Lawsuit for Over-Distribution of Firearms and Flooding the Market With Guns
In Brazas Sporting Arms, Inc. v. Am. Empire Surplus Lines Ins. Co., 220 F.3d 1, 6 (1st Cir. 2000), the underlying suit charged the gun manufacturer with flooding the market with more guns than it knew would legitimately be purchased, thus creating "an unlawful national market in firearms." 220 F.3d at 3.
The policy excluded coverage for "all injuries 'arising out of' the insured's products." Id. at 6.
The court found two interdependent causes of the plaintiffs' injuries: "Brazas's alleged misconduct is the over-distribution of firearms and the proximate cause of the plaintiffs' injuries are firearms . . . ." Id. at 8.
The court concluded that the suits "concern off-premises conduct arising out of (not merely incidentally related to) firearms products," and held that the exclusion applied. Id. at 8-9.