Injured Remington Gun Owners Control Key Panel in Bankruptcy

(Bloomberg) -- Remington Outdoor Co.’s newly named panel of unsecured creditors is dominated by members who represent accidental shooting victims, according to court papers filed by the bankrupt arms maker.

The five-member committee includes two women whose daughters were shot while on separate family hunting trips, allegedly because of faulty triggers on Remington rifles. Both have sued Remington. A third seat went to the Lanier Law Firm, which has represented people who assert Remington’s Model 700 rifles can fire accidentally, according to documents filed Monday.

Representatives for Remington, based in Madison, North Carolina, didn’t respond to a request for comment. The company has denied liability for the two suits, but did issue a recall for some of its rifles, which it has said could unintentionally discharge. Representatives for Remington’s private equity owner, New York-based Cerberus Capital Management, didn’t respond to a request for comment.

Remington, whose heavy debts drove it to seek Chapter 11 court protection last month, faces lawsuits alleging that its guns go off without the trigger being pulled. Those claims gave the plaintiffs standing to get on the committee. While unsecured creditors often get just pennies on the dollar, the reorganization plan calls for them to get 100 percent of their $163 million in claims against Remington, and have the lawsuits survive the bankruptcy.

Hunting Trips

One of the committee members is Michelle Lefebre of Michigan, whose 12-year-old daughter Shellsea was shot and killed during a 2014 hunting trip. Lefebre sued Remington for $5 million in September, alleging the Model 700’s safety lever caught on a phone charger cord in the father’s vehicle and likely moved into the "fire" position. The weapon then discharged, striking the girl in the jaw.

Remington sought to dismiss the suit, saying it was immune under a federal statute that shields firearms companies when weapons are used unlawfully. It said Lefebre’s father had violated local law by transporting a loaded rifle in his vehicle. The suit was put on hold due to the bankruptcy.

Another is Joy Seguin, whose daughter Precious was shot on a Louisiana hunting trip in 2013 with her father. According to the Seguin’s 2014 lawsuit, James Seguin had been carrying his Remington Model 710 rifle with the muzzle pointed upward, and when he was struck by a low hanging branch, the safety moved to fire and discharged, shattering Precious’ hip and pelvis. She survived, but was left in pain and with ongoing medical issues, according to the lawsuit.

Court Award

The Seguins won a $500,000 award, and Remington appealed in June. It had argued in the case that a local law called the "Louisiana Products Liability Act" protected it from the lawsuit.

Lefebre’s lawyer, Leonard Siudara, said he was thrilled to see his client join the creditors committee, saying he hoped it would allow the lawsuit to continue. Seguin’s lawyer declined to comment.

The Lanier Law Firm represents plaintiffs caught up in a controversy over whether a class settlement related to misfiring triggers should be approved. Several state attorneys general oppose a settlement, saying the plan doesn’t adequately inform class members about the defect or the risks of continuing to use the weapons.

The firm’s founder, W. Mark Lanier, said in an emailed statement that he hopes Remington’s reorganization is quickly approved, "and that the gun owners get their guns fixed and the creditors all get their money owed.”

More Members

Other creditors on the panel include Art Guild Inc. of West Deptford, N.J., which created a traveling exhibit of Remington’s historic weapons, and the federal Pension Benefit Guaranty Corp., which insures the old-style, company-funded retirement plans.

Remington’s restructuring plan says it has claims it considers "disputed" about product liability, and that it may "incur significant costs" because there are efforts to expand liability against firearms and ammunition makers. When outlining risks associated with its future reorganized business, it said it may not have enough resources to cover current and future claims.

The case is Remington Outdoor Company Inc., 18-10684, U.S. Bankruptcy Court, District of Delaware (Delaware.)

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