Hunton Retail Law Resource

After a hiatus from civil penalties, the CPSC recently announced a $12 million penalty.  In November 2017, Walter Kidde Portable Equipment Inc. (“Kiddie”) recalled fire extinguishers for two issues.  First, the fire extinguishers could become clogged or require excessive force to discharge.  Second, the nozzle of the fire extinguishers could detach.  These issues could result in a failure of the fire extinguishers to discharge during a fire emergency.  In fact, a 2014 death was reported involving a car fire after emergency responders could not get the fire extinguishers to work.  By November 2017, Kiddie had received 391 reports of defects, including one fatality, 16 injuries, and 91 episodes of property damage.

The CPSC referred the matter to the U.S. Department of Justice.  In a rare move, the referral was made public, though the company’s identity was not disclosed until now.  The U.S. Department of Justice acted on the referral quickly, filing a complaint in December 2020 alleging that Kiddie violated the CPSA by (a) significantly underreporting the scope and nature of the defect and risks prior to the recall; (b) failing to report immediately to the CPSC information about nozzles detaching from fire extinguishers; (c) making misrepresentations to the CPSC during its investigation; and (d) misusing a registered safety certification mark.  Five days after the complaint was filed, Kiddie agreed via consent decree to a $12 million civil penalty and to an injunction governing its future compliance with the CPSA, which includes the implementation of a compliance program, enhanced reporting requirements, and a new system of internal controls and procedures.

CPSC Acting Chairman Robert Adler issued a statement about the civil penalty and injunction.  Adler observed that “[t]his penalty is important not only because of its size, but also because it represents the first such penalty by CPSC after an unfortunate hiatus of several years.”  As we previously discussed, civil penalties peaked in 2018 and totaled roughly $40 million.  But divergent opinions emerged among the Commissioners on circumstances meriting civil penalties, which may explain why civil penalties have decreased in recent years.

Two recalls this month represent further CPSC developments in focusing on products that threaten children’s lives.  In October, the CPSC took proactive steps to address concerns about infant sleep products that pose suffocation hazards and could lead to Sudden Infant Death.  These steps included a rare proposal for a mandatory consumer product safety standard for crib mattresses and a warning to consumers about safety concerns with pillow-like infant products.  In December, the CPSC announced a recall of an importer’s inclined infant sleeper accessory product due to the risk of suffocation that can lead to infant fatalities.  In 2019, the CPSC issued an alert about the deadly risks posed to small children by home elevators.  Last month, the CPSC announced a recall for private residence elevators after four incidents involving children resulted in a crushed spine and abdomen, fractured hip, broken arm and feet, and bruising to the face and chest.

Total Recalls: 28

Hazards:  Fire/Burn/Shock (12); Crash (3); Choke (3); Injury (2); Laceration (2); Tip-Over (1); Violation of Federal Standard (1); Crush (1); Suffocation (1); Entrapment (1); Fall (1)