Over the past few weeks, there have been many key goings-on related to the CPSC and its Commissioners.

Chairman Buerkle’s Confirmation Hearing and Committee Vote

First, on September 27, 2017, Acting Chairman Ann Marie Buerkle sat for a confirmation hearing before the Senate Committee on Commerce, Science, and Transportation. At the beginning of the hearing, Buerkle faced tough questions, particularly from ranking member, Senator Bill Nelson of Florida. In the wake of Hurricane Irma, and subsequent 11 deaths due to carbon monoxide poisoning from portable generators, Ms. Buerkle was repeatedly asked to defend her position that the CPSC should not undertake mandatory rulemaking on portable generator emissions. She explained that she believed the EPA has primary jurisdiction over carbon monoxide emissions from portable generators, but by working with industry on a voluntary standard involving an automatic shut-off mechanism within CPSC’s jurisdiction, it was her hope that a solution can be developed by the end of the year. Under CPSA, CPSC is required to rely on consensus standards instead of mandatory regulations where they are effective and compliance is widespread.

On October 4, 2017, the Committee cleared Chairman Buerkle’s nomination as Chair by voice vote but presumably because of the portable generators issue, her nomination for a second seven-year term as a CPSC Commissioner was not unanimous and voting followed party lines. Ms. Buerkle’s final hurdle will be a confirmation by the full Senate, which could take place quickly or take a couple of months depending on any further opposition to one or both of her nominations.

Continue Reading CPSC Round-Up: Buerkle Confirmation Hearing, Landmark Civil Penalty Ruling, and Partisan Action on Flame Retardants

DOJ Failure to Timely ReportOn Wednesday of last week, the Department of Justice (DOJ) and Consumer Product Safety Commission (CPSC) announced that a complaint has been filed in federal court against Spectrum Brands, Inc. (Spectrum).  Notably, this is the second case in the past three months brought by the government in federal court against a company for an alleged failure to timely report (see our earlier post on the Michaels Stores litigation).  These cases are not typical because most companies settle civil penalty claims rather than litigate against the government.  As a result, there is precious little case law precedent as to how these lawsuits might play out in court, and close attention is being paid to them in the product safety community.

In this case, the government alleges that Spectrum and a former subsidiary (Applica Consumer Products) failed to timely report under Section 15(b) of the Consumer Product Safety Act (CPSA) a hazardous defect relating to certain Black and Decker brand SpaceMaker coffee pot handles.  Specifically, the Complaint claims that the companies knowingly violated the reporting requirements of the CPSA with respect to allegedly defective carafe handles that could detach and cause hot coffee to spill onto consumers and burn them.  According to the government, over a three year period, hundreds of consumers reported incidents involving the detached handle to the CPSC before the companies notified the agency of the potential problem and later recalled the product.  The Complaint alleges that the companies themselves received approximately 1,600 consumer complaints regarding the same issue over the three year period (early 2009 through April 2012).  The Complaint further alleges that the companies distributed a small number of the allegedly defective coffee pots to retailers even after the recall was announced, which is also prohibited by the CPSA.

The government is seeking an undisclosed monetary civil penalty under Section 20 of the CPSA and injunctive relief, including the enactment of a stringent compliance program to ensure future compliance with CPSC reporting obligations.

Notably, in response to the filing of the complaint, Spectrum Brands has stated, in part, that “the Commission is taking a position that is inconsistent and irreconcilable with its conclusions concerning the nature and degree of risk associated with similar products and similar quality issues” and that it is “compelled to defend its conduct in court” in the face of the Commission’s “inconsistent positions and arbitrary civil penalty demand.”  The Company further stated that that it “has a long history of proactive communications with the [CPSC]” including in this case after “Spectrum Brands determined that it had distributed a small number of recalled coffeemakers…”

As we have previously commented, we expect the Commission to remain active in brining enforcement actions against companies for violations of Section 15(b) of the CPSA and other provisions of the CPSA (and statutes enforced by the Commission).  We will continue to follow this litigation, and the Michaels Stores case, and update our readers on notable latest developments given the importance of these recent cases.

 

For the first time in nearly a year, a unanimous U.S. Consumer Product Safety Commission (“CPSC”) announced that a company will pay a hefty civil penalty and enact a strict compliance program to resolve allegations regarding its reporting practices.  This announcement comes almost one year after three similarly structured civil penalties were levied by the CPSC against Ross Stores, Kolcraft and Williams Sonoma.  Importantly, the settlement reached with the New Jersey-based, clothing retailer Forman Mills, like the ones entered into last year, mandates the implementation and maintenance of a comprehensive compliance program.  This recent trend continues to be a notable, and controversial, one.

Specifically, the settlement agreement announced this week resolves charges by CPSC staff that Forman Mills, a retailer of lower-priced designer clothing, failed to report timely its sale of banned children’s upper outerwear containing drawstrings between June 2007 and February 2010.  The sale of some of these garments took place while the company negotiated a prior settlement with the CPSC to resolve similar charges in 2009.

Perhaps most notably, in addition to paying a $600,000 fine, Forman Mills has agreed in the settlement to implement and maintain a comprehensive compliance program designed to ensure the company’s compliance with safety standards for these garments.  The program will include the following elements:

Continue Reading CPSC Announces Forman Mills Civil Penalty and Compliance Program