Camden Cty. Bd. of Chosen Freeh. v. Beretta U.S.A.

Page 245

123 F.Supp.2d 245

CAMDEN COUNTY BOARD OF CHOSEN FREEHOLDERS, Plaintiff, v. BERETTA U.S.A. CORP., et al., Defendants.

No. CIV. A. 99-2518 JBS.

United States District Court, D. New Jersey.

December 5, 2000.

COPYRIGHT MATERIAL OMITTED

Lisa J. Rodriguez, Kenneth I. Trujillo, Ira Neill Richards, Louis C. Ricciardi Trujillo Rodriguez & Richards LLC, Haddonfield, NJ, John A. Misci, Jr., City Attorney, Camden, NJ, Steven E. Fineman, Robert J. Nelson, Jonathan D. Selbin, Lieff Cabraser Heinmann & Bernstein LLP, New York, NY, Richard S. Lewis, Joseph M. Sellers, Ari Karen, Michelle A. Exline, Cohen Milstein Hausfeld & Toll PLLC, Washington, D.C., Jonathan Schub, Sheller Ludwig & Badey, Philadelphia, PA, Dennis A. Hennigan, Brian J. Siebel, Jonathan E. Lowy, The Center To Prevent Handgun Violence Legal Action Project, Washington, D.C., David Kairys, Kairys Rudovsky Epstein Messing & Rau, Philadelphia, PA, for Plaintiff.

John Renzulli, Anthony M. Pisciotti, Leonard Rosenbaum, Renzulli & Rutherford, Hackensack, NJ, for Defendants Arms Technology, Inc., Glock, Inc., Eagle Imports, Inc., and Import Sports, Inc.

William M. Griffin, III, Friday Eldredge & Clark, Little Rock, AR, Of Counsel, for Defendant Arms Technology, Inc.

Louis R. Moffa, Jr., Craig A. Livingston, Schnader Harrison Segal & Lewis LLP, Cherry Hill, NJ, Lawrence S. Greenwald, Gordon, Feinblatt, Rothman, Goffberger & Hollander LLC, Baltimore, MD, for Defendant Beretta U.S.A. Corp.

David R. Gross, Timothy A. Bumann, Pamela B. Betlow, Dana S. Mancuso, Budd Larner Gross Rosenbaum Greenberg & Sade PC, Short Hills, NJ, for Defendants Bryco Arms, Inc. and Taurus International Manufacturing, Inc.

James C. Sabalos, Newport Beach, CA, Of Counsel, for Defendant Bryco Arms, Inc.

Alan E. Kraus, Riker Danzig Scherer Hyland & Perretti LLP, Morristown, NJ, Robert Klonoff, Thomas E. Fennell, Jones Day Reavis & Pogue, Washington, D.C., for Defendant Colt's Manufacturing, Inc.

Timothy G. Atwood, Shelton, CT, for Defendant International Armaments Corp.

Louis Niedelman, Cooper Perskie April Niedelman Wagenheim & Levenson, Atlantic City, NJ, James R. Branit, Bullaro & Caston, Charterted, Chicago, IL, for Defendant Navegar, Inc., d/b/a Intratec USA Corp.

Joseph Tripodi, Post Polak Goodsell & MacNeil, Roseland, NJ, for Defendant Navy Arms Co., Inc.

Steven Kudatzky, Bradley T. Beckman, Beckman and Associates, Philadelphia, PA, for Defendant North American Arms, Inc.

Robert C. Tarics, Tarics & Carrington PC, Houston, TX, for Defendant Phoenix Arms.

William Krauss, Robert L. Joyce, Wilson Elser Moskowitz Edelman & Dicker, Newark, NJ, for Defendant Sigarms, Inc.

Louis John Dughi, Jr., Dughi and Hewitt, Cranford, NJ, James P. Dorr,

Anne G. Kimball, Wildman Harrold Allen & Dixon, Chicago, IL, for Defendants Smith & Wesson Corp. and Sturm, Ruger & Co., Inc.

Richard Mayberry, Mayberry & Associates, Washington, D.C., for Defendant American Shooting Sports Council, Inc.

Douglas E. Kliever, Cleary Gottlieb Steen & Hamilton, Washington, D.C., for Defendants National Shooting Sports Foundation and Sporting Arms and Ammunition Manufacturer's Institute, Inc.

OPINION

SIMANDLE, District Judge:

TABLE OF CONTENTS
  I. INTRODUCTION ...........................................................  248
 II. BACKGROUND .............................................................. 249
      A. Procedural History .................................................. 249
      B. Factual Allegations in the Second Amended Complaint ................. 250
III. DISCUSSION .............................................................. 252
      A. Motion to Dismiss Standard .........................................  252
      B. Whether New Jersey's Products Liability Act Subsumes and Requires
           Dismissal of Plaintiff's Claims ....................................... 253
      C. Constitutional Law Issues ........................................... 253
      D. Whether the Second Amended Complaint Improperly Aggregates Claims ... 255
      E. Negligence Claims: Standing and Proximate Cause ..................... 255
         1. Injury in Fact ................................................... 256
         2. Whether the County's Alleged Injuries Are Caused by or Fairly
              Attributable to the Challenged Action of the Defendants ............ 256
             a. Factor One: Causal Connection ................................ 259
             b. Factor Two: Specific Intent to Harm .......................... 259
             c. Factor Three: The Nature of the County's Injury .............. 259
             d. Factor Four: Directness/Indirectness of Injury ............... 261
             e. Factor Five: Highly Speculative Damages ...................... 263
             f. Factor Six: Avoiding Trial Complexity ........................ 263
             g. Summary of Proximate Cause ................................... 264
      F. Public Nuisance Claim ............................................... 264
         1. Whether the County Has the Power to Sue in its Public Capacity to
              Abate a Public Nuisance                                  ........... 265
         2. Whether the Plaintiff's Public Nuisance Claim Should Be Dismissed
              Because it Requests Relief That Includes Governmental Costs ........ 265
         3. Analysis                                                  ........ 266
  V. CONCLUSION .............................................................. 267

I. INTRODUCTION

In this noteworthy case, the governing body of Camden County, New Jersey (the "County" or "Camden County") has taken aim against various firearms manufacturers (collectively the "defendants"), claiming that their wrongful conduct in marketing and distributing handguns has facilitated the creation of a criminal market for handguns within County borders. As described in its detailed 40-page Second Amended Complaint, the County seeks injunctive and monetary relief in compensation for harm suffered by the County due to the defendants' allegedly reckless and negligent handgun marketing and distribution policies and practices, and due to the defendants' alleged creation of a public nuisance in Camden County that has endangered public safety, health and peace.

Several of the named manufacturing defendants¹ presently move to dismiss the County's complaint pursuant to Rule 12(b)(6), Fed.R.Civ.P., the resolution of which calls upon this Court to address several issues of first impression under the laws of this state and the Third Circuit.

The principal issues to be decided are: (1) whether Camden County's complaint in this case is sufficient to allege that the County's injuries (that is, the increased costs of governmental functions due to law enforcement related to illegal use of handguns) are caused by or fairly attributable to the alleged negligence of these manufacturers in their marketing and distribution of legal firearms; and (2) whether Camden County's complaint states a cognizable claim under New Jersey law that these manufacturers control or participate to a substantial extent in the creation of a public nuisance (that is, the criminal market for illegal handguns) within the county. This case, and therefore this Opinion, is not about conduct of local handgun distributors or local retailers who actually sell to the public, nor does Camden County allege that the manufacturers' marketing practices violate federal or state statutes. Further, the Court does not determine whether the defendants are doing all that they reasonably can or should do to diminish the risks that their handguns end up in the hands or criminals.

As discussed in detail below, the Court finds that the County lacks constitutional standing to assert its negligence claims because its injury — increased governmental costs — is too attenuated from the distribution policies of the manufacturers, and the negligence-based claims therefore fail to allege that the County's expenditures are caused by or fairly attributable to the manufacturers' negligence. Second, the Court further finds that, under New Jersey law, Camden County generally has the legal authority to seek to abate a public nuisance and to receive compensation for the remedy of a public nuisance, but that these manufacturers, who distribute lawful handguns in compliance with existing federal and state statutes, may not be held liable for creating or maintaining the public nuisance of which Camden County complains.

Having considered the parties' submissions, and having twice heard extensive oral argument on these submissions, and for reasons discussed herein, the defendants' motion to dismiss will be granted.

II. BACKGROUND

A. Procedural History

Camden County seeks compensation for its expenditures arising from handgun-related violence within its borders, and seeks to prevent such violence and expenditures from occurring in the future.² In furtherance of these aims, the County presently asserts three causes of action against 16 handgun manufacturers. These three causes of action are: (1) public nuisance; (2) negligent entrustment; and (3) negligence in marketing and distribution. These claims have been refined through a series of amendments to the pleadings.³

B. Factual Allegations in the Second Amended Complaint

In its Second Amended Complaint (SAC), plaintiff alleges that Camden County has suffered immense hardship as a direct result of the defendants' reckless and negligent misconduct in the manufacture, distribution, sale, marketing and design of their firearms. (SAC ¶ 1.) The defendants are manufacturers of handguns who are not engaged in direct sales; instead, they sell the handguns to licensed distributors, who then sell to licensed retailers, who then sell to the purchaser. None of these transactions is claimed to violate existing statutes or regulations, and the County does not contest that these sales involve lawful firearms...