The Consumer Product Safety Commission reports that a U.S. company has agreed to pay an $11.5 million civil penalty to resolve charges that it knowingly failed to immediately report product defects.
According to the CPSC, for more than a year the company received numerous reports indicating that various of its products contained a defect that could create a substantial product hazard and created an unreasonable risk of serious injury to consumers. By the time the company filed an initial report with the CPSC those reports numbered more than 150, and a recall of the products was subsequently announced.
The CPSC acknowledges that during this time the company had a product safety compliance program in place, both to help ensure the safety of its products before they are marketed and to identify, monitor, and evaluate potential product safety issues on an ongoing basis. However, the settlement agreement requires the company to ensure that its compliance program covers any consumer product imported, manufactured, distributed, or sold by the company and includes a number of specified elements designed to ensure compliance with the Consumer Product Safety Act. The company will also be required to conduct and report on three annual internal audits of the effectiveness of its compliance policies, procedures, systems, and training.
CPSC Chair Alexander Hoehn-Saric noted that the agency has now assessed $52.4 million in civil penalties over the last 12 months, a number that “demonstrates CPSC’s commitment to hold companies accountable when they put the public at risk.”
Interested parties have until Sept. 12 to request that the CPSC not accept this latest settlement agreement or otherwise comment on its contents.
For more information on product safety issues, please contact Beth Ring at (212) 549-0133 or Ned Steiner at (202) 730-4970.
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