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$4.5 Million Penalty for Not Timely Reporting Product Defect

Tuesday, June 07, 2016
Sandler, Travis & Rosenberg Trade Report

A U.S. company has agreed to pay a $4.5 million civil penalty to resolve charges that it knowingly failed to immediately notify the Consumer Product Safety Commission after becoming aware of defects in its coffee makers that posed a risk of injury to consumers. The company will also have to (a) maintain a compliance program that includes specified elements and (b) maintain and enforce a system of internal controls and procedures designed to ensure proper reporting of product safety issues.

This settlement does not constitute an admission of violation by the company or a determination by the Commission that a violation was committed. The company pointed out that it notified the CPSC after conducting an investigation of the problem and determining the cause.

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