On 4/26/01, the New York Court of Appeals ruled 7-0 in favor of manufacturers in a case alleging negligent distribution of guns and market-share liability for all manufacturers of guns. The U.S. Court of Appeals for the Second Circuit, which asked the NY Court of Appeals for its opinion, is expected to dismiss the case.First, the court ruled that the manufacturers do not owe victims of handgun violence a duty to exercise care in the marketing and distribution of handguns. Manufacturers do not generally have a duty to control the conduct of third persons to prevent them from harming others. Nor do they have a duty to control the marketing and distribution of guns without any evidence that certain classes of dealers presented a greater threat than others. While there may be liability if a manufacturer knows or has reason to know that a distributor is engaging in substantial sales of guns into the gun-trafficking market on a consistent basis, there was no such showing made here. The court also ruled that manufacturers do not have a duty to investigate and identify corrupt dealers, particularly where such investigations can disrupt pending criminal investigations and endanger the lives of undercover officers.
Second, it ruled that liability may not be apportioned among manufacturers according to their share of the market. The NAM was concerned that market-share liability would spread from its original incarnation in the DES case of 1989 to manufacturers of other products. However, the court ruled that the DES case was unique. It could be distinguished from the gun case on a number of grounds, including the fact that, unlike DES, guns can often be traced to the manufacturer. Thus, there was no reason to depart from the traditional principle that a plaintiff must prove that a particular product caused an injury.
This is a major victory for all manufacturers. It is a stunning conclusion to years of uncertainty and apprehension about potential liability for marketing of legal products that are misused. The NAM filed amicus briefs in this case in the Second Circuit and in the NY Court of Appeals seeking this result.