October 22, 2019

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CPSC Chairman Kaye and Commissioner Adler: Current Civil Penalties Approach Works

Yesterday, CPSC Chairman Elliot Kaye and Commissioner Robert Adler issued a lengthy joint statement vigorously defending the Commission’s current approach to civil penalties against various criticisms voiced by Commissioners Joe Mohorovic and Ann Marie Buerkle as well as stakeholders in the business community.  Their overarching message: such criticisms are without merit and are, in reality, a call for lesser penalties; there will be no change in the Commission’s current approach.

Over the past few months, we have written about the Commission’s approach to seeking civil penalties against companies for failure to report violations—and the ongoing debate surrounding that process. 

According to Kaye and Adler, “agency critics have urged an enormous undertaking by the Commission to prioritize exploring and redesigning its civil penalty system, effectively displacing work intended to save lives and prevent injuries.”  They expressed disappointment at the “distortion” of Chairman Kaye’s remarks at the ICPHSO conference last year, and pushed back at the idea that the Commission somehow operates without transparency when assessing civil penalties.  Specifically, Kaye and Adler assert the following points in their joint statement against the common civil penalty criticisms:

  • critics of the Commission’s current policy want more information shared related to the facts and factors that enter civil penalty valuations, but hamstring the agency in doing so by seeking (or supporting) stringent Section 6(b) confidentiality protections;

  • there is ample regulatory guidance to determine when to file a Section 15(b) report;

  • both the Commission and companies need flexibility when negotiating a civil penalty settlement, thus counseling against a matrix or formulaic approach to applying the civil penalty factors;

  • companies are afforded full due process protections and procedures when the Commission seeks civil penalties including the opportunity to be heard; and

  • the Commission carefully tracks the information available to firms at each and every step in time and does not rely on hindsight regarding companies’ obligation to file.

While many could find much to dispute in the joint statement, the Commission’s majority has made their view clear.

Companies should take a very close read of this policy statement.  It is now evident that the Commission will not change—or even revisit—its current approach to civil penalties in the coming fiscal year, as urged by some stakeholders in the product safety community.  Barring a change in CPSC personnel, Congressional action, or judicial involvement through the litigation process, the ongoing “debate” over civil penalties has effectively ended for now.

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About this Author

Charles Samuels, Mintz Levin Law Firm, Washington DC, Tax and Environmental Law Attorney
Member

Chuck is engaged in a federal and international regulatory and legislative practice. He has been extensively involved in product safety, environmental, tax, health care, technology, and energy issues, and public finance legislative and regulatory matters for a variety of trade associations, corporations, local governments, and state agencies.

His practice encompasses work before the US Consumer Product Safety Commission, Departments of State, Health and Human Services, Energy, and Treasury, US Trade Representative, Environmental Protection...

202-434-7311
Matthew Howarse, Consumer Safety, Attorney, Mintz Levin, Law Firm
Member

Matt is a prominent consumer product safety lawyer who advises manufacturers, retailers, importers, distributors, trade associations, and test laboratories. He has extensive experience with compliance, regulatory enforcement, recalls, and other product safety related issues. He represents clients before the Consumer Product Safety Commission (CPSC), Health Canada, the Federal Trade Commission, Congress, and state agencies. Matt draws on his four-year tenure as the CPSC chief of staff and his many years advising clients in private practice to devise practical and resourceful solutions for clients. He serves as Chair of Mintz’s Consumer Product Safety Practice and president-elect of the International Consumer Product Health and Safety Organization (ICPHSO).

Based in Washington, DC, Matt is the Chair of the firm’s Consumer Product Safety Practice. He focuses his practice on consumer product compliance and enforcement issues involving the US Consumer Product Safety Commission (CPSC), individual US states, the Federal Trade Commission, and Health Canada.

Matt previously served as the Chief of Staff of the CPSC from 2010 to 2013 and as the Chairman’s Senior Counsel in 2009. Matt is very involved in the national and international product safety community and currently serves as Vice President on the Board of Directors for the International Consumer Product Health and Safety Organization (ICPHSO).

Matt regularly helps companies seeking representation on product safety reporting obligations, recalls, regulatory compliance, product safety investigations, civil penalties, import investigations, internal compliance programs and training, the CPSC’s public database, and other regulatory and enforcement matters involving the Consumer Product Safety Act (CPSA), Consumer Product Safety Improvement Act (CPSIA), Federal Hazardous Substances Act (FHSA), Flammable Fabrics Act (FFA), Poison Prevention Packaging Act (PPPA), the Canada Consumer Product Safety Act (CCSPA), and other federal and state product safety laws. He assists clients with navigating complex product safety compliance issues and avoiding unwarranted recalls or enforcement actions.

Matt’s experience includes representing manufacturers, distributors, and retailers of apparel, children’s toys, fitness equipment, office supplies, household furniture, juvenile products, power tools, products requiring child resistant packaging, audio video equipment, arts & crafts materials, books, recreational and sporting equipment, safety equipment, hair care tools, kitchen appliances, lighters, candles, heating and cooling equipment, home decorations, promotional products, household cleaners, and many other types of consumer products. Matt also advises trade associations, testing laboratories, and various other types of clients on product safety issues and represents them before product safety regulators and Congress.

With over 10 years of experience in product safety, including the representation of a wide range of consumer product industries and working in a senior leadership position at the CPSC, Matt is able to provide well rounded, efficient, and thorough advice on the full spectrum of product safety issues.

202-434-7446