Adventure Outdoors is not done Fighting despite Appeals Loss in New York City Suit

Wednesday’s U.S. Second Circuit Court of Appeals ruling was a mixed bag for Jay Wallace, owner of in Smyrna.

The court ruled that a previous default judgment from a lower court would stand, but maintained that the original injunction against Adventure Outdoors was unconstitutional because the plaintiff, New York Mayor Michael Bloomberg, lacked personal jurisdiction.

“The court ruled that no, he didn't have personal jurisdiction, that we were correct,” Wallace said. “However, we did not stay the course in his courtroom. We tied their hands. It's like the chicken before the egg. If we had ignored New York when they filed suit against us and not answered the judge, then we could have had a default judgment against us then they could have ruled in favor of us.”

The trouble for Adventure Outdoors began in 2006. Bloomberg sued Wallace and 26 other gun purveyors, mostly in the Southeast, claiming that they violated federal regulations by knowingly permitting straw transactions, which the federal government defines as a gun dealer knowingly selling firearms to a proxy who then gives them to a person who can’t legally purchase guns. These guns were then used to commit crimes in New York, Bloomberg claimed.

The cases against 23 gun shop owners either were settled or defaulted while three others were dismissed.

The Adventure Outdoors case went to trial in New York in 2008 where Wallace defaulted, basically meaning he forfeited, because he didn’t think he’d get a fair trial in New York.

“We knew we wouldn't because some of things the judge had already said publicly,” Wallace said. “He did all these things to us as we were coming to court. He said that Bloomberg would not be able to testify in the courtroom, our accuser. Six days before the trial was going to begin, he took my jury away. He said he was going to make the decision. 

“It was obvious I was not going to get a fair trial and it was going to cost me half a million dollars to get it.”

Wallace explained that Adventure Outdoors couldn’t win the appeal because of the default judgment from 2008.

“If we had ignored them and said from the beginning that he didn't have the jurisdiction to do what he was doing and let him go ahead with his default judgment, then we could have appealed it and we would have won,” he said.

Although the default judgment still stands, Wallace’s fight isn’t over just yet. The Second Court of Appeals sent the case back to district court because the original injunction was unconstitutional.

With the loss of Wednesday’s appeal, Adventure Outdoors must comply with monitoring to oversee gun sale records. New York has financed the court-appointed monitor for three years in the other cases.

A libel suit Wallace filed against Bloomberg after he said Adventure Outdoors had “New Yorkers’ blood on their hands” is still in litigation.