City of New York v. Beretta U.S.A. Corp.

Decision Date12 April 2004
Docket NumberNo. 00 CV 3641(JBW).,00 CV 3641(JBW).
Citation315 F.Supp.2d 256
PartiesCITY OF NEW YORK, Plaintiff, v. BERETTA U.S.A. CORP.; Browning Arms Co.; Charco 2000, Inc.; Colt's Manufacturing Co., Inc.; Forjas Taurus, S.A.; Glock Inc.; Glock GmbH; Phoenix Arms; Sigarms, Inc.; Sig Arms Sauer GmbH f/k/a J.P. Sauer & Sohn Inc.; Smith & Wesson Corp.; Sturm, Ruger and Co., Inc.; Tanfoglio Fratelli S.R.L.; Taurus International Mfg, Inc.; Acusport Corp; Alamo Leather Goods, Inc.; Bangers, L.P.; Bill Hick's and Co., Ltd.; Brazas Sporting Arms, Inc.; Camfour, Inc.; Chattanooga Shooting Supplies, Inc.; Davidson's Supply Co., Inc.; Dixie Shooters Supply Inc.; Ellet Brothers, Inc.; Euclid Avenue Sales Co.; Faber Brothers, Inc.; Glen Zanders Fur and Sporting Goods, Co.; Hicks, Inc.; Kiesler Police Supply, Inc.; Lew Horton Distributing Co., Inc.; Lipsey's, Inc.; MKS Supply, Inc.; Riley's, Inc.; Ron Shirk's Shooters Supply, Inc.; RSR Group, Inc.; Scott Wholesale Co., Inc.; Southern Ohio Gun, Inc.; Sports South, Inc.; Valor Corp.; Walter Craig, Inc.; and Williams Shooters Supply, Defendants.
CourtU.S. District Court — Eastern District of New York

Michael A. Cardozo, Corporation Counsel of the City of New York by: Eric Proshansky, Richard J. Costa, New York, NY, Violence Policy Center by: Mathew Nosanchuk, Washington, DC, Weil, Gotshal & Manges, LLP by: Steven A. Reiss, New York, NY, for Plaintiff City of New York.

Gordon, Feinblatt, Rothman, Hoffberger & Hollander, LLC by: Lawrence S. Greenwald, Baltimore, MD, for Defendant Beretta U.S.A. Corp.

Friday, Eldredge & Clark, LLP by: Jonann E. Coniglio, Little Rock, AK, Jamie Huffman Jones, Renzulli, Pisciotti & Renzulli, LLP by: John F. Renzulli, Leonard S. Rosenbaum, New York, NY, for Defendant Browning Arms Co.

Jones Day by: Thomas E. Fennell, Michael L. Rice, Dallas, TX, for Defendant Colt's Manufacturing Co., Inc.

Budd Larner, P.C. by: Timothy A. Bumann, Atlanta, GA, Budd Larner, P.C. by: Kathleen Marchetti, Short Hills, NJ, for Defendants Forjas Taurus, S.A. and Taurus International Manufacturing, Inc.

Renzulli, Pisciotti & Renzulli, LLP by: John F. Renzulli, Leonard S. Rosenbaum, New York, NY, for Defendant Glock, Inc.

Tarics & Branisa, P.C. by: Michael J. Zomcik, Houston, TX, for Defendant Phoenix Arms.

Wilson, Elser, Moskowitz, Edelman & Dicker, LLP by: Jan Michael Skidds, New York, NY, for Defendants Sigarms, Inc. and Sig Arms Sauer GMBH f/k/a J.P. Sauer & Sohn, Inc.

Shook Hardy & Bacon, LLP by: Jeffrey S. Nelson, Kansas City, MO, Greenberg Traurig, LLP by: Alan Mansfield, New York, NY, for Defendant Smith & Wesson Corp.

Wildman, Harrold, Allen & Dixon by: James P. Dorr, Chicago, IL, for Defendant Sturm, Ruger & Co., Inc.

Saiber Schlesinger Satz & Goldstein, LLC by: David R. Gross, Christopher M. Chiafullo, Newark, NJ, for Defendants AcuSport Corp., Alamo Leather Goods, Inc.; Bangers, L.P., Bill Hicks & Co., Brazas Sporting Arms, Inc., Camfour Inc., Chattanooga Shooting Supplies, Inc. Davidson's Supply Co., Inc., Dixie Shooters Supply, Inc., Ellet Brothers, Inc., Faber Brothers, Inc., Glen Zanders Fur and Sporting Goods Co., Hicks, Inc., Kiesler Police Supply, Inc., Lew Horton Distributing Co., Lipsey's Inc., Riley's, Inc., RSR Group, Inc., Scott Wholesale Co., Inc., Ron Shirk's Shooter's Supplies, Inc., Southern Ohio Gun, Inc., and Sports South, Inc.

Scott L. Braum, Esq. by: Scott L. Braum, Dayton, OH, Saiber Schlesinger Satz & Goldstein, LLC by: David R. Gross, Christopher M. Chiafullo, Newark, NJ, for Defendant MKS Supply, Inc.

United States Attorney's Office by: Elliot M. Schachner, Brooklyn, NY, United States Attorney's Office by: Vincent Lipari, Central Islip, NY, for Observer Attorney General of the United States.

MEMORANDUM JUDGMENT & ORDER

WEINSTEIN, Senior District Judge.

Table of Contents

                  I. Introduction ............................................................... 262
                 II. Factual and Procedural History ............................................. 262
                III. Preclusion ................................................................. 263
                     A. Effect of Motion to Dismiss ............................................. 264
                     B. Privity of a Non-Party .................................................. 265
                        1. Privity with State under Parens Patriae Doctrine ..................... 265
                        2. Privity between Governmental Entities Generally ...................... 266
                        3. Privity between New York State and New York City ..................... 268
                           a. Development of the Legal Status of Cities ......................... 268
                           b. Modern Law of Municipal Corporations .............................. 269
                           c. Home Rule in New York ............................................. 271
                           d. Relationship between New York State and New York City ............. 273
                           e. Governmental Entity Analysis ...................................... 273
                 IV. Statement of a Claim ....................................................... 274
                     A. Rule 12(b)(6) Standard and Scope ........................................ 274
                     B. Stare Decisis and the Rule of Erie ...................................... 275
                     C. Stating a Public Nuisance Claim against the Firearms Industry ........... 276
                        1. Existence of a Public Nuisance ....................................... 276
                        2. Conduct of Defendants Creating, Contributing to, or Maintaining the
                             Nuisance ........................................................... 277
                           a. Conduct ........................................................... 277
                                i. Standard of Liability ........................................ 277
                               ii. Intentional Conduct .......................................... 278
                              iii. Negligent Conduct ............................................ 279
                               iv. Otherwise Lawful Conduct ..................................... 280
                           b. Causation ......................................................... 281
                                i. Factual Cause ................................................ 281
                               ii. Proximate Cause .............................................. 282
                              iii. Causation in Suits Against the Firearms Industry ............. 283
                        3. Statutory Nuisance Claim ............................................. 284
                  V. Commerce Clause and Due Process Clause ..................................... 285
                     A. Commerce Clause ......................................................... 285
                     B. Due Process Clause ...................................................... 286
                 VI. Conclusion ................................................................. 286
                
I. Introduction

The City of New York sues manufacturers, importers and distributors of firearms for common law and statutory public nuisance. It asserts that the imprudent policies and practices of defendants in manufacturing, marketing, distributing, and selling guns substantially increase levels of gun use, crime, deaths, and injuries in New York City.

Defendants move to dismiss on the grounds that: (1) the City is precluded from bringing suit by the decision of the New York Supreme Court in People v. Sturm, Ruger & Co., Inc., Index No. 402586/00 (Aug. 10, 2001), aff'd, 309 A.D.2d 91, 761 N.Y.S.2d 192 (N.Y.App.Div.2003), leave to appeal denied, 100 N.Y.2d 514, 769 N.Y.S.2d 200, 801 N.E.2d 421 (N.Y.2003) ("Sturm, Ruger"), a public nuisance suit brought by the State of New York in its parens patriae capacity; (2) the complaint fails to state a claim for public nuisance; and (3) the injunctive relief demanded by the City places an impermissible burden on interstate commerce in violation of the Commerce Clause and Due Process Clause. For the reasons stated below, the motion to dismiss is denied.

II. Factual and Procedural History

The City of New York brought this action against manufacturers and importers of handguns and other firearms in June 2000 seeking monetary and injunctive relief. An amended complaint was filed in September 2000. Because the terrorist attacks of September 11, 2001 prevented the City from accessing its files, the case was stayed. In January 2004, the stay was lifted and the City was granted leave to amend its complaint a second time. City of New York v. B.L. Jennings, Inc., 219 F.R.D. 255, 256 (E.D.N.Y.2004). In its second amended complaint, the City dropped causes of action based on negligence and a demand for monetary damages. The suit is now solely an equitable claim seeking an injunction to abate a public nuisance.

Defendants are manufacturers, importers and distributors of firearms that have allegedly been possessed or used illegally in New York City. The City asserts that, as a result of defendants' failure to institute appropriate marketing and distribution practices, defendants' guns are diverted into an illegal market catering to juveniles, criminals and other persons prohibited from owning guns. It alleges that defendants know or should know that a substantial number of their guns are diverted into the hands of criminals and that defendants could, but do not, take steps to reduce the harm occasioned by the use of these guns in New York to kill, maim, rob, and conduct other illegal activity, all to the great harm of the City.

The firearms market consists of primary and secondary tiers. The primary market is composed of transactions through which new firearms move from manufacturers and importers through wholesale distributors and retail dealers to a first retail purchaser. The secondary segment is characterized by the illegal sale and purchase of guns by non-federally licensed individuals. The City asserts that firearms move quickly from the legal primary market to the illegal secondary market, which is a significant source of firearms for criminals. It alleges that diversion from the primary, legal market to the...

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13 cases
  • City of New York v. Beretta U.S.A. Corp.
    • United States
    • U.S. District Court — Eastern District of New York
    • December 2, 2005
    ...for the City's suit. See N.A.A.C.P. v. Acusport, 271 F.Supp.2d 435 (E.D.N.Y.2003) (findings of fact and law); City of New York v. Beretta, 315 F.Supp.2d 256 (E.D.N.Y.2004) (denying motion to On October 26, 2005, the President of the United States approved the Protection of Lawful Commerce i......
  • City of New York v. Beretta U.S.A. Corp.
    • United States
    • U.S. Court of Appeals — Second Circuit
    • April 30, 2008
    ...complaint are set forth in painstaking detail in NAACP v. Acusport, 271 F.Supp.2d 435 (E.D.N.Y.2003), and City of New York v. Beretta U.S.A. Corp., 315 F.Supp.2d 256 (E.D.N.Y.2004) (denying motion to dismiss). Accordingly, our factual summary is brief. The City seeks "injunctive and abateme......
  • Cayuga Indian Nation of N.Y. v. Seneca Cnty.
    • United States
    • U.S. District Court — Western District of New York
    • April 30, 2017
    ...3962992, at *12 (E.D.N.Y. July 21, 2016) (some citations and internal quotation marks omitted); see also, City of N.Y. v. Beretta U.S.A. Corp. , 315 F.Supp.2d 256, 267 (E.D.N.Y. 2004) ("New York courts have largely refused to find two functionally independent governmental entities in privit......
  • City of New York v. Milhelm Attea & Bros., Inc.
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    • U.S. District Court — Eastern District of New York
    • April 30, 2008
    ...of a municipality imperils the very existence of that municipality as a governmental unit."). See also City of New York v. Beretta U.S.A. Corp., 315 F.Supp.2d 256, 276-77 (E.D.N.Y.2004) ("[T]he City [of New York] is a proper party to bring an action to restrain a public nuisance that allege......
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4 books & journal articles
  • Preemption and Commerce Clause Issues
    • United States
    • ABA Antitrust Library Business Torts and Unfair Competition Handbook Business tort litigation
    • January 1, 2014
    ...have expressed doubt about applying the Commerce Clause to state common law causes of action. See City of N.Y. v. Beretta USA Corp., 315 F. Supp. 2d 256, 285 (E.D.N.Y. 2004) (“The applicability of the Commerce Clause to state common law actions is unsettled.”); Crowley v. Cybersource Corp.,......
  • Preemption and Commerce Clause Issues
    • United States
    • ABA Archive Editions Library Business Torts and Unfair Competition Handbook. Second Edition Business Tort Litigation
    • June 23, 2006
    ...have expressed doubt about applying the Commerce Clause to state common law causes of action. See City of N.Y. v. Beretta USA Corp., 315 F. Supp. 2d 256, 285 (E.D.N.Y. 2004) (“The applicability of the Commerce Clause to state common law actions is unsettled.”); Crowley v. Cybersource Corp.,......
  • Global Warming: The Ultimate Public Nuisance
    • United States
    • Environmental Law Reporter No. 39-3, March 2009
    • March 1, 2009
    ...used”). 79. Cox v. City of Dallas, 256 F.3d 281, 292 n.19, 31 ELR 20767 (5th Cir. 2001); City of New York v. Beretta U.S.A. Corp . , 315 F. Supp. 2d 256, 281 (E.D.N.Y. 2004) (“Satisfaction of the causation requirement for liability in public nuisance actions requires proof that a defendant,......
  • Extraterritoriality and the Dormant Commerce Clause: A Doctrinal Post-Mortem
    • United States
    • Louisiana Law Review No. 73-4, July 2013
    • July 1, 2013
    ...and distribution of firearms did not constitute impermissible extraterritorial regulation). See also New York v. Beretta U.S.A. Corp., 315 F. Supp. 2d 256, 285–86 (E.D.N.Y. 2004). 124. See, e.g. , Ileto v. Glock, Inc., 349 F.3d 1191, 1216–17 (9th Cir. 2003); District of Columbia v. Beretta,......

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