The “Protection of Lawful Commerce in Arms Act” was passed in 2005, and generally shields FFL manufacturers, dealers, and sellers of firearms or ammunition from civil liability with six exceptions.  The Act does not bar all lawsuits against FFL manufacturers.  The six exceptions are a powerful reminder that if you do not have a robust compliance program, you could be opening your company not only to loss of your license but also to civil liability. First, where do you find this law?  The Protection of Lawful Commerce in Arms Act is found at 15 U.S.C. §§7901-7903. (Public Law 109-92).  We’ve made your work one step easier by uploading a copy of it to the Orchid Advisors research library. The basic premise of the Act is to insulate manufacturers (among others) from civil lawsuits based on events involving a firearm “resulting from the criminal or unlawful misuse of a qualified product by the person or a third party.”  To raise the Act as a defense, one must first be a federal firearms licensee (FFL), engaged in lawful activity. There are six exceptions to this liability defense through which the plaintiff may continue to pursue a civil proceeding against a manufacturer, summarized as follows: 1. the FFL is convicted under 18 U.S.C. 923(h), which makes it unlawful for anyone to knowingly transfer a firearm to someone who will use that firearm in a crime of violence or drug trafficking; 2. the lawsuit claims negligent entrustment or negligence per se; 3. the FFL violated a federal or state law relating to the sale or marketing of the product, and that violation was a proximate case of the damages; 4. the lawsuit claims breach of contract or warranty in connection with the purchase of the product; 5. the damages resulted from a product defect, where the product was used as intended or in a reasonably foreseeable manner, unless the use was in an act that constituted a criminal offense; or, 6. the action or proceeding is brought by the Attorney General to enforce the Gun Control Act or the National Firearms Act against an FFL. In particular, attention should be paid to the third item on this list.  The language of the statute relates to “sales” and “marketing,” but, be aware that this provision includes the making of a false entry or failure to make a required entry in any records required by federal and state law.  Here, we’re particularly zeroing in on your book of acquisitions and dispositions, required to be kept for every firearms transfer, in accordance with detailed federal laws, regulations, and ATF Rulings. In a 2012 ruling from an appellate division in New York, a lawsuit was permitted to proceed where the allegations involved the sale of a pistol from an FFL in one state to a buyer who was an out-of-state resident.  The buyer may have been a straw purchaser – but this issue was secondary.  The winning argument by the plaintiff was that the FFL allowed the buyer to take delivery of the firearm at the show, instead of shipping the firearm to an FFL in the buyer’s home state, where the out-of-state FFL would have been responsible for, among other things, running an NICS check on the buyer before permitting the buyer to take delivery of the firearm.  The 2012 opinion and order and the 2013 amendment order in Williams vs. Beemiller, Inc. et al., is readily available for your reading in the Orchid Advisors on-line research library under New York reference materials.