Advisory Group Recommends Cost/Benefit Analysis for CPSC Regulations

We have posted before about the impact of regulations on clients and indirectly on product litigation. Earlier this month the Administrative Conference of the United States, a federal advisory council, gave its approval to a policy recommendation encouraging independent regulatory agencies to apply formal cost-benefit analysis to their rule-making efforts. One affected agency would be the Consumer Product Safety Commission.

Readers may know that the ACUS is an independent federal agency dedicated to improving the administrative process through consensus-driven applied research, providing nonpartisan expert advice and recommendations for improvement of federal agency procedures. Its membership is composed of federal officials and experts with diverse views and backgrounds from both the private sector and academia.

Several independent regulatory agencies are not subject to the benefit-cost analysis requirements of various Executive Orders or legislation.  The ACUS undertook a project to examine the possible use of benefit-cost analysis at independent regulatory agencies and to highlight any innovative practices those agencies could use. The group adopted a recommendation encouraging agencies to voluntarily adopt certain practices that other agencies have developed when conducting regulatory analyses for major rules. The recommendation, first, identifies various policies and practices used in several regulatory agencies and offers a series of proposals to encourage their use in other agencies. For example, it recommends that each independent regulatory agency develop written guidance on the preparation of benefit-cost and other types of regulatory analyses.

Second, the recommendation highlights a series of analytical practices that OMB has promulgated in the past. For example, it recommends that agencies’ analyses be as transparent and reproducible as practicable, subject to the limitations of law and applicable policies (including preventing the disclosure of proprietary information or trade secrets, or other confidential information). The recommendation does not
seek to establish a one-size-fits-all approach to regulatory analysis, and recognizes that each agency must tailor the analyses it conducts to accord with relevant statutory requirements, its own regulatory priorities, and the potential impact of the analysis on regulatory decision-making to ensure proper use of limited agency resources. 

Note that during the debate on the measure, at least one CPSC commissioner argued against requiring a cost-benefit analysis.

Following the report, Senate Bill 1173 was introduced to require independent agencies to analyze the costs and benefits of new regulations and to tailor new rules to minimize unnecessary burdens on the economy. "The Independent Agency Regulatory Analysis Act of 2013" would apply to any proposed new rule with an economic impact of $100 million or more annually. Sponsors argue there is no good reason the independent agencies should not conduct the same important review other executive agencies must.


 

"Doe" Wins Challenge to CPSC Database

Readers may recall we have posted before about an unnamed company that had filed a suit, under seal, to challenge aspects of the Consumer Product Safety Commission's new public database. The federal district court found for the company earlier this week, ruling that the agency's attempt to publish an incident report on the database about the company's product was arbitrary and capricious, and an abuse of discretion. See Company Doe v. Tenenbaum, No. 8:11-cv-02958 (D. Md.10/9/12).

The Consumer Product Safety Improvement Act of 2008 mandated the creation of a consumer product safety information database, and from the beginning, there was controversy about the absence of an adequate process for addressing false and inaccurate reports that will scare consumers, harm business, and generate no additional safety gains; the need to employ means to prevent the submission of fraudulent reports of harm while not discouraging the submission of valid reports; the importance of not putting the governmental imprimatur on voluntary data that has not been verified; and the absence of a sufficient time period allocated for manufacturers to evaluate and respond to any proposed report.

Much of the opinion is redacted, but the suit related to material inaccuracies with respect to a report of alleged injury that found its way into the database. The company protested inclusion of the report, and presented evidence regarding the alleged injury and alleged risk of harm. The CPSC apparently redacted the report twice in an attempt to make it not materially inaccurate. Plaintiff then sued, saying the issues had not been fixed, and later used results of the CPSC's ongoing investigation of the product to renew its objections.  Eventually, the CPSC rejected the company's final objection to the many-times redacted report.

The court cannot substitute its judgment for the agency's but can overturn arbitrary and capricious agency actions.  The court found that the publication decision was an abuse of discretion, because it violated the requirement that the harm "relate to" the use of the product, and would violate the prohibition of publication of materially inaccurate information.  Related to was correlated with associated with or connected with, and the CPSC initial agreements to redact much of the report as inaccurate undercut the later argument that a sufficient "relation to" had been demonstrated to let the final version be published. And mere speculation about a causal link was not sufficient evidence of an actual connection. Similarly a theoretical possibility or mere mathematical possibility was not proof of a sufficient relationship.

On the second prong, the court attempted to put itself in the shoes of the average consumer, and to use inferential reasoning to conclude the report was materially inaccurate and misleading. Interestingly, the court found that the CPSC standard disclaimer that it does not guarantee the accuracy of outside submitted reports, this was "boilerplate" that would not be of interest to the average consumer.

Finally, the court rejected the CPSC's "doomsday" arguments about the impact of the case on the database. The regulations expressly permit a challenge to materially misleading reports, and the court referenced a 2011 GAO report on the evealuation of reports, so a finding that a report is indeed inaccurate would not bring the "apocalypse."  Nonetheless, the ruling appears to represent a clear victory for consumer product manufacturers who are worried about inaccurate consumer complaints.  The decision does not strike at the idea of the database itself as much as it may encourage the CPSC to take a closer look at any reports that a manufacturer challenges as materially inaccurate or misleading.

CPSC Commissioners Testify At Hearing Regarding Database

Issues about the product complaint database set up by the U.S. Consumer Product Safety Commission bubbled over again last week.  We have posted on the topic before.

The CPSC-operated database allows consumers, government agencies, and others to submit reports of alleged injury or death allegedly caused by a product. Since the beginning of the database notion, there have been serious concerns about the accuracy and confidentiality of reports of alleged injury submitted and conveyed back to the public in the database. There has always been an apparent lack of attention to legitimate issues of a manufacturer's goodwill and reputation, to the costs of unnecessary panic among product consumers, and the mischief that some plaintiffs' lawyers might cause with unwarranted increase in litigation against manufacturers.  Obviously, false or inaccurate information does not serve the interests of consumers. And CPSC allows reports by parties who are more likely to have an agenda that goes beyond merely advising CPSC of an incident. The possibility that someone might attempt to seed the database with inaccurate or misleading information to provide ostensible support for lawsuits is a real concern for many observers.

As we noted, an anonymous company sued the CPSC last Fall over an apparently false report in the database.

Last week, Commissioner Anne Northup testified before a Subcommittee on Commerce, Manufacturing, and Trade of the House Energy and Commerce Committee at a hearing on “Oversight of the Consumer Product Safety Commission.” She addressed generally the issues with CPSC regulatory approaches. Commissioner Nord also testified, and she has reported that many of the complaints on the database were filed by law firms.

Chairwoman Mary Bono Mack, R-Calif., noted that the public database remains a source of controversy. Manufacturers continue to express their concern that most of the complaints are not vetted by the CPSC before they are made public, "opening the door to all kinds of mischief, whether to fuel law suits or to try and ruin a competitor’s brand."

Video of the hearing here.

Company "Doe" Files Suit Challenging the CPSC Database

Multiple reports indicate that an unnamed company filed a suit last week, under seal, to challenge aspects of the Consumer Product Safety Commission's new public database.

Readers may recall that the Consumer Product Safety Improvement Act of 2008 mandated the creation of a consumer product safety information database, and from the beginning, there was controversy about the absence of an adequate process for addressing false and inaccurate reports that will scare consumers, harm business, and generate no additional safety gains; the need to employ means to prevent the submission of fraudulent reports of harm while not discouraging the submission of valid reports; the importance of not putting the governmental imprimatur on voluntary data that has not been verified; and the absence of a sufficient time period allocated for manufacturers to evaluate and respond to any proposed report.

The suit was reportedly filed in federal court in Maryland, and relates to material inaccuracies with respect to a report of alleged injury that found its way into the database.  The suit apparently asks that the CPSC be enjoined from keeping the complaint about one of the company's products in the public database.

Almost anyone can file a “report of harm,” including consumers; government agencies; health care professionals; child service providers; and public safety entities. Consumers could include not just the purchaser of the product but their personal injury attorney, with their own agendas.

Manufacturers have only a limited opportunity to review and dispute information in incident reports before they are published on-line in the CPSC database. Manufacturers have limited control over what information can be removed or amended once posted. The two dissenting votes at the time the CPSC commissioners approved the database made an unsuccessful attempt to amend the final rule so as to give manufacturers more time to comment on or respond to the inaccuracy of postings before they are published to the database and to the public.

The database is accompanied by a weak disclaimer stipulating that CPSC has not verified the accuracy of any report. Observers continue to worry that the agency has not paid sufficient attention to legitimate issues of a manufacturer's goodwill and reputation, to the costs of unnecessary panic among product consumers, and the mischief that plaintiffs' lawyers might cause with unwarranted increase in litigation against manufacturers.

A recent U.S. Government Accountability Office report on the database found that of 1,800  published reports, manufacturers noted that 160, nearly 10%, had materially inaccurate information.

 

CPSC General Counsel Speaks at DRI

I am attending the DRI Product Liability Conference in New Orleans this week (as I know a number of readers are). Your humble blogger serves as Chair of the Mass Torts and Class Action sub-committee.

At the keynote address, Cheryl Falvey, Esq., General Counsel of the Consumer Product Safety Commission, spoke about an issue we have posted on before, the new incident report database.
With the usual disclaimer that she was not speaking for the CPSC officially, she shared a number of personal insights.

The new database went on line last month, and the first consumer reports were posted last week. It can be viewed through the Commission site with a link to SaferProducts.gov. There is a search function for products or manufacturers names, and it lists any recalls and reports, which can be filtered by date.

She indicated that, like Congress and the bar, the Commission is extremely divided on the new database. She stressed that, per the statutory requirement, there is a disclaimer on the site that: CPSC does not guarantee the accuracy, completeness, or adequacy of the contents of the Publicly Available Consumer Product Safety Information Database on SaferProducts.gov, particularly with respect to information submitted by people outside of CPSC. She admitted, however, that some lawyers may well seek to use the database to argue manufacturers were on notice of something regarding the product.

She noted that anonymous reports to the CPSC are not automatically published, but of course as to the public, every report on the website appears anonymous.

The CPSC believes it is mandated to publish reports of risks of harm as well as actual harm.

The Commission, she says, investigates only about 10% of the reports received; they do not have the budget and resources to investigate every report, let alone investigate reports before they are published. The CPSC is thus "not adjudicating" the product complaints, just posting them.
 

House Hearing on Consumer Product Safety Improvement Act

The House Energy and Commerce Committee's Subcommittee on Commerce, Manufacturing, and Trade, chaired by Rep. Mary Bono Mack (R-CA), held a hearing last week to examine the unintended consequences of the Consumer Product Safety Improvement Act of 2008 on American job creators, including small businesses. The purpose of this oversight hearing was to develop an understanding of the problems created by CPSIA, including the practical impediments to implementation; the impact of CPSIA on children’s safety; the impact on American jobs and businesses of all sizes; and practical ways to amend the law without endangering children’s health.

Two panels of witnesses testified before the Subcommittee. On the first were Honorable Inez Tenenbaum, Chairman, Consumer Product Safety Commission; and Honorable Anne Northup, Commissioner, Consumer Product Safety Commission.   The second panel included a mix of child safety advocates and representatives of small business industries.

The Chair noted that as a former small business owner, she recognized how unnecessary regulations – even well intentioned ones – can destroy lives.  Rick Woldenberg, the operator of Learning Resources, Inc., a small business making educational products and educational toys, testified on the many difficulties associated with the new, burdensome regulatory requirements. His company, Learning Resources, Inc., has recalled a grand total of 130 pieces in a single recall since its founding in June 1984, showing management of safety risks that was highly effective long before the government intervened in the safety processes.

CPSC Commissioner Northup testified on the exorbitant costs to small businesses, stating that in  March 2009, Commission staff reported that the economic costs associated with the CPSIA would be in the billions of dollars. Small businesses without the market clout to demand that suppliers provide compliant materials have been hit the hardest. Many report that the new compliance and testing costs have caused them to cut jobs, reduce product lines, leave the children’s market completely, or close.

CPSC Commissioner Anne Northup also focused on a key aspect of the new reporting database, observing that the Commission's database rule all but guarantees that the database will be flooded with inaccurate reports of harm, and thus it will be less useful for commission staff in determining hazard patterns than are the current, internal databases. She suggested that the Congress delay the launch of the database until new CPSC regulations can ensure that reports of harm contain sufficient information to permit verification, and the agency has an effective procedure in place to resolve a claim of material inaccuracy before a report is posted on the database.

She noted that the the Majority on the CPSC has expanded the list of database submitters to such an extent that virtually anyone can submit reports of harm—thereby rendering meaningless the statutory language listing permitted submitters. A database full of inaccurate reports from individuals who have second or third-hand information is not remotely helpful to consumers to determine which consumer product they should purchase.  Soliciting information from sources seeking to promote an agenda unrelated to simply sharing first-hand information invites dishonest, agenda-driven use of the database.  Trial lawyers, unscrupulous competitors, advocacy groups and other nongovernmental organizations and trade associations serve their own agendas and lack an incentive to prioritize accuracy in their reports of harm.  In particular, she testified, plaintiff trial lawyers with self-serving motives will use the Commission’s database to look for potential trends and patterns of hazards. Under the current database rule, this same group could also submit to the database false and unverifiable reports to fuel a lawsuit.


 

CPSC and CDC Release Report on Alleged Drywall Deaths

The Consumer Product Safety Commission released a report of an investigation it had requested be performed by the CDC's National Center for Environmental Health regarding deaths allegedly associated with exposure to imported drywall.  The report concludes that the drywall was not a contributing factor in the deaths of the people who had previously lived in or visited homes reported to contain problem drywall.

The investigation included reviews of the pertinent medical records,  interviews of witnesses, and available information from state public health authorities.   The CDC review confirms the results of previous reviews conducted by CPSC itself.  The cause of death in each case was clearly a primary, and often secondary, pre-existing chronic health condition.  Subjects typically had multiple long-term, severe, pre-existing conditions.  

We have posted about the drywall issues here and here


 

CPSC to Hold Webinars on New Product Safety Database

The Consumer Product Safety Commission is holding two Web conferences to demonstrate to interested stakeholders various aspects of its new (and still controversial) consumer product safety information database.  The conferences will focus on the incident reporting form, industry registration and comment features, and the search function of the publicly available part of the database.

The first Web conference will be held from 10:30 a.m. to 12:30 p.m. today, January 11, 2011, and the second Web conference will be held from 10:30 a.m. to 12:30 p.m. on Thursday, January 20th. The first Web conference will focus on the incident form that the public will use to file a report of harm and the search function of the database. The Web conference is intended to inform all interested stakeholders of the information required on the form to be used to report an incident, in addition to an explanation of the public search function of the Database.  The second Web conference will focus on the industry registration and comment features, the process for reporting incidents, and the public search component of the database.  It will address how to access and use the new business portal, and how to register an account on the business portal, which is designed to facilitate more efficient electronic notice, review, and comment on reports of harm before they are published in the database.  The database is set to go live March 11 through the CPSC's website.

As we have noted, the database raises a number of significant issues for our readers, as the CPSC will not be able to guarantee the accuracy of reports before it publishes them on the database, important confidentiality concerns may be compromised, and the data appears vulnerable to trolling and misuse by plaintiff lawyers.  Reports of harm will be published in the database 10 business days after the company has been provided notice of the report of harm. The CPSC has acknowledged that it will not be able to independently verify the accuracy of the information in the reports in that time, so  manufacturers will need to attempt to ask the CPSC to remove “materially inaccurate information” and “confidential information” in the report before it is published, or file comments about the report of harm to be published along with the report in the database.  As a practical matter, it may be difficult for a company to fully investigate the allegations in the report in that time frame. Moreover, any such investigation will likely not include an interview of the person who filed the report, because the person filing the report can choose to not release his or her name.

Reports may be filed not only by consumers but by health care workers, attorneys, and many others. Plaintiffs' lawyers have an unhealthy incentive to seed the database with self serving reports, and, at the least, may search the database looking for products to go after.

Again, companies should register with the CPSC so that they can receive the most timely notice of a report filed about their products.  It may make sense to consider developing an SOP for reviewing and following up on reports in the database, including designation of a lead reviewer or team to follow through. This SOP may include a plan for quickly preparing the appropriate documentation that the company's products are in fact reasonably safe, and for dealing with any adverse PR.  


 

CPSC Approves Product Safety Database Rule

The U.S. Consumer Product Safety Commission last week gave final approval to the controversial
new consumer product safety database, overriding very real concerns about who should be permitted to submit incident reports and how they will be verified as accurate. Readers may know that Section 212 of the Consumer Product Safety Improvement Act of 2008 (‘‘CPSIA’’) amended the Consumer Product Safety Act (‘‘CPSA’’) to require the Commission to establish and maintain a publicly available, searchable database on the safety of consumer products, and other products or substances regulated by the Commission.

CPSC commissioners split along party lines in the 3-2 vote, which came after  a final discussion of whether the regulation would simply give certain interest groups a new forum to attack product makers and plaintiff lawyers a new tool, giving rise to lawsuits based on a rumor repeated through the echo chamber of the Internet.

The rule will give consumers access to reports of alleged product-related safety incidents via a new publicly accessible database.  Consumers, government agencies, and various public health and safety interest groups will be able to post largely self-verified reports related to the safety of any product regulated by the CPSC.

Manufacturers will have limited control over what information can be removed or amended once posted.  The two dissenting votes made an unsuccessful attempt to amend the final rule so as to give manufacturers more time to comment on or respond to the accuracy of postings before they are published to the database and to the public. 

The database will be accompanied by a weak disclaimer stipulating that CPSC has not verified the accuracy of any report.  But the Democratic commissioners rejected any system by which the CPSC could investigate obviously questionable claims and find out the origin of such reports before allowing the public to see and use them.   We posted about these very issues last Spring, and argued that the CPSC had not fully addressed them.  It still seems that insufficient attention has been paid by the majority commissioners to legitimate issues of a manufacturer's goodwill and reputation, to the costs of unnecessary panic among product consumers, and the mischief that plaintiffs' lawyers might cause with unwarranted increase in litigation against manufacturers.

Accordingly, a product seller may only make a comment in response to the report of harm, which may be published; claim the report of harm contains confidential business information, triggering a CPSC review of the claim; and/or claim the report of harm contains materially inaccurate information (e.g., that it is not the manufacturer or private labeler of the product), triggering a CPSC review of the claim. Materially inaccurate information is narrowly defined to include information that is false or misleading and relates to a matter which is so substantial and important as to affect a reasonable consumer’s decision making about the product. 

CPSC is expected to have the database go live at www.saferproducts.gov in March, 2011. In the meantime, the Commission plans to start outreach on business portal registration and features; conduct workshops with manufacturers and private labelers; offer training webinars; and finalize the new incident report form.

CPSC Shares Public Comments on Product Database

The Consumer Product Safety Commission is in the process of reviewing comments submitted on the impending consumer product safety information database. The agency has posted the comments received.

No surprise, those consumer-oriented interest groups in favor of a database generally praise what CPSC is proposing to do, and industry groups reiterate concerns they have about the implementation of the database concept.

As we have posted before, even back to the time Congress was considering this provision, there remain concerns about the accuracy and confidentiality of reports of alleged injury submitted and conveyed back tot he public in the database;  and the CPSC remains vague about how it will provide "due process" for product sellers who could find the database being used against them even when it contains erroneous, duplicate, or confidential data.  for manufacturers and private labelers.  There seems scant attention to legitimate issues of a manufacturer's goodwill and reputation, to the costs of unnecessary panic among product consumers, and the mischief that plaintiffs' lawyers might cause with unwarranted increase in litigation against manufacturers.


Organizations such as  the National Association of Manufacturers noted that false or inaccurate information does not serve the interests of consumers. Congress knew that counterfeit products are too common in the marketplace and may be confused with real brand name products.  Manufacturers and private labelers of products have a legitimate interest in protecting their brands from inaccurate, defamatory, and intentionally false statements and in protecting trade secret and confidential commercial information.  Accordingly, a request for confidential treatment “is not a matter that should be left to the discretion of a CPSC staffer,” NAM said.

Industry groups also worried about the CPSC's unduly broadening the list of people who can submit a report to the database. Broadening the list of reporting parties does not serve the Congressional interest in providing accurate information to consumers about reports of harm. It is obvious why parties included in CPSC's broad proposed listing of "others" may not be reliable reporters of an incident. CPSC has largely added parties who are more likely to have an agenda that goes beyond merely advising CPSC of an incident. The possibility that someone might attempt to seed the database with inaccurate or misleading information to provide ostensible support for lawsuits is a real concern. 

So far, the Commission has not ensured that the CPSC will deal with accuracy challenges in a timely manner. Conceivably, busy CPSC staff might take weeks, months, or even years to determine whether information that is posted on the database is materially inaccurate.  CPSC has also set up a catch-22 procedure for handling such challenges. CPSC has asked firms who wish "expedited" treatment to submit no more than five pages including attachments to show a problem. However, CPSC has simultaneously set a standard of  "significant evidence" to support claims that information is materially inaccurate.  To provide sufficient evidence to support a challenge, a manufacturer may need to provide more than 5 pages of information; however, if they do so,  CPSC will publish first, and resolve the challenge at some indefinite time in the future.

These parts of the proposal likely will not withstand judicial scrutiny, nor should they have any credibility with the public.

 

CPSC Finds No Product Link to Alleged Diaper Injuries

The Consumer Product Safety Commission, aided by Health Canada, has not been able to identify any link between new technology diapers and reports of alleged diaper rash-like injuries in users. CPSC says it looked into nearly 4,700 reports of diaper rash from April to August, 2010, but cannot identify a "scientific connection.”

Readers may recall that we posted about plaintiffs who have sued the Procter & Gamble Co. in a proposed national class action, alleging that new Pampers diapers containing “Dry Max” technology is causing rashes and "chemical burns" in some infants. See Clark, et al. v. Procter & Gamble Co., No. 10-301 (S.D. Ohio, 5/11/10).  What was most interesting for our readers, perhaps, is the fact that this litigation was apparently spurred by the social networking site, Facebook, where some parents have been blaming the new diapers for rashes. This has spread not only word of the incidence of a possible problem, but also the non-scientific, non-expert attribution of causation.

The CPSC said the on-line activism was part of what prompted them to try to get to the bottom of the alleged diaper issues. But it now has reported that the review has not identified any specific cause linking Dry Max diapers to diaper rash. CPSC notes that nearly 85 percent of the complaints came in May and then dropped off significantly -- which, MassTortDefense notes,  wouldn't make sense if the diapers actually were causing problems.

As part of its technical evaluation, staff from each agency considered certain characteristics of the diaper, including the materials used, the construction of the diaper, and heat and moisture retention issues.  In addition, CPSC staff reviewed clinical and toxicological data found in published, peer-reviewed medical literature. CPSC also critically reviewed data submitted by Procter & Gamble and the results of a human cumulative irritation patch study conducted by P&G in May 2010. Further, chemistry, toxicology and pediatric medicine information provided by Health Canada was reviewed by CPSC.

Both agencies say they will continue to evaluate consumer complaints related to Pampers Dry Max diapers and will provide parents with updated information if this assessment of no link somehow changes. Parents and caregivers were advised to seek the attention of a medical professional if they have any concerns about adverse health reactions to any baby product.  But most babies exhibit diaper rash at least once in their lifetime. At any given moment, more than 250,000 babies will experience a serious rash.  Diaper rash is not only very common, it is sometimes severe, regardless of the diaper used. Disposable diapers in fact have helped reduce the incidence of rash by more than 50 percent since they were first introduced in the 1960s because they pull wetness away from a baby's skin.

Window Closing on Time to Comment on CPSC Draft Strategic Plan

In 2008, as readers know, the CPSC was granted extensive new regulatory authorities and mandates to on consumer product safety issues through the Consumer Product Safety Improvement Act (CPSIA).   So what's next? The Commission recently completed a strategic planning process intended to help align resources with agency priorities to meet what it sees as the key challenges moving into the next decade.

The CPSC is for only a short time longer accepting comments on a new draft of its 2011–2016 strategic plan.  As globalization and technological advances expand the range of products on the market, the risks and opportunities associated with these advancements make the challenge of overseeing and regulating the thousands of product types all the more complex, says CPSC. Some risks include the growth of global supply chains that assemble products across a vast web of interconnected geographies, the difficulty of identifying product hazards among hundreds of thousands of containers entering US ports, and the new ways in which the public receives product information through the Internet and other media sources.

The revised plan details CPSC efforts to set consumer product safety priorities, efficiently identify and respond to product hazards, improve public outreach efforts, and raise awareness of potential product risks. The plan grew out of interviews and focus groups with 76 internal and external stakeholders to obtain feedback on the CPSC’s performance and how the agency can improve in the future (these individuals and groups included a cross-section of diverse stakeholders: consumer organizations, industry associations, the CPSC headquarters staff, the CPSC field staff, other federal agencies, and states’ attorneys general).

One goal of the plan is to find ways the CPSC can reduce the number of unsafe imported products entering the U.S. marketplace, such as by strengthening its bilateral and multilateral relationships with foreign regulators and manufacturers. The draft also states that CPSC wants to improve its response time for removing hazardous products from the market. 

A third major aspect of the plan relies on the new public product safety database, which is scheduled for launch in March 2011.  The database will allow consumers and others to submit reports of alleged harm in a Web-based, publicly search-able format to the CPSC. The database is to be designed with the needs of multiple types of users in mind. Creation of the database is being guided by a series of public hearings, focus groups, and joint workshops with CPSC staff to determine how manufacturers, retailers, and consumer advocates expect to use the database and how they think it should work. The new system is supposed to make it simple for consumers, industry representatives, health officials, and any other member of the public to report safety incidents and view publicly reported incident information that the CPSC has amassed on a particular consumer product safety concern.

We reported earlier this year on the notice of proposed rulemaking that would establish a publicly available consumer product safety information database. As we have noted at MassTortDefense, CPSC still needs to develop a rigorous and timely process for addressing false and inaccurate reports-- those that will scare consumers, harm business, and generate no additional safety gains. The commission needs to employ means to prevent the submission of fraudulent reports of harm while not discouraging the submission of valid reports. CPSC also needs to think about specific disclaimers it should make with regard to the accuracy of the information contained in the public database, and not put any governmental imprimatur on voluntary data that has not been verified. A sufficient time period should also be allocated for manufacturers to evaluate and respond to any proposed report.
 

Update on Chinese Drywall Litigation

The Consumer Product Safety Commission last week announced the results of testing performed by the Lawrence Berkeley National Laboratory on allegedly defective drywall samples.  Among the findings, most of the drywall that has allegedly caused personal injury and corroded electrical components in various homes throughout the U.S. was indeed manufactured in China;  specifically,  the most reactive sulfur-emitting drywall samples were all produced in China, according to the CPSC.  The worst-testing samples of the Chinese drywall showed emission rates of hydrogen sulfide 100 times greater than non-Chinese drywall samples.

CPSC released the names of the 10 worst-performing samples, including those of Knauf Plasterboard (Tianjin) Co. Ltd. for drywall manufactured in 2005, Taian Taishan Plasterboard Co. Ltd. for drywall manufactured in 2006, Shandong Taihe Dongxin Co. for drywall manufactured in 2005, Beijing New Building Materials for drywall manufactured in 2009.  Drywall samples manufactured in the United States in the same period contained low or no detectable emissions of hydrogen sulfide, according to the agency. 

At the U.S.-China Strategic and Economic Dialogue meetings in Beijing May 24-25, U.S. officials reportedly pressed the Chinese government to facilitate a meeting between CPSC and the Chinese drywall companies whose products were used in U.S. homes, and which exhibit the emissions identified during the testing procedures. The Strategic and Economic Dialogue represents the highest-level bilateral forum to discuss a broad range of issues between the two nations.

Federal cases concerning the drywall products are coordinated in multidistrict litigation pending in the U.S. District Court for the Eastern District of Louisiana. More than 7,000 plaintiffs have claimed that Chinese-made drywall in their homes emits sulfide gases that corrode electrical wiring and/or cause personal injury such as nasal damage and other respiratory problems.  In the first trial, the court ordered Taishan Gypsum to pay $2.6 million to seven plaintiffs last April. In the second trial, the court ordered Knauf Plasterboard to pay a plaintiff family $164,000.  In re: Chinese-Manufactured Drywall Products Liability Litigation, MDL No. 2047 (E.D. La.).

Cases are also pending in state court, and a state trial court in Miami recently certified a class in this litigation. Harrell v. South Kendall Construction Corp. et al., No. 09-008401 (11th Judicial Circuit, Fla.). Following a hearing last Thursday, Judge Farina granted class certification, the first Chinese drywall case to be certified. The class consists of approximately 150 claimants who were purchasers of homes in three subdivisions of the Keys Gate community there. The class alleged that those homes were built using Chinese drywall. Defendants are home builder Kendall Construction Corp., Palm Isles Holdings LLC, broker Keys Gates Realty Inc, and supplier Banner Supply Co.

The court found that a predominating common issue in each class member's case is whether the drywall installed in his or her house was defective. The trial court found that the alleged defect, the potential to emit sulfur gases that can cause damage, is inherent in the physical characteristics of the product and thus has a uniform nature. With one supplier and one builder allegedly involved, the court distinguished the case from other product defect cases in which individual issues are typically found to predominate.

The opinion noted that differences among proof of damages has typically not defeated class certification. The court stressed that if individual class member homeowners were to file their own separate actions, the court would be confronted with a multiplicity of lawsuits that would unnecessarily burden the court system and create the risk of inconsistent rulings and contradictory judgments.

While the court was clearly influenced by the belief that the issues surrounding the allegedly defective product were "unaffected by outside variables," like the way the product was used, its analysis of predominance is quite questionable.  For example, it concluded that a common issue was whether the defective drywall damaged the homes of the putative class members, and thus that the issue of injury (whether the drywall damaged all the homes) could be proved with class-wide evidence.  The fact is that enough of the drywall was imported to damage more than 50,000 homes; yet only a small percentage of that has been observed. Thus, it may be that any number of factors may be impacting the damage drywall is or is not causing in a particular house. Moreover, it is far too simplistic to talk about the injury or "damage" being caused, when there are hotly debated issues about whether there is injury to, or the need for remediation of, non-problem drywall, insulation, flex duct, molding, encapsulated wiring, counter tops, and a whole host of house components. Similar issues will relate to the causation of corrosion of a home’s electrical wiring or AC system.  

CPSC Issues Proposed Rule on Database

The Consumer Product Safety Commission has issued a notice of proposed rulemaking that would establish a publicly available consumer product safety information database.  Readers may know that Section 212 of the Consumer Product Safety Improvement Act of 2008 (‘‘CPSIA’’) amended the Consumer Product Safety Act (‘‘CPSA’’) to require the Commission to establish and maintain a publicly available, searchable database on the safety of consumer products, and other products or substances regulated by the Commission. We posted on some of the potential issues before.  Serious questions surround the potential posting of inaccurate, incomplete, or confidential information as part of the database.

The proposed rule would interpret the various statutory requirements pertaining to the information to be included in the database and also would establish provisions regarding submitting reports of harm; providing notice of reports of harm to manufacturers; publishing reports of harm and manufacturer comments in the database; and dealing with confidential and materially inaccurate
information.  The new regs would consist of four subparts:  Subpart A—Background and Definitions; Subpart B—Content Requirements; Subpart C—Procedural Requirements; Subpart D—Notice and Disclosure Requirements.

Some of the highlights: A submitter of a report of harm must affirmatively verify that he or she has reviewed the report of harm and that the information contained therein is true and accurate to
the best of the submitter’s knowledge, information and belief.  As part of verifying the report, submitters of reports of harm must indicate which category they are in (consumer,
government agency, health care professional etc.).

Proposed § 1102.12(a) would state that manufacturers who receive a report of harm transmitted from the CPSC may submit comments. Proposed § 1102.12(b) would propose that comments may be received via an on-line manufacturer portal where the manufacturer can register to submit comments on a secure nonpublic portal that will be provided through the Commission’s database. The proposal also would specify that comments may be submitted via electronic mail or regular mail. The Commission will publish a manufacturer’s comments related to a report of harm if the comment specifically relates to a report of harm, contains a unique identifier assigned to it, contains the manufacturer’s verification of the truth and accuracy of their comment (similar to the verification required of a submitter of a report of harm) as well as their consent for publication in the database. The proposed rule would require a manufacturer to affirmatively request that its comment be published and to affirmatively consent to such publication in order for the manufacturer comment to be published in the database.

CPSC says it will not publish confidential information in the database. Proposed §1102.24 explains how the Commission will define ‘‘confidential information’’ and would set forth criteria which must be followed to assert a claim of confidentiality. The Commission notes its view that most reports of harm received from consumers will not likely contain confidential information. However, where such a claim for a portion of information on a report of harm is asserted, the proposal would require affirmative statements that would assist the Commission in an evaluation of the merits of the request. The proposal would establish parameters for asserting and supporting a claim of a portion of a report of harm as confidential. For example, proposed § 1102.24(b)(3) would require an explanation on whether the asserted confidential portion of the report is commonly known or readily ascertainable by outside persons with a minimum of time and effort. Proposed § 1102.24(b)(5) would explain that the manufacturer also must support a confidentiality claim by describing how release of the information could cause competitive harm. Overall, one wonders whether the CPSC is trying to create a barrier to a valid claim of confidentiality much higher than in other contexts.

Proposed § 1102.26 would contain definitions and the process for how claims of materially inaccurate information contained in reports of harm may be asserted and how they will be evaluated. Materially inaccurate information in a report of harm means information that is false or misleading in a significant and relevant way that creates or has the potential to create a substantially erroneous or substantially mistaken belief in a database user about information in a report of harm relating to:
(i) The identification of a consumer product;
(ii) The identification of a manufacturer or private labeler; or
(iii) The harm or risk of harm related to use of the consumer product.

Written comments must be received by July 23, 2010.  It is not clear that the database plan offers adequate safeguards or assurances that the information posted will be true and accurate, will not simply lead to consumer confusion, and will not give rise to lawsuits based on a rumor repeated through the echo chamber of the Internet.  Although not as strong as we have called for here at MassTortDefense, § 1102.42 does have a disclaimer to the effect that the Commission does not guarantee the accuracy, completeness or adequacy of the contents of the Database, particularly with respect to the accuracy, completeness, or adequacy of information submitted by persons outside of the CPSC. The Consumer Product Safety Information Database will contain a notice to this effect that will be prominently and conspicuously displayed on the database and on any documents that are printed from the database.
 



 

Consumer Product Safety Commission Issues Draft Guidance on Definition of "Children's Products"

As readers know, much of the recent policy focus of the Consumer Product Safety Commission (as well as Congress) has been on the safety of products used by children. But what is a "children's product"?  The CPSC has announced it is issuing a proposed interpretive rule aimed at providing further guidance as to what constitutes a “children's product” to mitigate potential confusion among manufacturers about how to comply with the relevant new safety requirements, such as under the Consumer Product Safety Improvement Act.  The proposal would provide additional guidance on the factors that must be considered when evaluating what is a children's product. Written comments and submissions in response to this notice must be received by June 21, 2010.

Section 3(a)(2) of the CPSA (as amended by the CPSIA) defines a "children's product'' as a consumer product designed or intended primarily for children 12 years of age or younger. A determination of whether a product is a "children's product'' will be based on consideration of  four specified statutory factors, but because each of those four factors incorporates the concept of  "use'' by the child in some manner, under the proposed rule the Agency would further interpret the term "for use'' by children 12 years or younger to generally mean that children will physically interact with such products based on the reasonably foreseeable use and misuse of such product.

First factor: a manufacturer's statements about the product's intended use, including a label on such product; a manufacturer's statement that the product is not intended for children does not preclude a product from being regulated as a children's product if the primary appeal of the product is to children 12 years of age or younger. Similarly, a label indicating that a product is for ages 10 and up does not necessarily make it a children's product if it is a general use product. Such a
label may recommend 10 years old as the earliest age for a prospective user, not necessarily the age for which the product is primarily intended.

Second factor: if the product is represented in its packaging, display, promotion, or advertising as appropriate for use by children 12 years of age or younger. These representations can be express
(such as product advertising declaring that the product is for use by children 12 years of age or younger) or implied (such as product advertising showing the product being used by young children). These representations may be found in packaging, text, illustrations and/or photographs depicting consumers using the product, instructions, assembly manuals, or advertising media used to market the product. The prominence, conspicuousness, and or other emphasis given to each portrayal of a product's uses or intended users on packaging or in advertising media can be weighted differently according to which images or messages are the strongest and most obvious to the consumer at the point of purchase. For example, labeling in large, high contrast letters on the front of a package can send a stronger message than block letters in a small box on the package's side panel. Besides labeling and illustrations, a product's physical location in a retail outlet or visual associations in the pages of an on-line distributor's Web site could imply its suitability for a certain age group. The close association of a product in a store or on a Web site with other products that are clearly intended for children 12 years of age or younger could affect consumer perceptions of the intended age group for that product.

Third factor: whether a consumer product is designed or intended primarily for a child 12 years of age or younger is whether the product is commonly recognized by consumers as being intended for use by a child 12 years of age or younger. For example, traditional board and table games like chess, checkers, backgammon, playing cards, or Chinese checkers are commonly recognized as equally attractive to children and adults because the level of difficulty increases or decreases depending on the player's skill. Versions of these games, and similar games commonly considered by consumers to appeal to a general audience, are not considered children's products. However, if a manufacturer adds marketing portrayals or other features to the game or its packaging that make it more attractive to or suitable for children than a general use product would normally be, then the game could be  considered a children's product. Examples include small sizes that would not be comfortable for the average adult; exaggerated features (large buttons, bright indicators) that simplify the product's use by kids; safety features that are not found on similar products intended for adults; colors commonly associated with childhood (pinks, blues,
bright primary colors); features that do not enhance the product's utility, (such as cartoons), but contribute to its attractiveness to children 12 years of age or younger.

Fourth factor: the Age Determination Guidelines (``Guidelines'') issued by the CPSC staff in 2002, which focus on an age determination for a given product's intended user group,  The Guidelines provide information about the primary goals of play that are seen for different ages throughout childhood. For example, toddlers consistently want to mouth objects because mouthing is a primary strategy for exploration of any object at that age. Early  childhood entails lots of exploration and discovery. High levels of detail in their toys are not necessary, and toddlers like bright
colors. However, during middle childhood, children become very interested in role-playing, and they desire increasingly more realistic props during their playtime, and more realistic colors become
important. After a certain age, children do not consider the simplistic, brightly colored toys intended for toddlers to be intended for them and may find them very unappealing or even insulting. Nine to
12 year old children are interested in developing new motor skills and exercising their increasingly complex problem solving abilities. The factors that make various objects appealing to children of different ages are discussed at length in the Guidelines.

The proposed rules also offer examples in a number of product lines.

CPSC Chair Offers Comments on Database

U.S. Consumer Product Safety Commission Chairwoman Inez Tenenbaum testified last week at a  hearing before the U.S. Senate Subcommittee on Financial Services and General Government.  She noted that her agency was preparing to staff up for 2011 in anticipation of greater enforcement efforts under the Consumer Product Safety Improvement Act of 2008.  

Tenenbaum was seeking a slight increase in CPSC's approximately $118 million funding. She testified that the budget will allow CPSC to hire 46 new full-time employees, bringing total staffing staffing levels more than 1.5 times the complement as recently as in 2008.  Tenenbaum also noted that the CPSC would work closely with small businesses to ensure that CPSIA third-party verification requirements do not become a costly burden, by dedicating a business ombudsman to address concerns.

She testified that the CPSC is currently in the process of building the Consumer Product Safety Risk Management System, a Web-based database that is supposed to change the way CPSC collects, analyzes and deploys data about regulated products. She reiterated that the system is scheduled to be up and running by March 11, 2011.

We have posted about this database before.  And we had the opportunity to hear the Chair speak on the issue at the recent DRI Products Liability Annual Meeting.  She noted she understand the level of concern about the database.  The CPSC has issued a proposed notice of rulemaking on the database, and the recent Open Commission Briefing/Meeting on Public Database - Notice of Proposed Rules-making is available. To concerns from the manufacturing community about whether the database might allow for unconfirmed reports about their products, she noted that the CPSC does not want to publish inaccurate or confidential information. Every report of harm that is submitted will be reviewed by a member of the agency’s staff and, further, every report that identifies a manufacturer will be sent to that manufacturer, generally within 5 business days. She stressed the creation of a non-public manufacturer portal to speed receipt of and replies to these reports. She also stated that the agency will protect proprietary and confidential information from the companies.

While those goals are worthy, CPSC needs to develop a rigorous and timely process for addressing false and inaccurate reports-- those that will scare consumers, harm business, and generate no additional safety gains. The commission needs to employ means to prevent the submission of fraudulent reports of harm while not discouraging the submission of valid reports. CPSC also needs to think about specific disclaimers it should make with regard to the accuracy of the information contained in the public database, and not put any governmental imprimatur on voluntary data that has not been verified. A sufficient time period should also be allocated for manufacturers to evaluate and respond to any proposed report.

Update on CPSC Database Issues

We have posted before about one of the more controversial aspects of the Consumer Product Safety Improvement Act, the to-be-created publicly accessible database of product safety information.

The CPSIA mandates that the database be completed by March, 2011. The agency views its task as the creation of a public portal and a publicly accessible, searchable database of consumer product incident reports. Through the public portal, consumers will theoretically be able to report potential product safety hazards to CPSC in ways that are supposed to improve the quality, value, and accuracy of the data collected. Manufacturers will be able to investigate and respond to product hazard reports more quickly, and to share information with both CPSC investigators and with the public through the public database. And consumers are supposed to be able to use the public portal and database to find more information about hazards in order to keep their families safe.

Unless done very carefully, the database will be of little use to the average consumer, but subject to potential mischief in the hands of plaintiff lawyers.

Since last Fall, the CPSC has held various meetings and a two-day public workshop to gather stakeholder input on the new database. A number of affected groups have submitted comments on the implementation of the new product safety database, including the Soap and Detergent Association.  A common theme for the comments is the need for the CPSC to focus on verifying and ensuring the accuracy of safety incident reports submitted to the commission. Factual accuracy and veracity are two fundamental elements underpinning a credible incident database. 

CPSC needs to develop a process for addressing false and inaccurate reports that will scare consumers, harm business, and generate no additional safety gains. The commission needs to employ means to prevent the submission of fraudulent reports of harm while not discouraging the submission of valid reports.  CPSC also needs to think about specific disclaimers it should make with regard to the accuracy of the information contained in the public database, and not put the governmental imprimatur on voluntary data that has not been verified.  A sufficient time period should also be allocated for manufacturers to evaluate and respond to any proposed report.    

CPSC Releases Study of Chinese Drywall

To date, CPSC has received more than 2000 reports from 32 states, the District of Columbia and Puerto Rico, from consumers and homeowners concerned about alleged problem drywall from China in their homes. The majority of consumer complaints on allegedly defective drywall have come from Florida and Louisiana.

The CPSC last week released a study of Hydrogen Sulfide Gas in connection with its Chinese drywall investigation.  Specifically, CPSC released results from a major indoor air study of 51 homes, and initial reports from two studies of alleged corrosion in homes with Chinese drywall. The 51 home study was actually contracted by CPSC and done by Environmental Health & Engineering (EH&E). The  two preliminary reports on corrosion safety issues are from the Sandia National Laboratories’ (SNL) Materials and Engineering Center concerning the long-term electrical safety hazards of conductor metal components, and the National Institute of Standards and Technology (NIST), studying the corrosion effects on fire safety components taken from complaint homes.

EH&E compared 41 “complaint” homes in five states selected from CPSC’s consumer
incident report database, with 10 non-complaint homes built around the same time in the
same areas as the complaint homes. Homes were sampled between July and September
2009. The EH&E findings were that hydrogen sulfide gas appears to be the essential component that causes copper and silver sulfide corrosion found in the complaint homes. Other factors,
including air exchange rates, formaldehyde and other air contaminants appear to contribute to the
reported problems.  The reports do not explain how the hydrogen sulfide gas is being created in homes built with Chinese drywall. (Earlier studies found varying amounts of elemental sulfur in the Chinese drywall.)

In terms of method, EH&E exposed copper and silver test strips, known as coupons, in homes for a period of about two weeks. The coupons showed significantly higher rates of corrosion in complaint homes than in the control homes. The dominant species of corrosion on the coupons were copper sulfide and silver sulfide, as determined by additional laboratory tests. Visual inspection and evaluation of ground wire corrosion also revealed statistically significant greater ground wire corrosion in complaint homes compared to non-complaint homes. The EH&E study also found that by using hand-held x-ray fluorescence and Fourier Transform Infrared instruments, they were able to detect markers that could identify Chinese-made dry wall at a sheet-by-sheet level.

The study did not link the corrosion with any long term safety effects, which are still under investigation. The levels reported, however, are well below the amount associated with long term health effects in the literature.

Like the EH&E study, initial reports from SNL and NIST show copper and silver sulfide corrosion on samples of metal taken from homes with problem drywall.

In terms of next steps, CPSC continues to search for homes exhibiting the alleged corrosion and health effects under study. Second, the federal Interagency Task Force has established an Identification and Remediation Protocol Team of scientists and engineers. This Team will try to use the results of the EH&E study and other information to design a screening protocol to identify homes with this problem.  Because professional air sample testing, and destructive testing of drywall both are costly, the Protocol Team is trying to develop quick, cost-efficient evaluation methods to identify homes with these problems. The Protocol Team will also look at remediation protocols, to see what cost-efficiency improvements to current remediation practices, if any, may be available, and what guidance should be issued on doing the work safely.

CPSC believes it has secured the cooperation of the Chinese Government to help identify the sources and causes of this problem. The agency believes that no new Chinese drywall has entered the United States in 2009. CPSC is also working with an ASTM committee that has just initiated discussions on the formulation of a proposed new standard on inspection of drywall for air quality issues.

Chinese Drywall Update

On the eve of the 3rd biennial United States--China Consumer Product Safety Summit, to be held in China, the head of the Consumer Product Safety Commission reported she will press Chinese officials on whether new regulatory standards need to be set for drywall composition. CPSC Chairwoman Inez Tenenbaum said she also would inquire whether the Chinese were willing to provide compensation for the damage from tainted drywall.

In its latest status report on the Chinese drywall issues, the CPSC noted that it had received 1192 consumer complaints, from 24 different states. The majority of the reports continue to be from Florida, Louisiana, and Virginia. The focus of the federal drywall team has remained pursuing the scientific bases of the possible problems, and tracing the chain of commerce of the drywall.

CPSC reports it has completed principal field work for a 50 home indoor air sampling program, coordinated the state and federal response to allegations of radioactive phosphogypsum in Chinese drywall, and completed 75 in-depth site investigations, with another 20 in progress. Long-term air sampling tests will be completed later this month. The evaluation of the results is expected to be complete before November. (Phosphogypsum is a gypsum that has elevated levels of naturally occurring potassium, thorium and uranium radionuclides and decay products.) The CPSC coordinated testing and reporting results for radioactive phosphogypsum contamination in drywall with the Florida Department of Health and the EPA National Air and Radiation Environmental Laboratory. The results of the technical review showed that no radiological hazard was present. EPA is conducting elemental analyses of 15 drywall samples. EPA expects to complete its analyses of drywall samples in the next few weeks.

CPSC continues to analyze the information received from consumers, builders, importers, manufacturers, and suppliers of drywall to determine how much imported drywall may be affected and where that drywall has been installed. To date, CPSC staff has confirmed that during 2006, 6,997,456 sheets of Chinese drywall were imported into the U.S.

As readers of MassTortDefense know, litigation has been filed over the drywall issues, alleging that sulfur levels in the Chinese-made products are abnormally high, causing problems with air conditioning systems, appliances, internal wiring and other electrical systems.  Approximately 200 cases are pending in the MDL. In re: Chinese-Manufactured Drywall Products Liability Litigation, No. 09-md-02047 (E.D. La.).

In the MDL , the next status conference is scheduled for Thursday, November 19, 2009. Recently, the court  issued an order regarding a "Revised Exporter, Importer, or Broker Defendant Profile Form.”  All defendant drywall exporters, importers, or brokers must complete this Profile Form.  The form, inter alia, requires information on exemplar transactions concerning the exportation/importation/brokering of Chinese Drywall for import/export to the United States between 2001 and 2009, including but not limited to purchases, sales, consignments, shipments, transfers, deliveries, receipts, or other distributions.  The form requires information to identify any markings on the Chinese Drywall product (e.g., lot number, batch number, serial number, color markings, UPC codes, etc.) involved in this transaction; a list all trademarks of the product, and any markings or means of identification employed to track or identify the Chinese Drywall.

The issue of linking the specific product that allegedly harmed a plaintiff to the defendants who made and sold that particular product -- often termed "product identification" -- is an essential aspect of the cause in fact inquiry and is often problematic in toxic tort litigation.

 

 

Update On Chinese Drywall Litigation

The Consumer Products Safety Committee has reported that it has received approval from the Chinese for a visit to China in connection with the drywall issues, and that CPSC staff is working with the Chinese government to arrange an investigative visit beginning later this month.  The CPSC has asked to visit several sites of interest in its investigation of issues related to the tainted drywall, which we have posted about before.

The CPSC reports that it has now received a total of 810 reports related to the allegedly defective drywall, including complaints from two additional states, Pennsylvania and South Carolina. That means the Commission has received reports from homeowners in 23 states and the District of Columbia. The majority of the reports continue to be from Florida, Louisiana, and Virginia.  About 6.2 million sheets of Chinese drywall were imported into the U.S. during 2006.

As part of its investigation, the Commission notes the:
• Start of the Lawrence Berkeley National Laboratory chamber testing of various drywall samples to isolate specific emissions.
• Start of a 50 home indoor air sampling program.
• Site visit to a synthetic drywall manufacturing facility.
• Completion of testing for radioactive phosphogypsum contamination in drywall, in coordination with the Florida Department of Health and the EPA National Air and Radiation Environmental Laboratory. 

The EPA is conducting elemental analyses of 15 drywall samples, with a tentative date for completing its analyses of drywall samples by late August. The CPSC's engineering staff has visited seven homes in Florida, Louisiana and Virginia to gather samples of electrical, plumbing and safety systems. CPSC also has hosted a call among attorneys general of impacted States to coordinate and exchange information about State-level efforts.

Lawsuits filed over the drywall issues allege that excessive sulfur levels in the Chinese-made products are causing health effects and problems with air conditioning systems, appliances, internal wiring and other electrical systems. In June, the U.S. Judicial Panel on Multidistrict Litigation consolidated the lawsuits in the U.S. District Court for the Eastern District of Louisiana. More than 90 suits were on the docket as part of the MDL as of last week. Plaintiffs have asked the court to certify the matter as a class action. In re: Chinese-Manufactured Drywall Products Liability Litigation, MDL 2047.

The monthly status conference in the MDL was held last week before Judge Fallon. At the conference, the court considered issues raised by Liaison Counsel, including pre-trial orders, property inspections, Plaintiff and Defendant profile forms, an evidence preservation order, state court settings, state/federal coordination, discovery issues, Freedom of Information Act/ public records requests, trial settings in federal court, tolling agreement/suspension of prescription, plaintiffs' request for a class action, insurance issues, service of pleadings electronically, and the master complaint. A full report can be found here. 

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MDL Created for Chinese Drywall Litigation

The U.S. Judicial Panel on Multidistrict Litigation has consolidated a number of lawsuits brought over Chinese-made drywall installed in U.S. homes. See In re: Chinese-Manufactured Drywall Products Liability Litigation, MDL-2047 (JPML).

The motion for consolidation encompassed ten actions, four actions in the Southern District of Florida, three actions in the Middle District of Florida and one action each in the Northern District of Florida, Eastern District of Louisiana, and Southern District of Ohio. The panel said it was aware of 67 related lawsuits that were pending in federal courts around the country. Those suits and any other related actions will be treated as potential tag-along actions.

The Panel found that all actions share factual questions concerning drywall manufactured in China, imported to and distributed in the United States, and used in the construction of houses; plaintiffs in all actions allege that the drywall emits smelly, corrosive gases. Centralization under Section 1407 will eliminate duplicative discovery, including any discovery on international parties; prevent inconsistent pretrial rulings, particularly those with respect to class certification issues; and conserve the resources of the parties, their counsel and the judiciary, said the Panel.

As is sometimes the case, no district was a clear focal point of this litigation. The common manufacturing defendant and its affiliates are foreign entities without a major presence in any of the suggested transferee districts. Most actions also name local entities, such as builders and suppliers, as defendants. Several parties suggested different districts, and all of the suggested districts, particularly those in the southeastern region, have a nexus to the litigation through allegedly affected houses built with the drywall at issue. On balance, the panel was persuaded that the Eastern District of Louisiana is a preferable transferee forum for this litigation. Centralization in this district permits the Panel to effect the Section 1407 assignment to a judge who has "extensive experience in multidistrict litigation as well as the ability and temperament to steer this complex litigation on a steady and expeditious course." That would be the Honorable Eldon E. Fallon of the Eastern District of Louisiana.

As posted on MassTortDefense before, the lawsuits allege that sulfur compound levels in the drywall are too high, causing issues with air conditioning systems, electrical appliances, internal wiring and other electrical systems in homes. Plaintiffs also allege the drywall produces a rotten egg-like stench and causes a variety of respiratory and other health problems for those who live in the affected homes. The lawsuits filed so far have named Chinese-based manufacturers, as well as importers, developers and builders, contractors, suppliers and others. Companies facing suits include Knauf Gips KG, Knauf Plasterboard Tianjin Co., Taishan Gypsum Co., L&W Supply Corp. and USG Corp. Lennar Corp., a major home builder, has brought in more than 20 manufacturers, suppliers and installers.  Some legislators have been critical of the CPSC's handling of the issue.  And bills have been introduced to ban the product.

CPSC Responds To Criticism on China Drywall Investigation

The Consumer Product Safety Commission has issued a report on the imported drywall situation, noting that nearly 200 consumers from at least 13 States and the District of Columbia have reported health symptoms or certain metal corrosion problems in their homes that may be related to drywall imported from China. (CPSC says it is still investigating the scope of the drywall problem, working to identify the links from foreign manufacturers to the U.S. consumers in consultation with the Chinese government and the U.S. Customs and Border Protection.)

The update comes on the heels of criticism by Senator Nelson (D. Fla.) of how quickly the CPSC was moving. The agency, together with the Environmental Protection Agency and the Department of Health and Human Services, is looking at charges of health symptoms or the corrosion of certain metal components in their homes allegedly related to the presence of drywall produced in China. The majority of the reports to the CPSC have come from consumers residing in Florida while others have come from consumers in Louisiana, Virginia, Wisconsin, Ohio, Alabama, Mississippi, Missouri, California, Washington, Wyoming, the District of Columbia, Arizona, and Tennessee. Consumers largely report that their homes were built in 2006 to 2007, when an unprecedented increase in new construction occurred in part due to the hurricanes of 2004 and 2005.

The judicial panel on multidistrict litigation recently agreed to consider consolidating the
more than 30 federal lawsuits filed so far over the drywall.The lawsuits so far name Chinese-based manufacturers, as well as importers, developers and builders, contractors, suppliers and others.

Common features of the reports submitted to the CPSC from homes believed to contain
problem drywall have been:
• “rotten egg” smell within their homes.
• health concerns such as irritated and itchy eyes and skin, difficulty in breathing, persistent cough, bloody noses, runny noses, recurrent headaches, sinus infection, and asthma attacks.
• blackened and corroded metal components in their homes and the frequent replacement of components in air conditioning units.

The federal government is working on an (1) evaluation of the relationship between the drywall and the reported health symptoms; (2) evaluation of the relationship between the drywall and electrical and fire safety issues in the home; and (3) the tracing of the origin and distribution of the drywall. One obvious challenge has been figuring out how much problem drywall there is in any house, given that it is already installed, likely painted and may not be clearly marked.

On the health side, the most frequently reported symptoms are irritated and itchy eyes and skin, difficulty in breathing, persistent cough, bloody noses, runny noses, recurrent headaches, sinus infection, and asthma attacks. Some of these symptoms are similar to colds, allergies or reactions to other pollutants sometimes found in homes. As such, it is difficult to determine if the reported symptoms are related to the drywall and not any other environmental factors or pollutants in the home.

Data being gathered include from in-home air sampling; laboratory elemental characterization studies of domestic and imported drywall; and laboratory chamber studies of domestic and imported drywall to separate and isolate chemical emissions from drywall as opposed to chemicals emitted from other home products (e.g., carpets, cleaners, paint,adhesives, beauty products).

If a house has “problem” drywall, the CPSC is recommending that consumers with health issues consult a physician as soon as possible; those with any of the electrical or fire safety concerns should consult the local gas or electric supplier and a licensed electrician or building inspector as soon as possible. Consumers are cautioned to beware of unqualified testing and remediation services already seeking to o take advantage of consumers struggling to address this issue.

CPSC admits it could be months before it can confidently address the scientific relationships, if any, between the problem drywall and the health and safety concerns raised by consumers.
 

Senator Calls For CPSC Resignation Over China Drywall

Sen. Bill Nelson, D-Fla., has sent a letter to the President calling for the resignation of the current head of the U.S. Consumer Product Safety Commission, and criticizing the agency for its response to reports of Chinese-made tainted drywall installed in U.S. homes.

In a letter addressed to President Obama earlier this month, the senator targeted the CPSC for failing to do enough, in his view, to halt the import of the drywall. Readers will recall that residents claim this product emits a sulfur smell, poses health risks, and also causes electrical problems.

Nelson asserted that the "agency is doing too little, too late to help residents of Florida and other states who are reporting serious health and safety problems associated with living in homes built with tainted drywall imported from China.”  The CPSC reports that it has launched a formal compliance investigation to determine any risk associated with the sulfur-based gases that may be emitted from the imported drywall

Nelson is also a sponsor of the Drywall Safety Act of 2009, which seeks to impose a recall and a temporary ban on imports until federal drywall safety standards are put in place to protect consumers. The legislation also calls for the CPSC to perform a study with the EPA to determine the level of risk posed by the substances in the drywall.

Products litigation has ensued, including a proposed class action was filed in the U.S. District Court for the Middle District of Florida. According to that suit, a shortage of drywall made in the U.S. caused many builders to use imported Chinese drywall during Florida's pre-recession construction boom earlier this decade. There has also been speculation that some of that drywall may have been kept at sea waiting to enter U.S. ports, and was thus exposed to excessive moisture/humidity that caused the alleged fume problems. Such claims are typically inappropriate for class certification because of the individual issues that will be presented by evidence surrounding injury and causation. And at least one U.S. home builder has sued more than two dozen manufacturers, suppliers and installers of drywall imported from China.
 

Agency Corresponds With Congress on Consumer Product Safety Improvement Act Issues

Here at MassTortDefense we have posted before about the Consumer Product Safety Improvement Act of 2008 and how it might impact manufacturers, importers, distributors, and retailers. Congressman John Dingell, D-Mich., sent a March 2, 2009, letter to the commission posing specific questions about the ongoing implementation of the CPSIA.

Commissioner Moore responded, noting, first, that the agency did not get the immediate increase in funding that the Act envisioned. Second, the agency still has only two Commissioners (no chairman). Third, the letter noted that additional time to implement certain of the Act's provisions would have been preferable.

Acting Chairman Nord provided a longer, 20 page response from the agency staff, echoing requests for additional time, and resources. [Note, the Act required product manufacturers and importers subject to a consumer product safety standard or rule to certify in writing that the product conforms to all applicable standards or rules; children’s products must be tested by a third-party, accredited testing laboratory. The agency became backlogged with laboratories’ requests for accreditation. And thus a stay of a number of the Act's provisions has been imposed. Of course, the stay of the testing and certification requirements does not alter the requirements that all products must meet the underlying safety standard.] The staff letter asks Congress to eliminate the fixed time-table, and give the commission the discretion to address certification and testing on a product-class basis. 

A focus of the staff response is that the commission staff feels it needs more discretion to effectively implement the CPSIA and uphold its general purpose. The argument is that the strict CPSIA deadlines and standards deprive the commission of the ability to effectively use risk analysis in establishing priorities and resource allocation. The commission staff concludes that this factor, along with the limited resources point above, has prevented it from taking important measures with respect to other product safety rules, such as improving children’s health and safety.

For example, the commission staff views the definition of “children’s product” as over-inclusive for the CPSIA’s goals, considering that the risk of mouthing and ingestion decreases with age. The commission suggests lowering the age limit and giving the commission the discretion to set higher age limits for products that pose a greater risk to older children.
 

State Attorneys General and the CPSAct

One potential products liability development to watch in 2009 is the impact of the Consumer Product Safety Improvement Act of 2008. As MassTortDefense alerted readers before the legislation was even passed, one of the potentially most significant aspects of the legislation is the provision giving state Attorney Generals expanded jurisdiction to seek to enforce the Act against manufacturers and sellers of consumer products.

Under the Act, state AGs are authorized to bring federal court actions to enforce any regulation or standard of the CPSC which affects their state's residents. Previously, many such standards and rules were enforced only by the CPSCommission. (An AG must give the CPSC 30 days notice before filing, unless the product poses a "substantial product hazard," in which case no notice is required.)  The legislation has given a potentially sweeping and relatively undefined authority for state Attorneys General to act on perceived product safety concerns, largely independent of the CPSC.

While this move has potentially increased the resources available for enforcement actions, it has also created the likelihood of different interpretations and applications of product safety rules, as different state officials apply different approaches to enforcement. The Act does not require that an Attorney General pursue the CPSC's viewpoint or position in regard to a consumer product issue. The provision could thus undermine both the uniformity of product safety standards as applied across the country, and the CPSC's role in providing centralized regulation and guidance to industry and consumers alike.

The media reports that the National Association of Attorneys General has amassed a war chest of $140 million dollars, available to help individual state Attorneys General investigate alleged wrongdoing and to pay for expert consultants. State AGs have already been very active in product liability contexts, even before the Act, with tobacco, baby products, toys and mattresses being involved in recent memory.
 

CPSC Holds Public Meeting On New Legislation

The Consumer Product Safety Commission held a public meeting last week to discuss issues of testing and certification under the Consumer Product Safety Improvement Act (CPSIA). The meeting followed up on a September meeting regarding the accreditation of laboratories for third-party testing.

Readers of MassTortDefense will recall from other posts that the legislation increased CPSC budget, staff, and enforcement powers. The law mandates reduction of the amount of lead in toys; calls for third-party testing of certain children's products; raises allowable penalties for violations. And the Act has a number of potentially vexatious provisions for product sellers, including a broad protection of so-called employee whistleblowers. Such employees falling under the Act can seek to get their job back temporarily, and then after a hearing, permanently, with back pay, attorney fees, expert witness fees, and undefined compensatory damages. The former employee apparently needs to show that one, but not the only, reason for the firing was probably that the worker was or was about to start complaining about a product safety issue. It may be that prudent sellers will want train their management teams about the new provisions.

A second controversial provision was the move that state attorneys general can now take enforcement actions and seek the penalties that the commission could have. The aggressive approach of the National Association of Attorneys General (NAAG) members in the past may suggest that prudent national manufacturers who learn of a potentially substantial product safety situation will be better off negotiating a settlement with the federal agency rather than have the issue battled out in multiple state courts.

Third, the Act’s emphasis on independent lab certification of various products has caused some larger companies that have their own testing laboratories to consider divesting in-house laboratories.

At the meeting, participants discussed the requirement for certification of general conformity with all applicable requirements under any of the Acts administered by the CPSC, which becomes effective in November of this year. In response to questions on what the certificates should look like, CPSC plans to post a sample certificate on its Web site.

Officials of the CPSC assured attendees they are not out to play "gotcha" with manufacturers and importers, but the agency wants to ensure full compliance with the product certification requirements of the new law. There are significant penalties for noncompliance, including the destruction of imported goods that are not certified. When a product is imported, the foreign manufacturer and the importer both must certify that the product complies with all requirements, unless the commission exempts one or the other. Certification is required for products that are subject to a standard or ban, and are imported into the United States for consumption or warehousing. The Act provides that if there is no certificate, or a false certificate is furnished, the products will be refused entry. If the products are refused admittance into the United States, they may be destroyed, and the costs of destroying the products will be paid by the owner or consignee.

CPSC Acting Chairman Nancy A. Nord has agreed that the new law is "incredibly complex," and the agency will have to undertake about 40 new rulemakings to flesh out its provisions.  Among the likely forthcoming rules that will require certification are lead content, infant and toddler products, toys, phthalate, ATVs, drain covers for pools, and others.
 

President Signs CPSC Reform Act

Despite some concerns, President Bush on Thursday signed into law the Consumer Product Safety Improvement Act of 2008. A White House spokesman was quoted as saying, "This bill will help to ensure that the products Americans find on their store shelves are safe, and that the regulating agencies have the resources they need to enforce law."  Useful summary here.

The Act will increase funding for CPSC over five years; add whistleblower protections for employees of manufacturers and sellers; require third-party testing of certain children's products; adopt an interim toy safety rule and require CPSC to make new safety rules for toys; create a public database for consumer reports; ban six types of phthalates and lowers lead levels in certain products for children. Three of the phthalates would be temporarily banned pending further study. The American Chemistry Council said although there was no scientific basis for the phthalate restriction, they understood consumer concerns and were committed to working with the CPSC and others to conduct the studies.

One of the most controversial aspects empowers state attorneys general to enforce federal consumer rules.
 

MassTortDefense has posted about the legislation here and here.
 

CPSC Improvement Act Update

The White House received the Consumer Product Safety Commission Improvement Act of 2008 (H.R. 4040)  on August 6th, giving the president until August 18th to sign the bill into law. Apparently the Congress had delayed sending the bill to accommodate the president's travel schedule to the Summer Olympics.

The president has 10 days, excluding Sundays, in which to sign the bill into law.  All indications are that President Bush will sign the legislation.

As noted here at MassTortDefense both houses of Congress passed the CPSC reform bill with near-unanimous support. 

CPSC Legislation Passes Both Houses

A quick update on the CPSC reform legislation: The House voted 424-1 (9 not voting) to agree to the Conference Report on the Consumer Product Safety Commission Reform Act of 2008. Last night, the Senate agreed to the Conference Report by a vote of 89-3 (neither Presidential candidate present to vote). On to the White House.

Compromise Reported On CPSC Reform Act

The approach of the August congressional recess has apparently spurred compromise on the Consumer Product Safety Commission bill. The House passed its CPSC reform bill in December, 2007, and the Senate passed its version, the Consumer Product Safety Commission Reform Act of 2008, in March.  MassTortDefense has posted on the process here and here. And here.

The conference committee has reached an agreement, and will present the new compromise CPSC Improvement Act of 2008 to both houses for a vote, probably late this week.  The House Conference Report is found here.

One sticking issue had been language concerning phthalates, which have been used to soften plastic in children's toys. The original Senate version included a stringent assertedly non-preemptive version of a California law banning toxic phthalates in children's products. But, of course, not all phthalates are created equal. Phthalates are a broad class of chemicals, and each phthalate has distinct properties and safety profiles. The European Union Risk Assessment organization has concluded that one form (DINP) is safe for use in toys, for example. The new bill would ban phthalates from toys and other child-care items.

The compromise bill would name the ASTM international standard No. F963-07 as the temporary safety standard for toys, pending work on a permanent regulation (to take place within a year).  Ideally, this would mean that product safety decisions will be made by experts at the appropriate federal agencies, rather than allow creation of a hodge-podge of varying state standards. But the bill "grandfathers" in, as not preempted, any existing overlapping state regulations on child product safety, and permits states to apply for exemption from preemption for future proposed safety standards.  The CPSC is to consider whether the state standard offers significantly higher protection, the technological and economic feasibility of the standard, and the need for a uniform national standard.

The bill also contains the controversial "whistle-blower" protection provision, and requires third-party testing of certain children's products.  And it would create the consumer product safety database from the original House bill.


Conference Committee Reports Progress On CPSC Legislation

Congress took a step closer last week to finalizing the Consumer Product Safety Modernization Act. The conference committee (including chairs Sen. Daniel Inouye (D-Hawaii) and Rep. John Dingell (D-Mich.)) voted in favor of nine more provisions, further reconciling the different bills that have passed the Senate and House of Representatives. MassTortDefense has posted on the bills here and here.

The lawmakers agreed:
- to ban the export of recalled and nonconforming products, enabling the CPSC to prohibit a U.S. entity from exporting a product out of compliance with CPSC rules unless the importing country has previously notified the Commission of its permission;
- to require certain import safety management and interagency cooperation steps, requiring requires the CPSC to develop a plan to identify shipments of consumer products for import into the U.S.;
- to create a public consumer product safety database and
- to require the public disclosure of certain safety information.

They also adopted provisions to create a substantial product hazard list, mandate the destruction of imported products that don't comply with U.S. laws, require inspectors general to carry out audits and file reports, set new rules on lead paint in children's (12 or under) products and empower state attorneys general to enforce product safety laws.

The CPSC will return to five full members. Both bills (H.R. 4040 and S.2663 would increase funding for the agency. Both versions of the law would establish third-party premarket testing of certain products.

Senators and Representatives are still unable to agree on phthatlate restrictions, mandatory ASTM toy testing standards, preemption, whistleblower protection, mandatory All-Terrain Vehicle standards, and product-specific standards. The conferees also voted on an amendment to allow CPSC to ban importers and local manufacturers from the marketplace for repeat offenses. The Senators unanimously voted in favor while the Representatives unanimously voted against the amendment.

In the first conference on June 25, conferees voted and agreed on 21 noncontroversial items. The conferees have repeatedly said that they are hoping that the legislation passes in time for the August recess, which begins in just about two weeks.

CPSC Releases Import Final Safety Strategy Document

The Consumer Product Safety Commission has just released its revised import safety strategy document. The comment period on the draft import strategy (which MassTortDefense posted on here) expired in May. The final import plan is now described in the CPSC document, Executive Summary: Import Safety Strategy, found here.

The four-prong plan addresses regulated consumer products at the design, manufacture, distribution, and consumption stages:
I. Engage the private sector and foreign governments to foster both compliance with relevant safety standards and adoption of more effective techniques of identifying potential product hazards;
II. Build safety assurances into the production processes by promoting the use of safety standards by manufacturers, and verifying compliance through third-party testing and inspections where appropriate;
III. Prevent unsafe products through strategically redeploying CPSC resources according to principles of hazard analysis and risk management to target surveillance and inspection of the distribution chain; and
IV. Identify and quickly remove product hazards in the market and provide real-time communications to consumers, foreign governments, and the private sector.

There has been a 100% increase in imports of consumer products into the United States over the last decade. The value of all imported consumer products under the jurisdiction of the CPSC was an estimated $639 billion in 2007. Last year, approximately 42% of these products were from China, and the value of these imports from China nearly quadrupled from 1998 to 2007. While imports currently account for about 44% of all consumer products sold in the United States today, they comprise over three-fourths of all product recalls administered by the agency.

With over $2 trillion worth of products (including those under CPSC jurisdiction) imported into the United States every year by over 800,000 importers at more than 300 U.S. ports of entry, the CPSC must be strategic in its vision and targeted in its use of resources to ensure the products imported into this country are safe. The plan’s theme involves reaching out to foreign agencies and countries to attempt to build safety assurances into production processes. CPSC sees a need to address product safety in the "new global marketplace" with a range of actions beyond the traditional methods of marketplace surveillance and enforcement historically utilized by the Commission. Those actions include memoranda of understanding with 14 foreign regulatory agencies in Canada, China, European Commission, Israel, South Korea, Peru, Chile, Costa Rica, India, Japan, Mexico, Taiwan, Egypt, and Vietnam.

Imports from China, in particular, have recently presented serious issues, as noted by MassTortDefense here and here and here. The CPSC action plan with China's General Administration for Quality Supervision, Inspection, and Quarantine focuses on product safety for fireworks, toys, electrical products, and lighters. The plan employs such steps as exchange of standards information, training on product testing, and exchange of information on emerging hazards. This year, CPSC created a Chinese-language page on its web site. The U.S. in December, 2007 signed two memoranda of agreements with China to enhance the safety of a wide variety of food, feed, drugs, and medical devices.

The release of the plan was accompanied by an updated import action plan update report from the Interagency Working Group on Import Safety, citing progress in import safety strategy and reiterating the call for measures beyond simply inspecting imported products at the border. The report, Import Safety--Action Plan Update, here, outlines steps taken by the federal government and trading partners to improve import safety since the last update in November, 2007. The update cited new enforcement actions, signed agreements with key trading partners, bilateral and multilateral discussions, and critical information shared on best practices. For example, CPSC established its Import Surveillance Division in early 2008, representing the first permanent, full-time presence of CPSC personnel at key U.S. ports-of-entry 

A congressional conference committee currently is working to harmonize competing versions of CPSC reform legislation that would strengthen CPSC authority and increase funding. MassTortDefense has posted on the legislation, here and here

Congress Still Wrestling with CPSC Legislation

MassTortDefense has posted before about the competing Senate and House bills to reform the Consumer Product Safety Commission. See here.


Media reports are suggesting that conferees on Consumer Product Safety legislation might not complete their efforts before Congress recesses June 27th. House Majority Leader Hoyer (D-Md.), had predicted that the compromise CPSC bill would come to the floor in June. But debate, and lobbying, on the bill continue.

As noted before, most of the more contentious issues in the bill were included in the Senate version of the legislation, which was passed in March. Sticky issues include provisions granting state attorneys general the power to pursue purported violations of laws enforced by CPSC; whistleblower protections for employees of manufacturers; and a public database for reports of injuries, illness, death, or risk related to consumer products submitted by consumers, local, state or national government agencies.


If the process is not completed by August, Congress will be in campaign mode and that may scuttle the reform legislation for this year.

Congress Set to Reconcile CPSC Reform Bills

As noted in earlier postings of MassTortDefense, both the House and Senate have passed legislation affecting the Consumer Product Safety Commission. The different versions have to be reconciled.

The House has just named conferees to work on the legislation, including Rep. John Dingell (D-Mich.), chairman of the Commerce and Energy Commission, Rep. Robert Rush (D-Ill.), chairman of the House Subcommittee on Commerce, Trade and Consumer Protection, Reps. Diana DeGette (D-Colo.), Janice Schakowsky (D-Ill.), Henry Waxman (D-Calif.), Joseph Barton (R-Texas), Cliff Stearns (R-Fla.), and Edward Whitfield (R-Ky.).

The Senate conferees were announced two weeks ago, and they include Senate Commerce Committee Chairman Daniel Inouye (D-Hawaii), and Sens. Mark Pryor (D-Ark.), Barbara Boxer (D-Calif.), Amy Klobuchar (D-Minn.), Ted Stevens R-Alaska), Kay Bailey Hutchison (R-Texas), and John Sununu (R-N.H.).


Consumer advocates are lobbying Congress to produce a compromise Consumer Product Safety Reform bill that combines the “strongest protections” of the House and Senate bills, particularly on toy and other children's product safety.

Both House and Senate bills would strengthen CPSC authority and funding, establish new standards on lead content in children's toys, and require third-party certification of testing of certain children's products.

Likely to be more controversial are some of the differences, including the proposal for a publicly accessible database of product safety information. This seems to be of little use to the average consumer, but subject to potential mischief in the hands of plaintiff lawyers. Think about how they attempt to misuse adverse event data in drug litigation.

Another issue is proposed enforcement of the CPSAct by state attorney generals. This proposal risks the creation of uncertainty and inconsistency, with the potential for a patch-work of differing practical rules, rather than a uniform federal standard.

The proposed new “whistle-blower” protections seem both unnecessary and likely to encourage additional litigation.

CPSC Reveals New Import Safety Strategy

In an earlier post on the "year of China recalls," MassTortDefense noted legislative changes to the Consumer Product Safety Act and enhanced resources of the CPSC as a response to the spate of recalls.  The commission has announced it is now seeking public comments on a draft report, on Import Safety Strategy.

The Executive Summary notes that imports currently account for about 44 percent of all consumer products sold in the United States today, but they comprise over three-fourths of all product recalls administered by the agency. The value of all imported consumer products under the jurisdiction of the CPSC was an estimated $639 billion in 2007. Last year, approximately 42 percent of these
products were from China, and the value of these imports from China nearly quadrupled from
1998 to 2007.

The report describes a four-pronged strategy to deal with the issue if safety of imported products:

I.  Engage the private sector and foreign governments to foster both compliance with relevant safety standards and adoption of more effective techniques of identifying  potential product hazards;
II.  Build safety assurances into the production processes by promoting the use of safety standards by manufacturers, and verifying compliance through third-party testing and inspections where appropriate;
III.   Prevent unsafe products through strategically redeploying CPSC resources according to  principles of hazard analysis and risk management to target surveillance and inspection of the distribution chain; and
IV.   Identify and remove quickly product hazards in the market and provide real-time
communications to consumers, foreign governments, and the private sector.

Public comments are due  by May 30, 2008, and can be sent  via e-mail to
cpsc-os@cpsc.gov