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Recall Roundup: May 2020

Should you have to pay to see CPSC’s adopted safety standards?  That is the question raised by a lawsuit filed in the Third Circuit this month, which challenges the CPSC’s adoption of mandatory safety standards for consumer products that are not available for free to the public.  The American Society for Testing and Materials (“ASTM”) is a well-recognized independent organization that develops consensus-based, voluntary standards for children’s products.  In 2019, ASTM updated its safety specifications for infant bath seats, which includes changes to labeling, product performance, and safety testing (ASTM F1967-19).  The CPSC later promulgated an agency rule adopting the updated ASTM standard as legally binding on infant bath seat manufacturers (16 C.F.R. § 1215).  On behalf of a new mother, a civil rights group filed a petition with the U.S. Court of Appeals for the Third Circuit pursuant to 15 U.S.C. § 2060 challenging the CPSC’s rule.  The mother claims that she asked the CPSC for a copy of the standard and the CPSC instead directed her to buy a copy from ASTM.  ASTM charges $56 for a copy of the standard—almost double the price of an infant bath seat.  The petition asks the Third Circuit to vacate the rule, order the CPSC to make any binding standard freely accessible to the public whenever the CPSC proposes to promulgate a new rule, and order the CPSC to make any binding standard freely accessible to the public permanently after the CPSC adopts it in a final rule.

With warmer weather comes increased drowning risks to small children posed by swimming pools.  The CPSC recently announced the availability of $2 million in pool safety grants for state and local governments to help prevent drownings and drain entrapments.  The CPSC also recently announced new statistics on child drownings that underscore the need for more public awareness on this issue.  Child drownings remain the leading cause of unintentional death among children ages 1 to 4 years old.  The new statistics show that, on average, there were 379 pool-or-spa-related fatal child drownings per year for 2015 through 2017.  Annual fatal child drownings increased gradually between 2015 and 2017, with a spike of 395 fatalities in 2017.  Included in the statistics were drownings involving children under 15 years old.

Lawyers from Hunton Andrews Kurth LLP’s insurance coverage practice provide an update on a recent food contamination-related insurance dispute:

In Egg and I, LLC v. U.S. Specialty Insurance Co., No. 2:20-cv-00747 (D. Nev.), Las Vegas-based restaurant group Egg Works filed a class-action lawsuit against its insurer, U.S. Specialty, alleging that the insurer wrongly denied coverage under the company’s Restaurant Recovery Insurance Policy.  Egg Works alleged that it suffered financial losses due to the Nevada governor’s mandated closures of non-essential businesses due to COVID-19, which limited restaurants to takeout and delivery service only.

The lawsuit, which seeks class certification on behalf of similarly situated policyholders that have had business interruption claims denied under restaurant recovery policies, asserts that U.S. Specialty incorrectly denied Egg Works’ claim under the policy, which affords coverage for certain “Insured Events,” including accidental or unintentional contamination or impairment of food products.  In response, U.S. Specialty moved to dismiss the complaint, arguing that Egg Works’ alleged suspension of business operations due to the governor’s stay-at-home orders does not constitute an “Insured Event” because none of the losses were incurred directly and solely as the result of contamination or impairment of food products.

Many businesses adversely impacted by COVID-19-related governmental orders like those at issue in Nevada have filed insurance claims under property, event cancellation, and similar policies to recoup losses.  Egg Works’ approach to recovery under a restaurant food contamination policy, however, is noteworthy and, if successful, may cause restaurants and other businesses in the food service industry to follow suit and evaluate whether losses arising from COVID-19 may be covered under other food contamination policies.

Total Recalls: 18

Hazards:  Violation of Federal Standard (7); Fire/Burn/Shock (4); Tip-Over (3); Injury (1); Ingestion (1); Fall (1); High Levels of Chromium (1)

Copyright © 2023, Hunton Andrews Kurth LLP. All Rights Reserved.National Law Review, Volume X, Number 163

About this Author

Syed S. Ahmad Insurance Coverage Attorney Hunton Andrews Kurth Washington, DC

Syed represents clients in connection with insurance coverage, reinsurance matters and other business litigation.

Syed has been admitted to the US Court of Appeals for the Second Circuit, US Court of Appeals for the Sixth Circuit, US District Court for the District of Columbia and US District Court for the Eastern District of Virginia. 

Relevant Experience

  • Advised clients on COVID-19 insurance claims for business interruption, contingent business income (CBI), extra expense, civil authority, ingress/egress, D&O, and general liability...
Jonathan L. Caulder Associate Retail Consumer Products

Jon is a commercial litigator handling post-M&A disputes, products liability issues, environmental challenges, and appellate litigation.

During law school, Jon served as an extern for the Honorable Michael F. Urbanski of the United States District Court for the Western District of Virginia. Jon also interned in the office of Chief Staff Attorney for the Supreme Court of Virginia.

Before attending law school, Jon worked in the education field as a sixth grade math teacher for Teach for America in Warren County, North Carolina.

Jon is admitted to practice before the...

Kelly L. Faglioni Partner Retail Consumer Products

Kelly practices as a commercial and regulatory litigator on products liability and post M&A disputes and issues and serves as one of the firm’s Deputy General Counsel focusing on law firm ethics, conflicts, and risk management issues.

Kelly’s litigation experience spans both commercial and regulatory litigation before state and federal trial and appellate courts, regulatory agencies, and alternative dispute resolution forums. A significant amount of her litigation practice has focused on product issues that have included compliance, recall, investigations, retail sale, warranty...

Geoffrey B. Fehling Associate Washington, DC Insurance Coverage Litigation

Geoff dedicates his practice to advising corporate policyholders and their directors and officers in complex insurance coverage matters, from placement of sophisticated insurance programs and policy reviews to claim advocacy through arbitration, litigation, trials, and appeals. As part of Hunton Andrews Kurth’s full-service insurance coverage practice, he works with clients to maximize insurance recoveries through policy analysis and audits, claims presentation and negotiation, alternative dispute resolution, and litigation.

Geoff regularly...