Newtown Shooting: Bushmaster Under Fire

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Stutts said the company's brand is at risk, and to counter that, "they should be talking loudly about how mentally ill people shouldn't be using or purchasing their firearms. And they should be reminding people that Adam Lanza did not purchase their firearms."

If history is any guide, the public relations challenge that Bushmaster now faces may be matched by potential legal challenges.

After police determined that the Washington, D.C. Beltway snipers killed their randomly chosen targets with a Bushmaster rifle, the company faced a lawsuit from victims of the attacks and from the Brady Campaign to End Gun Violence. The lawsuit, which also named the Tacoma, Washington gun shop where under-aged sniper Lee Malvo managed to walk out the door with a weapon, yielded one of the largest settlements in a gun case to date -- $2.5 million, with Bushmaster's insurance company paying $500,000 to settle the company's share of the suit. Bushmaster did not admit fault and said they settled to combat rising legal fees.

Since that time, Congress passed legislation to help to shield firearms manufacturers and dealers from liability lawsuits. President George W. Bush signed it into law in 2005. But attorneys involved in the first case against Bushmaster told ABC News that manufacturers are still vulnerable if they go too far in building a weapon that appears to be designed for mass killing.

"We certainly will look to see where the gun industry is facilitating these crimes," said Jonathan E. Lowy, director of the Brady Campaign's Legal Action Project. "We look at that and try to hold them accountable when they are profiting off the criminal market."

In the case of the Connecticut shooting, Lowy said it was too soon to say whether Bushmaster will face legal action. "We'll wait and see where the facts will lead us," he said.

Bushmaster's parent company, Freedom Group, says on its website that it will "only act within the law" and "will not compromise our moral or ethical principles." In its filings with the Securities and Exchange Commission, the company notes that both lawsuits and increased regulation are a risk in the gun business. "In the event that such lawsuits were filed, or if certain legal theories advanced by plaintiffs were to be generally accepted by the courts, our financial condition and results of operations could be adversely affected," the filings note.

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