Ileto v. Glock, Inc.

• Decision Date: 11 May 2009
• Docket Number: No. 07-15404.,No. 06-56872.,No. 07-15403.,06-56872.,07-15403.,07-15404.
• Citation: 565 F.3d 1126
• Parties: Lilian S. ILETO, an individual and mother to Joseph S. Ileto, deceased; Joshua Stepakoff, a minor, by his parents Loren Lieb and Alan B. Stepakoff; Mindy Gale Finkelstein, a minor, by her parents David and Donna Finkelstein; Benjamin Kadish, a minor, by his parents Eleanor and Charles Kadish; and Nathan Lawrence Powers, a minor, by his parents Gail and John Michael D.C. No. Powers, for himself and on behalf of a class of persons similarly situated, Plaintiffs-Appellants, v. GLOCK, INC., a Georgia corporation; RSR Management Corporation; and RSR Wholesale Guns Seattle Inc., Defendants-Appellees, Maadi, an Egyptian business entity; Quality Parts Co., formerly doing business as Bushmaster Firearms, a Maine corporation; Imbel, a Brazilian business entity; The Loander Pawnshop Too, a Washington corporation; David McGee, an individual; Intrac Arms International, Inc., a Tennessee Corporation, formerly doing business as Intrac corporation also known as Doe 1, and China North Industries Corp., aka Norinco, Defendants, and United States of America, Defendant-Intervenor-Appellee. Lilian S. Ileto, an individual and mother to Joseph S. Ileto, deceased; Joshua Stepakoff, a minor, by his parents Loren Lieb and Alan B. Stepakoff; Mindy Gale Finkelstein, a minor, by her parents David and Donna Finkelstein; Benjamin Kadish, a minor, by his parents Eleanor and Charles Kadish; and Nathan Lawrence Powers, a minor, by his parents Gail and John Michael Powers, for himself and on behalf of a class of persons similarly situated, Plaintiffs-Appellants, v. China North Industries Corp., aka Norinco, Defendant-Appellee, and United States of America, Defendant-Intervenor-Appellee, and RSR Management Corporation; RSR Group Nevada, Inc., formerly doing business as RSR Wholesale Guns Seattle Inc.; Maadi, an Egyptian business entity; Quality Parts Co., formerly doing business as Bushmaster Firearms; a Maine corporation; Imbel, a Brazilian business entity; The Loander Pawnshop Too, a Washington corporation; David McGee, an individual; Intrac Arms International, Inc., a Tennessee Corporation, formerly doing business as Intrac Corporation also known as Doe 1; Glock, Inc., a Georgia corporation, Defendants. Lilian S. Ileto, an individual and mother to Joseph S. Ileto, deceased; Joshua Stepakoff, a minor, by his parents Loren Lieb and Alan B. Stepakoff; Mindy Gale Finkelstein, a minor, by her parents David and Donna Finkelstein; Benjamin Kadish, a minor, by his parents Eleanor and Charles Kadish; and Nathan Lawrence Powers, a minor, by his parents Gail and John Michael Powers, for himself and on behalf of a class of persons similarly situated, Plaintiffs-Appellees, v. China North Industries Corp., aka Norinco, Defendant-Appellant, and RSR Management Corporation; RSR Group Nevada, Inc., formerly doing business as RSR Wholesale Guns Seattle Inc.; Maadi, an Egyptian business entity; Quality Parts Co., formerly doing business as Bushmaster Firearms, a Maine corporation; Imbel, a Brazilian business entity; The Loander Pawnshop Too, a Washington corporation; David McGee, an individual; Intrac Arms International, Inc., a Tennessee Corporation, formerly doing business as Intrac Corporation also known as Doe 1; Glock, Inc., a Georgia corporation, Defendants.
• Court: U.S. Court of Appeals — Ninth Circuit

565 F.3d 1126

Lilian S. ILETO, an individual and mother to Joseph S. Ileto, deceased; Joshua Stepakoff, a minor, by his parents Loren Lieb and Alan B. Stepakoff; Mindy Gale Finkelstein, a minor, by her parents David and Donna Finkelstein; Benjamin Kadish, a minor, by his parents Eleanor and Charles Kadish; and Nathan Lawrence Powers, a minor, by his parents Gail and John Michael D.C. No. Powers, for himself and on behalf of a class of persons similarly situated, Plaintiffs-Appellants, v. GLOCK, INC., a Georgia corporation; RSR Management Corporation; and RSR Wholesale Guns Seattle Inc., Defendants-Appellees Maadi, an Egyptian business entity; Quality Parts Co., formerly doing business as Bushmaster Firearms, a Maine corporation; Imbel, a Brazilian business entity; The Loander Pawnshop Too, a Washington corporation; David McGee, an individual; Intrac Arms International, Inc., a Tennessee Corporation, formerly doing business as Intrac corporation also known as Doe 1, and China North Industries Corp., aka Norinco, Defendants, and United States of America, Defendant-Intervenor-Appellee Lilian S. Ileto, an individual and mother to Joseph S. Ileto, deceased; Joshua Stepakoff, a minor, by his parents Loren Lieb and Alan B. Stepakoff; Mindy Gale Finkelstein, a minor, by her parents David and Donna Finkelstein; Benjamin Kadish, a minor, by his parents Eleanor and Charles Kadish; and Nathan Lawrence Powers, a minor, by his parents Gail and John Michael Powers, for himself and on behalf of a class of persons similarly situated, Plaintiffs-Appellants, v China North Industries Corp., aka Norinco, Defendant-Appellee, and United States of America, Defendant-Intervenor-Appellee, and RSR Management Corporation; RSR Group Nevada, Inc., formerly doing business as RSR Wholesale Guns Seattle Inc.; Maadi, an Egyptian business entity; Quality Parts Co., formerly doing business as Bushmaster Firearms; a Maine corporation; Imbel, a Brazilian business entity; The Loander Pawnshop Too, a Washington corporation; David McGee, an individual; Intrac Arms International, Inc., a Tennessee Corporation, formerly doing business as Intrac Corporation also known as Doe 1; Glock, Inc., a Georgia corporation, Defendants Lilian S. Ileto, an individual and mother to Joseph S. Ileto, deceased; Joshua Stepakoff, a minor, by his parents Loren Lieb and Alan B. Stepakoff; Mindy Gale Finkelstein, a minor, by her parents David and Donna Finkelstein; Benjamin Kadish, a minor, by his parents Eleanor and Charles Kadish; and Nathan Lawrence Powers, a minor, by his parents Gail and John Michael Powers, for himself and on behalf of a class of persons similarly situated, Plaintiffs-Appellees, v. China North Industries Corp., aka Norinco, Defendant-Appellant, and RSR Management Corporation; RSR Group Nevada, Inc., formerly doing business as RSR Wholesale Guns Seattle Inc.; Maadi, an Egyptian business entity; Quality Parts Co., formerly doing business as Bushmaster Firearms, a Maine corporation; Imbel, a Brazilian business entity; The Loander Pawnshop Too, a Washington corporation; David McGee, an individual; Intrac Arms International, Inc., a Tennessee Corporation, formerly doing business as Intrac Corporation also known as Doe 1; Glock, Inc., a Georgia corporation, Defendants.

No. 06-56872.

No. 07-15403.

No. 07-15404.

United States Court of Appeals, Ninth Circuit.

Argued and Submitted August 5, 2008.

Filed May 11, 2009.

Peter Nordberg, Berger & Montague, P.C., Philadelphia, PA; and Sayre Weaver, The Educational Fund to Stop Gun Violence, La Habra, CA, for the plaintiffs-appellants.

Charles H. Dick, Jr., and Shannon D. Sweeney, Baker & McKenzie LLP, for defendant-appellant/appellee China North.

Christopher Renzulli, Renzulli Law Firm, LLP, White Plains, NY, for defendants-appellees Glock & RSR.

H. Thomas Byron, III, Appellate Staff Civil Division, Department of Justice, Washington, D.C., for the defendant-intervenor-appellee.

Beth S. Brinkman, Morrison & Foerster LLP, Washington, D.C., for amicus curiae.

Appeal from the United States District Court for the Central District of California, Audrey B. Collins, District Judge, Presiding. D.C. No. CV-01-09762-ABC.

Before: STEPHEN REINHARDT, SUSAN P. GRABER, and MARSHA S. BERZON, Circuit Judges.

Opinion by Judge GRABER; Partial Concurrence and Partial Dissent by Judge BERZON.

GRABER, Circuit Judge:

By enacting the Protection of Lawful Commerce in Arms Act ("PLCAA" or "Act"), 15 U.S.C. §§ 7901-7903, Pub.L. No. 109-92, 119 Stat. 2095 (2005), Congress has protected federally licensed manufacturers and sellers of firearms from most civil liability for injuries independently and intentionally inflicted by criminals who use their non-defective products. Under the terms of the PLCAA, the claims brought here, by the victims of a criminal who shot them, against a federally licensed manufacturer and a federally licensed seller of firearms must be dismissed. But the claims brought against an unlicensed foreign manufacturer of firearms may proceed. We therefore affirm.

FACTUAL AND PROCEDURAL HISTORY

On August 10, 1999, Bufford Furrow shot and injured three young children, one teenager, and one adult at a Jewish Community Center summer camp in Granada Hills, California. Later that day, he shot and killed Joseph Ileto, a postal worker. Furrow was carrying at least seven firearms, which he possessed illegally.

In 2001, the shooting victims and Ileto's surviving wife filed this action against the manufacturers, marketers, importers, distributors, and sellers of the firearms. They alleged that Defendants intentionally produce, market, distribute, and sell more firearms than the legitimate market demands in order to take advantage of resales to distributors that they know or should know will, in turn, sell to illegal buyers. They also alleged that Defendants' deliberate and reckless marketing and distribution strategies create an undue risk that their firearms would be obtained by illegal purchasers for criminal purposes.¹ They did not, however, allege that Defendants violated any statute prohibiting manufacturers or sellers from aiding, abetting, or conspiring with another person to sell or otherwise dispose of firearms to illegal buyers. Instead, Plaintiffs brought their claims against Defendants solely under California common law tort statutes for foreseeably and proximately causing injury, emotional distress, and death through knowing, intentional, reckless, and negligent conduct.

In 2002, the district court dismissed the case for failure to state a claim under California law. Ileto v. Glock, Inc., 194 F.Supp.2d 1040 (C.D.Cal.2002). We affirmed in part and reversed in part. Ileto v. Glock, Inc., 349 F.3d 1191 (9th Cir.2003) ("Ileto I"). We held that Plaintiffs stated cognizable negligence and public nuisance claims under California law with respect to the firearms actually used in the shootings. Id. at 1203-15. We therefore reversed the dismissal of the action against Defendants RSR Management Corp. and RSR Wholesale Guns Seattle Inc. (collectively "RSR"), Glock Inc., and China North Industries Corp. ("China North"), because Plaintiffs alleged that Furrow may have used the firearms manufactured and distributed by those Defendants. Id. at 1215-16. We affirmed the dismissal of the action against all other Defendants, however, because the allegations did not support a conclusion that Furrow fired the firearms associated with those Defendants. Id. at 1216.

That holding resulted in disagreement within our court. The majority of our colleagues declined, however, to take the case en banc. Ileto v. Glock Inc., 370 F.3d 860 (9th Cir.2004) (order denying rehearing). As noted in our opinion our holding was not an outlier: Other jurisdictions had upheld similar claims against manufacturers and distributors of firearms under other state laws. Ileto I, 349 F.3d at 1200 n. 10, 1206-07, 1214 & n. 30 (citing Hamilton v. Beretta U.S.A. Corp., 96 N.Y.2d 222, 727 N.Y.S.2d 7, 750 N.E.2d 1055, 1061 (2001); City of Cincinnati v. Beretta U.S.A. Corp., 95 Ohio St.3d 416, 768 N.E.2d 1136, 1142 (2002); City of Chicago v. Beretta U.S.A. Corp., 337 Ill.App.3d 1, 271 Ill.Dec. 365, 785 N.E.2d 16, 24 (2002), rev'd, 213 Ill.2d 351, 290 Ill.Dec. 525, 821 N.E.2d 1099 (2004)).

The dispute soon reached the floor of the United States Congress and, in 2005, Congress enacted the PLCAA. The PLCAA generally preempts claims against manufacturers and sellers of firearms and ammunition resulting from the criminal use of those products. The PLCAA affects future and pending lawsuits, and courts are required to "immediately dismiss[ ]" any pending lawsuits preempted by the PLCAA. 15 U.S.C. § 7902(b).

After enactment of the PLCAA, the district court halted discovery and sought briefing on the effect of the Act on this case. Plaintiffs argued that the PLCAA did not apply here and, in the alternative, that the PLCAA is unconstitutional. The district court permitted the United States to intervene, pursuant to 28 U.S.C. § 2403(a), to defend the constitutionality of the Act.

In a published opinion, the district court dismissed Plaintiffs' claims against Defendants Glock and RSR. Ileto v. Glock, Inc., 421 F.Supp.2d 1274 (C.D.Cal.2006). The court held that the PLCAA preempted Plaintiffs' claims against those Defendants, id. at 1284-98, and upheld the constitutionality of the Act, id. at 1298-1304. The court eventually entered a final judgment pursuant to Federal Rule of Civil Procedure 54(b) as to Defendants Glock and RSR. Plaintiffs timely appealed.

In an unpublished order, the district court denied Defendant China North's motion for summary judgment. The court held that the PLCAA did not preempt Plaintiffs' claims against China North because, by contrast to Glock and RSR, China North is not a federal firearms licensee, as required by the PLCAA. The district court then certified an interlocutory appeal of that order.

We consolidated the appeals. In addition...