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Understanding the Importance of State Laws and the Protection of Lawful Commerce in Arms Act

Written by Orchid


August 30, 2023


State Compliance and PLCAA

In the complex landscape of firearms commerce in the United States, the interplay between Federal and State laws holds significant importance. One such instance is the Protection of Lawful Commerce in Arms Act (PLCAA), a Federal law that shields firearms industry members from certain types of liability. However, navigating the intricacies of State laws, particularly those that challenge the protections granted by the PLCAA, is crucial for businesses and individuals involved in the industry.

The State Compliance Challenge

Recent years have witnessed a surge in the enactment of State laws and regulations related to firearms. Businesses holding Federal Firearms Licenses (FFLs) must not only adhere to Federal regulations but also ensure compliance with the myriad State laws that apply to their operations. These laws encompass various aspects, such as State licensing requirements, zoning regulations, recordkeeping obligations, additional background checks, transfer paperwork, waiting periods, and prohibitions on specific firearms or accessories.

Staying informed about existing State laws is essential, but it’s equally vital to anticipate potential changes. Laws can evolve swiftly, making it imperative for industry participants to stay vigilant. Failing to monitor these developments can lead to inadvertent violations, exposing individuals and businesses to criminal prosecution, civil lawsuits, regulatory sanctions, and even the revocation of their Federal licenses.

The Role of the Protection of Lawful Commerce in Arms Act (PLCAA)

The PLCAA is a Federal law enacted to protect firearms industry members from liability for the actions of third parties using their products. In essence, it shields manufacturers and distributors from legal responsibility when their legally produced firearms are used unlawfully. This legislation was a response to a wave of lawsuits filed against industry members by plaintiffs seeking to hold them accountable for crimes committed by others using firearms.

Exceptions to PLCAA

The PLCAA, while offering protection, isn’t an absolute shield. For example, it doesn’t shield industry members from product liability claims arising from defective products.

One of the other exceptions is known as the “predicate exception,” which allows plaintiffs to bring claims if a violation of a law “applicable to the sale and marketing of firearms” is alleged. Initially, when this law was passed the general understanding was if you violate any industry specific law you’d lose that shield of protection. As time went on, plaintiffs’ attorneys came up with more creative arguments to get around that shield of protection.

State Laws Eroding PLCAA Protections

The landscape shifted significantly with the landmark Soto case in Connecticut which highlighted the concept of violating State consumer protection statutes as a means to bypass the PLCAA shield. In this case, a firearms company faced allegations of violating a State consumer protection law through its marketing practices. This legal strategy has sparked concern within the industry about potential liability exposure arising from marketing practices that might be deemed in violation of State laws.

Additionally, recent developments show an emerging trend in which certain States are enacting “Firearms Industry Responsibility Acts” or “Firearms Industry Code of Conduct” laws. These laws, deliberately vague in nature, are specifically drafted to target industry members for various otherwise lawful actions and strip them of their PLCAA protections via the predicate exception.

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The Importance of Understanding State Laws

Whether you’re an over-the-counter dealer selling to nonresidents or if you’re selling online, there are going to be more and more State laws and more “creative” plaintiffs arguments to get around PLCAA. With that said, FFLs need to be aware of what is currently on the books and what changes that are coming.

Here are a few examples of State Laws to be aware of:

Non Firearm Specific State Laws
Standard State / Local Business Licensing
Unfair Trade Practices Acts
Consumer Protection Laws
Marketing Laws
Firearm Specific Laws:
Firearm Business Licensing
Product prohibitions (laws of multiple States apply)
Sales to and purchase by nonresidents (laws of multiple States apply)
Waiting periods (laws of multiple States may apply)
“Firearm Industry Responsibility Act” laws (laws of multiple States apply)

In order to be knowledgeable about industry changes, it is important to have a way to monitor those changes. It’s worth noting that some changes go into effect immediately. Here is a list of areas to monitor to stay up to date as a member of the firearms industry:

Areas to Monitor
State bills
Local / country ordinances
State referendums
State constitutional initiatives
Federal statutes
Federal regulations
State court cases
Federal court cases

In conclusion, the complexities of State laws in the firearms industry underscore the importance of maintaining a deep understanding of legal requirements at both the Federal and State levels. As laws evolve and strategies shift, industry participants must remain vigilant to ensure their operations adhere to all relevant regulations while safeguarding their protections under the PLCAA.

To learn more about PLCAA visit https://www.congress.gov/bill/109th-congress/senate-bill/397/text

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