Remington To Go Into Bankruptcy After Class Action Rifle Settlement

The gun manufacturer Remington intends to file for Chapter 11 bankruptcy protection, following a steep drop in sales, a recent settlement agreement reached for lawsuits over defective triggers, and ongoing litigation over the use of its weapons in mass shootings. 

On February 12, Remington Outdoor Company, Inc. filed a report (PDF) that outlines plans for comprehensive financial restructuring, announcing the pending bankruptcy. However, the company notes that it intends to continue operating.

The Remington bankruptcy announcement comes after a massive fall-off in sales, following the election of Donald Trump as president of the United States. Experts say that sales of guns in some cases have fallen as much as 90%, after being artificially inflated in recent years amid conspiracy theories that former President Barack Obama would enact laws restricting gun ownership. When that failed to happen, the theories shifted to beliefs that candidate and former Senator Hillary Clinton was actually the person who be elected and would restrict gun sales.

Since there have been no realization of gun control measures in the United States, following the election of Trump and Republican control of Congress, artificially inflated fears of gun seizures and 2nd Amendment restrictions have dissipated, leading to the collapse of gun sales nationwide.

Remington may have been particularly vulnerable, because the fall in sales came shortly after the company agreed to settle a class action lawsuit over Remington 700 and Seven series rifles, which have been found to spontaneously discharge without the trigger being pulled. The problems were blamed on manufacturing defects involving excessive bonding agent.

The settlement was reached in a federal court in Missouri in December 2015, including an agreement that Remington will retrofit an estimated 7.85 million Model 700 and Seven series rifles free of charge.

Over the past few years, Remington received reports indicating at least 24 deaths and more than 100 serious injuries may have been caused by the faulty trigger systems on Remington rifles that accidentally or spontaneously discharged.

In April 2016, a Remington rifle recall was announced for Model 700 and Model Seven rifles with X-Mark Pro (XMP) triggers. However, the recall only affected Remington 700 and Seven model rifles manufactured between May 1, 2006 and April 9, 2014.

The company also faces a number of lawsuits linked to mass shootings, such as the 2012 massacre of children and teachers at Sandy Hook Elementary in Newtown, Connecticut, focused on the design of its Bushmaster series of rifles.

Remington is currently owned by Cerberus Capital Management, which will give up ownership of the company following the restructuring, which is designed to reduce the company’s debt by $700 million.