Campaign Seeks to Halt Gun Makers' Bankruptcy Ploy (Freedom grabber lawsuits

Oakland plaintiffs attorney Richard R. Ruggieri had never handled a case involving guns until Brandon Maxfield came along. Maxfield was seven years old when he was left paraplegic by the inadvertent discharge of a Bryco Model 38 .380-caliber handgun by a 20-year-old family friend who didn't know the gun was loaded.

When Ruggieri examined the facts surrounding the incident he became convinced that the gun was poorly and dangerously designed, so he took the case as a product-liability suit he thought he and the Maxfield family could win. On May 13, 2003, a jury in Alameda County, Calif. agreed, finding Bryco Arms and owner Bruce Jennings liable for $24 million in damages.

The next day Jennings announced what he was going to do about the verdict: He was declaring bankruptcy.

Ruggieri, who had brought the suit two years earlier, wasn't surprised. "They'd always threatened to file bankruptcy," he says. "The first time I had a phone conversation with their attorney, he said, 'Well, we have no insurance, so if you win we'll just file bankruptcy.'"

Ruggieri also wasn't surprised to learn, as time has passed since the bankruptcy announcement, that Bryco's operation isn't necessarily over. He knew that there has been a pattern of similar gun manufacturers -- those who make cheap "Saturday-night specials" that are popular among young criminals and gang members -- re-emerging under different names after declaring bankruptcy to evade legal liability. So when Ruggieri heard that the bankruptcy court had granted Jennings' request to sell the gun-manufacturing assets to a former plant foreman if he submits the highest bid on June 17, 2004, and when he heard that Jennings' wife had obtained a federal firearms sales license, he became convinced that it would happen again with Bryco.

Ruggieri is certain that the same manufacturing operation that produced firearms that are both defective and unusually prevalent as crime guns among youthful offenders will continue as before--unless a different buyer approaches the court.

So he and the family have devised a plan. It might be a long shot, but Ruggieri and the injured boy's family have put out a plea asking for people to contribute money in hopes that enough will accumulate to exceed the foreman's offer of $150,000. The sale is to be awarded via a bid process on June 17 in the U.S. Courthouse for the Middle District of Florida in Jacksonville.

"We're making an appeal for a white knight, if you will, to come forward and say, 'I don't want to see millions of these junk guns put back on the street. I'll pony up some money, sell off the machinery and maybe recover half of my money, and take a tax deduction for the rest."

Ruggieri and the family have set up a website, www.brandonsarms.org, which explains the case and provides a donation form.

Bryco was one of the notorious "Ring of Fire" gun makers -- a phrase that describes the physical proximity of cheap-handgun manufacturers in southern California -- and by the time Ruggieri filed suit, the bankruptcy tactic had already been used by several of these companies to avoid legal liability. In 1996, for example, Lorcin Engineering filed for bankruptcy to protect the company from at least 18 pending liability suits, and in 1999, Davis Industries took the same escape route to deal with liability suits as well as the new municipal suits that had named it as a defendant.

Just as egregious, in the eyes of the gun makers' critics, was the fact that these companies often reconstitute themselves under different names, and the operations that produced the cheap handguns continue production much as before. Lorcin, for instance, became Standard Arms and Talon Industries (both of which have since gone out of business). Davis became Republic Arms, which in turn was succeeded by Utah-based Cobra Enterprises, which is still selling guns made by Davis and Republic.

The tactic had begun to attract the attention of some lawmakers, and in 2000 U.S. Sen. Carl Levin (D-Mich.) sought to amend a bankruptcy-related bill to prohibit gun manufacturers from evading accountability for firearms death and injury by filing for bankruptcy. Senate Republicans, however, killed the measure, citing its "anti-business" intent.

In the case of Bryco, Ruggieri expects that it too could very well live on in a different guise. Jennings has asked the bankruptcy court to approve the sale of all Bryco Arms' assets (excluding its gun inventory) to his former plant manager, Paul Jiminez. Ruggieri says the proposed sales price is $150,000 and that Jiminez has already stated that he intends to continue the gun-making operation at the same Bryco site under the name, Jiminez Arms. Meanwhile, according to Ruggieri, the separate entity that actually owned and distributed the gun inventory, B.L. Jennings, Inc., would likely spring back to life under the name of Shining Star Investments, the company under which Jennings' wife, Janice, has recently obtained a federal firearms license. He believes that Jennings' next step would be to ask the court to transfer the assets of B.L. Jennings, which includes an inventory of some 22,000 handguns, to Shining Star.

Meanwhile, even if the effort is successful, the 22,000-gun inventory of B.L. Jennings, Inc., would remain in existence. Ruggieri says that he and his client plan on asking the court to have the guns destroyed. But if the court rules against that request and allows Jennings to sell off the inventory, Ruggieri says he and the boy's family will be looking for someone interested in buying the guns for purposes of melting them down.

Bryco, like other Ring of Fire manufacturers, was known for the cheapness -- in price and quality -- of its products. The Gun Control Act of 1968 banned importation of cheap guns from foreign manufacturers, so new domestic makers arose to fill a perceived market void. As gang violence mushroomed in the late 1980s and early '90s in large part due to the crack-cocaine trade, so did the sale of cheap handguns. Some of the Ring of Fire manufacturers have gone out of business because of declining sales since then, but as Sacramento emergency-room physician Dr. Garen Wintemute says, "We'll be facing the consequences of the availability of these guns for years to come." He points out, for instance, that among the top 10 firearms listed by the Bureau of Alcohol, Tobacco and Firearms in their 2000 trace report on guns used in crime, five are Ring of Fire guns. The fourth most popular gun on that list, the Raven .25-caliber semiautomatic, had not been manufactured since the Raven Arms manufacturing plant burned in 1991.

Bryco came in at numbers eight and nine on that list, with its 9-millimeter and .380-caliber semiautomatics.

According to Wintemute, who is also the director of the Violence Prevention Research Program at the University of California at Davis, the first Ring of Fire guns were mostly small-caliber guns, many of them .25-calibers, selling for as little as $70. But as time went on, they became more powerful -- the 9-millimeters and .380s -- with only a slight increase in price. No matter how powerful, they have always been "starter sets for gang bangers," he says.

"Not too long ago I was at a gun show in Florida and overheard two young men who were dressed in gang colors who were looking at some fairly expensive guns, next to which were sitting two or three Bryco 9-millimeters," Wintemute says, "and they were speaking wistfully about how their first guns had been Bryco 9-millimeters."

The toll that these guns exact in the hands of criminals is costly, but they also pose risks in the hands of non-criminals -- which was the case with the injuries suffered by Ruggieri's client. The problem with the Model 38, he says, is that its design was flawed. When the safety was in the "safe" position, it jammed -- thus preventing safe unloading. At trial, Ruggieri produced gun-industry experts who said the flaw could have been fixed, easily and inexpensively. But instead of correcting the jamming, Bryco redesigned the safety so that the only way a user could unload or check the gun was to switch it to the "fire" position, thus increasing the possibility that an inadvertent trigger pull would cause a discharge.

He says that is precisely what happened when Brandon was shot. In addition, he says, Bryco sold the chrome-plated gun with two magazines (the devices that contain the bullets and slide into the gun's handle) -- one chrome-plated and one black. The possible consequence of two different magazines is "pretty obvious," he says. If a person sees a chrome-plated gun with a chrome-plated magazine next to it, he may conclude that the gun is empty, especially since the black magazine "mimics" the look of a gun without a magazine in its handle, Ruggieri says.

He thought he had a good case. So did the jury. But Bryco -- or at least a semblance of Bryco -- may live on to produce the same cheap guns. And Ruggieri and his clients are left to pursue novel means of stopping them.

Clearly, the actions of Bryco and other such manufacturers to use bankruptcy laws to avoid legal liability and reconstitute themselves to continue making guns are legal. But the ethics of such actions may be another question. Wintemute says that he once had the chance to meet Bruce Jennings at a trade show a few years ago and he asked him that very question.

"I asked him, face to face, if he had any sense of responsibility for what he had done with his product. And his answer to me, in essence, was, 'No, of course not, because the sad fact is that poor people tend to drink too much and shoot each other.'"

The firearms industry enjoys a special exemption from the reach of the Consumer Product Safety Commission, so gun makers are answerable to no one but plaintiffs if their guns have dangerous design flaws. But as the case of Bryco and other manufacturers of cheap guns reveal, even plaintiffs who win in court may not be able to get around the bankruptcy maneuver. As Ruggieri points out, if Bryco lives on as another entity, "there's nothing to prevent them from making the same defective guns and sell them on the streets, as long as they're willing to face the consequences in civil court -- and I think that's exactly what they plan to do under a different name."

Senate Republicans, however, killed the measure, citing its "anti-business" intent.

That was a bipartisan kill something like 65-35. Lenin and Durbin got trounced there.

2 posted on 05/30/2004 2:43:56 PM PDT by Dan from Michigan ("Today we did what we had to do. They counted on America being passive. They were wrong.” - Reagan)

Cheap guns bad... Expensive guns good...

Hmmm.

Liberals with a loaded weapon = Darwin award nominee.

This is the truth about the lawyer. He is not upset that they are still working, he is upset he did not and will not get his FEES.

He is an unsecured creditor tough. He did not add value to the estate so he looses.

If the situation had been reversed, and the plaintiffs had been required to pay attorneys fees and damages, they would not have hesitated to seek ecconomic relief.

Keep this in mind. This is only about money, the constitution provides for this relief in order to prevent debtor's prisons and indentured servitude. (at least private indentuted servitude, ha ha) This is what the losser can do when looser pays.

Just love how the author throw in the "Ring of Fire" propaganda as though this is the name of the trade industry or something. I doubt that articles about Iran in this newspaper use "Axis of Evil" everytime they mention the country.

Another case of bias, that the author can't even see. I bet he would have been on of the 'moderates' in the recent Pew survey.

There is so much factually wrong and technologically ignorant in this article that it is not worth replying to.

The mere fact that this lawsuit was allowed to go to trial is a perversion of our justice system.

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