INDUSTRY NEWS: JUNE 2002

By Robert M. Hausman

Industry Making Progress At U.N.

While the news coming from the United Nations in recent times has not been good concerning firearms ownership, an association of the world’s leading firearms companies and shooting groups is getting close to being officially recognized by the United Nations as a “non-governmental organization” (NGO). Status as an NGO would allow the association more active involvement and to be more effective in countering the global gun ban zealots at the world body.

The World Forum on the Future of Sport Shooting Activities, comprised of major European arms producers, leading American gun manufacturers, as well as organizations such as the Sporting Arms & Ammunition Manufacturers’ Institute, the National Rifle Association and foreign shooters’ organizations, are seeking NGO status to allow attendance and participation at UN firearms meetings. At a recent gathering of the UN’s NGO Committee in New York, the gun group was recommended for NGO listing. There was no dissent among the 19 countries sitting on the committee. Final approval could come this summer when the UN’s Economic and Social Council meets to consider the recommendation.

Over the last several years, the UN has become increasingly involved in issues dealing with the manufacturing, marketing, distribution and ownership of firearms. Two countries, Canada and Japan, have been leading efforts to severely curtail the legitimate international firearms trade.

U.S. Supreme Court To Hear Gun Rights Restoration Appeal

In what could be a major decision for firearms civil rights activists, the U.S. Supreme Court will decide whether federal courts can restore convicted felons’ right to possess a firearm, even though the government has stopped considering such requests. The Bush Administration is appealing a lower court ruling in favor of a licensed firearms retailer from Texas who was convicted in Mexico of unlawfully importing ammunition.

The appeals court said the man, through a “simple oversight,” failed to remove the ammunition from his vehicle before going into Mexico for dinner. U.S. federal law bars anyone convicted of a felony (meaning a serious crime) in “any court” from possessing firearms (regardless of whether or not the offense involved violence). The law allows affected persons to ask federal officials to lift the ban for their individual circumstances, and federal courts can review a denial. Since 1992, Congress has barred the Bureau of Alcohol, Tobacco & Firearms from spending money to consider restoring firearms rights on grounds it could result in a risk to public safety.

“A district court does not have authority to assume the responsibility that Congress removed from ATF,” the Justice Dept. said in court filings. The appeals court ruling “threatens to create the very dangers to public safety that Congress sought to avoid.”

Case Background

Thomas Lamar Bean attended a gun show in Laredo, Texas in 1998. One evening, he and three assistants decided to go into Mexico for dinner. He said he directed his assistants to remove all firearms and ammunition from his vehicle. Nonetheless, a box of ammunition was left in plain view. At the border, Mexican customs officers saw the box and Bean was later convicted in Mexico of a felony charge of unlawfully importing ammunition. After spending several months in a Mexican prison, he was transferred to a U.S. prison and later released.

In 1999, Bean asked ATF to restore his right to own firearms so he could resume his business. After ATF said it was barred from acting on his request, he went to a federal judge in Beaumont, Texas, who granted it. Federal courts can restore the right to possess firearms after ATF fails to act on the request, the judge said. The New Orleans-based 5th Circuit U.S. Court of Appeals agreed last June, saying it would be an “injustice” for Bean to lose his livelihood due to the conviction.

The Justice Dept.’s appeal to the Supreme Court said district courts “are no more able than ATF to protect the public from the risks” of restoring gun rights. Five other federal appeals courts have disagreed with the 5th Circuit, according to government lawyers. Bean’s lawyers argued that Congress “did not take any direct step to preclude judicial review” in such cases.

The Supreme Court will hear arguments in the term beginning next October and will likely issue a decision by June 2003. The case is U.S. v. Bean, 01-704.

The anti-gun Violence Policy Center has jumped on the case, hailing the Supreme Court’s decision to hear the case as it says it could put an end to the gun rights restoration program officially known as “relief from disability.” The group claims that research it conducted in 1991 led to the Congressional funding prohibition.

The VPC says it worked with anti-gun members of Congress to shut the program down through the appropriations process. “It was and still remains the clear, unequivocal intent of Congress that the ‘guns-for-felons’ program cease operation altogether,” said VPC spokesperson Kristen Rand. The VPC plans to submit a friend-of-the-court brief to the Supreme Court.

In its research, VPC said it investigated 100 case files obtained from ATF and issued a report, Putting Guns Into Criminals’ Hands. It claims that of those granted relief from 1985 to 1992, 69 were subsequently re-arrested for crimes that included: attempted murder, first degree sexual assault, abduction/kidnapping, child molestation, illegal possession of a machine gun, trafficking in narcotics, and illegal firearms possession or carrying. However, the VPC may have hand-picked the files it chose to review to produce a desired negative result of the program. Between 1985 and 1992, it says the relief from disability program cost taxpayers $21 million.

New Multiple-Threat Body Armor

Moving to company news, a new body armor system called Kevlar MTP (Multiple Threat Protection) providing protection against both bullets and knives has been developed by Dupont Kevlar Life Protection.

The Kevlar MTP vests are said to be much lighter, concealable and flexible than the vests made of ceramic or metallic material designed for knife protection previously. Vests using Kevlar MTP technology are expected to be the first flexible body armor system to pass both the National Institute of Justice stab (knife class) and bullet standards.

A federal lawsuit was recently filed by Second Chance Body Armor, Inc. against First Choice Armor & Equipment, Inc. of Brockton, MA. The suit alleges patent and trademark infringement, particularly regarding First Choice’s Millennium Flex 2000 vests. The suit also alleges that First Choice’s millennium Tri-Flex product infringes on Second Chance’s Tri-Flex trademark, creates market confusion between the two products and constitutes unfair competition.

Armor Holdings, Inc., has acquired substantially all of the assets of Identicator, Inc., a manufacturer and distributor of paper-based fingerprint identification products. Armor holdings paid $5.4 million, primarily in common stock by issuing 214,880 shares to the seller. Identicator had $3.2 million in revenue for the fiscal year which ended March 31, 2001 and about $2 million net cash on its balance sheet at closing.

The Identicator brand name is thought to be a good complement to Armor holdings’ existing NIK and Lightning Powder brands in the forensics product category.

SSK Industries of Wintersville, Ohio has developed a conversion of the AR-10™ Match grade rifle to operate with the highly efficient and accurate 300 Winchester Short Magnum cartridge. “After conducting comprehensive testing, we’ve conclued this combination of rifle and cartridge seem made for each other,” said J.D. Jones, SSK’s president. “Use of the 300 WSM in the AR-10™ increases velocity and energy, as well as flattening the trajectory a significant amount over the 308 Winchester cartridge. This is ‘the’ semi-auto rifle for the long-range shooter. Functioning of the Winchester ammunition in the AR-10™ is flawless and accuracy is usually under 1 MOA with factory ammunition, with some groups going one half of one MOA.”

Units for the 270 and 7mm will be developed as factory ammunition becomes available. Other calibers based on the .308 Winchester case are also available, as is the .338 Whisper®.

Doskocil Manufacturing Co., Inc., marketer of Gun Guard products and other firearms accessories, says it has reached agreement with its bondholders to significantly reduce its outstanding debt. The transaction, completed in late December, reduced the firm’s debt from $176 million to $58 million. Doskocil now operates as a private company. Doskocil’s holders of 10 1/8% notes due in 2007 voted unanimously to exchange debt for minority ownership in the company. The agreement also provided for the majority owner, Westar Capital, to make an additional investment in the company.

“We are now focused on accelerated investments in new products with more than 40 significantly redesigned or totally new products being introduced this year,” said Larry Rembold, the firm’s president and ceo.

S&W’s Sales Up

The proud old firm of Smith & Wesson is making a comeback with its new American ownership. The gunmaker has posted a whopping 77% increase in sales during its second fiscal quarter. The total S&W sales of $19.9 million during the quarter ended Oct. 31, was 77% more than the first quarter’s total of $11.2 million. Operating income came to $261,087 in the second quarter, compared to a $3.5 million loss in the first quarter.

S&W’s president, Bob Scott, said, “It is important to note our monthly sales and earnings have gone up consistently since our acquisition. As we enter our 150th year, we are confident we will see the continuation of the current positive trend in both sales of our products and corporate profitability,” Scott added. The company was acquired in May 2001 by Saf-T-Hammer Corp.

Analysts believe S&W is benefiting from a combination of the increased interest in acquiring self-defense products by the public which began last fall, and the changeover to becoming an American-owned, rather than a British-owned, company.

A spokesperson for noted gunmaker, Heckler & Koch has confirmed rumor that the German gunmaker is for sale and that negotiations with a British buyer are in the due diligence stage.

The Israeli Defense Force is testing a new military rifle that may replace the M-16. Called the Tavor, it is manufactured by TAAS-Israel Industries. The IDF is also testing the American-made M-4 rifle. If the Tavor is selected, TAAS will probably produce the arm under license in the U.S.

The Tavor is similar in design to the British Enfield FA80, with the magazine inserted behind the grip into the butt. This allows for the arm to be shorter in length, while retaining a long barrel. The Tavor is largely composed of plastic components.

Winchester Ammunition is recalling one lot of Super-X Drylock Super Steel Shotshells after discovering the shells could contain the wrong propellant. The only lot number affected is 49X3SG29. Coupons are being issued for replacement of the shells to affected purchasers.

Kimber Manufacturing unveiled a dozen new models of 1911-style pistols at the 2002 S.H.O.T. Show. These include a double stack family of 10-shot polymer frame models. Two single stack models are now available in .38 Super. A complete line of Eclipse pistols was unveiled and a Custom Shop model for Limited Ten competiton is in the works.

FBI Loses H&K Subgun

Three FBI firearms – a 10mm Heckler & Koch submachine gun, a .40 caliber Glock pistol, and a Remington 12-gauge shotgun, left in plain view in an FBI agent’s parked car in New York City, were recently stolen. The guns, along with a laptop computer, a digital camera and an FBI parking sticker, were stolen in the borough of Queens from a car parked overnight.

The unmarked FBI vehicle was vandalized after agent Jennifer Bleier parked at 121st Street and 22nd Avenue in College Point. Bleier returned to the car the next morning and found the front window broken. The shotgun and submachine gun were taken from a rack mounted on the front seat of the vehicle which was visible from the street.

The Brady Center to Prevent Gun Violence, the tax exempt arm of the former Handgun Control, Inc. group, was recently given $500,000 in gift donations. The funds came from the family of hardware businessman John Hechinger, Sr. and the late Washington Post political cartoonist Herbert Block (Herblock).

Michael Barnes, president of the Brady Center, said the Hechinger gift was intended to be used to establish and train a national network of volunteer speakers – including college students- who will “educate” their communities about the threat of gun violence and how it can be reduced through “gun safety” laws.