Smith & Wesson lawsuit overview:
- Who: A group of Catholic nun congregations have filed a derivative lawsuit against Smith & Wesson’s board of directors and senior management team.
- Why: The sisters argue the Smith & Wesson board members and senior executives allowed the company to be exposed to “significant” liability with the way it has handled its manufacturing, marketing and sale of AR-15 rifles used in mass shootings.
- Where: The lawsuit was filed in the District Court for Clark County, Nevada.
Smith & Wesson’s board members and senior executives have breached their fiduciary duty to investors by allowing the company to be exposed to “significant” liability with its manufacturing, marketing and sale of AR-15 rifles used in mass shootings, a group of Catholic nuns allege.
The congregations claim Smith & Wesson’s board members are unwilling to exercise “any oversight whatsoever” in connection with its manufacturing, marketing and sale of AR-15 rifles, which they argue prevents it from being protected under the Protection of Lawful Commerce in Arms Act.
“This suit seeks to hold Smith & Wesson’s Board members (among other fiduciaries) accountable for their failure to protect the Company’s interests,” the Smith & Wesson lawsuit states.
The congregations are the Adrian Dominican Sisters, Sisters of Bon Secours USA, Sisters of St. Francis of Philadelphia and Sisters of the Holy Names of Jesus and Mary, U.S.-Ontario Province.
Board, execs failed to act in response to being known as supplier of mass shooters’ ‘weapon of choice,’ nuns say
The nuns argue Smith & Wesson board members and executives have failed to act in response to being known as a “primary supplier” of the “weapon of choice” for “numerous mass murderers” and to numerous complaints revolving around the use of AR-15 rifles to perpetrate mass shootings.
The Smith & Wesson board members and executives are also accused of failing to respond to state and local laws banning the sale and/or possession of AR-15 rifles along with government investigations regarding the company’s manufacturing, marketing and sale of the weapons.
“The Individual Defendants continue to place their own personal interests, greed, biases, beliefs, and political concerns above the interests of the Company and its stockholders,” the Smith & Wesson lawsuit states.
The nuns are demanding a jury trial and requesting Smith & Wesson be awarded restitution from the individual defendants, and for the company to be directed to “take all necessary actions to reform and improve its compliance procedures and governance policies to comply with applicable laws.”
The nuns also want Smith & Wesson to be directed to protect itself and its stockholders from “a repeat of the damaging events” described in the complaint.
In other gun-related news, the Supreme Court agreed last month to hear a case from the federal government that is out to determine whether the U.S. Bureau of Alcohol, Tobacco, Firearms and Explosives is able to ban bump stocks.
Do you believe Smith & Wesson has breached its fiduciary duty to its investors? Let us know in the comments.
The plaintiffs are represented by Jeffrey M. Norton and Benjamin D. Baker of Newman Ferrara LLP and Matthew L. Sharp.
The Smith & Wesson lawsuit is Adrian Dominican Sisters, et al. v. Mark P. Smith, et al., Case No. A-23-882774-B, in the District Court for Clark County, Nevada.
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