Product Recalls Prompt Reform Legislation
October 26, 2007
A veritable avalanche of product recalls in the past few months (including no fewer than 25 recalls of children's products for lead poisoning hazards) has accelerated calls for reform of the Consumer Product Safety Act. Already — by voice vote — the House of Representatives has passed legislation (HR 2474) that would substantially increase maximum penalties for failure to report product defects, from $1.8 million to $10 million. Pending Senate legislation goes further yet, and would increase even the heightened penalty ten-fold.
On October 30 the Senate Commerce Committee is expected to take up S. 2045, the first comprehensive reform of the Consumer Product Safety Act in 17 years. The bill is sponsored by Chairman Dan Inouye (D-HI) and Subcommittee Chairman Mark Pryor (D-AK). Among other things, this legislation would:
- Increase
individual penalties for failure to report product defects from $8,000
to $250,000 and raise the cap on related violations from $1.8 million
to $100 million.
- Increase funding and staffing at the Consumer Product Safety Commission.
- Require third-party testing of children's products, and authorize the CPSC to require testing for other products.
- Authorize actions by State Attorneys General as parens patriae
whenever they have reason to believe that the people of their states
are adversely affected by violations of the Consumer Product Safety Act.
- Authorize bounties for whistleblowers — up to 25% of civil
penalties — and authorize the CPSC to adjudicate whistleblower
employment discrimination claims.
- Eliminate many existing protections against the disclosure of documents filed by manufacturers in conjunction with incident reports and related investigations.
House Chairman John Dingell (D-MI) is drafting similar legislation. While there is widespread support for increased funding of the CPSC, critics of the proposal, including the National Association of Manufacturers, say the bill will "divert CPSC and industry resources toward litigation and defensive tactics and away from cooperative safety analysis and standards setting," and "result in multiple enforcement actions against companies, ... requiring them to shift major resources toward litigation...." Chairman Inouye has stated that he hopes to pass the bill before Christmas.
For a copy of these bills or additional information, contact Christopher Brewster in our Washington office at 202-682-3535 or cbrewster@kayescholer.com.
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