April was an historic month for the CPSC. The agency approved a $27.25 million civil penalty—the largest in CPSC history. The significance of this record amount cannot be overstated. The previous record was held by a $15.45 million civil penalty approved in March of 2016. In fact, except for in 2016, the CPSC has never approved civil penalties that totaled $27.25 million in each of the last ten calendar years. Now, it is has done so in 2018 with just one civil penalty. Continue Reading Recall Roundup: April
There is plenty of recall activity to report but no civil penalty news to report for November. Perhaps the holiday spirit prevails at the CPSC in this holiday season.
Hoverboards were last year’s hottest toy during the holiday season, but they also caused alarm due to the tendency of their lithium-ion battery packs to overheat while charging, causing the hoverboards to catch fire or explode. This year, the CPSC is taking a proactive approach to hoverboards. In May and again this month, hoverboards by the same manufacturer caused house fires and prompted the CPSC to warn consumers to stop using those hoverboards altogether. Further, a hoverboard by a different manufacturer recently caught fire and caused $40,000 of property damage to a consumer’s home. These serious reports culminated in the CPSC issuing seven recalls this month for hoverboards by different manufacturers due to their potential fire and explosion hazards. Continue Reading Recall Roundup: November
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
In a move affecting manufacturers, distributors and retailers in the furniture and other wood-based industries, the Environmental Protection Agency (“EPA”) recently issued a series of amendments to its Final Rule implementing the Formaldehyde Standards for Composite Wood Products Act (the “Formaldehyde Final Rule”), which added Title VI to the Toxic Substances Control Act (“TSCA”). The Formaldehyde Final Rule, 40 CFR Part 770, sets formaldehyde emissions standards for composite wood products and includes requirements for the testing, third-party certification, import certification and labeling of covered products by manufacturers of those products. The Final Rule also imposes requirements on downstream fabricators, distributors and retailers to keep records for at least three years demonstrating that covered products they use, distribute and/or sell are TSCA Title VI-compliant. Continue Reading Recent Amendments to EPA’s Formaldehyde Emissions Final Rule Affect Furniture Industry
Last month, the solar eclipse captivated the United States and many consumers flocked to purchase solar eclipse glasses to safely observe the astronomical phenomenon. We previously reported how NASA issued a safety alert advising consumers on the proper eye protection they should seek. Now, some consumers have filed a class action lawsuit against a major online retailer for allegedly selling “unfit, extremely dangerous, and/or defective” solar eclipse glasses. As a result, the consumers allege “varying degrees of eye injury ranging from temporary discomfort to permanent blindness.”
August was a busy month in the world of recalls. First, the end of August ushered in a hefty $5.7 million civil penalty against a major retailer in the United States. The retailer was allegedly selling and distributing recalled products and has agreed, in addition to the civil penalty, to maintain a compliance program and a system of internal controls and procedures. The CPSC voted 4 to 1 to accept the settlement, with Acting Chairman Buerkle voting to accept a lower civil penalty. Continue Reading Recall Roundup: August
On July 26, 2017, an amusement ride named “Fire Ball” at the Ohio State Fair broke apart, killing one passenger and injuring seven others. This deadly incident may trigger a CPSC investigation into the matter.
Prior to 1981, the CPSC exercised jurisdiction over all amusement rides. But after several high-profile cases challenged the CPSC’s jurisdiction over amusement rides with mixed results, an amusement parks trade group successfully lobbied Congress to exempt stationary amusement rides from the CPSC’s jurisdiction. In 1981, Congress passed the Consumer Product Safety Amendments, which amended the definition of “consumer product” to explicitly exempt stationary amusement rides.
June commenced with another massive civil penalty. A manufacturer agreed to pay a $5.2 million civil penalty and maintain a compliance program for allegedly failing to immediately report defective floorboards in recreational off-highway vehicles. In a three-year period, the manufacturer received over 400 reports of floorboards cracking or breaking in one vehicle model and over 150 similar reports in two other models. Once the manufacturer filed its report, it allegedly underreported the number of floorboard incidents associated with one model and failed to identify altogether the floorboard incidents associated with the two other models. These omissions, according to CPSC staff, constituted a material misrepresentation. The CPSC accepted the settlement by a 4-to-1 vote. Continue Reading Recall Roundup: June
This past week, several regulatory and self-regulatory actions made headlines that affect the retail industry. Continue Reading Consumer Protection in Retail: Weekly Roundup
On June 19, 2017, the United States Supreme Court announced important constitutional limitations on state courts’ ability to exercise specific jurisdiction over nonresidents’ claims against out-of-state defendants. The Court’s nearly unanimous decision in Bristol-Myers v. Superior Court, 582 U.S. (2017) has potentially far-reaching implications for companies facing claims brought by nonresident and resident plaintiffs in states in which those companies are neither incorporated nor maintain their principal place of business. In holding that mere joinder of nonresident plaintiffs’ claims with those of resident plaintiffs does not permit a state court to exercise specific jurisdiction over an out-of-state defendant, the Court’s decision is the latest in a trend of important personal jurisdiction decisions rendered by the high court in recent years which provide companies with significant constitutional protections in terms of where plaintiffs may force companies to litigate. Continue Reading Supreme Court Again Tightens Jurisdictional Requirements for Claims Against Out-of-State Defendants