WASHINGTON – Sens. Carl Levin, D-Mich., and Dick Durbin, D-Ill., introduced an amendment today which would close a loophole in the bankruptcy code which currently enables firearm manufacturers and distributors to escape accountability for damages caused by negligent or reckless actions by filing for Chapter 11 bankruptcy.

“Week after week, thousands of Americans are killed or injured to the senselessness of gun violence, yet when the carnage results from negligence by the firearm manufacturer or distributor, the perpetrators are seeking to avoid financial responsibility by filing Chapter 11,” Levin said.

“American consumers who incur debts because of fraudulent conduct can't walk away from those debts when they file for bankruptcy,” Durbin said. “The gun industry shouldn't be any different. Our legislation says if a gun manufacturer engages in reckless and fraudulent conduct while flooding the market with its deadly products, that company must be held accountable.”

Cities and their residents have filed dozens of lawsuits against gun manufacturers and distributors to recover damages resulting from unsafe and poorly designed weapons and from gun dealers granting unauthorized users access to the deadly products. Currently, the bankruptcy code enables perpetrators to avoid liability from these legitimate claims by filing for Chapter 11 reorganization.

This loophole has protected several major gun manufacturers from financial responsibility, including Lorcin Engineering Co., one of the chief manufacturers of “Saturday Night Specials.” In 1996, Lorcin filed for Chapter 11 bankruptcy to evade responsibility from several product liability lawsuits, and, at the time, Lorcin told the publication Firearms Business that it was choosing to “take advantage of the system.” Subsequently, Lorcin’s cheap semiautomatic pistol became number two on the list of guns traced to crime scenes by the Bureau of Alcohol, Tobacco and Firearms, yet Lorcin was able to evade financial accountability because of its bankruptcy tactic.

The Levin/Durbin amendment has been endorsed by the National League of Cities, the U.S. Conference of Mayors, Handgun Control, Inc., and the Violence Policy Center.