Another gambit by the anti-gun crowd. These nuns bought some shares of S&W and Ruger too
Activist Nuns, With Stake in Smith & Wesson, Sue Gun Maker Over AR-15 Rifles
Groups argue the company’s leaders put shareholders at risk by making a popular gun often used in mass shootings
A group of activist nuns filed an unusual shareholder lawsuit to pressure gun maker Smith & Wesson to drastically change the way it markets, makes and sells its popular version of the AR-15 rifle.
The so-called shareholder derivative action, which the nuns filed in Nevada state court Tuesday against publicly traded Smith & Wesson, alleges that company leaders are putting shareholders at risk. They argue the leaders are exposing the company to liability by the way they have made and sold the rifle, which has been used in several mass shootings in recent years.
Smith & Wesson didn’t immediately respond to a request for comment about the suit.
This type of lawsuit is brought by a group of shareholders against the company’s leadership claiming they have breached their duties. Such suits are common with publicly traded corporations, but lawyers said it appeared to be the first time one has been brought against gun makers over the manufacture and marketing of guns.
The legal action by the nuns, who aren’t major shareholders and collectively own about 1,000 shares of the company, comes amid a flurry of lawsuits against gun companies that were spurred by a $73 million settlement between the families of those killed in the Sandy Hook Elementary School massacre and Remington in a suit over its marketing practices.
Though the 1,000 shares is a small portion of Smith & Wesson shares, it allows the group to raise governance questions as shareholders.
Lawrence Keane, senior vice president and general counsel for the National Shooting Sports Foundation, which represents gun makers, called the lawsuit frivolous.
“This same group has been filing shareholder proposals and losing so I guess they’re trying a new tactic,” Keane said.
Jeffrey Norton, a partner with the New York law firm of Newman Ferrara and the lead attorney for the nuns on the case, said that the approach has worked in other industries.
“The theory we are pursuing has been successful in a lot of different situations, but it’s novel in pursuing it with the gun industry,” Norton said.
Joe Kavan, a lawyer who represents firearms companies, said it was an unusual legal tactic and the case will be watched closely.
“It will get a great deal of publicity initially and if they get an activist judge it may survive summary judgment,” said Kavan. “But with most judges I can’t see how it will survive. It’s just too speculative.”
The nun groups—the Adrian Dominican Sisters in Adrian, Mich.; the Sisters of Bon Secours USA, based in Marriottsville, Md.; the Sisters of St. Francis of Philadelphia, based in Aston, Pa.; and the Sisters of the Holy Names of Jesus & Mary, U.S.-Ontario Province, based in Marylhurst, Ore.—filed the 47-page suit in Clark County District Court in Las Vegas.
The gun company’s marketing practices “played a significant role in contributing to many of the most heinous gun crimes in United States history” by promoting its guns in ads mimicking first-person shooter games “appealing to young, and predominantly male consumers of such games,” the suit says.
The nuns are calling on the company to adopt a new marketing approach to limit the gun’s appeal to younger men, including teenagers, or disturbed people.
“We’re trying to get it out of the hands of troubled people,” Norton said. The nuns also called for stricter safety standards for how the gun is manufactured, so that gun owners can’t easily adapt the semiautomatic rifle so that it mimics a machine gun.
The AR-15 rifle first was developed for the military in the 1950s, and a version of the rifle, capable of automatic and semiautomatic fire, was adopted by the U.S. military in the 1960s and named the M16. A civilian, semiautomatic version of the AR-15 today has become the most popular rifle in America. Civilians today own more than 20 million, according to industry estimates.
Smith & Wesson first started selling its version of the rifle called the M&P 15 in 2006 and was a major producer of an AR-15 rifle by 2020, according to the suit. The company made more than $695 million in revenue from the sale of AR-15s from 2012 to 2021, according to the suit.
Smith & Wesson faces other lawsuits regarding mass shootings and gun violence, including a 2022 suit by a resident of Highland Park, Ill. Backed by gun-control groups, the resident filed a lawsuit against Smith & Wesson and others over the July 4, 2022 parade shooting, in which one person using a Smith & Wesson AR-15 killed seven people and injured dozens more.
Part of the nuns legal challenge: In 2005, a Republican-led Congress passed the Protection of Lawful Commerce in Arms Act, which protects gun makers from liability if their products are used in criminal acts. Mass shootings in recent years have sparked renewed efforts by gun-control groups to find different ways to sue gun manufacturers. Attorneys for the Sandy Hook families gained traction with a legal theory that gun makers could be held liable for negligent marketing.
The Connecticut Supreme Court ruled in 2019 that Remington could be held legally responsible for “immoral and unscrupulous” advertising under state law, paving the way for the large settlement.
The nun groups have held Smith & Wesson shares for years and have previously pressed shareholder resolutions, such as asking the company to set up a human-rights policy. By owning shares, the groups have been allowed to make the proposals at shareholder meetings. Many of the resolutions haven’t passed, and the board hasn’t taken up their proposals.