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Beretta Statement On The S&W Agreement

Tuesday, September 5, 2000

Following the signing of the now infamous Smith & Wesson agreement there was a great deal of misinformation about its ramifications and whether or not other gun manufacturers would sign it. Recently, Beretta has detailed its reasons for steering clear of both the agreement and the proposed "code of conduct" that manufacturers have been asked to sign.

When Smith & Wesson announced, on March 17, 2000, that it had signed an agreement with a handful of politicians to try and settle lawsuits filed (or threatened) against the company by those politicians, the announcement received great attention, making front-page headlines in newspapers across the country and featuring in national news broadcasts.

Secretary of Housing and Urban Development Andrew Cuomo, self-described as an architect of the settlement, claimed that it was by far the most significant accomplishment of his administration. Although the Secretary`s claim may simply have been a comment on his other accomplishments in office, the Smith & Wesson settlement was undoubtedly significant, but perhaps for reasons different than those cited by Secretary Cuomo.

In all of the media attention directed at the settlement, most reports tended to focus on a single part of the settlement agreement in which Smith & Wesson agreed to ship locks with handguns that it sells. The public thus came to understand the agreement as a commitment on Smith & Wesson`s part to provide locks with its guns, not realizing that almost every handgun manufacturer who sells in the United States, including Beretta U.S.A. and Smith & Wesson, already does so. Regrettably, in the rush to simplify the terms of the Smith & Wesson settlement to aid public understanding, the media paid a disservice to the public by ignoring the most far-reaching and radical terms of the agreement.

Beretta U.S.A. was not asked to sign the particular agreement which Smith & Wesson signed, but the terms of the agreement are ones which have been presented by politicians and gun control advocates to the firearm industry on numerous prior occasions. After the Smith & Wesson settlement, Secretary Cuomo and other politicians attempted to force other handgun manufacturers to sign a separate "Code of Conduct" fashioned around the terms of the Smith & Wesson settlement by withholding law enforcement sales to these companies unless they sign. Ironically, as will be shown in this article, even Smith & Wesson did not sign the "Code of Conduct" and should be subject - even though it signed a settlement agreement - to the same restrictions on law enforcement sales being sought against other gun companies. Beretta U.S.A. Corp. signed neither, the Settlement Agreement nor the Code of Conduct. Here is why:

THE "CODE OF CONDUCT" BANS ALMOST ALL SEMIAUTOMATIC PISTOLS.

Section 1, paragraph 4 (d) of the Code bars a manufacturer from producing a pistol that "accepts magazines with a greater than ten-round capacity". Since (with the exception of a few semiautomatic pistols that have fixed, rather than removable, magazines) the ability of a semiautomatic pistol to hold more than ten rounds depends, not upon the design of the pistol, but upon the length and capacity of the magazine, this provision essentially bans all semi-automatic pistols that have removable magazines. Thus, for example, all pistols which use ten round magazines for civilian use would be banned because those same pistols can also hold a larger magazine with more rounds for law enforcement or military use.

The Smith & Wesson agreement tries to skirt this restriction by applying it only to new models. How Smith & Wesson will redesign its pistols to comply with this provision - by eliminating removable magazines, for example - remains to be seen.

THE "CODE OF CONDUCT" BANS THE MANUFACTURE OF ALL SMALL HANDGUNS.

Section I. (3) of the Code prevents a manufacturer from making or distributing guns that cannot be imported into the United States under Chapter 18, Section 925 of the U.S. Code, which was enacted to only allow importation of handguns suitable for sporting use. Under that restriction, small handguns were effectively barred from importation into the United States.

Long-time observers of gun control issues know, of course, that restrictions based on the suitability of a firearm for sporting use ignore the more important role which firearms can also play in aiding self-defense. Thus, although some might argue that a small handgun is not typically used for sporting purposes, no one would deny that these guns are important for self-defense. This is especially true now, when over 30 states have enacted laws allowing concealed carry of handguns for self-defense.

In one stroke of the pen, the Code of Conduct obliterates the notion that handguns can be manufactured because of their usefulness for self-defense. Instead, by limiting the manufacture of handguns to those that comply with the import restriction, the Code limits handgun manufacture to those made for sport.

The Smith & Wesson settlement, to its credit, does not contain this restriction, but replaces it with accuracy restrictions on small handguns. Readers can decide whether this restriction is a gun ban by other means.

THE "CODE OF CONDUCT" POTENTIALLY REQUIRES THE RECALL OF EVERY HANDGUN MADE.

Section I. B (6) of the Code requires the manufacturer to agree, at the manufacturer`s cost, to retrofit all prior guns with new safety devices that become available and feasible. The Code does not specify whether it is the device or the retrofit that must be feasible, and the retrofit itself is not limited by the Code to guns made by that manufacturer, so a plain reading of this provision could lead one to conclude that a manufacturer who creates an internal lock for a handgun must then retrofit all existing handguns - made by that manufacturer or not - with that lock.

The Smith & Wesson agreement, to its credit, does not contain this far-reaching retrofit requirement. Smith & Wesson, in other words, did not sign the Code of Conduct, but its own, separate agreement.

BOTH THE "CODE OF CONDUCT" AND THE SMITH & WESSON SETTLEMENT REQUIRE GUN DEALERS TO CREATE A FUND THAT ENCOURAGES FUTURE LAWSUITS.

Section II. A.1. c of the Smith & Wesson settlement requires its dealers and distributors to carry at least $1 million in liability insurance. The Code of Conduct contains the same provision. Whenever someone suing you demands that you carry insurance, watch out. It means they want more money to be available for suits in the future. If a thousand Smith & Wesson dealers now have a million dollars each in insurance, does anyone believe such a requirement benefits public safety, or is this simply a gift for greedy plaintiff`s lawyers?

THE "CODE OF CONDUCT" POTENTIALLY REPLACES A HANDFUL OF PRODUCT LIABILITY LAWSUITS WITH HUNDREDS OF OTHER LAWSUITS.

The signature page of the Code of Conduct allows signature, not only by politicians who are currently suing the gun industry, but by any politician. In the same way, the Smith & Wesson agreement includes signatures by politicians (for example, Secretary Cuomo from HUD) who have not sued the gun industry.

Notwithstanding the fact that some of the signers have not sued the gun industry, Section V of the Code of Conduct allows it to be enforced by any signer. Thus, dozens or even hundreds of municipal jurisdictions could sign the agreement, then sue if they decide the manufacturer has failed to comply with their requirements.

This means that, if a manufacturer fails to comply with the terms of the agreement (for example, by failing to build locks into all of its handguns within two years, as the Smith & Wesson agreement requires), any or all signatories to the Code could sue to enforce the agreement. Even if a manufacturer had an understanding with some government officials that it will be given leeway in complying with the more burdensome conditions of the Code (for example, the requirement to recall and retrofit all prior models with new safety features), that understanding may not exist with regard to each of the hundreds of municipalities who might, for their own political or even vindictive reasons, decide to sign the Code later to force compliance with restrictions as they interpret them.

THE SMITH & WESSON SETTLEMENT SURRENDERS FIREARM DESIGN AND DISTRIBUTION CONTROL TO ANTIGUN POLITICIANS.

One of the most troubling aspects of the Smith & Wesson agreement is that it establishes a "Oversight Commission" (Section III) comprised of five members, the majority of whom (three) are suing or threatening to sue the gun industry. This Oversight Commission has the authority to enforce all terms of the agreement.

If the Oversight Commission decides that an ad showing a father and son hunting together make the firearm shown "particularly appealing to juveniles," it can ban the ad (Section II. D. 2). If the Oversight Commission decides that ten firearm traces for a dealer is too many, it can ban sales to that dealer (Section II.E), even if the dealer sells two thousand guns per year or sold the traced guns 10 years ago or had no reason to know that any given gun would be misused or end up in a trace.

The Code of Conduct contains even more vague and open-ended controls. The Code of Conduct would allow politicians to ban the sale of handguns with trigger pull weights of less than 10 pounds if they decided such guns were "readily operated by a child aged 6, or younger," (Section I.A.4), notwithstanding the chance that such a restrictions can make it more difficult for the elderly, or infirmed to fire a gun. If these same politicians decided that the semi-automatic feature of a pistol made it attractive to criminals, or that certain revolvers are more frequently used by criminals, they could ban these as well.

THE SMITH & WESSON SETTLEMENT AND THE CODE OF CONDUCT ADD NOTHING TO THE CURRENT COMMITMENT OF GUN COMPANIES AND USERS TO PUBLIC SAFETY.

Reading the Smith & Wesson settlement agreement and the Code of Conduct, one is left with the feeling that the authors of the agreement believe that guns are designed without regard for safety, that the distribution of firearms is a free-for-all without restraint or regulation and that firearms manufacturers are answerable to no one. To the contrary, of course, gun manufacturers incorporate those safety features in their products which they find to be prudent and feasible. The distribution of firearms is one of the most heavily regulated commercial activities in the United States and every firearm manufacturer is answerable for the consequence of its design and distribution decisions, not only to each of its customers, but also to law enforcement regulators and to the American public in general. Gun control advocates, when they lament that firearms are not subject to jurisdiction of the Consumer Product Safety Commission and seek to create an "Oversight Commission" to exert their own control over gun design and distribution, forget that the firearm industry already has a regulatory body which governs its every action. That regulatory body is found in Article I, Clause I of the Constitution and is called the U.S. Congress.

More importantly, critics of the gun industry ignore the fact that manufacturers have, without being required to do so, instituted the types of important safety initiatives and design choices which have played a key role in dramatically reducing accidental deaths with firearms. All manufacturers ship safety instructions with every firearm they sell. Manufacturers provide a variety of firearms with various safety features to meet consumer needs and demand, including loaded chamber indicators, internal locks, external locks, firing pin blocks, external safety levers, etc. It is the firearm industry and firearm users - not ironically, gun control advocates - who have instituted massive firearm safety programs nationwide (like, for example, the National Shooting Sports Foundation`s Project HomeSafe, which is providing hundreds of thousands of free gun locks and the NRA`s Eddie Eagle Gunsafe program, which teaches gun avoidance to hundreds of thousands of schoolchildren, across the country.)

Important efforts to ensure firearm safety have already been undertaken by the firearm industry and by firearm users and will continue, with or without the imposition of terms found in the Smith & Wesson settlement or in the Code of Conduct.

THE SMITH & WESSON SETTLEMENT REWARDS LITIGATION THROUGH CAPITULATION.

Critics around the country have decried the lawsuits against the gun industry as an attempt by gun control advocates to impose their legislative agenda through the use of harassing lawsuits. The formula for this misuse of the court system has now become clear: A "social interest group" formulates a legislative agenda, then compares it with what is already being done by an industry. The litigants describe anything that is not being done by the industry as "negligence", then sues or encourages others to sue based on that "negligence", never minding the fact that their original legislative agenda may be misguided, factually or legally wrong, or that the alleged "negligence" may not be the actual cause of any harms alleged in the lawsuit.

The voice of the American public has effectively been taken out of this equation. By resorting to the courts rather than the legislative process, in which all sides of an issue may be heard and by which every citizen is represented in the debate, these lawsuits circumvent the democratic process. Regrettably, by signing the settlement agreement, Smith & Wesson has rewarded this anti-democratic tactic by gun control advocates with success.

There are a host of other problems with both the Smith & Wesson agreement and the Code of Conduct, but one further issue bears special and final comment.

BOTH AGREEMENTS CIRCUMVENT THE CONSTITUTION.

The Second Amendment of the Constitution does not say that Americans have the right to bear arms only if an Oversight Commission tells them they can, or tells them how many guns they can buy per month or tells them what type or style of firearm they can purchase. By accepting the Oversight Commission and other restrictions in the settlement agreement, Smith & Wesson has enabled gun control advocates to neatly sidestep the interference of the Second Amendment with their agenda.

Similarly, when a homeowner in Iowa chooses to buy a firearm, they do not expect their choice of models or dealers to be determined by the Secretary of HUD or a politician in New York or Atlanta. The power to regulate interstate commerce lies in the elected representatives of all people, expressed only through laws passed by the U.S. Congress. The Smith & Wesson settlement and the Code of Conduct sidestep this Constitutional protection as well.

In 1985, the Beretta Model 92FS pistol was chosen as the standard service sidearm for the U.S. Armed Forces. That pistol has been carried with pride in the Iraq war, in the Panama Campaign, in Bosnia, and in Somalia. In addition, Beretta handguns are carried by hundreds of thousands of law enforcement officers throughout the United States. Equally important, Beretta handguns are used by hundreds of thousands of American citizens to protect their lives and to protect the safety of their families and of others.

Smith & Wesson`s chief executive has publicly stated that the decision to sign the settlement agreement was a business decision occasioned by the burdensome cost of fighting the lawsuits filed against his company by a number of municipalities. This sentiment is understandable, of course, and in the context of many products, (for example, lawnmowers, home appliances, etc.), one might argue that the decision was a wise one.

In the context of firearm ownership, though, with the role which firearms play in saving people`s lives and ensuring both domestic safety and freedom, simple business decisions of profit or loss are only part of the equation. This is why Beretta U.S.A. did not sign the Smith & Wesson agreement. When we looked at all aspects of the agreement, the cost was simply too great.


1 Jeff Reh is General Counsel for Beretta U.S.A. Corp., a position he has held since 1986. In addition to being distributor of Beretta products in the United States and Canada, Beretta U.S.A. Corp. is the supplier of the standard service sidearm for the U.S. Armed Forces and provides firearms for personal defense and law enforcement use, as well as for sporting use, throughout the United States and Canada. The views expressed in this article are those of Beretta U.S.A. Corp. alone and are not intended to represent the views of any other firearm manufacturer.

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