Over a period of three days in late April, multiple state governors signed new legislation into law establishing ‘reasonable controls’ for firearm industry members and removing protections against civil liability. Passed by legislatures in Colorado, Hawaii and Washington, the three states are the latest to join others across the country in enacting bills targeting FFLs and undermining the Protection of Lawful Commerce in Arms Act (PLCCA).

Below is a summary of the recently signed bills:

‘Reasonable Controls’ Bills

Colorado SB 168

Effective October 1, 2023, Colorado Senate Bill 23-168 will require industry members in the state to establish and implement reasonable controls and precautions related to the industry product in its control.

The law defines the following:

• Industry Member: “A person, firm, corporation, or any other entity engaged in the manufacture, distribution, importation, marketing, or wholesale or retail sale of a firearm industry product.”
• Industry Product: “(a) A firearm, (b) ammunition; (c) a completed or unfinished frame or receiver; (d) a firearm component or magazine; (e) a device marketed or sold to the public that is designed or adapted to be inserted into, affixed onto, or used in conjunction with a firearm, if the device is (1) reasonably designed or intended to be used to increase a firearm’s rate of fire, concealability, magazine capacity, or destructive capacity, or (2) reasonably designed or intended to increase the firearm’s stability and handling when the firearm is repeatedly fired; (f) any machine or device that is marketed or sold to the public, or reasonably designed or intended to be used to manufacture or produce a firearm or any other firearm industry product.”

The law also establishes firearm industry standards of responsible conduct, applying to any industry member who:

• Engages in the business of industry products that are or are intended to be sold, made, distributed, or marketed in this state;
• Violates the Colorado Consumer Protection Act; or
• Violates state firearm law

A cause of action is created for a person/entity that suffered harm as a result of an industry member violation of the firearm industry standards of responsible conduct. An intervening act by a third party, including unlawful misuse of an industry product, does not prevent an industry member from being liable.

Hawaii HB 426

Effective July 1, 2023, Hawaii House Bill HB 426 establishes standards of conduct for firearm industry members and authorizes the state attorney general and any person who has suffered harm because of a firearm industry member’s violation of the standards of conduct to bring a civil action.

The law defines the following:

• Firearm Industry Member: “A person, firm, corporation, company, partnership, society, joint stock company, or any other entity or association engaged in the manufacture, distribution, importation, marketing, wholesale, or retail sale of firearm-related products.”
• Firearm-Related Product: “A firearm, ammunition, a firearm precursor part, a firearm component, or a firearm accessory that: (1) is sold, made, or distributed in the state, (2) is intended to be sold or distributed in the state, or (3) is or was possessed in the state and was reasonably foreseeable that the item would be possessed in the state.”
• Reasonable Controls: “Reasonable procedures, acts, or practices that are designed, implemented, and enforced to (1) prevent the sale or distribution of a firearm-related product to a straw purchaser, a firearm trafficker, a person prohibited from possessing a firearm under federal or state law, or a person who the firearm industry member has reasonable cause to believe is at substantial risk of using a firearm-related product to harm themselves or another or of possessing or using a firearm-related product unlawfully, (2) prevent the loss or theft of a firearm-related product from the firearm industry member, and (3) ensure the firearm industry member complies with all provisions of federal or state law and does not otherwise promote the unlawful manufacture, sale, possession, marketing, or use of a firearm-related product.”

Under the law, firearm industry members shall not violate new requirements of the standard of conduct by:

• Establishing, implementing, and enforcing reasonable controls
• Taking reasonable precautions to ensure that the firearm industry member does not sell, distribute, or provide to a downstream distributor a firearm-related product that is abnormally dangerous and likely to create an unreasonable risk of harm to public health and safety in the state; or
• Not engaging in any conduct related to the sale or marketing of firearm-related products that is in violation of state firearm law

A cause of action is created for a person that suffered harm in the state because of a firearm industry member’s violation. The state attorney general or any county attorney or public prosecutor may also bring a civil action in in the name of the people of the state to enforce the law and remedy harm caused by a violation.

Washington SB 5078

Effective July 23, 2023, Washington Senate Bill 5078 establishes duties of firearm industry members to adopt and implement reasonable controls to prevent the diversion of firearms and related products to straw purchasers, firearm traffickers, unauthorized individuals, and individuals who pose a risk to themselves or others, to prohibit such firearm industry members from creating or maintaining a public nuisance, and providing for investigation and enforcement by the attorney general.

The law defines the following:

• Firearm Industry Member: “A person, firm, corporation, company, partnership, society, joint stock company, municipality or other political subdivision of the state, or any other entity or association engaged in the wholesale or retail sale, manufacturing, distribution, importing, or marketing of a firearm industry product, or any officer or agent to act on behalf of such a person or who acts in active concert or participation with such a person.”
• Firearm Industry Product: “A firearm; ammunition; a component part of a firearm or ammunition, including a completed or unfinished frame or receiver; an accessory or device that is designed or adapted to be inserted into, affixed onto, or used in conjunction with a firearm; or a machine or device that is marketed or sold to the public that is designed, intended, or able to be used to manufacture or produce a firearm or any other product that (1) was or intended to be sold, made, distributed, or marketed in the state; or (2) was used or possessed in the state, and was reasonably foreseeable that the product would be used or possessed in the state.”
• Reasonable Controls: “Reasonable procedures, safeguards, and business practices, including but not limited to screening, security, and inventory practices, that are designed and implemented to (1) prevent the sale or distribution of a firearm industry product to a straw purchaser, a firearm trafficker, a person prohibited from possessing a firearm under state or federal law, or a  person who the firearm industry member has reasonable cause to  believe is at substantial risk of using a firearm industry product to harm themselves or unlawfully harm another, or of unlawfully possessing or using a firearm industry product; (2) prevent the loss of a firearm industry product or theft of a firearm industry product from a firearm industry member; and (3) ensure that the firearm industry member complies with all provisions of state and federal law and does not otherwise promote the unlawful sale, manufacture, distribution, importing, possession, marketing, or use of a firearm industry product.”

Among the identified reasonable controls, industry members shall not manufacture, distribute, import, market, offer for wholesale, or offer for retail sale a firearm industry product that is:

• Designed, sold, or marketed in a manner that foreseeably promotes conversion of legal firearm industry products into illegal firearm industry products; or
• Designed, sold, or marketed in a manner that is targeted at minors or individuals who are legally prohibited from purchasing or possessing firearms.

A firearm industry member’s conduct in violation of any provision of the law constitutes a proximate cause of the public nuisance if the harm is a reasonably foreseeable effect of the conduct, notwithstanding any intervening actions, including but not limited to criminal actions by third parties.

Stay State Compliant

State and local firearm laws – like those signed in Colorado – often change more frequently than Federal regulations, putting an increased burden on FFLs to abide by state restrictions, avoid revocation, and guard against legal liability. But when armed with Orchid eState™, staying up to date with the latest firearm restrictions in your state and across the country is easy!

Whether integrated into your ecommerce webstore or used as a standalone tool, Orchid eState™ enables FFLs to monitor and check transactions against state and local-level firearm laws by customer ZIP code, product characteristics, and item UPC to prevent illegal shipments and sales, both in-store and online. Plus, non-firearm laws, like purchase age and waiting periods, are also tracked for complete transparency and compliance to better protect your FFL from ATF.

To learn more about Orchid eState™, contact Orchid today for a free demo.