Congress Passes Product Safety Legislation

Dennis Cuevas, Project Director and Chief Counsel, Consumer Protection and Telemarketing Fraud

Dennis Cuevas, Project Director and Chief Counsel, Consumer Protection

The year 2007 could be dubbed as the “year of the recall” with a record-breaking 231 recalls of 45 millions toys and other children’s products. In fact, well-known manufacturers were forced to recall millions of toys due to problems associated with lead paint. In the first half of 2008, 108 children’s products were recalled, including 45 for lead contamination and 10 for hazardous magnets.

As a result of the increased reports of unsafe products, Congress, law enforcers, and the public sparked renewed interest in product safety and the Consumer Product Safety Commission (CPSC). Last year Congress acted relatively swiftly and introduced legislation to improve product safety and enforcement. Senator Mark Pryor (D-AR) and Senate Commerce, Science and Transportation Committee Chairman Daniel Inouye (D-HI) introduced S. 2045, while House Energy and Commerce Committee Chairman John Dingell (D-MI), Committee Ranking Member Joe Barton (R-TX) and Commerce, Trade and Consumer Protection Subcommittee Chairman Bobby Rush (D-IL) introduced H.R. 4040. Both bills significantly increased resources for the CPSC over the next seven years, required new standards for dangerous products, such as lead and phthlates and addressed important enforcement provisions.

As the bill continued to develop, a coalition of consumer advocacy groups, scientific organizations, law enforcement and industry worked to provide information to congressional staff by reviewing new sections and providing support for what some have deemed the strongest consumer product safety legislation since the founding of the CPSC more than 30 years ago.

Throughout the legislative process, industry repeatedly attempted to limit states’ authority to pass stronger laws and effectively enforce consumer protection laws. In May 2008, 50 State Attorneys General submitted a letter to the conference managers urging them to include a clause introduced by the Senate which clarifies that state attorneys general maintain the authority to pursue consumer protection investigations and enforcement actions under state law when dangerous products are offered for sale or use, affirming that federal legislation does not preempt non-conflicting state consumer protection laws. The letter also urged the inclusion of fee-shifting language which would prevent defendants from collecting court and expert fees from states attempting to enforce the Consumer Product Safety Act.

After months of discussion, a conference committee of House and Senate leaders approved a package on July 28, 2008, bringing negotiations on the Consumer Product Safety Improvement Act to a close. The final version of the bill passed the House two days later in a 424-1 vote. The next day, the bill passed the Senate in an 89-3 vote. In August, President Bush signed the Consumer Product Safety Improvement Act of 2008 (CPSIA).

CPSIA Product Safety Provisions

The CPSIA permanently bans any children’s products containing more than point one percent of three specific types of phthalates (a plastic additive used to increase flexibility): di-(2-ethylhexyl) phthalate (DEHP), dibutyl phthalates (DBP), or benzyl butyl phthalate (BBP). Some advocates have said that a ban was imperative, while others have claimed that the science does not support a widespread restriction. In Europe, the European Union has banned phthalates in children’s products, while the Centers for Disease Control and Prevention advocate for more research. Before the enactment of this legislation, phthalates were not regulated by CPSC. Under the new legislation, there is limited preemption of state laws regulating phthalates and phthalate alternatives.

The CPSIA also sets a general ban on lead in children’s products by requiring the CPSC to set a standard of .01 percent within three years -- mandating that lead content in children’s products and toys be reduced to: no more than 600 parts per million by February 10, 2009; no more than 300 parts per million by August 14, 2009; and no more than 100 parts per million by August 14, 2011. The Act will also tighten the federal standard on lead paint to .009 percent.

The Act requires manufacturers “to the extent practicable” to place tracking labels on children’s products in order to help consumers identify the source of a product in the event of a recall, and requires third party testing and certification for imported children’s product for compliance with U.S. safety standards. The testing and certification provisions take effect 90 days after the CPSC has published its requirements for accreditation of third-party testing bodies. Previously, there were neither tracking label requirements nor certification of safety standards compliance.

Moreover, the new legislation creates new rules for durable infant and toddler products that will facilitate owner registration by requiring manufacturers to provide postpaid registration cards and to take steps that will enable more efficient distribution of recall and safety notices. It also expands warning requirements for choking hazards. Websites and printed catalogs that provide a direct means of purchasing must include warning statements by December 12, 2008 and February 10, 2009 respectively. Lastly, the Act requires the CPSC to adopt and enforce safety standards for four-wheel all-terrain vehicles.

CPSIA Enforcement Provisions

The Act provides state attorneys general the authorization to seek injunctive relief for certain violations of the CPSA. A state attorney general would be required to provide at least 30 days prior notice to the CPSC. If the CPSC files suit first, the state attorney general is precluded from filing suit with respect to certain violations. The Act includes a savings clause that protects the state attorney general’s right to pursue an action under state law and limits the use of privileged information by a private attorney hired to assist a state attorney general.

The Act infuses the CPSC with much-needed resources by increasing funding to $136 million in fiscal year 2014 and increasing the commission’s full-time staff by at least 500. For fiscal year 2008, CPSC received $80 million. It restores the number of Commissioners to five, allows CPSC to operate with a two-member quorum for one year and allows CPSC to begin writing new regulations without publishing an Advanced Notice of Proposed Rulemaking.

Furthermore, the legislation decreases waiting periods for disclosure of consumer product information by the CPSC when disclosure would permit the public to ascertain readily the identity of the manufacturer or private labeler. It provides for expedited court actions to release information on products to the public and requires the CPSC to maintain on its website a publicly available, searchable database that includes any reports received by the CPSC of injuries, illness, death, or risk of such injury, illness, or death related to the use of consumer products other than information provided to the CPSC by manufacturers, private labelers, or retailers. The CPSIA eliminates the right of a party recalling a product to elect whether it will offer a refund, repair or replacement of recalled products and permits the CPSC to require a refund, repair and/or replacement.

The Act greatly increases civil penalties for violations of the CPSA to $100,000 for each violation with a maximum of $15 million for a related series of violations. It also increases criminal penalties by permitting larger fines, up to five years imprisonment, and forfeiture of assets associated with a violation. Previously, the civil penalty cap was $8,000.

In sum, the CPSIA represents a dramatic change with respect to a regulatory and enforcement philosophy. It significantly enhances the role of the CPSC and State Attorneys General in regulating the manufacture and sale of consumer products.

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