Open this photo in gallery Friends of 18-year-old Danforth shooting victim Reese Fallon leave candles at a makeshift memorial, in Toronto, on July 23, 2018. Mark Blinch/The Canadian Press

Victims of a Toronto mass shooting have launched a class-action lawsuit against the U.S. company that manufactured the stolen handgun used to kill two people and injure 13 others along Danforth Avenue in July, 2018.

The suit, filed in the Ontario Superior Court of Justice on Monday, alleges that the gun maker, Smith & Wesson, failed to incorporate certain safety features into the design of the handgun that could have prevented the bloodshed. The claim seeks $50-million in general damages and $100-million in punitive damages.

A spokesman for Smith & Wesson said the company does not comment on pending litigation. The allegations in the suit have not been proven in court.

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At the core of the action is a settlement agreement Smith & Wesson signed with the Clinton White House in 2000. The company acknowledged the threat of stolen firearms and committed to adopting smart gun technology in all its new firearm models by 2003, along with other design and marketing changes.

Smart guns incorporate technology that ensures only authorized users can fire the weapon.

The Smith & Wesson agreement collapsed when George W. Bush came to power and supported a law shielding gun makers from liability lawsuits.

No such shield laws exist in Canada. Although Canadian courts have no authority to enforce the U.S. agreement, the lawyer representing the families, Malcolm Ruby, says the document shows Smith & Wesson recognized the public-safety risk of its products in the hands of unauthorized users and did little to mitigate it.

“They knew about those potential harms and committed to developing technology that would address it – and they didn’t,” Mr. Ruby said.

The lead plaintiffs in the case are Skye McLeod and Samantha Price. On the night of July 22, 2018, they were having ice cream with Reese Fallon and several other friends, all recent high-school graduates, when a gunman opened fire with a Smith & Wesson M&P 40 pistol. Over the course of six minutes, he would shoot dozens of rounds into packed restaurants and coffee shops in Toronto’s bustling Greektown before fatally shooting himself.

The class is open to all victims – which includes the dozens of people who suffered cuts, bruises and trauma fleeing the gunfire – and their families.

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Ten-year-old Julianna Kozis and Ms. Fallon, 18, died of gunshot wounds. Ms. Price was shot through the thigh.

“This is something you never escape,” said Ms. Price’s father, Ken, who has helped launch and lead a gun-control advocacy group, Danforth Families for Safe Communities, in the wake of the attack. “Something like this has a permanent effect on who you are.”

The handgun had been stolen, along with several others from a gun shop in Saskatchewan in 2016.

Police have yet to determine how the gun came into the shooter’s possession.

"If smart gun technology had been put in place like it should have been back in 2003, he would never have been able to use it,” said Ms. McLeod’s father, Patrick.

Gun makers have designed smart guns that can be activated by a distinct fingerprint or radio-frequency identification chip, but they remain largely absent from the civilian market.

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Manufacturers have said the technology is expensive and unfeasible.

“I don’t buy that,” said Mr. McLeod, a retired Toronto police officer. “I can look at my iPhone and it unlocks. Meanwhile, we’re selling semi-automatic handguns that have no safety devices on them at all.”

Major gun makers may also be hesitant to introduce smart guns in light of the Smith & Wesson experience of the early 2000s.

Shortly after Smith & Wesson signed the White House agreement, the National Rifle Association called the company – at the time America’s biggest and oldest gun manufacturer – a “sellout” and gun businesses began boycotting the company. Plummeting sales brought mass layoffs, an executive resignation and an eventual sale of the business.

Mr. McLeod says he hopes the suit will ultimately lead to restrictions on the types of guns exported to Canada and other countries. “Years ago, people were dying in car crashes and companies changed only after being sued and sued,” he said. “The gun companies are going through the same thing now.”