"The legal fees alone are enough to bankrupt the industry."
-John Coale, one of the private lawyers suing gunmakers on behalf of municipalities, as quoted in The Washington Post after the March 17 settlement in which Smith & Wesson agreed to adopt various safety measures that have stalled in Congress.
In its March 21 ruling that the Clinton Administration lacked authority to regulate the tobacco industry, no matter how great the need for regulation, the Supreme Court reaffirmed the broad principle that the power to set national policy on such hotly contested issues belongs to Congress. But the Justices have taken little note of other bold efforts to bypass Congress-and short-circuit the judicial process to boot-by using the threat of ruinous litigation to impose de facto regulation and taxation on targeted industries, including guns and tobacco. As The Wall Street Journal observed, the gun lawsuits could bring about "a more sweeping round of gun regulation than any single piece of legislation in 30 years."
And the far larger tobacco companies, which seem to have been sued by almost everyone alive, could be bankrupted by litigation, including a pending class action by smokers in Florida and a Clinton Administration lawsuit that invokes far-fetched legal theories to seek many billions of dollars to compensate the government for the cost of treating smokers covered by Medicare. Also in the dock are HMOs, companies that sold lead paint more than 40 years ago, and makers of latex gloves. Later may come purveyors of liquor, beer, fatty foods, and, someday, maybe even fast cars and violent videos.
(For a fuller taste of these and other peculiar workings of our legal system, with copious links to news reports, check out an amusingly depressing Web site called Overlawyered.com, created and edited by Walter K. Olson of the conservative-libertarian Manhattan Institute.)
The alliance of would-be lawmakers behind many of these broad legal assaults includes the Clinton Administration, state attorneys general, and municipalities, working closely with public interest activists and wealthy private lawyers who started it all. Their incentives to sue variously include hopes of raising vast new revenues, bringing unpopular industries to heel, protecting public health and safety, and reaping billions of dollars in fees for the lawyers, who also tend to be big campaign contributors.
This public-private alliance’s most recent triumph illustrates the combination of policy-making ambitions and financial incentives that drives such litigation. The triumph was the March 17 decision by British-owned Smith & Wesson, the nation’s largest maker of handguns, to abide by a long list of restrictions on gun sales demanded by the Clinton Administration. Smith & Wesson entered the agreement to extricate itself from some or all of the lawsuits against the industry by 29 cities, counties, and other plaintiffs.
The gun lawsuits were bankrolled by contingent-fee lawyers who are also prominent in the more-lucrative tobacco wars and have lots of money to invest in multifront attacks on other industries. They recruited municipalities as clients by dangling the prospect of imposing previously unimagined liability on gunmakers for selling unnecessarily dangerous guns, and selling them to the wrong people, thus allegedly contributing to governmental costs associated with murders, accidental shootings, and other gun violence. Every shooting by a spouse, a child, an armed robber, or a drug dealer is at least theoretically a potential source of liability to the gunmakers. Seizing on the fact that many such shootings occur in federally subsidized housing projects, President Clinton and Housing and Urban Development Secretary Andrew Cuomo jumped in by pressing the gun companies to accept new restrictions or face "death by a thousand cuts," as Cuomo put it.
The plaintiffs have never had to prove their flimsy theories of liability in court. Indeed, judges have dismissed some of the lawsuits. But in this era of astronomical jury awards, a few losses could bankrupt the gun companies even if they win most of their cases. And the legal fees alone are potentially crushing, given the plaintiffs’ strategy of deploying massive firepower on multiple fronts, the better to force the companies to settle.
This strategy forced Smith & Wesson to raise the white flag. The restrictions drafted by Administration officials and agreed to by the company require it to develop "smart gun" technology within three years, so that only authorized users can fire new handguns; to limit bulk purchases; to bar dealers from selling at gun shows unless the buyers have passed background checks; to include trigger locks with all new handguns (which Smith & Wesson was already doing); and more. Others may be driven to make similar concessions.
If the plaintiffs’ divide-and-conquer strategy forces the rest of the industry to fall into line, the effect would be the de facto imposition of new, nationwide gun-control rules much like those that President Clinton has urged but that Congress has refused to pass. This is reminiscent of the far richer tobacco industry’s $246 billion in settlements with state attorneys general in 1998: The intent, and effect, was to finance the payments (and the billions in legal fees) by sharply raising cigarette prices, in what was the functional equivalent of a new nationwide tax on smokers-a tax that neither Congress nor state legislatures had voted to impose.
Will restrictions like those in the Smith & Wesson settlement reduce the number of shooting deaths? There’s great dispute about that. Even some advocates of more-radical controls such as banning all handguns worry that "smart gun" technology might increase total gun deaths by stimulating the sale of tens of millions more guns to people who mistakenly think them safe. The National Rifle Association and other, more scholarly opponents of the new gun controls sought by the Administration argue that they would not have prevented the rash of highly publicized shootings since the Littleton, Colo., massacre last year, and that "smart guns" might fail when most needed for legitimate self-defense.
I suspect that restrictions such as those agreed to by Smith & Wesson would save some lives, and so I would like to see Congress pass most, or all, of the Administration’s proposals. But with scholarly experts, detailed empirical studies, and millions of people on all sides of the issue, I can’t be sure.
One thing I am sure of is that the Framers of the Constitution created Congress-and assigned to it "all legislative powers herein granted"-to set policy for the nation on such complex questions of social engineering. They also made it hard to enact legislation unless backed by a fairly broad national consensus. That’s a far cry from what’s going on now, with the Clinton Administration and its allies boasting of using lawsuits to bypass partisan gridlock in Congress.
Do the ends justify the means? After all, these lawsuits represent just the latest in a succession of mushrooming theories of liability, expansive constitutional doctrines, and other trends that have led to deep intrusions by the judicial and executive branches into what was once the province of Congress. Why stop now, when so much needs to be done, and Congress is so unhelpful?
But the gun litigation represents a deeply disturbing way of making public policy. It was started by private lawyers and municipalities with big financial interests at stake. The courts have largely been bystanders as the Clinton Administration and its allies have sought to bludgeon gunmakers into settling before trial. And in the words of Robert B. Reich, Clinton’s former Labor Secretary, in The American Prospect: "If I had my way, there’d be laws restricting cigarettes and handguns. [But] the White House is launching lawsuits to succeed where legislation failed. The strategy may work, but at the cost of making our frail democracy even weaker…. You might approve the outcomes in these two cases, but they establish a precedent for other cases you might find wildly unjust."
After the Supreme Court’s 5-4 ruling that the federal Food and Drug Administration lacks the power to regulate tobacco without new legislation, President Clinton appropriately stressed that the Justices had been unanimous in asserting that "tobacco use…poses perhaps the single most significant threat to public health in the United States." He also called on Congress to pass a new law incorporating the now-voided FDA rule. Senate Majority Leader Trent Lott, R-Miss., immediately announced his opposition. It will be a bitter election-year struggle, with all players attending closely to how the voters will react to whatever they do.
That’s called democracy. It’s not always the quickest or easiest way to get things done. But it’s the best way.