On March 18th President Trump fired the Federal Trade Commission’s two Democratic Commissioners, Alvaro Bedoya and Rebecca Kelly Slaughter. The news broke when Commissioner Bedoya took to the social media site X, stating, “I am a commissioner at the Federal Trade Commission. The president just illegally fired me. This is corruption plain and simple.”
On April 30, 2024, the U.S. Consumer Product Safety Commission (“CPSC”) published a direct final rule related to pre-filled portable fuel containers and the Portable Fuel Container Safety Act (“PFCSA”), 15 U.S.C. 2056d. The Act directed the CPSC to require flammable, liquid fuel containers of fewer than five gallons and intended for transport to include devices that impede flames from entering the container. Congress gave the CPSC the authority to either promulgate a rule or adopt an existing standard. Additionally, the Act requires the CPSC to educate consumers about dangers associated with using or storing such containers near an open flame or a source of ignition.Continue Reading Changes to CPSC’s Portable Fuel Container Safety Act Regulation Could Come as Soon as This Summer
Greetings from Orlando, FL! The Crowell product safety team is currently attending the annual meeting and training symposium of the International Consumer Product Health and Safety Organization (ICPHSO). We just heard keynote remarks from the Chair of the U.S. Consumer Product Safety Commission (CPSC), Alexander Hoehn-Saric, and wish to share some highlights. As he did in October 2023 at the ICPHSO International Conference in Sweden, Chair Hoehn-Saric focused his remarks on addressing products sold on or through online marketplaces.
Chair Hoehn-Saric first set the stage by sharing some important data points. In 2023, the CPSC announced more than 300 product recalls; levied more than $52 million in civil penalties; engaged in 14 new mandatory safety standard rulemakings; screened more than 60,000 harmful products at the ports; and participated in numerous safety education campaigns. He also noted the budget uncertainty at the CPSC and the need to “do more with less” and stated that the CPSC will always “put consumers first” as they prioritize their work should the CPSC budget decrease.Continue Reading CPSC Chair Hoehn-Saric Addresses Annual Product Safety Conference
On Friday, CPSC Chairman Alexander Hoehn-Saric gave a keynote address to the International Symposium of the International Consumer Product Health and Safety Organization (ICPHSO) in Almhult, Sweden. Hoehn-Saric focused his remarks on his stated goal for the third year of his term as chairman of the agency—addressing recalled or otherwise violative products sold on or through online marketplaces. In Hoehn-Saric’s view, consumers expect to purchase safe products on online marketplaces, and they should not need to know or discern whether a product is purchased directly from an online retailer or from an entity that has been provided access to consumers through the online platform. He complemented collaborative improvements by Amazon, eBay and Target but issued a call to action including adoption of “safety by design“ and legislative and regulatory protections.Continue Reading CPSC Chair Hoehn-Saric Focuses on Online Marketplaces at ICPHSO International Conference
On March 30, 2023, the FDA authorized marketing of Happiest Baby’s SNOO Smart Sleeper, an over-the-counter infant sleep system intended to keep infants on their back throughout sleep. This marks the first time we are aware of that the FDA has given de novo marketing authorization to a product designed to keep sleeping babies positioned on their backs,[1] and signals a potential expansion of what the FDA considers to be a “medical device” within its regulatory purview.Continue Reading The FDA Appears to Expand Its Definition of a “Medical Device” to Include CPSC-Regulated Infant Sleep Products
The FTC joined with the National Labor Relations Board in order to bolster efforts to protect workers against anticompetitive and unfair practices. It also announced a $25 million refund to U.S. and international consumers that were allegedly defrauded by a sweepstakes scheme. And for the first time in FTC history, the Commission brought an action under the Military Lending Act against a Jewelry company that allegedly mislead military families. These stories and more after the jump.Continue Reading FTC Updates (July 18-22, 2022)
Despite imposing onerous new compliance terms, the recently announced Vornado civil penalty was criticized by three commissioners as too low amid their urgent calls for larger penalties in the future. On July 7, the U.S. Consumer Product Safety Commission (CPSC) announced a $7.5 million civil penalty settlement with manufacturer of air circulation products, Vornado Air (Vornado). Vornado agreed to pay the civil penalty to resolve charges that the Company knowingly failed to immediately report allegedly defective electric space heaters to the CPSC under Section 15(b) of the Consumer Product Safety Act (CPSA). The Commission voted 4-0-1 to provisionally accept the settlement. Notably, three of the agency’s five commissioners published individual statements alongside the agency’s announcement of the penalty, which is atypical. The statements provide product safety stakeholders with insights on how the “new” Commission views civil penalties and its enforcement authority. Continue Reading “Wiping the Slate Clean”— CPSC Commissioners Signal Higher Penalties to Come in Wake of Vornado Penalty Resolution
In one of the most significant developments in product safety law over the past decade, Gree Electric Appliances Inc. of Zhuhai, Hong Kong Gree Electric Appliances Sales Co. Ltd., and Gree USA Inc. (the “Gree Companies”), an appliance manufacturer and two of its subsidiaries, have pled guilty to willfully failing to report to the Consumer Product Safety Commission (CPSC) under Section 15(b) of the Consumer Product Safety Act (CPSA). According to the U.S. Department of Justice (DOJ) and the CPSC, the Gree Companies knew their dehumidifiers were defective, failed to meet applicable safety standards, and could catch fire, but failed to timely report that information to the CPSC. Section 19 of the CPSA makes it unlawful to fail to furnish information required by Section 15(b), and such failures are subject to both civil and criminal penalties. While CPSC civil penalties have become fairly routine—the Gree Companies also paid a then-record $15.45 million civil penalty in 2016—this is the first corporate criminal enforcement action brought under the CPSA, according to the DOJ.
Continue Reading Silence Isn’t Golden: Failure to Report Consumer Product Safety Issues Results in Rare $91 Million Criminal Penalty
Last month, U.S. Representative Grace Meng (D-NY) announced that she has reintroduced legislation—the Total Recall Act—to change the way that businesses notify the public about recalls. The text of the legislation can be found here.
H.R. 3724, entitled the “Total Recall Act,” requires firms engaged in a product recall to post recall notices on their websites and all social media accounts, and also spend a defined amount of money on publicizing the recall depending upon whether it is mandatory or voluntary. For a mandatory recall, which is an incredibly rare event, businesses would be required to expend a sum of money that equals at least 25% of what the firm spent on marketing the product prior to its recall. On the other hand, for common voluntary recalls, firms would be required to use at least 25% of the product’s original marketing budget as well as 100% of the product’s social media marketing budget on publicizing the recall. The bill would also mandate that the U.S. Consumer Product Safety Commission provide an annual report to Congress on participation rates for each recall.
Continue Reading Product Recall Notification Legislation Reintroduced in Congress
On May 21, 2021, the U.S. Consumer Products Safety Commission (“CPSC”) published a report on artificial intelligence (AI) and machine learning (ML) in consumer products. The report highlights recent CPSC staff activity concerning AI and ML, proposes a framework for evaluating the potential safety impact of AI and ML capabilities in consumer products, and makes several recommendations that the CPSC can take in identifying and addressing potential hazards related to AI and ML capabilities in consumer products.
Concerning staff activity, CPSC recently hired a Chief Technologist with a background in AI and ML to address the use of AI in consumer products. The CPSC also recently established an “AI/ML Working Group” and held a virtual forum on AI and ML in March 2021.
Informed by the discussions held with various stakeholders at this forum, the CPSC staff has proposed a framework in the report for evaluating the potential safety impact of AI and ML in consumer products. The framework’s first step involves screening products for AI and ML “components.” The CPSC and stakeholders have identified the following components to be essential to producing an AI capability: data sources, algorithms, computations, and connections. Likewise, the CPSC and stakeholders have found the following components to define ML capabilities: assessing and monitoring outputs, analyzing and modeling changes, and adjusting and adapting behavior over time. The framework’s second step involves assessing the functions and features of consumer products’ AI and ML capabilities. The third step involves understanding how products’ AI and ML capabilities may impact consumers, which can be accomplished by studying the nature of the technology, how it is implemented in the product, and how the consumer might use the product. The final step involves ascertaining if, and to what extent, AI and ML capabilities may transform the product and/or its use over time.
Continue Reading CPSC Publishes Report on Artificial Intelligence and Machine Learning