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The Feds fire a round
Washington’s new tactic: target gunmakers with litigation
By Matt Bai
NEWSWEEK
Dec. 12 — It was an unseasonably warm December Friday, and
managers at Colt were already looking ahead to a weekend of
Christmas shopping as they arrived at the plant in West
Hartford, Conn. Instead, they were handed lists of employees
and told to let them go. An engineer who had been with the
nation’s oldest gunmaker for almost 20 years wept openly in
disbelief; another man went outside and vomited.
THE SUN WAS SETTING by the time the executives realized that they,
too, were on the list. The “furloughs” brought the number of layoffs at
Colt this holiday season to more than 300, slowing production of new guns
to a crawl as management scrambles to save the company.
From Connecticut’s “Gun Valley” to California’s “Ring of Fire,”
gunmakers are starting to buckle under the weight of mounting legal bills.
“Without the lawsuits,” says Donald Zilkha, one of Colt’s owners, “none
of this would have happened.” Twenty-eight municipalities and the
NAACP have already sued, and two states — New York and Connecticut
— are threatening to do the same. And last week the federal government
vowed to file a monster class-action lawsuit against the industry if it
doesn’t agree to sweeping changes.
The administration’s real aim is to push both sides to make concessions,
and some gun execs are privately hopeful that it will do just that. But the
Feds’ bullying tactic also raises the stakes considerably. It may now be
impossible for gunmakers to have their day in court without going
bankrupt defending themselves. Having failed to beat the gunmakers in
Congress, the White House and its allies now seem bent on litigating them
to death.
FOLLOWING IN LOCAL FOOTSTEPS
Behind the scenes, administration officials have been trying to broker
peace in the gun wars from the start. But having failed to make an impact
that way, the White House is prepared to coordinate a suit on behalf of
some 3,300 public-housing authorities, for whom gun violence is costly.
Like the cities, the Feds would claim that the gun companies design unsafe
products and knowingly distribute them to criminals. Although Ohio and
Connecticut judges have now thrown out the municipal suits, courts in
four states have let similar suits go forward. Before it gets to that point,
government lawyers are looking for a settlement that would allow Clinton
— and Al Gore — to claim a victory on guns. The administration would
rather avoid a costly suit that couldn’t possibly be resolved before Clinton
leaves office. “We have strong litigation if it comes to that,” says Housing
Secretary Andrew Cuomo, “but I don’t think it comes to that.”
He may turn out to be right. While the mighty National Rifle
Association and its archenemy, gun-control groups, are nowhere near
compromise, more moderate factions on either side aren’t really that far
apart. Most of the companies that have been meeting in Washington with
lawyers for the cities and New York’s attorney general, Eliot Spitzer, are
willing to accept some new restrictions, including background checks at gun
shows. Glock, for one, has proposed a modified “one gun a month”
system, whereby anyone who buys multiple guns could take only one
home right away and pick up the others after a thorough background check.
What gunmakers need most now is a negotiator on the other side who
wants a deal as badly as they do, and who can sell it to the mayors — a
role the White House can play.
A FRACTIOUS COALITION
Meanwhile, gunmakers aren’t the only ones who have to make some
compromises. Getting 28 mayors to negotiate in unison is, in Cuomo’s
words, “like trying to herd cats.” Sources close to the talks say the cities
are divided over a few key points, most notably the introduction of
high-tech “personalized” guns that could be fired only by their owners.
Dennis Henigan, the chief lawyer for Jim and Sarah Brady’s Center to
Prevent Handgun Violence, a co-counsel in many of the suits, wants to
force gun companies to make only personalized guns by a fixed date.
That’s not a popular position among other plaintiffs’ lawyers, who think
Henigan’s position will get in the way of an agreement.
That debate is likely to get more heated next month, when Sigarms,
Inc., a Swiss-owned company, begins shipping the first-ever personalized
handgun. The $900 pistol — about $150 more than the regular version —
won’t fire unless the owner enters a pin code into a keypad under the
barrel. Others will surely follow. Colt had been banking its future on a
start-up company that would make an even more sophisticated “smart
gun,” but Steven Sliwa, Colt’s former CEO, left the project when he was
unable to attract investors. Another gunmaker, Mossberg and Sons, has set
up a new venture to introduce the first personalized shotgun as early as
next year.
Clinton’s point man on guns, Bruce Reed, will begin meeting with
plaintiffs’ lawyers next week to sort out the government’s position on
personalized guns and other key issues. But even if he gets a deal that
everyone can live with, this latest gambit raises deeper questions about a
government’s role in the courts. After all, unlike Big Tobacco, the $2
billion gun industry can scarcely afford to defend so many lawsuits, and
several insurance carriers are already refusing to pay the costs. “The
industry’s already in court — we didn’t put them there,” Reed says.
“We’re offering them a way out.” With so many enemies taking aim, it’s
likely to be the best offer they get.
© 1999 Newsweek, Inc.
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