This week, the Supreme Court of the United States (SCOTUS) heard oral arguments in a big gun case.
Mexico wants to hold American gunmakers liable for billions in damages caused by cartels armed with their firearms. Rather than decide if the country can prove its case, SCOTUS is tasked with figuring out whether their claims are even allowed under the federal law that provides limited immunity to those gun companies.
Contributing Writer Jake Fogleman runs through the transcript to show why it appears the justices were unreceptive to Mexico’s central argument. However, he also explains why they may not be leaning toward an expansive ruling. Then, law professor Dru Stevenson joins the podcast to give a bit of a different view on how oral arguments went.
Plus, I explain why the gun industry appears headed for some turbulence after we got word on how many guns were sold last month.
Analysis: What Will SCOTUS Say About Gunmaker Liability? [Member Exclusive]
By Jake Fogleman
Mexico’s attempt to place America’s largest gun businesses on the hook for cartel violence concerns found a cold reception before the Supreme Court this week.
On Tuesday, The Court heard oral arguments in Smith & Wesson v. Mexico, a case pitting a foreign government against the American gun industry with up to $10 billion at stake. The entire dispute centers around the 2005 Protection of Lawful Commerce in Arms Act (PLCAA), which generally prohibits lawsuits against gun businesses for harms perpetrated by third parties using their legal products. Though the law has long been a political flashpoint, the Supreme Court has not weighed in on the bounds of its protections or exceptions until now.
While the justices questions revealed a high level skepticism for Mexico’s specific claims against Smith & Wesson, they didn’t necessarily paint a clear picture of how far they think gunmaker liability extends.
The PLCAA’s predicate exception allows for lawsuits against the gun industry for actions that “knowingly violated a State or Federal statute applicable to the sale or marketing of the product.” But it also requires that “the violation was a proximate cause of the harm for which relief is sought.”
Mexico’s theory for fitting its suit into that exception involves claiming that gun manufacturers aid and abet violations of federal law. Mexico argues the companies knowingly provide their firearms to dealers who sell them to gun traffickers, often through straw purchasers, and that those traffickers later arm cartel members who commit violent acts with them on the other side of the southern border.
Right off the bat, that theory of aiding and abetting liability creating an opening through the PLCAA was greeted with skepticism. Justice Clarence Thomas opened the justices’ discussion by questioning whether Mexico had identified a violation of any specific state or federal statute on the part of the gun companies in its complaint.
“The exception is for knowingly violating a state or federal statute, and it would seem helpful in determining aiding and abetting and then eventually proximate cause if that comes up if you knew which statute we were dealing with,” he said.
The lack of specificity in Mexico’s allegations was a theme that appeared several times throughout the oral argument, as justices from across the ideological spectrum repeatedly probed Mexico’s claims. When it became clear that Mexico was claiming that certain gun dealers selling to illegal straw purchasers was the violation in question—even though it is only suing manufacturers and a wholesaler in this case—three separate justices questioned why it couldn’t even identify the supposed law-breaking retailers.
“But what you don’t have is particular dealers, right?” Justice Elena Kagan asked Mexico’s attorney, Catherine Stetson. “I mean, there are lots of dealers. And you’re just saying they know that some of them [sell to straw purchasers]. But which some of them? I mean, who are they aiding and abetting in this complaint?”
“Are there any allegations in the complaint that the Petitioners knowingly sell to specific red flag dealers?” Justice Samuel Alito asked.
“You haven’t sued any of the retailers that were the most proximate cause of the harm,” Justice Amy Coney Barrett said. “And you haven’t identified them that I can tell in the complaint.”
Other justices appeared to read Mexico’s aiding and abetting claims as a thinly veiled attempt to advance the same liability suit that the PLCAA precludes.
“How is your suit different from the types of suits that prompted the passage of PLCAA?” Justice Thomas asked.
Similarly, Justice Ketanji Brown Jackson repeatedly invoked her concern that Mexico’s suit struck at the very heart of the PLCAA.
“My point is that Congress didn’t want general aiding and abetting concerns to be what is imposing duties on these manufacturers,” Jackson said. “I mean, if you look at your lawsuit and what you’re asking for, you’re asking for changes to the firearm industry, safety practices, the distribution practices, the marketing, all of the things that you ask for in this lawsuit would amount to different kinds of regulatory constraints that I’m thinking Congress didn’t want the courts to be the ones to impose.”
Finally, practical concerns surrounding the impacts it would have for The Court to accept Mexico’s theory of aiding and abetting liability worried Justice Brett Kavanaugh.
“What do you do with the suggestion on the other side and in the amicus briefs that your theory of aiding and abetting liability would have destructive effects on the American economy in the sense that, as you’ve read in the briefs, lots of sellers and manufacturers of ordinary products know that they’re going to be misused by some subset of people?” Kavanaugh asked, citing car and pharmaceutical manufacturers as examples. “That’s a real concern for me about accepting your theory of aiding and abetting liability.”
However, while a healthy dose of suspicion toward Mexico’s aiding and abetting claims was a constant theme of the argument, at least a handful of justices indicated they want a fairly narrow ruling, particularly on the issue of proximate cause. Noel Francisco, the lawyer arguing on behalf of the gun companies, faced some of his toughest questions from the justices on how to identify a gun company as the proximate cause of harm with a firearm.
“As to proximate cause, this Court has repeatedly said there must be a direct relationship between the defendant’s conduct and the plaintiff’s injury,” he said in his opening remarks. “But no such relationship exists if plaintiff’s injury is caused by multiple intervening independent crimes committed by foreign criminals on foreign soil to inflict harm on a foreign sovereign.”
Conservative and liberal justices alike probed this proximate cause analysis. They seemed to want to avoid drawing too narrow a line on the issue, particularly in cases involving foreseeable harm.
“Put aside aiding and abetting,” Justice Neil Gorsuch asked. “Assume for the moment that your clients aided and abetted the sale of guns to bad apple dealers, ones they knew or intended even for them to sell on to people in Mexico doing bad things. They knew that. They knew all of that. How would you not have proximate cause in that hypothetical?”
“I still don’t think that establishes proximate cause when you have an intervening independent crime,” Francisco responded.
“Counsel, the complaint says that 2 percent of the guns manufactured in the United States find their way into Mexico, and I know you dispute that, but is there a number where your legal analysis might have to be altered?” Chief Justice John Roberts asked. “If it’s 10 percent, if it’s 20 percent? At some point, the proximate cause lines that you draw really can’t bear the weight of the ultimate result.”
In the end, however, some justices signaled they may be content to decide the case without resolving the question of proximate cause at all.
“Is there any reason for us to reach the proximate cause question if we conclude for aiding and abetting that you win?” Barrett asked.
“I think for us to go into proximate cause opens up a Pandora’s box,” Sotomayor added.
Overall, the justices’ comments suggested a win for the gun manufacturers, but perhaps one cabined to Mexico’s specific claims. That would be a significant loss for gun-control advocates hoping for a way around the gun industry’s liability protections, but not a lasting defeat.
If SCOTUS declines to outline what constitutes proximate cause in tort suits against gun businesses for third-party crimes, gun-control activists will likely continue filing their own PLCAA workarounds over alleged violations of “public nuisance” and similar state-level statutes. Those have become increasingly popular in recent years.
So, even if the Supreme Court squashes Mexico’s PLCAA suit, there’s a good chance it won’t be the last.
Podcast: Unpacking Smith & Wesson v. Mexico’s Oral Arguments (ft. Professor Dru Stevenson) [Member Early Access]
By Stephen Gutowski
This week, we’ve got a longer episode than usual.
That’s because we’re doing a deep dive into oral arguments for the Supreme Court’s latest gun case, Smith & Wesson v. Mexico. Most observers, including me, thought Mexico faired poorly in its attempt to move forward with liability claims against American gunmakers over cartel violence south of the border. However, Professor Dru Stevenson, who studies gun policy at Southern Texas College of Law, had a bit of a different take.
So, I wanted to have him on the show to go through why he thought the justices may be more sympathetic toward Mexico’s claims than most other people thought. While he still believes Mexico’s suit is unlikely to make it through the Supreme Court unscathed, Stevenson argued the justices might allow part of it to proceed. And, even if not, he said The Court may end up laying out what amounts to a framework for how to successfully pierce gun industry liability protections in future suits.
You can listen to the show on your favorite podcasting app or by clicking here. Video of the episode is also available on our YouTube channel. An auto-generated transcript is available here. Reload Members get access on Sunday, as always. Everyone else can listen on Monday.
Get a 30-day free trial for a subscription to The Dispatch by clicking here.
Plus, Contributing writer Jake Fogleman and I break down the latest national gun sales data for February and discuss why they suggest trouble ahead for the gun industry. We also talk about Trump’s latest omission of his gun policy priorities in a major public address, this time in his first joint address to Congress.
Analysis: The Gun Industry Enters Uncertain Territory [Member Exclusive]
By Stephen Gutowski
Gun sales are declining, and there’s reason to think the trend could get worse.
This week, an industry analysis showed gun sales were down nine percent year-over-year in February. That made it one of the worst Februarys in a decade.
It follows a 2024 where sales declined to pre-pandemic levels. If the next four years are anything like the previous four when Donald Trump was president, the slide may just be starting.
Smith & Wesson saw a 15.7 percent net sales decline year over year in its last quarter. Ruger’s sales were up about 11 percent in the last quarter but down about 1.5 percent for 2024.
“There’s no demand,” Michael Cargill, a Texas gun dealer, told The Wall Street Journal last month. “People are relaxed because there’s no fear of them losing their Second Amendment rights.”
That’s likely to be the primary driver of any gun sales downturn. Americans don’t like to be told what they can and can’t own. Gun buyers are particularly sensitive to this.
Donald Trump was the pro-gun candidate in the race. So, while the possibility he could back new federal gun restrictions is underrated, most feel there isn’t a good reason to rush out and buy a gun in anticipation of new restrictions. Outside of Trump’s unpredictability in responding to major mass shootings, this is probably a pretty good assumption.
The industry will likely end up with a more forgiving regulatory environment under Trump. Significant legislative changes are unlikely, given the margins in Congress. However, his administration is reviewing executive gun policy with an eye to roll some back–especially those implemented by Joe Biden.
But the tradeoff may be lower sales.
Between 2016 and 2019, gun sales fell by nearly 17 percent. 2020 then sent sales soaring to an all-time high. Even former President Biden’s four-year push for new gun restrictions couldn’t come close to sustaining that level of demand as sales fell nearly 30 percent during his tenure.
The last four years demonstrated the limit of politically motivated gun buying, especially after a huge sales spike that likely pulled demand forward. Now, we’ll likely see where the new floor for firearms demand could land.
Some in the industry don’t think demand will collapse.
“I think the expectation is it will continue to be a relatively soft market,” Larry Keane, general counsel for the National Shooting Sports Foundation, told The Reload. “But, you know, if you look at where things are now compared to where they were 10 years ago, people would be very happy. So, slow and steady wins the race.”
Keane pointed to the pandemic-era sales spike as a reason to think the customer base is broader than it used to be, which should help sustain the industry through any downturn.
“The consumer base has certainly increased significantly, particularly since 2020,” he said. “We have millions of new gun owners, and they have varying ideological views from across the spectrum.”
Our politics certainly haven’t become any less polarized since Trump retook office. Many of his opponents are concerned about the direction he’s taking the country, and some minority communities, such as trans people, are fearful enough to consider buying guns for the first time–at least according to anecdotal reports. There may well be an increase in gun buying among some non-traditional demographics.
However, that doesn’t appear to have offset the level of apathy among many traditional gun buyers, who still tend to make up a majority of consumers.
As 2020 shows, enough societal chaos could bring Americans of all stripes to their local gun store regardless of the president and his position on guns. But that level of chaos is far from a common occurrence and not really something anybody would root for just to sell a few more firearms.
So, barring a disastrous turn, sales are likely to continue to decline in the near term. But some, like Cargill, might be willing to accept that if President Trump delivers substantial wins for the gun-rights movement.
“The gun community is willing to bite the bullet and take the loss of sales to have a little relief to the fact that you’re not going to lose constitutional rights,” Cargill told The Times.
Of course, Cargill’s name may sound familiar since he is the one who successfully sued to have Trump’s bumpstock ban found unconstitutional by the Supreme Court. So, the tradeoff may not be as lopsided as some expect. But how deep sales slump and how many pro-gun moves Trump makes will determine that.
That’s it for now.
I’ll talk to you all again soon.
Go Birds,
Stephen Gutowski
Founder
The Reload
