The exception for state law requires the defendant be convicted of violating the state law. Here is the exclusion in the new law that the judge probably based his decision on:
(A) IN GENERAL- The term `qualified civil liability action' means a civil action or proceeding or an administrative proceeding brought by any person against a manufacturer or seller of a qualified product, or a trade association, for damages, punitive damages, injunctive or declaratory relief, abatement, restitution, fines, or penalties, or other relief, resulting from the criminal or unlawful misuse of a qualified product by the person or a third party, but shall not include--
(iii) an action in which a manufacturer or seller of a qualified product knowingly violated a State or Federal statute applicable to the sale or marketing of the product, and the violation was a proximate cause of the harm for which relief is sought, including--
(I) any case in which the manufacturer or seller knowingly made any false entry in, or failed to make appropriate entry in, any record required to be kept under Federal or State law with respect to the qualified product, or aided, abetted, or conspired with any person in making any false or fictitious oral or written statement with respect to any fact material to the lawfulness of the sale or other disposition of a qualified product; or
(II) any case in which the manufacturer or seller aided, abetted, or conspired with any other person to sell or otherwise dispose of a qualified product, knowing, or having reasonable cause to believe, that the actual buyer of the qualified product was prohibited from possessing or receiving a firearm or ammunition under subsection (g) or (n) of section 922 of title 18, United States Code;
So all the plaintiffs have to do is claim they can prove the manufacturer aided, abetted or conspired with someone to transfer a firearm to a prohibited person. Then the judge can allow the suit to continue and further bleed the resources of manufacturers. It doesn't matter to the plaintiffs if they lose the case, it's how long can we keep them in court before we lose or can we get the defendant to settle as did Smith & Wesson.
It looks to me like the new law has a gaping loophole.