California judge slaps down ghost gun manufacturer's anti-SLAPP motion

SAN DIEGO (CN) — A San Diego judge shot down Friday arguments from a Texas-based ghost gun manufacturer that California is stifling their speech by suing them for claims they market to Californians wanting to bypass the state’s strict gun laws.

In 2024, the state of California sued Austin-based company Defense Distributed, alongside Coast Runner Industries and Ghost Gunner, which it says are merely alter egos for Defense Distributed, which produces computer numerical control milling machines.

The state says those machines allow customers to manufacture their own firearms known as ghost guns, which don’t have serial numbers, making them harder to track by law enforcement.

The defendants struck back by filing an anti-SLAPP, or strategic lawsuit against public participation motion. The suit, they said, is over protected acts of free speech like its marketing or the company’s political stance on guns and prior litigation over the state ban on the machines.

San Diego Superior Court Judge Loren Freestone denied the defendants’ motion, affirming an earlier tentative ruling. He found in that ruling California isn’t trying to hold the defendants liable for when they began manufacturing the disputed machine, named the Coast Runner, or because of their challenges to state regulations, but because the companies are selling the Coast Runner itself.

“Neither cause of action specifically references any political statements or prior litigation as a basis for liability. Such conduct is not sales, marketing, or advertising, and therefore it is not clear how such conduct even could supply an element of either claim,” the judge said.

The defendants also can’t claim that their commercial speech is protected, Freestone added in his tentative ruling because commercial speech is exempt under the anti-SLAPP statute.

A particular point of contention on Friday was a section in California’s original complaint that states that the defendants are trying to make an “end-run” around the state prohibition on CNC milling machines.

“The end-run is an unfair business practice,” said Chad Flores of Flores Law, Coast Runner Industries attorney, appearing over video call at a hearing at San Diego Superior Court’s Hall of Justice on Friday.

“The end-run is the marketing and sale of an illegal device,” retorted Leonid Traps, an attorney with Sullivan & Cromwell, who represents the state of California.

Defense Distributed has argued that the state’s suit stems from California’s opposition to the company’s prior litigation and stifles its advocacy challenging CNC milling machine regulations. The company also said in a memorandum in support of their motion to strike that California took issue with its founder’s speech regarding his “gun politics."

In 2022, Defense Distributed sued the state in federal court to stop the enforcement of restrictions on ghost gun machinery and challenged a provision in one of the new California laws that was modeled on Texas’s controversial abortion law and that makes a plaintiff liable for the state’s legal costs in defending an unsuccessful challenge to its gun laws.

The company dropped the suit the same year, but the state claims that soon after a new company called Coast Runner Industries started to market the “Coast Runner,” a very similar milling machine to a product sold by Defense Distributed called the “Ghost Gunner.”

That’s not a coincidence, the state claims, because Coast Runner Industries is an alter ego of Ghost Gunner, and their milling machines are exactly the same.

Coast Runner, they add, is specifically marketed to Californians because the state’s strict gun laws are targets of Defense Distributed and Ghost Gunner founder Cody Wilson, the state claims.

A “CR Wilson” is listed as the organizer of Coast Runner Industries Inc. on the company’s certificate of formation, the state says in the complaint. An Austin address that’s also listed on corporate fillings for Defense Distributed as Wilson’s address leads the state to believe that he is the “CR Wilson” in Coast Runner’s certificate of formation.

One description of the Coast Runner’s physical overview diagram also refers to the product using the initials “GG,” which the state claims refers to Ghost Gunner.

“It appears that in preparing the Coast Runner Operator’s Manual, defendants simply used a global find-and-replace function to replace ‘Ghost Gunner’ with ‘Coast Runner’ — but failed to catch this use of the initials ‘GG’ for ‘Ghost Gunner,’” the state says in their complaint.

Defense Distributed tried, unsuccessfully, to move the state’s case out of California and into Texas in 2024.

Tools to manufacture ghost guns are specifically of interest to criminal groups, because the unregistered guns are harder to track by law enforcement, making them grave and urgent dangers to Californians, the state claims. The state recovered 12,894 ghost guns that were involved in crimes in 2022.

The state is asking a judge to order the company to stop violating gun laws, and to award the state damages and civil penalties for each violation of state gun regulations.

“Defendants flout California law with too-cute-by-half sales and marketing tactics. The Coast Runner is not a joke — it is an illegal device designed, marketed, and sold to enable its users to make firearms and to violate California’s gun violence prevention laws,” the state says in their complaint.