lawsuits 
thwarts our ability to raise new capital, borrow money, establish 
credit, obtain insurance, attract new employees, and retain valued 
employees in the same manner that companies in other industries are 
able to do without these attacks against their industry.
    These lawsuits are dangerous not only to us but also to 
manufacturers of lawful products in other industries. Where will it 
end? Should General Motors be liable for an aggressive driver who 
crashes into another car? If the theory of these cases is widely 
applied, it could result in the bankruptcies of countless companies and 
the displacement of innumerable amount of American workers.
    I come here today to ask you to support H.R. 800. This Bill would 
protect legitimate businesses, such as SIGARMS, that provide hundreds 
of thousands of jobs for our citizens, assemblers, polishers, tool and 
die makers, cafeteria workers and the people who fill our snack vending 
machines.
    If enacted into law, this Act would preempt state and local 
government entities and other parties from bringing aggregate liability 
lawsuits against the firearms industry as a way to circumvent our 
legislatures. It also would promote interstate and foreign commerce of 
small arms. A majority of the states--in fact, over 30 states--have 
passed legislation of some type that insulate the firearms industry 
from these types of suits. However, we need and are seeking passage of 
Federal law that would afford protection to the industry on a national 
level.
    Let me emphasize that this legislation would not provide the 
sweeping immunity that many of its opponents suggest. This Bill would 
not protect gun manufacturers from liability claims. Instead, it would 
stop lawsuits against our industry that are based on the criminal 
misuse of lawfully distributed products and premised on theories such 
as public nuisance and market share liability.
    If passed, this Bill would help to set a much needed precedent that 
frivolous and junk suits like these should be stopped. If passed, it 
would prevent the usurpation of power by the judicial branch from the 
legislative branch. For it is the legislature that makes laws on how we 
should manufacture, design, and sell firearms, not the courts. If not 
stopped, these lawsuits clearly will threaten other legitimate and 
vital industries in America.
    This Bill if enacted would restore the rule of law and protect 
manufacturers and sellers in the firearms and ammunition industry who 
act legally from being harassed by frivolous and junk lawsuits. 
However, the Bill ensures that if a seller provides a firearm and the 
seller knows or should have known that the firearm would be used 
negligently, that seller would be liable.
    We are dutifully helping to defend our country when attacked and in 
times of war. I ask that each of you help us in our time of war so that 
we can focus on making the best firearms available for our men and 
women in uniform and law enforcement.
    In conclusion, it makes no difference that SIGARMS or other firearm 
manufacturers make high quality firearms that enjoy excellent records 
of safety. It makes no difference that we and our industry are 
committed to continuing our efforts, individually and together with 
others, to increase awareness of the issues related to the safe 
handling and storage of firearms and the criminal acquisition of 
firearms. In makes no difference that the firearms industry is one of 
the most patriotic and staunchly pro-law and order industries in the 
corporate landscape. These frivolous and junk lawsuits are being 
brought to exert undue pressure on our industry to settle or cave under 
the massive weight of litigation. Without this Federal legislation, the 
survival of SIGARMS, our firearms and ammunition industries, and all of 
the jobs, taxes, and commerce that we contribute to the U.S. economy 
are threatened.

    Mr. Cannon. Mr. Henigan, you are recognized for 5 minutes.

TESTIMONY OF DENNIS A. HENIGAN, DIRECTOR, LEGAL ACTION PROJECT, 
              BRADY CENTER TO PREVENT GUN VIOLENCE

    Mr. Henigan. Thank you, Mr. Chairman, and thank you to the 
entire Subcommittee for this opportunity to appear today.
    Let me state my position on this bill in the must 
unequivocal terms. This bill is nothing but a special interest 
giveaway to the gun lobby and a shameful attack on the legal 
rights of gun violence victims.
    As an attorney at the Brady Center, I have had the honor to 
represent on a pro bono basis gun violence victims whose rights 
would be trampled by this legislation, and I have a difficult 
time explaining to those clients why we are here today. As 
Ranking Member Conyers noted, just recently we have heard that 
suspected terrorists repeatedly have been able to buy guns over 
the counter in our country. The Department of Homeland Security 
recently issued an alert about that Belgian gun manufacturer 
that is selling a handgun in this country that shoots bullets 
that can penetrate police body armor.
    And what is the response of the U.S. Congress to these 
recent threats to our national safety and security? Is it to 
move quickly to prevent terrorists from buying guns over the 
counter? Is it to ban copkiller handguns? No. It is to hold 
hearings on a bill to give special legal protection to the most 
reckless gun sellers in America.
    Mr. Chairman, this Congressional response defies rational 
explanation. I regret to say the only explanation is the 
overarching power of the gun lobby.
    Now, the proponents of this bill say it affects only 
frivolous lawsuits brought to bankrupt the gun industry. This 
assertion is insulting to the victims who have sought to assert 
their legal rights against this industry and it also grossly 
misrepresents what this bill does.
    Consider first the lawsuit brought by Brady Center 
attorneys for New Jersey Police Officers David Lemongello and 
Ken McGuire. These two officers were seriously wounded in a 
shoot-out with an armed robbery suspect, and the Ruger pistol 
used by the shooter was sold by a West Virginia pawn shop 
called Will's Jewelry and Loan. It was one of 12 handguns sold 
by Will's in a single transaction 6 months before the shooting 
to a gun trafficking team. A woman named Tammi Lea Songer acted 
as a straw buyer for a gun trafficker, James Gray. Gray pointed 
out the guns he wanted. Songer paid the clerk $4,000 in cash. 
It was perfectly obvious those guns were headed to the illegal 
market.
    So the officers brought a civil damages suit against Will's 
and a West Virginia judge determined that the suit stated 
legally valid claims. If this legislation had passed last year, 
the judge's decision would have been nullified and the police 
officers' suit would have been dismissed. But fortunately, the 
bill failed. The suit went forward. And in June of last year, 
Will's settled the suit with a payment of $1 million in damages 
to those two brave police officers. And as a result of this 
suit, that gun shop no longer engages in large-volume sales of 
handguns.
    So because this bill failed last Congress, two brave police 
officers received a measure of justice, the pawn shop was held 
accountable for this reckless sale, and the pawn shop now 
operates more responsibly than it did before, and I might add, 
no one went bankrupt.
    But consider also the case brought by Brady Center lawyers 
for the victims of the D.C. area sniper shootings against 
Bull's Eye Shooter Supply, the gun shop in Tacoma, Washington, 
that Mr. Smith referred to, where the gun that was used in that 
shooting mysteriously disappeared from that gun shop. And it 
turned out that in the previous 3 years, some 238 other guns 
had mysteriously walked away from that gun shop.
    So eight D.C. sniper victims and their victims brought a 
lawsuit with our help seeking damages against Bull's Eye, and 
we also sued Bushmaster, the manufacturer of the assault rifle, 
because it sold military-style assault rifles to the general 
public while doing absolutely nothing to ensure that the 
retailers it chose to do business with were responsible 
corporate citizens.
    Well, in June of 2003, a Washington State trial judge ruled 
the victims' claims were legally valid against both of those 
defendants, but if this immunity bill had passed, Mr. Chairman, 
it would have required dismissal of that lawsuit, even though a 
Washington State court had already held it consistent with 
accepted principles of law. And in the last Congress, we had 
letters from former White House Counsel Lloyd Cutler as well as 
noted attorney David Boies analyzing exactly the question Mr. 
Smith raised and concluding that, in fact, this would bar that 
lawsuit.
    Mr. Smith. Mr. Chairman, I'm sorry to break the flow here, 
but could I ask a question on that?
    Mr. Chabot. [Presiding.] Yes, if you will make it quick.
    Mr. Smith. In reading the bill, it says that the immunity 
shall apply but shall not include an action brought against a 
seller for negligent entrustment or negligence per se. I guess 
given that exception, you're telling me you couldn't make a 
case for negligence in that situation?
    Mr. Henigan. That's right, Mr. Smith. Neither of those 
exceptions would have applied, and let me explain why. First of 
all, negligence per se would have required a showing that the 
gun shop violated a law leading to the shooting that occurred. 
That's what negligence per se requires, as opposed to ordinary 
negligence, Mr. Smith, which simply requires a violation of the 
common law duty of ordinary care.
    In every State that adopts negligence per se, you have to 
show a violation of a law and then you have to show the causal 
link between the shooting and the violation. Here, what we had 
was a situation in which----
    Mr. Smith. You could go on, but that answers the question.
    Mr. Chabot. Okay, and if you wouldn't mind wrapping up your 
testimony, Mr. Henigan.
    Mr. Henigan. Okay.
    Mr. Chabot. Your 5 minutes are up.
    Mr. Henigan. I'd be happy to do that. These cases, Mr. 
Chairman, show how the proponents of this bill have 
misrepresented what the bill does, because these are two cases 
that were not frivolous. They were two cases not about trying 
to hold gun sellers responsible simply because a criminal uses 
the gun to shoot somebody, but to hold them responsible for 
their own conduct.
    I would suggest, Mr. Chairman, that if we are going to be 
in the business of immunizing from civil liability the most 
reckless gun sellers among us, that is not only going to 
deprive gun violence of their legal rights, it's going to make 
us all more unsafe. It's going to mean more guns on the 
streets, and for those reasons, we urge that this bill be 
defeated. Thank you.
    Mr. Chabot. Thank you, Mr. Henigan.
    [The prepared statement of Mr. Henigan follows:]

                Prepared Statement of Dennis A. Henigan

    Chairman Cannon, Ranking Member Watt, Members of the Subcommittee, 
I appreciate this opportunity to appear before you today. On behalf of 
Jim and Sarah Brady, and their organizations, let me state my position 
on H.R. 800 in the most direct and unequivocal terms: this bill is 
nothing but a special interest giveaway to the gun lobby and a shameful 
attack on the legal rights of innocent victims of gun violence.
    As Director of the Legal Action Project at the Brady Center to 
Prevent Gun Violence,\1\ I have the honor to represent, on a pro bono 
basis, innocent victims of gun violence whose rights would be trampled 
by this legislation. I have a difficult time explaining to these 
clients, who have personally faced the horror of gun violence, why the 
response of the United States Congress to their personal tragedies, and 
to the continuing national tragedy of gun deaths and injuries, is to 
give special legal protection to the most reckless members of the gun 
industry.
---------------------------------------------------------------------------
    \1\ The Brady Center, and its affiliate, the Brady Campaign to 
Prevent Gun Violence united with the Million Mom March, are the largest 
organizations dedicated to creating an America free from gun violence.
---------------------------------------------------------------------------
    Just last week, the GAO reported that suspected terrorists, who are 
not permitted to board airplanes or cruise ships, repeatedly have been 
allowed to purchase guns over-the-counter.
    The Department of Homeland Security recently issued an alert to all 
its law enforcement personnel about a Belgian gun maker selling a 
handgun in America that shoots bullets that penetrate police body 
armor.
    Another gun maker is selling .50 caliber sniper rifles with such 
extraordinary range and power that they can bring down airplanes.
    And gun deaths in America, after a seven-year decline, have started 
to rise again and are now over 30,000 a year. In the last two weeks, 
our Nation has learned, once again, that no one is truly safe from gun 
violence: a judge's family slain in Chicago, a judge and two others 
murdered in an Atlanta courtroom and, on Saturday, seven worshippers 
shot and killed while attending church services in Milwaukee.
    What is the response of the United States Congress to these clear 
and present threats to our national safety and security? Is it to move 
quickly to strengthen the Brady background check system to stop 
terrorist suspects from buying guns? Is it to ban cop-killer guns and 
terrorist sniper rifles? No. It is to hold hearings on a bill that 
would protect from legal accountability the most reckless gun sellers 
in America.
    Mr. Chairman, this Congressional response is beyond rational 
explanation. I suggest the only explanation is the power of the gun 
lobby.

  GUN INDUSTRY IMMUNITY LEGISLATION IS A SHAMEFUL ATTACK ON THE LEGAL 
                     RIGHTS OF GUN VIOLENCE VICTIMS

    The proponents of this legislation claim it would block only 
``frivolous'' lawsuits against gun sellers brought only to bankrupt the 
gun industry. Not only is this assertion a gross misrepresentation of 
the bill, it also is an insult to gun violence victims who have sought 
justice in the courts - justice that would be denied if this bill 
became law.
    This legislation would provide legal immunity in many cases to 
grossly irresponsible gun dealers who supply the criminal gun market, 
as well as to manufacturers of defectively designed firearms. It would 
throw out of court innocent victims of gun violence, even where courts 
have found their cases justified by general and established principles 
of law. Never before has a class of persons harmed by the dangerous 
conduct of others been so wholly deprived of the right to legal 
recourse. As Senator Mike DeWine (R-Ohio) stated so eloquently in 
opposing this legislation of the Floor of the United States Senate a 
year ago: ``I oppose this bill because...it singles out one particular 
group of victims and treats them differently than all other victims in 
this country...It denies them their access to court.''
    When this bill was debated in the last Congress, two lawsuits, then 
pending in the courts, were at the center of the debate. Lawyers at the 
Brady Center represented the victims in both cases. Had this 
legislation been passed into law last year, these lawsuits would have 
been blocked.

Gun Industry Immunity Legislation Would Have Deprived Two New Jersey 
        Police Officers of their Legal Rights Against a Reckless West 
        Virginia Pawnshop
    The first suit had been filed by two brave New Jersey police 
officers, David Lemongello and Ken McGuire. Almost two years ago, 
Officer Lemongello testified before this Subcommittee and told their 
story. In January of 2001, Dave Lemongello was on a stakeout of a gas 
station in Orange, New Jersey that had been the target of several armed 
robberies. He spotted an individual walking near the station who 
matched the description of a suspect in the robberies. When the officer 
approached, the individual, career criminal Shuntez Everett, opened 
fire with a Ruger pistol. Lemongello was hit three times, fell to the 
ground, and radioed for help. Officer McGuire responded, chased Everett 
into a nearby backyard, and the two exchanged fire. McGuire also was 
seriously wounded, but was able to return fire. Everett died from his 
wounds. The shootings ended the police careers of the two officers.
    How was a convicted felon like Shuntez Everett able to obtain a 
handgun? It turned out that the gun used in the shooting was one of 
twelve handguns purchased from a West Virginia pawnshop six months 
before by a gun trafficking team. Tammi Lea Songer, acting as a straw 
purchaser for gun trafficker James Gray, paid $4,000 in cash for the 
guns, after Gray pointed out which guns he wanted. The pawnshop, Will 
Jewelry and Loan in Charleston, West Virginia, completed the sale, even 
though it was obvious that the handguns were headed directly into the 
illegal market. Indeed, the sale was so suspicious that Will reported 
it to ATF the next day, long after the shop had pocketed the profits 
and the guns were headed to New Jersey. Ironically, another one of the 
twelve guns was taken by Ken McGuire from a criminal suspect months 
before the gas station shooting. Because of the recklessness of a West 
Virginia gun dealer, Orange, New Jersey became a more dangerous place 
and the careers of two police officers were ended.
    We represented Officers McGuire and Lemongello in a civil damages 
lawsuit against Will's pawnshop. The suit charged the pawnshop with 
negligence, and contributing to a public nuisance, in the sale of guns, 
creating a foreseeable risk that the guns would be used in criminal 
activity. In March of 2003, Judge Irene Berger of the Kanawha County 
Circuit Court denied Will's motion to dismiss our case, finding that 
the officers had stated a legally valid claim under general principles 
of West Virginia law. If the last Congress had enacted the predecessor 
of H.R. 800, Judge Berger's ruling would have been superceded and 
Officers McGuire and Lemongello would have been denied their day in 
court.
    Because gun industry immunity legislation was defeated in the 
Senate a year ago, the case against Will's pawnshop went forward. In 
June of last year, Will's settled the case by paying $1 million in 
damages to the two officers. As a result of the suit, the pawnshop 
changed its policies and now no longer engages in large-volume gun 
sales. Two other gun dealers in the Charleston area have adopted 
similar policies.
    I ask the Subcommittee to consider the outcome of this lawsuit. For 
these two brave police officers, justice was done. Will's pawnshop was 
properly held accountable for its reckless sale to a gun trafficking 
team and it now operates more responsibly. And no one declared 
bankruptcy. This outcome was possible only because this special 
interest immunity legislation did not become law.

Gun Industry Immunity Legislation Would Have Deprived the DC-area 
        Sniper Victims of Their Legal Rights Against a Reckless 
        Washington State Gun Dealer and the Assault Weapon Manufacturer 
        that Supplied It
    A second lawsuit that would have been blocked by this legislation 
is the civil damages action brought by the victims of the DC-area 
sniper shootings. Certainly no one on this Subcommittee will ever 
forget the paralyzing fear inflicted on this community by the snipers 
John Lee Muhammad and Lee Boyd Malvo in the Fall of 2002. For some 
families, that fear became tragedy, as 10 people were killed and four 
more injured by the snipers. When the snipers were arrested, they were 
found with the Bushmaster XM-15 assault rifle that had been used in the 
shootings. The gun was traced back to Bull's Eye Shooter Supply, a 
Tacoma, Washington gun shop. Incredibly, though, Bull's Eye had no 
record of what happened to the gun. The shop had no record of sale, no 
record of a background check, and had not reported the gun lost or 
missing. The gun had mysteriously disappeared. Bureau of Alcohol, 
Tobacco, Firearms and Explosives (ATF) audits showed that Bull's Eye 
had mysteriously ``lost'' 238 other guns in a three-year period, an 
average of more than one gun missing every week. Bull's Eye was one of 
the most irresponsible gun dealers in the Nation. It ranked in the top 
.27% of gun dealers nationwide in number of missing guns and in the top 
1% in the number of guns traced to crime.
    Neither Malvo nor Muhammad could legally have purchased a gun. 
Malvo was a juvenile; Muhammad had a disqualifying domestic violence 
restraining order on his record. Only through the gross negligence of 
Bull's Eye could they have obtained the Bushmaster assault rifle. The 
Brady Center represented eight of the sniper victims and their families 
in a lawsuit against Bull's Eye, charging that the shop's negligence 
put a deadly assault rifle in the hands of the killers. We also sued 
Bushmaster, the manufacturer of the gun, on the ground that companies 
that make high-firepower assault weapons have a special duty to ensure 
that their retailers are responsible corporate citizens. Bushmaster did 
not even require its retail dealers to report to it the results of ATF 
audits, which would have revealed Bull's Eye's chronic problem of 
``missing'' guns. Indeed, even after the press reported the gun shop's 
record, Bushmaster stated that it still considered Bull's Eye a ``good 
customer''.
    In June of 2003, a Washington State trial judge denied motions to 
dismiss by both Bull's Eye and Bushmaster, deciding that the victims' 
claims were legally valid under general principles of Washington State 
law. The Washington State Court of Appeals denied Bushmaster's appeal 
of this ruling.
    As former White House Counsel Lloyd Cutler concluded, after 
conducting his own independent analysis, the immunity bill that reached 
the Floor of the Senate in the last Congress would have superceded the 
judge's ruling and required the sniper case to be dismissed. Because 
the legislation was defeated, however, the lawsuit brought by the 
sniper victims went forward. In September of last year, the parties 
reached a settlement, resulting in the payment, by both Bull's Eye and 
Bushmaster, of a combined total of $2.56 million in damages to the 
victims. Bushmaster also agreed in the settlement to make its dealers 
aware of programs to encourage safe sales practices by gun retailers - 
something the company had never done before.
    Again, consider the outcome of this lawsuit. The sniper victims 
received justice. Bull's Eye and Bushmaster were made accountable for 
their shoddy business practices. And, again, no one declared 
bankruptcy.
    No one can seriously argue that these were ``frivolous'' lawsuits, 
and yet they would have been blocked by the immunity legislation. It is 
hardly surprising that in February of last year, Henry Cohen, a 28-year 
veteran of the Congressional Research Service and the author of a 
report on gun industry immunity legislation, stated ``it does not 
appear the bill would be limited to frivolous lawsuits. That's my 
neutral assessment.'' \2\
---------------------------------------------------------------------------
    \2\ Steve Volk, Specter Shoots Blanks, Philadelphia Weekly, 
February 18, 2004.
---------------------------------------------------------------------------
Gun Industry Immunity Legislation Would Protect a Careless Gun 
        Manufacturer that Hired Criminals and Allowed Them to Walk Away 
        with Guns
    H.R. 800 would also affect currently pending cases brought by gun 
violence victims. An example is the lawsuit brought by the family of a 
young man named Danny Guzman, an innocent bystander who was shot on the 
street in Worcester, Massachusetts on Christmas Eve in 1999. After the 
shooting, the loaded gun used in the shooting was found behind an 
apartment building by a four-year-old child. The gun had no serial 
number.
    Police investigators determined that the gun was one of several 
stolen from Kahr Arms, a Worcester gun manufacturer, by Kahr's own 
employees who were hired despite their long criminal records. One of 
the thieves, Mark Cronin, had been hired by Kahr to work in its plant 
despite his history of crack addiction, theft to support that 
addiction, alcohol abuse and violence, including several assault and 
battery charges. Cronin had been able to walk out of the factory with 
stolen guns, even before they had been stamped with serial numbers. 
Cronin told an associate that he takes guns from Kahr ``all the time'' 
and that he ``can just walk out with them.'' Cronin later pled guilty 
to the thefts. The investigation also led to the arrest of another Kahr 
employee, Scott Anderson, who also had a criminal history and who pled 
guilty to stealing guns from Kahr. At least fifty Kahr firearms 
disappeared from its manufacturing plant in a five-year period. 
Worcester Police Captain Paul Campbell classified the record keeping at 
the Kahr facility as so ``shoddy'' that it was possible to remove 
weapons without detection.
    Brady Center attorneys represent Danny Guzman's family in a 
wrongful death suit against Kahr arms, charging Kahr with negligence in 
completely failing to screen its employees for criminal history and in 
maintaining a security system so inadequate that employees repeatedly 
were able to walk out of the plant with unserialized guns. In April, 
2003, a Massachusetts trial judge denied Kahr's motion to dismiss the 
suit, finding it supported by general principles of Massachusetts law. 
It is now in pretrial discovery. Had immunity legislation been passed, 
the ruling of the Massachusetts court would have been nullified and 
Danny Guzman's family would be denied the right to justice against a 
gun maker that allowed drug criminals to ``help themselves'' to free 
lethal weaponry.
gun industry immunity legislation would be a ``breathtakingly radical'' 
     revision of liability law for the benefit of a single industry
    Far from affecting only ``frivolous'' lawsuits, H.R. 800 would 
exempt the gun industry from the oldest principle of our civil 
liability law: that persons, or companies, who act negligently should 
be accountable to the foreseeable victims of their negligence. Indeed, 
in the last Congress, over sixty law professors, from across the 
country, joined a letter calling the legislation ``breathtakingly 
radical'' because it ``affords to a handpicked few - those who make, 
distribute, and sell guns - special protection against the most 
commonplace, long-established form of tort liability: accountability to 
the standard of care required by principles of negligence.'' The 
professors called the immunity bill ``one of the most radical statutory 
revisions of the common law of torts that any legislature - federal or 
state - has ever considered, let along passed.''
    Proponents of this legislation try to obfuscate its radicalism 
through arguments that simply misstate the law.
    First, they assert that it is unfair to hold the seller of a 
product responsible for the conduct of a criminal. However, the cases 
brought by Officers McGuire and Lemongello and the sniper victims did 
not seek to hold the defendant gun sellers liable simply because guns 
they sold were used by criminals. Rather, these victims sought to hold 
the gun sellers liable for their own irresponsible conduct that enabled 
criminals to be armed and to commit violent crimes. The courts in West 
Virginia and Washington State based their rulings on the longstanding 
legal doctrine that a defendant can be liable when his own negligent 
conduct creates a foreseeable risk that a third party will commit a 
criminal act. Courts, for example, have applied this doctrine to hold 
landlords liable when their failure to secure their buildings allows 
criminals to victimize their tenants. It has been applied to drivers 
who leave their keys in the ignition in high-crime areas, allowing 
thieves access to a car that is then used to inflict injury on others. 
Courts in these cases are holding the landlords and the drivers liable 
for their own negligence that enabled someone else to commit a criminal 
act.
    Second, proponents of the bill argue that it is unfair to hold a 
gun company liable if its product, and its conduct, are entirely legal. 
This argument confuses criminal liability, which requires a showing of 
illegal conduct, with civil liability, which does not. The issue in a 
civil negligence case is whether the defendant has acted with 
reasonable care, not whether the defendant has violated a statute. For 
example, when a doctor leaves forceps in a surgical patient, he can be 
liable for his failure to use reasonable care. There is no requirement 
that his conduct violate a statute. It is particularly telling that the 
exception from immunity in H.R. 800 for illegal conduct applies only 
where a gun manufacturer ``knowingly violated'' a State or Federal gun 
statute. In other words, under this bill, a gun company is immunized 
from liability even if it has violated the law, as long as the company 
can demonstrate its ignorance of the law. It is also telling that the 
proponents of gun industry immunity opposed, and defeated, an amendment 
offered last year by Senator Levin (D-Mich.) that would have permitted 
lawsuits where a gun injury or death was caused by ``grossly negligent 
or reckless'' conduct by a gun company. Can there be any doubt that the 
purpose of this legislation is to protect gun manufacturers and dealers 
from civil liability, even if their conduct has been grossly negligent, 
reckless or even illegal?
    Third, the legislation's supporters assert that they are merely 
asking the Congress to do what over 30 states have already done. It is 
flatly untrue that over 30 states have enacted radical legislation of 
this kind. The vast majority of state immunity statutes apply only to 
suits brought by local governments and have no effect on the legal 
rights of individual gun violence victims. In fact, only five states 
have enacted legislation that limits the legal rights of individual gun 
violence victims to the extent of H.R. 800. For those in Congress who 
regard themselves as guardians of state prerogatives against federal 
encroachment, it is fair to ask: Why should Congress override the 
decisions of 45 states not to strip away the legal rights of gun 
violence victims?
    In virtually all states, victim claims against gun sellers are 
judged by the courts according to age-old principles of law that apply 
to everyone else. H.R. 800 is an effort by the United States Congress 
to impose a special set of legal rules on state courts that apply only 
to suits against gun companies. This bill is the worst form of special 
interest legislation. Its passage would be a tribute to the power of 
the gun lobby and an embarrassment to the country.

    GUN INDUSTRY IMMUNITY LEGISLATION WOULD ENDANGER COMMUNITIES BY 
  DESTROYING A STRONG INCENTIVE FOR GUN SELLERS TO BEHAVE RESPONSIBLY

    Mr. Chairman, irresponsible conduct by gun sellers has tragic real-
world consequences. As the Brady Center lawsuits dramatically show, 
reckless gun sellers put guns into the hands of criminals and endanger 
innocent lives. ATF has found from its own gun trafficking 
investigations that licensed gun dealers are the largest single source 
of guns trafficked into the underground market.\3\ Because of 
irrational statutory limitations on its enforcement powers, and limited 
resources, ATF is hampered in its efforts to ensure that gun dealers 
obey the law. The Office of the Inspector General of the Justice 
Department recently estimated that, at ATF's current rate of 
inspections, it will take the Bureau twenty-two years to inspect all of 
the approximately 100,000 current federal firearms licensees.\4\ When 
ATF does inspect dealers, violations of the law often are found, but 
severe statutory constraints on ATF's license revocation powers make it 
difficult for the Bureau to take meaningful action. According to the 
Inspector General, in FY 2003, ATF found that 1,812 of its inspections 
had revealed violations, with an average of over 80 violations for each 
inspection. However, ATF had issued only 54 notices of license 
revocation.\5\
---------------------------------------------------------------------------
    \3\ Following the Gun: Enforcing Federal Firearms Laws Against 
Firearms Traffickers, Bureau of Alcohol, Tobacco and Firearms (June 
2000), at 13.
    \4\ Inspections of Firearms Dealers by the Bureau of Alcohol, 
Tobacco, Firearms and Explosives, Report No. I-2004-005, U.S. Dept. of 
Justice Office of the Inspector General (July 2004), at iii.
    \5\ Id. at vi.
---------------------------------------------------------------------------
    The National Rifle Association has worked for years to weaken ATF's 
enforcement of federal gun laws. It has been tragically successful in 
this endeavor, by limiting ATF's legal authority and its resources. As 
a result, it is all the more important to maintain a strong civil 
liability system to give gun sellers a powerful incentive to behave 
responsibly. One of the recognized purposes of civil liability is to 
encourage individuals and companies to use reasonable care to prevent 
injury to others by ensuring that wrongful and dangerous conduct will 
result in damages liability. Having weakened ATF's enforcement powers, 
now the gun lobby seeks to remove the only remaining incentive for gun 
sellers to consider public safety in their business practices. The 
importance of civil liability was noted by former gun industry insider 
Robert Ricker, who wrote in a sworn declaration that ``until faced with 
a serious threat of civil liability for past conduct, leaders in the 
industry have consistently resisted taking constructive voluntary 
action to prevent firearms from ending up in the illegal gun market.'' 
\6\
---------------------------------------------------------------------------
    \6\ Mr. Ricker is a former NRA lawyer and former Executive Director 
of the American Shootings Sports Council, an industry trade 
association. His revelations about the gun industry are discussed in 
greater depth in the attached Brady Center special report, Smoking 
Guns: Exposing the Gun Industry's Complicity in the Illegal Gun Market, 
which details much of evidence against the gun industry uncovered in 
litigation.
---------------------------------------------------------------------------
    Far from pursuing legislation to strengthen ATF, proponents of 
immunity in Congress would rather reassure reckless gun sellers that 
they need no longer worry about the prospect that courts will hold them 
accountable to the victims of their conduct. If H.R. 800 passes, it 
will mean more gun sellers acting with utter contempt for public 
safety, with disastrous consequences for communities throughout the 
Nation. This is why, Mr. Chairman, there is substantial opposition to 
this legislation in the law enforcement community, including the Major 
Cities Chiefs Association, the International Brotherhood of Police 
Officers, the Police Foundation, the National Black Police Association, 
the Hispanic Police Command Officers Association and several state 
associations of police chiefs.\7\ In addition to recognizing that 
police officers like David Lemongello and Ken McGuire may be among the 
gun victims whose rights are infringed by this bill, these 
organizations also understand that H.R. 800 will only mean more illegal 
guns on the streets. It only takes a few ``bad apple'' gun dealers to 
funnel thousands of guns to criminals. ATF has found that only one 
percent of licensed gun dealers account for 57% of the guns traced to 
crime.\8\ These law enforcement organizations agree with us that good 
gun dealers don't need legal immunity; bad gun dealers don't deserve 
it.
---------------------------------------------------------------------------
    \7\ A letter opposing H.R. 800 from these organizations, and other 
members of the law enforcement community, is attached.
    \8\ Commerce in Firearms in the United States, Bureau of Alcohol, 
Tobacco and Firearms (February 2000), at 2.
---------------------------------------------------------------------------
 GUN INDUSTRY IMMUNITY LEGISLATION IS FAR MORE RADICAL THAN TORT REFORM

    Finally, it is important to distinguish H.R. 800 from other 
legislation this Congress has considered, and will consider, to reform 
our civil justice system. This bill is far more radical than any other 
proposal the Congress will address. Unlike class action reform, H.R. 
800 does not simply change the legal forum in which gun liability cases 
are considered; it protects reckless gun sellers from liability in any 
forum. Unlike medical malpractice reform, H.R. 800 does not simply 
limit the amount and kind of damages that can be recovered by gun 
violence victims against reckless gun sellers; it deprives victims of 
any recovery. Unlike the asbestos litigation reform proposals, H.R. 800 
sets up no alternative to the court system for victims to be 
compensated; it denies all avenues for compensation. In short, H.R. 800 
gives the gun industry special legal privileges that other industries 
can only dream about. And it makes the victims of reckless gun sellers 
into ``second-class'' citizens, who lack the basic civil liberties of 
other Americans who have been injured by the wrongful conduct of 
others.
    For these reasons, on behalf of the Brady Center to Prevent Gun 
Violence, and the brave gun violence victims we represent in court, I 
urge you to oppose this legislation. Thank you again for the 
opportunity to share my views.

                               ATTACHMENT



    Mr. Chabot. Mr. Beckman, you are recognized for 5 minutes.

   TESTIMONY OF BRADLEY T. BECKMAN, BECKMAN AND ASSOCIATES, 
                 COUNSEL TO NORTH AMERICAN ARMS

    Mr. Beckman. Good morning, Mr. Chairman and Members of the 
Subcommittee. My name is Bradley Beckman and I'm National 
Counsel for North American Arms, which is in Mr. Cannon's 
district.
    The legal assault that has been brought against North 
American Arms and the other manufacturers by Mr. Henigan's 
organization and various municipalities are nothing short of 
legal terrorism. This has been an assault that has been ongoing 
for many years.
    North American Arms is a small manufacturer, relatively 
modest-sized, been in business for 30-odd years. It employs a 
number of people and it has a number of suppliers that are 
employed and it goes on down the line. The burden that is put 
upon a small company like North American Arms and many that are 
similarly situated is extraordinary.
    I listened to Mr. Henigan's comments about what this bill 
has to do with, and respectfully, I suggest that this bill has 
nothing to do with terrorism, 50-caliber ammunition, armor-
piercing bullets, copkiller handguns, but it has everything to 
do with prevention of legal terrorism.
    Companies like North American Arms have been essentially 
held for ransom because they've been told if they don't, 
they're going to continue to be assaulted with litigation of 
this sort.
    I listened with interest to the comments about the Bull's 
Eye case because I was involved in that case. I was engaged as 
trial counsel. The acts of those criminals were just that. That 
was a firearm that was stolen. Bushmaster sold a lawful product 
in a non-defective condition which was openly stolen from the 
retailer. This legislation, I submit, under my understanding of 
the way it is written, would not prevent litigation such as 
that against a wrongful seller, somebody who has violated the 
law by allowing that firearm to escape their clutches.
    With regard to the Lemongello case in West Virginia, we're 
talking about, again, tragedies where we've seen law 
enforcement officers killed. Ruger sold another product in a 
non-defective condition in compliance with a host of laws. It 
did nothing wrong. To suggest that this legislation will 
prevent somebody from getting into the courthouse door, I think 
is simply a misstatement of what this bill is designed to 
prevent.
    Mr. Henigan was involved since the mid-1990's with 
approximately 30 lawsuits brought by municipalities throughout 
the country--Cincinnati, several in California, Detroit. Each 
and every one of them has been unsuccessful. However, the cost 
has been staggering. That is what this legislation is about.
    If the courthouses in America were designed to address 
that, then I would submit that we wouldn't have a legislature. 
We would have just a judicial branch. But this is up to the 
legislative body to make the laws. If our legislature should 
determine that firearms are illegal in some form or another, 
that's a matter for another day. This is to prevent the 
proverbial gun in the ribs to the manufacturers, the 
distributors, and the lawful sellers who comply with a very 
large host of law and regulation.
    If somebody could explain--I listened to Mr. Smith ask what 
liability is left. Well, we have retailers who are complying 
with law, distributors, and manufacturers. As we go through the 
chain, as we find somebody who violates the laws that presently 
exist, that's not going to be covered by this legislation. What 
is covered is the--truly a perversion of the tort system to try 
to use the tort law of public nuisance, which has been one of 
the prime sticks that the plaintiffs have tried to use against 
this industry, to essentially bankrupt them, and while there 
may have been some companies larger than others, better able to 
withstand some of the legal assault, I can tell you from the 
perspective of a modest-sized manufacturer like North American 
Arms, it cannot withstand that assault and there are a number 
of other similarly situated companies.
    I see that my time is expiring, and I thank you.
    Mr. Chabot. I can assure you you'll have an opportunity to 
respond to questions and speak some more.
    [The prepared statement of Mr. Beckman follows:]

                 Prepared Statement of Bradley Beckman

    Mr. Chairman, my name is Bradley Beckman and I am here representing 
a modest-sized firearms manufacturer with which I am sure you are 
familiar, North American Arms. North American Arms is based in your 
district. I want to begin by thanking you for holding this hearing. The 
legal assault on the firearms industry by opportunistic lawyers and 
anti-gun politicians threatens to bankrupt an entire industry that 
scrupulously follows all federal, state and local laws in the 
manufacture of our products and their sale to federally licensed 
firearms distributors.
    North American Arms employs approximately 40 people and specializes 
in the manufacture of small-sized, personal protection firearms. Many 
individuals who choose to carry our high-quality products are members 
of the law enforcement community who use them as a second or ``backup'' 
firearm to their standard sidearm. North American Arms has been named 
in several of the state and municipal suits against the firearms 
industry.
    The lawsuits brought against gun manufacturers are nothing short of 
outrageous. Holding gun makers liable for the criminal misuse of our 
products--one of the central accusations in these suits--is akin to 
holding Ford, Chevy or Honda responsible for the illegal actions of a 
drunk driver or holding Kodak responsible for the use of their film in 
the vile world of child pornography. It is an accusation that defies 
common sense. While these lawsuits barely pass the straight face test, 
the consequences of these suits are no laughing matter.
    North American Arms is literally being crushed under the weight of 
legal expenses. Money that could be used for developing new markets, 
hiring workers, improving firearms design and safety is instead 
channeled to fund the huge costs associated with the legal defense of 
the company.
    These lawsuits are nothing short of legal backmail-lawyers, 
politicians and anti-gun groups want to achieve in the courtroom 
draconian changes in gun laws that have been rejected by Congress and 
state legislatures. Their message is simple: ``settle with us or we 
will bankrupt you with lawsuits.'' This legal extortion must be 
stopped.
    North American Arms is a responsible firearms manufacturer that 
adheres strictly to all laws governing the manufacture and sale of our 
products to distributors. We have an excellent relationship with law 
enforcement. We have done nothing wrong, yet if a judge and jury in, 
for example, New York, decide against our industry it holds the 
potential of bankrupting not just North American Arms, but the entire 
U.S. firearms industry. It is doubtful that North American Arms or 
other manufacturers could post the necessary bond to appeal a verdict. 
If these suits are successful, they will be a wrecking ball on our 
national economy. Any member of Congress from Michigan should be ready 
for a similar assault on the auto industry. We already see suits 
against purveyors of fast food. The list of targeted industries could 
go on and on.
    I want to close with two quotes. The first from a recent decision 
by California Judge James Marchiano, writing for a unanimous state 
Court of Appeals decision in favor of the firearms industry just last 
month. Judge Marchiano wrote:

        ``The only business practice the defendants in this case have 
        engaged in is marketing their products in a lawful manner to 
        federally licensed dealers . . .''

        ``In this case, there is no causal connection between any 
        conduct of the defendants and any incident of illegal 
        acquisition of firearms or criminal acts or accidental injury 
        by a firearm. Defendants manufacture guns according to federal 
        law and guidelines.''

    In March 2002, the City of Boston dismissed with prejudice its 
lawsuit against firearms manufacturers. The city, facing mounting legal 
bills and recognizing that it would lose its case, stated in its 
dismissal that:

        ``. . . members of the Industry and firearms trade associations 
        are genuinely concerned with and are committed to, the safe, 
        legal and responsible sale and use of their products . . . The 
        Industry and the City believe that through cooperation and 
        communication they can continue to reduce the number of firearm 
        related accidents, can increase awareness of the issues related 
        to the safe handling of storage of firearms, and can reduce the 
        criminal acquisition of firearms.''

    Mr. Chairman, passage of H.R. 800 is common-sense judicial reform. 
This bill will protect jobs, prevent the misuse of the courts to 
circumvent elected officials and prevent abuse of the judicial system.
    Thank You.

    Mr. Chabot. Mr. Keane?

   TESTIMONY OF LAWRENCE G. KEANE, SENIOR VICE PRESIDENT AND 
   GENERAL COUNSEL, NATIONAL SHOOTING SPORTS FOUNDATION, INC.

    Mr. Keane. Chairman Cannon, distinguished Members of the 
Subcommittee, my name is Lawrence Keane and I'm the Senior Vice 
President and General Counsel for the National Shooting Sports 
Foundation, the trade association for the firearms industry. We 
strongly support this bill because it's an important common 
sense legal reform that will help restore integrity and 
fairness to our nation's judicial system by preventing lawsuit 
abuse.
    This vital, bipartisan legislation is critical to 
protecting America's firearms industry from destruction and 
bankruptcy at the hands of opportunistic trial lawyers, 
seriously misguided politicians, and radical anti-gun interest 
groups who seek to destroy and bankrupt our industry through 
massive damage awards and/or bleeding us dry through ever-
mounting legal fees. These ``regulation-through-litigation'' 
lawsuits misuse our judicial system in an attempt to dictate to 
all Americans public policy choices that are rightfully the 
purview of Congress and the elected State legislators. Under 
our Constitution, those policy choices are for Congress, not 
judges.
    The threat posed by ``regulation-through-litigation'' is 
why the U.S. Chamber of Commerce, the National Association of 
Manufacturers, the National Association of Wholesalers, and 
others support this bill. As the National Association of 
Manufacturers has said, ``It is a certainty that other 
businesses will be the next target if these groups succeed in 
misusing the courts against the firearms industry.'' This 
legislation is also supported by organized labor. The United 
Mine Workers, representing about 1,000 Remington factory 
workers, said the bill will, ``help prevent lawsuits by various 
parties that are intended to shut down the legitimate and legal 
firearms industry in the United States because of the improper 
use of firearms by individuals.'' These lawsuits seek to blame 
federally-licensed firearms manufacturers for the actions of 
criminals.
    Despite some industry success in the courts, this well-
funded, highly-coordinated onslaught of abusive lawsuits 
against Members of our industry continues unabated. A single 
$100 million verdict will bankrupt virtually all the 
defendants.
    Members of our industry are being sued today, right here in 
the District of Columbia, under a law that imposes absolute 
liability upon manufacturers for criminal shootings occurring 
in the District because they lawfully sold a gun that was then 
later illegally brought into the District and used in a crime. 
Bushmaster is being sued under this same statute with respect 
to the firearm misused in the sniper case.
    But the poster child for this bill is a case called Ileto 
v. Glock, where a manufacturer is being sued in Federal court 
in California for selling a firearm to a police department in 
Washington State that was later used in a criminal shooting. A 
distributor is being sued in that case, even though it never 
owned, possessed, or sold the firearm in question. Winning on 
the merits is not necessary in order for these politician and 
anti-gun activists, like Mr. Henigan, to impose through 
litigation or financially extorted or coerced settlements, a 
gun control agenda repeatedly rejected by Congress and State 
legislature.
    These anti-gun plaintiffs can implement their gun control 
policies through the entire nation if the coercive effect 
resulting from the staggering cost to defend these cases forces 
manufacturers into a Hobson's choice of capitulation or 
bankruptcy.
    The industry-wide cost to defend these cases is staggering. 
It exceeds $200 million, which is a huge sum for a small 
industry like ours that taken together doesn't equal a simple 
Fortune 500 company. These lawsuits threaten the very existence 
of the manufacturers, such as Sigarms, that produce the tools 
for law enforcement and military agencies that they use to 
protect America's freedoms here and abroad every day. These 
lawsuits have national defense and homeland security 
implications.
    The legislation you are considering today is as important 
for what it does not do. It does not, as Mr. Henigan tries to 
allege, close the courthouse door to those who have been 
injured by firearms that have been, for example, illegally sold 
or have been negligently entrusted or are defectively designed. 
The bill expressly provides that injured parties will be able 
to assert well-established tort law claims against the 
manufacturers themselves of firearms.
    The Wall Street Journal in an editorial got it right when 
it said, ``This isn't immunity, as some critics claim. The gun 
makers and distributors would still have to abide by product 
liability laws and still face civil suits for violating 
regulations on the sale and distribution. But just as Sony is 
not responsible for someone who uses a camcorder to film child 
pornography, no longer could Beretta be held responsible for 
someone using its legally purchased product to rob a liquor 
store.'' It's that judicial abuse that this legislation is 
carefully drafted to stop, and nothing more.
    There are several refinements to the bill that was passed 
by the House in the 108th Congress. We support those changes 
because they enhance and clarify the bill's purpose and intent.
    We agree with President Bush, who said, ``Recently our 
nation depends on a fair legal system that protects people who 
have been harmed without encouraging junk lawsuits that 
undermine the confidence in our courts while hurting our 
economy, costing jobs, and threatening small business.'' Over 
30 States have already enacted similar laws designed to stop 
junk lawsuits that are intended to destroy our industry and to 
achieve gun control regulation through litigation.
    The time has come for Congress to enact common sense legal 
reform to prevent an unconstitutional attempt to circumvent 
Congress and State legislatures, to restore integrity and 
fairness to our judicial system, to protect one of America's 
oldest and most important industries, and to prevent the loss 
of thousands of American jobs vital to the health of our 
economy, and to protect a critical component of our national 
security industrial base.
    Today, it's guns. We are already seeing similar legal 
assaults on the fast food industry. Are cars, alcohol, and 
distilled spirits next in line at the courthouse door? We've 
already seen it start with alcohol.
    The National Shooting Sports Foundation urges you to vote 
in favor of the Protection of Lawful Commerce in Arms Act. 
Thank you, Mr. Chairman, for permitting the National Shooting 
Sports Foundation the opportunity to address the Subcommittee 
and for the Subcommittee's time and attention.
    Mr. Cannon. [Presiding.] Thank you, Mr. Keane.
    [The prepared statement of Mr. Keane follows:]

                Prepared Statement of Lawrence G. Keane

    Chairman Cannon and distinguished members of the Subcommittee, my 
name is Lawrence G. Keane. I am the senior vice president and general 
counsel of the National Shooting Sports Foundation, Inc. (NSSF). The 
National Shooting Sports Foundation appreciates the opportunity to 
appear before the Subcommittee this morning to offer testimony in 
support of the Protection of Lawful Commerce in Arms Act (H.R. 800).
    Formed in 1961, the National Shooting Sports Foundation, with 
approximately 2,500 members, is the trade association for the firearm, 
hunting and recreational shooting sports industry. NSSF is proud of our 
industry's cooperative relationship with law enforcement, as 
exemplified by the NSSF--Bureau of Alcohol, Tobacco, Firearms and 
Explosives (ATF) partnership program called Don't' Lie for the Other 
Guy that ATF Director Carl Truscott described as ``vital in educating 
Federal firearms licensees (FFL's) and their employees how to recognize 
and deter the illegal purchase of firearms through straw purchases.'' 
He called the program ``an important tool for ATF as we pursue our 
missions of preventing terrorism, reducing violent crime, and 
protecting the public through Project Safe Neighborhoods and other 
initiatives.'' NSSF's commitment to promoting the safe and responsible 
use of firearms is typified by our Project ChildSafe program. Operating 
under a grant from the U.S. Department of Justice, NSSF, in partnership 
with state and local governments throughout the United States, has 
distributed to the public over 25 million firearm safety kits, which 
includes a free firearm lock. We are very proud that Don't Lie and 
Project ChildSafe are both components of the Justice Department's 
Project Safe Neighborhoods program.
    We strongly support the Protection of Lawful Commerce in Arms Act 
(H.R. 800) because it is an important common sense legal reform that 
will help restore integrity and fairness to our nation's judicial 
system by preventing lawsuit abuse. This vital bipartisan legislation 
is critical to protecting America's firearm industry from destruction 
and bankruptcy at the hands of opportunistic trial lawyers, seriously 
misguided politicians and radical antigun interest groups who seek to 
destroy and bankrupt our industry through massive damage awards and/or 
bleed us dry through ever mounting legal fees. These predatory lawsuits 
misuse and abuse our nation's judicial system in an attempt to dictate 
to all Americans public policy choices that are rightfully the purview 
of Congress and elected state legislators. In dismissing one such suit, 
a Florida appellate judge astutely observed that

        [Miami-Dade County's] request that the trial court use its 
        injunctive powers to mandate redesign of firearms and declare 
        that the [firearms manufacturers'] business methods create a 
        public nuisance, is an attempt to regulate firearms and 
        ammunition through the medium of the judiciary. . . . The 
        County's frustration cannot be alleviated through litigation as 
        the judiciary is not empowered to `enact' regulatory measures 
        in the guise of injunctive relief. The power to legislate 
        belongs not to the judicial branch of government but to the 
        legislative branch.

    This misuse of lawsuits by interest groups to force public policy 
changes, so-called ``regulation through litigation,'' when under our 
Constitution those policy choices are for Congress and state 
legislatures to make, represents a direct threat to the entire business 
community and the nation's economy. This is why the U.S. Chamber of 
Commerce, the National Association of Manufacturers, the National 
Association of Wholesalers, the American Tort Reform Association, and 
many others support H.R. 800. As National Association of Manufacturers 
executive vice president Michael Baroody has said, ``It is a certainty 
that other businesses will be the next target if these groups succeed 
in misusing the courts against the firearms industry.''
    This legislation is supported by organized labor as well. Cecil 
Roberts, president of the United Mine Workers of America, which 
represents nearly a thousand workers at the Remington Arms Company's 
plant in New York, said this bill ``will help prevent lawsuits by 
various parties that are intended to shut down the legitimate and legal 
firearms industry in the United States because of improper use of 
firearms by individuals.'' He cautioned, ``The United States is losing 
our industrial base and since January 2001 we have lost 2.5 million 
industrial jobs in the U.S. . . . We need to take steps to protect and 
encourage growth of our industrial base, including our firearms 
manufacturers.''
    Beginning in 1998, a group of approximately forty urban 
politicians, aligned with contingency-fee trial lawyers and anti-gun 
activists, have flooded our nation's courts with lawsuits filed against 
law-abiding, federally licensed firearm manufacturers, wholesale 
distributors and retailers. These suits blame federally licensed 
firearm manufacturers for the actions of criminals. The plaintiffs in 
these cases allege that the sale of a legal product in full compliance 
with the vast and extensive array of federal, state and local laws and 
regulations somehow causes criminal violence to occur. They allege that 
members of the industry are subverting the law by knowingly and 
willingly selling guns to criminals and are funneling firearms to the 
so-called ``criminal market.'' These despicable allegations are both 
patently false and highly offensive and defamatory to the tens of 
thousands of men and women who work in our industry.
    Despite some success in the courts, this well-funded, highly 
coordinated onslaught of abusive lawsuits against members of our 
industry continues unabated. Several cases are currently pending at the 
trial court level with several more cases at various stages of appeal 
that could be returned to trial courts for costly and time-consuming 
discovery and trial. A single hundred million dollar verdict will 
bankrupt virtually all of the defendants. In fact, the companies would 
almost certainly be unable to post the bond required to enable them to 
appeal such an award. Recently, the City of New York enacted into law 
the Gun Industry Responsibility Act that imposes absolute liability on 
law abiding, federally licensed firearm manufacturers and dealers for 
criminal shootings that occur in New York City. Members of our industry 
are being sued today right here in the District of Columbia under a 
similar law that imposed absolute liability upon manufacturers and 
dealers for criminal shootings occurring in the District because they 
lawfully sold a firearm that was then illegally brought into the 
District and used in the commission of a crime. A manufacturer is being 
sued in federal court in California for selling firearms to a police 
department in Washington State that was later used in a criminal 
shooting. In that same case, a distributor is being sued even though it 
never owned, possessed or sold the firearm in question. This case, 
Ileto v. Glock, is the poster child for the Protection of Lawful 
Commerce in Arms Act.
    Winning on the merits is not necessary in order for these 
politicians and antigun activists to impose through litigation, or 
financially extorted and coerced settlements, a radical gun control 
agenda repeatedly rejected by Congress and state legislatures, and not 
supported by the American public. At the time he filed his suit, 
Chicago Mayor Richard Dailey said, ``We're going to hit them where it 
hurts--in their bank accounts. . .'' Andrew Cuomo, then Housing and 
Urban Development Secretary, threatened firearm manufacturers with 
``death by a thousand cuts.'' NAACP president Kweisi Mfume said its 
lawsuit was ``an effort to break the backs'' of industry members. These 
antigun plaintiffs can implement their gun control policies throughout 
the entire nation if the coercive effect resulting from the staggering 
financial cost to defend these baseless suits forces industry members 
into a Hobson's choice of either capitulation or bankruptcy. Companies 
have gone bankrupt, and thousands of people thrown out of work, 
vindicating themselves against baseless lawsuits; just ask Dow Corning.
    The collective, industry-wide cost to defend these ill-conceived, 
politically motivated, predatory lawsuits has been truly staggering. 
Exact figures are unavailable because the defendants are competitors, 
and each considers its defense costs to be confidential business 
information. However, based on discussions with insurance industry 
executives, manufacturers' corporate counsel, reading cost estimates in 
various publications and NSSF's own experience as a defendant in these 
cases, I believe a conservative estimate for the total, industry-wide 
cost of defending ourselves to date now exceeds $200 million dollars. 
This is a huge sum of money for a small industry like ours. The firearm 
industry taken together would not equal a Fortune 500 company.
    The cost of litigation is borne almost exclusively by the companies 
themselves. With few exceptions, insurance carriers have denied 
coverage. These antigun plaintiffs have carefully drafted their 
complaints to take them outside of liability insurance coverage in 
order to apply maximum financial pressure on the defendant 
manufacturers. Because of these lawsuits, firearm industry members now 
confront skyrocketing premium increases when renewing their insurance 
policies. In addition, insurance policies now universally exclude 
coverage for these types of suits. This has resulted in large, across-
the-board price increases for consumers. In addition, in these trying 
economic times, taxpayers of the cities that have chosen to pursue the 
utterly discredited notion that manufacturers are responsible for the 
acts of criminals are forced to shoulder their city's cost of pursuing 
such a lawsuit, money that would be better spent hiring more police 
officers, procuring new equipment or funding critical social services.
    These lawsuits threaten the very existence of the manufacturers 
that produce the tools our military and law enforcement agencies use 
every day to protect America and our freedoms both here at home and 
abroad. If these companies are driven out of business, from whom will 
our military and law enforcement purchase firearms? Make no mistake 
about it; these lawsuits have national defense and homeland security 
implications.
    The legislation you are considering today is perhaps more important 
for what it does not do. It does not, as antigun interest groups have 
falsely alleged, ``close the courthouse doors'' to those who have been 
injured by firearms that have been illegally sold, supplied to a person 
likely to use the firearm in a manner involving an unreasonable risk of 
injury to himself or another, or prevent a suit due to a defectively 
designed or manufactured product. The bill expressly provides that 
injured parties will be able to assert well-recognized tort law claims 
against the manufacturers and sellers of firearms. The Wall Street 
Journal clearly stated in an editorial that, ``This isn't immunity, as 
some critics claim. Gun makers and distributors would still have to 
abide by product liability laws and still face civil suits for 
violating regulations on sales or distribution. But just as Sony is not 
responsible for someone who uses a camcorder to film child pornography, 
no longer could Beretta be held responsible for someone using its 
legally purchased product to rob a liquor store.'' (Wall Street 
Journal, April 17, 2003.) It is that abuse of our judicial system that 
this legislation is carefully drafted to stop, nothing more and nothing 
less.
    The loudest voices arrayed in opposition to this legislation are 
the same antigun interest groups that are orchestrating and financing 
the litigation assault to regulate the firearm industry in ways 
Congress and state legislatures have roundly rejected and hold no 
support with the American public.
    There are several refinements between the bill passed by the House 
in the 108th Congress (H.R. 1036) and this legislation. One change 
better clarifies that suits can proceed where there is a defective 
product, but that when a criminal volitionally pulls the trigger 
causing injury, the manufacturer cannot be sued. As revised, for 
instance, a juvenile who while target shooting without written 
permission from his parents (a violation of 18 U.S.C. Sec. 922(y)) is 
injured by defective ammunition could still be able to bring a suit 
against the ammunition manufacturer. H.R. 800 defines a ``trade 
association'' based on Internal Revenue Code and regulations. This new 
definition avoids specious arguments that the former definition was 
intended to protect the National Rifle Association. There was never any 
such intention in the previous bill, and this language makes that 
clear. H.R. 800 provides that manufacturers or sellers can be sued if 
they ``knowingly'' violate laws applicable to the sale or marketing of 
the product, and the violation is a proximate cause of harm to the 
plaintiff. By comparison, H.R. 1036 said ``knowingly and willfully.'' 
We support these refinements because they enhance and further clarify 
the bill's purpose and intent.
    Over thirty states have already enacted similar laws to stop 
``junk'' lawsuits designed to destroy this industry and to achieve gun 
control regulation through litigation. We agree with President Bush who 
recently said, ``Our country depends on a fair legal system that 
protects people who have been harmed without encouraging junk lawsuits 
that undermine confidence in our courts while hurting our economy, 
costing jobs and threatening small businesses.'' The time has come for 
Congress to enact a common sense legal reform to restore integrity and 
fairness to our judicial system, protect American jobs and industry and 
to prevent an unconstitutional attempt to circumvent Congress and state 
legislatures. We call upon Congress to prevent lawsuit abuse. The 
future of one of America's oldest, most important industries and the 
loss of thousands of American jobs vital to the health of our economy 
is at stake, as is a critical component of our national security 
industrial base.
    The shuttering of the firearm industry will hit states--especially 
rural states--especially hard. Each year hunters and shooters spend $21 
billion generating 366,344 jobs that pay more than $8,896,623,900 in 
salaries and wages and provide $1,223,049,215 in state tax revenue.
    In closing, if these lawsuits are not stopped, then it is open 
season on any industry. It is guns today, and we are already seeing 
similar legal assaults on the fast food industry--cars, alcohol and 
distilled spirits could be next in line at the courthouse door. In some 
way, these lawsuits will impact job creation in your districts and 
states and not for the better.
    The National Shootings Sports Foundation urges you to vote in favor 
of the Protection of Lawful Commerce in Arms Act (H.R. 800). I thank 
you Mr. Chairman for permitting the NSSF to address the Subcommittee 
and for the Subcommittee's attention this morning.

                               ATTACHMENT



    Mr. Cannon. We'd like to welcome Mr. Delahunt from 
Massachusetts, who's joined us.
    We have a vote coming up, and I'd hate to hold the panel 
through that vote and it would be hard for Members to come 
back, so I'd ask unanimous consent to limit questioning by the 
Members to 3 minutes. No objection, so ordered.
    Mr. Watt, would you like to begin?
    Mr. Watt. Thank you, Mr. Chairman. I think in light of our 
time constraints, I think I will not ask any questions. We've 
been through this several times now in this Committee, and here 
we go again. I mean, I made that point in my opening statement.
    I would just say that this whole notion that Mr. Beckman 
and Mr. Walton have--obviously, it's some public relations 
thing that you've undertaken to compare this war to the war in 
Iraq or call this legal terrorism and make it in some kind of 
way comparable to terrorism in general, I think is insulting to 
your argument, and I'll just leave that alone and tell you 
that's my opinion. That's a constructive suggestion. For you 
all to compare these things like that, I think is a bad, bad 
public relations move.
    I yield back, Mr. Chairman.
    Mr. Cannon. The gentleman yields back.
    Mr. Gohmert, would you like to question the witnesses?
    Mr. Gohmert. Yes, I would.
    Mr. Cannon. The gentleman is recognized for 3 minutes.
    Mr. Gohmert. Thank you. Mr. Henigan, let me ask, what do 
you take the term negligent entrustment to mean?
    Mr. Henigan. Congressman, negligent entrustment is actually 
defined in this bill, so it has a very special definition that 
is not necessarily the same as the common law definition. 
According to this bill, the suits that would be allowed under 
that doctrine are suits in which a seller transfers a gun to an 
obviously dangerous person and then that person misuses the gun 
against someone. So it would be, for example, a situation where 
a seller sells a gun to someone who is intoxicated and then 
goes out and shoots someone. That is a very rare kind of case.
    The much more frequent kind of case is the kind of thing 
that happened in that gun shop in West Virginia, where the sale 
of the gun is to a gun trafficking team and the person who 
pulled the trigger was nowhere near the gun shop, but 
nevertheless, the sale was incredibly suspicious. It had all 
the earmarks of a sale to people who were going to take those 
guns and sell them directly into the illegal market.
    So the doctrine of negligent entrustment as it is defined 
in this bill would not have preserved that case at all.
    Mr. Gohmert. Well, it does seem, though, that the Second 
Amendment, when it says--talks about not infringing the right 
to keep and bear arms, doesn't mean what one constable back in 
Texas thought it meant, that he had the right to wear short 
sleeves. But until such time as that is amended, it seems like 
we should be affording people the right to act within the 
purview of that amendment.
    I yield back the remainder of my time. Thank you, Mr. 
Chairman.
    Mr. Cannon. Thank you, Mr. Gohmert.
    Mr. Van Hollen?
    Mr. Van Hollen. Thank you, Mr. Chairman.
    Whenever the case of the sniper victims comes up, the 
proponents of the bill say, oh, no, no, no, we're not talking 
about trying to bar people like the sniper victims and their 
families from court. It's other people in the world. In fact, 
as I understood your testimony, Mr. Beckman, you said your 
understanding of the bill was it would not bar that case. Is 
that what your testimony was?
    Mr. Beckman. Insofar as the claims against the manufacturer 
of that firearm----
    Mr. Van Hollen. Let--go ahead.
    Mr. Beckman. Insofar as the claims against the manufacturer 
of that firearm, I believe that this legislation would prevent 
that. But respectfully, I suggest that Bushmaster sold its 
lawful product in a non-defective condition, which the Congress 
of the United States as well as every State said was a lawful 
product.
    Mr. Van Hollen. If I could, let me focus on the gun store, 
the gun store that sold the weapons. Is it your testimony that 
a lawsuit against the gun store on the facts of the sniper case 
would still be allowed to go forward under this bill?
    Mr. Beckman. Well, it----
    Mr. Van Hollen. And if so, if you could point to the 
specific provisions--specific provisions of this bill, because, 
as you know, when you go in front of a court of law and you sit 
before a judge, you've got to make an argument based on the 
language in this bill. If you could tell me, based on the 
facts, what provisions would allow that case would go forward, 
I'd appreciate it.
    Mr. Beckman. Okay. That firearm was not sold by Bull's Eye. 
It was stolen by Bull's Eye. Strike that, stolen from Bull's 
Eye. The qualified civil liability action would not include, in 
my opinion, the failure of Bull's Eye to have maintained 
control over whatever it--its inventory, because we already 
have plenty of Federal law that dictates the inventory control 
that the firearms manufacturers--the firearms retailers should 
have, and it is the unlawfulness use that is--it would not be 
precluded. And it would deal with, perhaps--you're asking me to 
interpret this draft statute as I sit here, and I believe----
    Mr. Van Hollen. Right. I'm not--you made a statement in 
your testimony that I interpreted to mean that you thought that 
this would allow this to go forward, so I thought that you 
looked at the provisions. That's all.
    Mr. Beckman. Yes, sir, I have, and I believe that the claim 
against the retailer would have not been foreclosed under the 
language of the statute. I believe that it would have 
foreclosed the----
    Mr. Van Hollen. And all I was asking you, Mr. Beckman, 
based on your reading of the statute, what provisions in the 
statute, based on your understanding of the facts, would allow 
it to go forward, because the fact of the matter is, although 
over 250 weapons were missing from this store, under the 
requirements in this bill, you have to show a direct connection 
between the particular gun that was stolen and used in the 
shootings and a proximate cause between the disappearance of 
that gun and the shootings.
    And I just--the way I read this bill, and the way many 
lawyers who have looked at the bill and written opinions and 
submitted opinions to the Congress, it's quite clear, I 
believe, that those claims would be barred against the store.
    Mr. Beckman. Well, but again, I respectfully disagree, sir, 
because I believe that it is a violation of Federal law, 
existing Federal law, for the retailer to have not reported the 
theft.
    Mr. Van Hollen. If I could ask you, the requirement is if 
you know of a theft, right?
    Mr. Beckman. Well----
    Mr. Van Hollen. In this case--Mr. Chairman, I don't mean to 
belabor this point, but I'd just like to just wrap up, because 
in this case, the testimony was that about 230 weapons had been 
missing from the store. Their testimony was, and it was 
unrefuted, that they were not aware of the theft of the 
Bushmaster rifles used in the sniper killings until after the 
killings took place, and therefore, there would be no legal 
obligation on them to report something that they did not know 
about under the statutes.
    Even though the record is clear that this is a gun store 
that did not keep control over its weapons--that's why 230 were 
missing and they couldn't account for them. But the way this is 
written, because their testimony is they didn't know about it, 
therefore, they didn't have a legal obligation to report it. 
Even though they were totally negligent in keeping control of 
their arsenal, of the guns they were selling, they couldn't--
the claim would not be brought.
    I would ask if you could, in a written statement, show us 
how that is not the case. Thank you, Mr. Chairman.
    Mr. Beckman. I'd be pleased----
    Mr. Cannon. You're welcome to answer that question, if 
you'd like.
    Mr. Beckman. I believe that I've given my view as to why 
the statute would not have precluded that case against the 
retailer. It's still a violation of Federal law. It is just 
akin go what Mr. Henigan explained in the West Virginia case, 
where it was a knowing violation of the straw purchase. That 
has been and will remain a violation of Federal law. Where we 
have somebody who violates the law, that's not within the 
purview of this statute. What is within the purview of this 
statute is the 30-odd lawsuits that were brought by 
municipalities around this country, all of which had no effect 
whatsoever on this industry other than to cost them staggering 
sums of money. And indeed, the lawsuits themselves were abject 
failures. That's what this legislation is designed to address.
    Mr. Van Hollen. Mr. Chairman, at some point, if you could 
maybe later supply for the record the particular provision in 
this bill that you say would still allow that lawsuit to go 
forward, because what this bill does is provide general 
liability and creates certain exceptions. If you could, please, 
pinpoint what in the bill allows the lawsuit against the seller 
of the weapons used in the sniper suit to go forward, I would 
appreciate it.
    Mr. Cannon. And if you could get that within 5 days, we 
would appreciate that, so that we can include it in the record.
    Mr. Beckman. I'd be pleased to do so.
    Mr. Cannon. Thank you, Mr. Beckman.
    The gentleman from Arizona, Mr. Franks, is recognized for 3 
minutes.
    Mr. Franks. Mr. Chairman, I know this isn't the appropriate 
venue to kind of dissect this legislation, but it occurs to me 
that in section 5, article III, 1, 2, the Malvo case is made 
very clear. Neither of these individuals involved in the sniper 
case could have legally purchased a gun in the first place, and 
so I think it's a red herring.
    But the ultimate situation is that in the final analysis 
here, this is going to a deeper question in our country, and 
that is simply the right of people to own and bear arms and 
defend themselves and the right of manufacturers to manufacture 
weapons that can accomplish that. Ultimately, even those that 
are opponents of this bill would suggest that the police 
officers of this nation should have the ability to defend other 
people.
    So with that statement made, it lays out very clearly that 
it's not the weapons, it's whose hands they are in. If we don't 
refocus our attentions as a nation into making sure that the 
people who misuse the weapons are our focus rather than the 
weapons, then we merely disarm the innocent and merely prevent 
people from being able to defend themselves, and I can suggest 
to you that criminals have always preferred unarmed victims, 
and that is at the core bases of this discussion.
    Thank you, Mr. Chairman.
    Mr. Cannon. Thank you.
    The bell has not yet run. Mr. Delahunt, would you like to 
ask questions?
    Mr. Delahunt. If the chair doesn't object.
    Mr. Cannon. How could I object? I wish you were on our 
side, but what the heck. We'll do with the information we get, 
whatever----
    Mr. Delahunt. I just want to pick up on something that the 
gentleman just talked about, a basic right and the Second 
Amendment. I want to assure you, I support the Second 
Amendment. But I also support what I consider as a basic right 
of a citizen who, if he or she feels that there has been an 
injury because of negligence or because of the actions of 
someone else, a basic right to the justice system, to the civil 
justice system. That is probably the core, most fundamental 
right that we enjoy as Americans, access to a justice system.
    You know, the gentleman speaks of staggering sums. How much 
has been spent?
    Mr. Beckman. Are you----
    Mr. Delahunt. I'm speaking to the gentleman with the nice 
white hair. [Laughter.]
    Mr. Beckman. Are you talking about for North American Arms 
specifically, or----
    Mr. Delahunt. No. In other words, I'll tell you, I'm having 
real difficulty finding out what the problem is. You know, all 
I see is in the findings, I don't read anything about empirical 
data supporting a premise that the industry is going to go 
under.
    Mr. Beckman. Well, respectfully, Congressman, we have other 
laws that preclude us from sharing all of our information among 
the manufacturers and distributors. So I can only speak to the 
company, or companies, that I have first-hand knowledge of.
    Mr. Delahunt. Okay.
    Mr. Beckman. And I can tell you that my client has spent 
hundreds and hundreds of thousands of dollars----
    Mr. Delahunt. Defending lawsuits.
    Mr. Beckman. Well, I'm talking about the municipal 
litigation. I'm not talking about----
    Mr. Delahunt. All right. Now, you've won those suits, 
correct?
    Mr. Beckman. Well, thus far, and where I have the problem 
with it, why I think that this legislation----
    Mr. Delahunt. Could I ask you--let me just interrupt, okay? 
You represent a manufacturer.
    Mr. Beckman. Yes, sir.
    Mr. Delahunt. Would you have problems if manufacturers 
enjoyed this particular--the benefit of this legislation, 
because, you know, I dare say that the most obvious party in 
terms of responsibility and negligence would be the seller, the 
immediate seller. Now, if legislation were redrafted which 
would continue the common law as it applies to the distributor, 
the immediate seller, would you have a problem with that?
    Mr. Beckman. I have a problem with holding--trying to hold 
somebody liable for damages that is very remote, because it is 
the same thing. We all know about the problems with drunk 
driving in this country, and if we start holding the auto 
manufacturers liable----
    Mr. Delahunt. No, no, but you're not answering my question. 
I'm saying, let's use your analogy. What about the bartender, 
okay, that gives that customer who's obviously inebriated that 
extra drink, as opposed to the maker of the scotch that was 
consumed? Do you see a distinction there?
    Mr. Beckman. Well, I do, and we have the Dram Shop Acts 
that----
    Mr. Delahunt. I'm not asking about the Dram Shop Acts. I'm 
asking about the analogy between the producer of the whiskey 
and the bartender who sells it in terms of responsibility. Do 
you see a distinction there?
    Mr. Beckman. I do. I do. I think that if you hold the 
manufacturer of the whiskey responsible, that's not----
    Mr. Delahunt. But what about the bartender?
    Mr. Beckman. If the bartender is serving somebody who's 
clearly inebriated, I think that's wrong.
    Mr. Delahunt. Okay, and should be held liable?
    Mr. Beckman. Indeed. If somebody is then injured by that 
drunk person, yes, I have no problem with----
    Mr. Delahunt. Well, I guess that's what I'm suggesting in 
terms of the difference between the manufacturer and the seller 
in that gun store to that individual who comes in.
    Mr. Beckman. Well, unless we have a vertically integrated 
industry where----
    Mr. Delahunt. I'm not asking about vertical integration. 
I'm asking about the individual who sells the gun at the gun 
store, not--if you guys want to have a caucus, I'll be quiet 
here and you two can work out the answer. Can I just please ask 
the question without the gentleman whispering in your ear for 
just a moment, okay? I'm sure he's more than capable of giving 
me an answer.
    Mr. Cannon. Do you want an answer to the question, or do 
you want to embarrass the witness, Bill?
    Mr. Delahunt. Maybe both, but at least an attempt----
    Mr. Beckman. Fortunately, I don't embarrass very easily.
    Mr. Delahunt. No. At least an attempt at giving me an 
answer. There's a distinction between the manufacturer and the 
gun store.
    Mr. Beckman. I think there's a great distinction between 
the manufacturer and the gun store, because you have somebody 
who is the proverbial--18 inches away----
    Mr. Delahunt. I'm not----
    Mr. Cannon. The gentleman's time has expired and we have a 
vote called----
    Mr. Delahunt. Okay.
    Mr. Cannon. --so if you don't mind, I'm going to give the 
gentleman a chance to answer the question and you can clarify a 
little bit if you want, but we probably do need to come to a 
close.
    Mr. Delahunt. I'll do the clarification at a later time.
    Mr. Beckman. To answer your question, the person who is 18 
inches away in a retail store, they have an obligation to 
comply with the law, and if they're selling through straw 
purchasers or if they're selling to somebody who is an 
unqualified buyer, that is a violation of the law and that is 
not something that is going to be barred under this statute.
    Mr. Cannon. The gentleman's time having expired, Mr. Watt?
    Mr. Watt. Mr. Chairman, Mr. Conyers has asked me to put 
some things in the record, so I ask unanimous consent to insert 
in the record a copy of the GAO report entitled, ``FBI Could 
Better Manage Firearm-Related Background Checks Involving 
Terrorist Watch List Records.''
    Mr. Cannon. Without objection--oh, go ahead.
    Mr. Watt. A copy of the bill that Mr. Conyers and 
Representative Chris Shays introduced in response to the GAO 
report; some information taken from a website which describes 
the Five-Seven as a 20-round pistol that fires a 5.7 millimeter 
bullet that will, quote, ``defeat most body armor in military 
service around the world today;'' a copy of the bill 
Representative Eliot Engel introduced which limits the use of 
the Five-Seven firearm; and some articles which highlight 
nearly a dozen or so assault weapons-related shootings which 
all occurred in the past 9 months, many of the shootings 
involving law enforcement officers.
    Mr. Cannon. Without objection, so ordered.
    [The material referred to is inserted in the Appendix.]
    Mr. Cannon. I want to thank the panel for being here today. 
The language which you said has helped us frame the language of 
the debate that I think we're going to have. Actually, I think 
it was more interesting year than it was last cycle, so perhaps 
we can get to a vote in the House and also in the Senate and 
make this thing move forward.
    I just want to, not having taken my 5 minutes, let me just 
make one point. That is, the hundreds of thousands of dollars 
that your company, Mr. Beckman, spent on defense of these 
lawsuits means the jeopardy of jobs in my district, and I would 
prefer that we keep liability the way it historically has been 
in America. That is personal, with personal responsibility, and 
I think this bill does that.
    Thank you very much, gentlemen. This hearing is adjourned.
    [Whereupon, at 11:27 a.m., the Subcommittee was adjourned.]


                            A P P E N D I X

                              ----------                              


               Material Submitted for the Hearing Record

 Prepared Statement of the Honorable Chris Cannon, a Representative in 
    Congress from the State of Utah, and Chairman, Subcommittee on 
                   Commercial and Administrative Law

    Good morning ladies and gentlemen; this hearing of the Subcommittee 
on Commercial and Administrative Law will now come to order. We 
consider today H.R. 800, the ``Protection of Lawful Commerce in Arms 
Act,'' which was introduced on February 15 by Representative Stearns. 
It currently has 157 co-sponsors, including myself.
    H.R. 800 provides that a ``qualified civil liability action'' 
cannot be brought in any State or Federal court. ``Qualified civil 
liability action'' is defined as a civil action or proceeding brought 
by any person against a manufacturer or seller of firearms or 
ammunition for damages resulting from the criminal or unlawful misuse 
of such products. However, such term does not include an action against 
a person who transfers a firearm or ammunition knowing that it will be 
used to commit a crime of violence or a drug trafficking crime, or a 
comparable or identical State felony law. It also does not include an 
action brought against a seller for negligent entrustment or negligence 
per se. The bill also includes several additional exceptions, including 
an exception for actions in which a manufacturer or seller of a 
qualified product knowingly and willfully violates a State or Federal 
statute applicable to sales or marketing when such violation was a 
proximate cause of the harm for which relief is sought. Other 
exceptions include actions for breach of contract or warranty in 
connection with the purchase of a firearm or ammunition; and an 
exception for actions for damages resulting directly from a defect in 
design or manufacture of a firearm or ammunition, when used as 
intended. The bill also makes clear that only licensed manufacturers 
and sellers are covered by the bill.
    Tort law rests upon a foundation of personal responsibility in 
which a product may not be defined as defective unless there is 
something ``wrong'' with the product, rather than with the product's 
user. However, in the last several years, lawsuits have been filed 
against the firearms industry on theories of liability that would hold 
it liable for the actions of others who use their products in a 
criminal or unlawful manner. Such lawsuits threaten to separate tort 
law from its basis in personal responsibility, and to force firearms 
manufacturers into bankruptcy, leaving potential plaintiffs asserting 
traditional claims of product manufacturing defects unable to recover 
more than pennies on the dollar, if that, in federal bankruptcy court. 
While some of these lawsuits have been dismissed, and some states have 
acted to limit them in one way or another, the fact remains that these 
lawsuits continue to be aggressively pursued. In January, the Supreme 
Court refused to overturn a decision by the notorious Ninth Circuit 
Court of Appeals that allowed a frivolous lawsuit brought against gun 
manufacturers for a crime committed by a third party to go forward. One 
of the personal injury lawyers suing the firearms industry--John 
Coale--told The Washington Post--quote--``The legal fees alone are 
enough to bankrupt the industry.'' Professor David Kopel (Ko-PELL) has 
also stated that the cities suing the firearms industry--quote--``don't 
even have to win . . . All they have to do is keep suing . . . They'll 
kill [the industry] with the cost of defending all the lawsuits.''
    Lawsuits seeking to hold the firearms industry responsible for the 
criminal and unlawful use of its products by others are attempts to 
accomplish through litigation what has not been achieved by legislation 
and the democratic process. As explained by one federal judge--quote--
``the plaintiff's attorneys simply want to eliminate handguns.''
    Under the currently unregulated tort system, personal injury 
lawyers are seeking to obtain through the courts stringent limits on 
the sale and distribution of firearms beyond the court's jurisdictional 
boundaries. Such a state lawsuit in a single county could destroy a 
national industry and deny citizens everywhere the right to keep and 
bear arms guaranteed by the Constitution. Insofar as these lawsuits 
have the practical effect of burdening interstate commerce in firearms, 
Congress has the authority to act under the Commerce Clause of the 
Constitution, as well as the Second Amendment.
    Such lawsuits also directly implicate core federalism principles 
articulated by the Supreme Court, which has made clear that--quote--
``one State's power to impose burdens on the interstate market . . . is 
not only subordinate to the federal power over interstate commerce, but 
is also constrained by the need to respect the interests of other 
States . . .''
    If the judicial system is allowed to eliminate the firearms 
industry based on legal theories holding manufacturers liable for the 
misuse of their products, it is also likely that similar liability will 
be applied to an infinitely long list of other industries whose 
products are statistically associated with misuse. Where will it end? 
Knives are mostly used for nonviolent purposes, such as cooking, but 
hundreds of thousands of violent crimes every year are perpetrated with 
knives. We've already seen multi-million dollar lawsuits against the 
makers of hamburgers and steaks for damages caused when other people 
abuse those products and overeat. Surely the manufacturers of steak 
knives will be sued next when such knives are used for criminal 
purposes.
    Congress must begin to stem the slide down this slippery slope. It 
can do that by fulfilling its constitutional duty and exercising its 
authority under the Commerce Clause to prevent a few state courts from 
bankrupting the national firearms industry and denying all Americans 
their fundamental right to bear arms. We need to preserve the benefit 
of American-made weapons for our soldiers overseas who are so ably 
defending all of us from terrorism. Let's not allow the American 
firearms industry to be bankrupted so we're left to rely on foreign 
countries to provide weapons for our own soldiers.
    I now yield to Mr. Watt, the Ranking Member of the Subcommittee, 
for an opening statement.

Prepared Statement of the Honorable Cliff Stearns, a Representative in 
                   Congress from the State of Florida



H.R. 1225, the ``Terrorist Apprehension and Record Retention (TARR) Act 

                               of 2005''




   GAO Report entitled ``GUN CONTROL AND TERRORISM: FBI Could Better 
Manage Firearm-Related Background Checks Involving Terrorist Watch List 
                                Records



          The ARMS site description of FN's Five-seveN Pistol



      H.R. 1136, the ``Protect Law Enforcement Armor (PLEA) Act''



  News Articles for the record offered by the Honorable John Conyers, 
   Jr., a Representative in Congress from the State of Michigan, and 
               Ranking Member, Committee on the Judiciary



Response to Post-Hearing Questions from a Minority Member to Bradley T. 
  Beckman, Counsel, Beckman and Associates, Counsel to North American 
                                  Arms



     Article submitted by Lawrence G. Keane, Counsel, Beckman and 
               Associates, Counsel to North American Arms



   Op-Ed Article from New York Daily News, Sunday, January 9, 2005, 
   submitted by Lawrence G. Keane, Counsel, Beckman and Associates, 
                     Counsel to North American Arms



Letter from Walter Olson, Senior Fellow, Manhattan Institute for Policy 
                 Research to the Honorable Chris Cannon



                                 
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