December was a quiet month in the world of recalls for two reasons. First, there were only 19 product recalls—the second lowest number of monthly recalls in 2019. Second, the partial federal government shutdown has forced the CPSC along with other agencies to close until President Trump and Congress can resolve their well-publicized funding dispute.
With a new commissioner confirmed in September, the Commission once again has five commissioners. A philosophical divide along party lines surfaced this month in two decisions.
The first decision involved the settlement of an administrative lawsuit filed by the CPSC in February. The lawsuit alleged that a distributor refused to recall three-wheeled jogging strollers after consumer complaints that the front wheel can detach suddenly during use, causing injuries to at least 50 children and 47 adults. To settle the lawsuit, the distributor agreed to notify dealers and retailers and to “develop and launch an information campaign that will include an instructional video demonstrating how to safely and correctly operate” the stroller. Eligible consumers who participate in this campaign can receive “incentives,” such as hardware to repair the stroller or a 20% discount towards the purchase of a new stroller from the same distributor.
October began with a CPSC announcement that a major retailer agreed to pay a $3.85M civil penalty for failing to report that a trash can it sold contained a defect or created an unreasonable risk of serious injury. The retailer sold 367,000 of the trash cans nationwide between December 2013 and May 2015. Allegedly the trash can’s plastic collar may dislodge, exposing a sharp edge and posing a laceration hazard to consumers. The retailer received 92 consumer complaints about this alleged defect but did not immediately notify the CPSC of the defect. The CPSC announced a recall of the trash can in July 2015. In addition to the civil penalty, the retailer agreed to maintain a compliance program and a system of internal controls and procedures to ensure it discloses information to the CPSC in accordance with applicable law. The Commission voted unanimously (4-0) to accept the settlement. Continue Reading Recall Roundup: October
This month marks the 10th anniversary of the Consumer Product Safety Improvement Act (“CPSIA”), which was signed into law on August 14, 2008. CPSIA was a bipartisan response to unsettling events in the world of consumer products that occurred in 2007. During that landmark year, reports emerged about lead contamination in a wide range of consumer products—including children’s toys—that forced the CPSC into the national spotlight and facilitated over 400 recalls. The CPSIA aimed to significantly enhance the CPSC’s regulatory and enforcement power by doubling its budget, increasing its staff levels, prohibiting the sale of recalled products and increasing its civil penalties. For example, before CPSIA, the CPSC could impose civil penalties in the amount of $8,000 per violation, with a maximum of $1.825 million. But in 2008, CPSIA increased significantly the amount of civil penalties to $100,000 per violation, with a maximum of $15 million, adjusted for inflation. Continue Reading Recall Roundup: August
The CPSC experienced a political shake-up this month when the U.S. Senate confirmed Dana Baiocco as the newest commissioner. In September, President Trump nominated Baiocco, a Republican and former partner at Jones Day, but the Senate did not act on the nomination by the end of the 2017 calendar year. So President Trump resubmitted his nomination of Baiocco in January. On May 22, 2018, the Senate confirmed Baiocco by a vote of 50-45, mostly along party lines. Her seven-year term will run through October of 2024. Continue Reading Recall Roundup: May
On the heels of a recent $5 million civil penalty, the CPSC recently secured a $1.5 million civil penalty with help from the U.S. Department of Justice (“DOJ”). The civil penalty concludes a long saga between the CPSC and a large arts and crafts retailer about vases with allegedly defective thin glass that rendered them prone to shattering. Continue Reading Recall Roundup: March
The CPSC has flexed its regulatory muscle during the first months of 2018 with respect to products that pose risks to children. With the U.S. Department of Justice’s (“DOJ’s”) help, the CPSC secured a $5 million civil penalty against a drug company for its allegedly deficient child-resistant packaging. In December, the DOJ filed a complaint in federal court against the drug company alleging that it knowingly violated the Poison Prevention Packaging Act and the Consumer Product Safety Act by distributing five household prescription drugs with non-compliant child-resistant packaging and failing to report the noncompliance to the CPSC. The complaint alleges that the drug company’s engineers drafted a “risk analysis” memo identifying the packaging as non-compliant. Rather than halt distribution and immediately report the non-compliance to the CPSC, the drug company continued distribution with non-compliant packaging while concurrently developing compliant packaging. The company also waited nearly 15 months before notifying the CPSC of its non-compliant packaging. In January, the federal court entered a consent decree for the matter. The drug company agreed to pay a $5 million civil penalty, implement and maintain a compliance program, and maintain and enforce a system of internal controls and procedures. Continue Reading Recall Roundup: February
With the arrival of 2018, President Trump resubmitted his nominations for CPSC leadership vacancies to the Senate. In 2017, Trump nominated Commissioner Ann Marie Buerkle to serve as CPSC Chair and Dana Baiocco to serve as a commissioner replacing Democrat Commissioner Marietta Robinson, whose term expired. But, under Senate rules, nominations not acted on are returned to the President. At the end of the Senate’s 2017 session, this meant that roughly 120 nominations were returned to Trump. Both nominees—Buerkle and Baiocco—are expected to receive Senate confirmation this year. Continue Reading Recall Roundup: January
October ushered in a case that might, on one hand, provoke a sigh of relief for manufacturers, distributors and retailers concerned about the upward trend in multimillion dollar civil penalties from the CPSC or, on the other hand, raise some eyebrows of concern about the extent of a court’s authority to prospectively impose auditing, compliance and training measures. See United States v. Spectrum Brands, Inc., No. 15-CV-371-WMC, 2017 WL 4339677 (W.D. Wis. Sept. 29, 2017). Continue Reading Recall Roundup: October
Earlier this month, Canada’s transport minister announced that a drone had collided with a commercial aircraft, the first confirmed collision of its kind in North America. Thankfully, the aircraft sustained only minor damage and was able to land safely. But this recent incident, which many commentators believed was inevitable given the proliferation of consumer and commercial drones, highlights the potential risks associated with drone operations. Continue Reading Are Your Drone Operations Covered by Insurance?