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CPSC Authorizes the Filing of Another Administrative Complaint Seeking Mandatory Recall

Aug.10.2012

On Tuesday, August 7, 2012, the U.S. Consumer Product Safety Commission ("Commission") authorized the filing of an administrative enforcement action under Section 15 of the Consumer Product Safety Act ("CPSA") (15 U.S.C. § 2064) for the second time in less than 2 weeks. In another 3 to 1 vote, the Commission approved a complaint to be filed against Zen Magnets, LLC, an importer and distributor of powerful magnet products. As with the complaint filed on July 25 against Maxfield and Oberton Holdings, LLC, the Commission has requested an order that Zen Magnets notify the public of the defect, cease further distribution and importation of the products, and conduct a recall including refunding consumers, among other things. For more information about the filing against Maxfield and Oberton seeking the recall of Buckyballs® and BuckyCubes™ magnet products, click here.

While similar magnet products are at issue here, the background of this case is slightly different:

  • There have been no reported incidents of harm involving Zen Magnets, and only 57,000 of the products have been sold in the United States. While there have been no reports, the complaint represents that "many children have ingested products . . . that are almost identical in form, substance, and content to Zen Magnet products," and that the Zen Magnets are marketed and used "in substantially similar ways" as the other magnet products.

  • Zen Magnets has not agreed to any voluntary recall of its products, nor has it appeared to cooperate with the Commission in connection with the magnet issue. Zen Magnets did, however, recently place a label on its products, stating that "CPSC recommends minimum age of 14," which is referenced in the administrative complaint.

  • The complaint acknowledges that the Zen Magnets packaging warns "DO NOT SWALLOW MAGNETS," and "Strong magnets can cause fatal intestinal pinching." But the packaging further states: "How old do you have to be to play with these? Dunno. 14 years old in the U.S. for a strong magnetic toy, unless it's not a toy, then no age limit, but they're fun magnets spheres, aren't they a toy? . . . But really, it's whatever age at which a person stops swallowing non-foods," and "Place swallowing magnets on your don't do list along with breathing water, drinking poison, and running into traffic." Zen Magnets were allegedly advertised as "fun to play with" and as magnets that "look good on cute people."

Zen Magnets issued a public statement following the filing of the complaint, claiming that "Zen Magnets may soon be going out of business," as it does not "have the resources to defend" against the Commission's charges. Zen Magnets notes that it is "unusual for the CPSC to target a product with such low risks . . . [and] to target related companies that have caused no injuries."

In the Commission's press release accompanying the complaint, it stated that Commission staff had requested that manufacturers and importers cease the sale and distribution of certain powerful magnet products, and that 11 other manufacturers and importers had voluntarily complied. The Commission further stated that Zen Magnets and Maxfield & Oberton "are the only companies that have refused to comply, to date." While the Commission has the power to ban unsafe products (15 U.S.C. § 2057 (CPSA Sec. 8)), that rulemaking process can be time consuming and may take longer than the Commission's attempt to work with industry to remove products from the market through its enforcement authority, as it has appeared to do here.

These recent administrative filings seeking mandatory recalls demonstrate the Commission's willingness to flex its enforcement muscle in pursuit of consumer products it perceives as hazardous. It is not yet clear, however, whether this will become a new trend in Commission enforcement efforts or is just a response to concerns with these particular magnet products. Nevertheless, this marks a significant change in the Commission's enforcement efforts over the last decade and will require firms to consider forced, mandatory recalls as a real possibility when negotiating potential corrective actions with the CPSC.

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