At issue in Smith & Wesson Corp. et al. & United States of America v. City of Gary, Indiana by its mayor, Rudy Clay, 45A05-0612-CV-754, was whether the PLCAA, 15 U.S.C. 7901-7903, barred Gary's nuisance claims against the manufacturers.
Gary had filed a suit against handgun manufacturers, one wholesaler, and retailers alleging the defendants knowingly sold guns to illegal buyers through intermediaries in "straw purchases," which is selling a gun knowing that the buyer will give the gun to someone who is not legally allowed to purchase one.
Gary first brought the suit in September 1999, and the Indiana Supreme Court held the city could proceed on its negligence and negligent design claims and reversed the trial court's dismissal of the city's public nuisance charge against the manufacturers, determining manufacturers should be included in the claim.
In 2005, Congress passed the PLCAA, which was created to protect handgun manufacturers, distributors, dealers, and importers from lawsuits because of handgun misuse or criminal activity. PLCAA included a "predicate exception," that said a "qualified civil liability action" would not include "any action in which a manufacturer or seller of a qualified product knowingly violated a State or Federal Statue applicable to the sale or marketing of the product ... ." 15 U.S.C. 7903(5)(A)(iii).
The manufacturers moved to dismiss the city's complaint, citing PLCAA. The trial court denied the motion because it found PLCAA to be unconstitutional and implied the act was applicable to the city's claims. The manufacturers appealed, arguing the predicate exception doesn't apply to the city's public nuisance claim.
The Court of Appeals determined Indiana's public nuisance statute, as applied by the Indiana Supreme Court to the alleged conduct of the manufacturers, is applicable to the sale or marketing of firearms for purposes of the PLCAA. Judge John Sharpnack wrote in the opinion the word "applicable" is unambiguous in the predicate exception and on the face of the language, Indiana's public nuisance statute appears applicable.
PLCAA was designed to protect manufacturers engaged in lawful sales of handguns, but the city alleges the manufactures were knowingly participating in unlawful sales of handguns to illegal buyers, so the predicate exception would not apply, wrote Judge Sharpnack.