It's a 1 watt class 4 blue laser (200x more powerful than the legal limits on normal red laser pointers). It's capable of causing permanent blindness from very brief exposure at close ranges, with still some risk even with blinking at medium ranges. You know very well people are going to be idiots and treat them just like laser pointers, shining them at people and such. Cases of blindness will happen, and maybe not even from misuse (even among users, from what I've heard the safety goggles used for class 4 lasers in labs are ~ 300 dollars, so the cheap pair they include may very well provide little real protection to yourself).
I'm not sure what I think about the lawsuit, but guys pulling blue lasers from projectors and marketing them publicly is bound to cause a lot of issues before the inevitable bans (even though the $200 price tag discourages casual buyers).
While there is a high risk of blindness, from color blindness to full, the risk of burns is overrated. The laser can set flammable things on fire from close range, from what I understand, but it takes particularly flammable materials and minimal distance, not too much risk of accident like there is with blindness.
I sort of hope the c&d goes through just to give more time for the public to become aware of how different it is from a laser pointer. To me, the risk of collateral blindness in innocent bystanders who have no real means of protection is just too high to justify the way they are marketing the product (and I do think the lightsaber like design is intentional).
