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By Nate Raymond

BOSTON, July 24 (Reuters) – The Mexican government on Monday urged a U.S. appeals court to revive a $10 billion lawsuit seeking to hold U.S. gun manufacturers responsible for facilitating the trafficking of weapons to drug cartels across the U.S.-Mexico border.

A three-judge panel of the 1st U.S. Circuit Court of Appeals in Boston questioned whether a lower-court judge wrongly concluded that a U.S. law barred Mexico from suing Smith & Wesson Brands (SWBI.O), Sturm, Ruger & Co (RGR.N) and others.

That law, the federal Protection of Lawful Commerce in Arms Act (PLCAA), provides the firearms industry broad protection from lawsuits over their products’ misuse.

But Mexico’s lawyers argued the law only bars lawsuits over injuries that occur in the United States and does not shield the seven manufacturers and one distributor it sued from liability over the trafficking of guns to Mexican criminals.

Steve Shadowen, a lawyer for Mexico, said allowing its case to proceed in U.S. courts would enable Mexico to not only seek damages but also a court order aimed at combating the 20,000 deaths a year he blamed on the companies’ actions.

“What we want is an injunction to make these defendants start paying attention to their distribution systems,” he said. “And it’s only U.S. courts that can provide that injunctive relief.”

Mexico says over 500,000 guns are trafficked annually from the United States into Mexico, of which more than 68% are made by the companies it sued, which also include Beretta USA, Barrett Firearms Manufacturing, Colt’s Manufacturing Co and Glock Inc.

Noel Francisco, a lawyer for Smith & Wesson, argued Mexico’s lawsuit was devoid of allegations the gun manufacturers’ gun sales themselves did anything that would create an exception to PLCAA’s broad protections.

“You have licensed manufacturers that sell to licensed distributors that sell to licensed retailers that sell to individuals who satisfy the requirements of federal law, but some of them happen to be straw purchasers,” he said.

U.S. Circuit Judge William Kayatta said that while Mexico had not alleged the gun makers directly violated any gun laws, one of its core legal theories was that they aided and abetted others who trafficked guns abroad, creating potential liability.

“What’s wrong with it?” Kayatta asked.

A ruling is expected in the coming months.