[Federal Register Volume 59, Number 216 (Wednesday, November 9, 1994)]
[Unknown Section]
[Page 0]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 94-27681]


[[Page Unknown]]

[Federal Register: November 9, 1994]


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CONSUMER PRODUCT SAFETY COMMISSION

[CPSC Docket No. 95-C0003]

 

Concord Enterprises, Inc., a Corporation; Provisional Acceptance 
of a Settlement Agreement and Order

AGENCY: Consumer Product Safety Commission.

ACTION: Provisional Acceptance of a Settlement Agreement under the 
Consumer Product Safety Act.

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SUMMARY: It is the policy of the Commission to publish settlements 
which it provisionally accepts under the Consumer Product Safety Act in 
the Federal Register in accordance with the terms of 16 CFR 1118.20 
(e)-(h). Published below is a provisionally-accepted Settlement 
Agreement with Concord Enterprises, Inc., a corporation.

DATES: Any interested person may ask the Commission not to accept this 
agreement or otherwise comment on its contents by filing a written 
request with the Office of the Secretary by November 25, 1994.

ADDRESSES: Persons wishing to comment on this Settlement Agreement 
should send written comments to the Comment 95-C0003, Office of the 
Secretary, Consumer Product Safety Commission, Washington, DC 20207.

FOR FURTHER INFORMATION CONTACT:
Earl A. Gershenow, Trial Attorney, Office of Compliance and 
Enforcement, Consumer Product Safety Commission, Washington, DC 20207; 
telephone (301) 504-0626.

SUPPLEMENTARY INFORMATION: The text of the Agreement and Order appears 
below.

    Dated: November 3, 1994.
Sadye E. Dunn,
Secretary.

Settlement Agreement

    1. Concord Enterprises, Inc. (hereinafter ``Concord''), a 
corporation, enters into this Settlement Agreement and Order 
(hereinafter ``Settlement Agreement'') with the staff of the Consumer 
Product Safety Commission, and agrees to the entry of the Order 
described herein. The purpose of the Settlement Agreement is to settle 
the staff's allegations that Concord knowingly caused the introduction 
into interstate commerce of certain banned hazardous toys, in violation 
of section 4(a) of the Federal Hazardous Substances Act, 15 U.S.C. 
1263(a).

I. Jurisdiction

    2. The Commission has jurisdiction over Concord and the subject 
matter of this Settlement Agreement pursuant to section 30(a) of the 
Consumer Product Safety Act (hereinafter ``CPSA''), 15 U.S.C. 2079(a), 
and sections 2(f)(1)(D), 4(a), and 5(c) of the Federal Hazardous 
Substances Act (hereinafter ``FHSA''), 15 U.S.C. 1261(f)(1)(D), 
1263(a), and 1264(c).

II. The Parties

    3. The ``staff'' is the staff of the Consumer Product Safety 
Commission, an independent regulatory commission of the United States 
established pursuant to section 4 of the CPSA, 15 U.S.C. 2053.
    4. Concord is a corporation organized and existing under the laws 
of the State of California, with its principal corporate offices 
located at 2957 E. 46th Street, Los Angeles, California 90058. Concord 
is a wholesaler of general and non-durable merchandise, including toys.

III. Allegations of the Staff

A. Toys
    5. On five occasions between June 27, 1991, and December 17, 1991, 
Concord caused the introduction into interstate commerce of 7 kinds of 
toys (107,040 units) intended for use by children under three years of 
age, which are identified and described below:

------------------------------------------------------------------------
   Sample No.          Product       Entry date          Expt/Mfg       
------------------------------------------------------------------------
P-860-7237......  Baby Angela.....      6/27/91  L&A Company.           
M-867-2954......  3-Piece Doll....      7/20/91  L&A Company.           
P-867-7694......  Plastic Doll....     10/31/91  L&A Company.           
P-867-7695......  Plastic Wind Up      10/31/91  L&A Company.           
                   Family Car.                                          
P-867-7716......  Soft Vinyl           11/11/91  Manley Toys.           
                   Animal In                                            
                   Plastic Box.                                         
P-860-7238......  Baby & Bear.....     12/17/91  Sunlight Industries.   
P-860-7236......  Two Dolls in         12/17/91  Rewinner Enterprises.  
                   Plastic Vinyl.                                       
------------------------------------------------------------------------

    6. The toys identified in paragraph 5 above are subject to, but 
failed to comply with, the Commission's Small Parts Regulation, 16 CFR 
part 1501, in that, when tested under the ``use and abuse'' test 
methods specified in 16 CFR 1500.51 and 1500.52, (a) one or more parts 
of each tested toy separated; and (b) one or more of the separated 
parts from each of the tested toys fit completely within the test 
cylinder, as set forth in 16 CFR 1501.4.
    7. Because separated parts fit completely within the test cylinder 
as described in paragraph 6 above, each of the toys identified in 
paragraph 5 presents a ``mechanical hazard'' within the meaning of 
section 2(s) of the FHSA, 15 U.S.C. 1261(s) (choking, aspiration and/or 
ingestion of small parts).
    8. Each of the toys identified in paragraph 5 above is a 
``hazardous substance'' pursuant to section 2(f)(1)(D) of the FHSA, 15 
U.S.C. 1261(f)(1)(D).
    9. Each of the toys identified in paragraph 5 above is a ``banned 
hazardous substance'' pursuant to (a) section 2(q)(1)(A) of the FHSA, 
15 U.S.C. 1261(g)(1)(A) (any toy or other article intended for use by 
children which bears or contains a hazardous substance); and (b) 16 CFR 
1500.18(a)(9).

B. Baby Rattles

    10. On November 21, 1990, Concord caused the introduction into 
interstate commerce of 4,320 units of a baby rattle, ``Set of Two 
Assorted Baby Rattles'' (``Rattle''), purchased from Manley Toys 
(Sample No. M-867-2411).
    11. When tested under the methods and procedures prescribed in 16 
CFR 1500.51, the Rattle entered and penetrated the full depth of the 
cavity of the test fixture specified in 16 CFR 1510.4.
    12. Pursuant to 16 CFR 1500.18(a)(15), the Rattle presents a 
``mechanical hazard'' (i.e., choking, aspiration, and/or ingestion of 
small parts) within the meaning of section 2(s) of the FHSA, 15 U.S.C. 
1261(s) because it failed to comply with 16 CFR 1510.4.
    13. The Rattle is a ``hazardous substance'' pursuant to section 
2(f)(1)(D) of the FHSA, 15 U.S.C. 1261(f)(1)(D), because it is a toy or 
other article intended for use by children which presents a 
``mechanical hazard'' under 16 CFR 1500.18(a)(15).
    14. The Rattle is a ``banned hazardous substance'' pursuant to 
section 2(q)(1)(A) of the FHSA, 15 U.S.C. 1261(q)(1)(A), because it is 
a toy or other article intended for use by children which bears or 
contains a hazardous substance.
    15. The introduction into interstate commerce of the aforesaid 
banned hazardous Rattle is a violation of section 4(a) of the FHSA, 15 
U.S.C. 1263(a), for which a civil penalty may be imposed pursuant to 
section 5(c) of the FHSA, 15 U.S.C. 1264(c).

IV. Response of Concord

    16. Concord denies the allegations of the staff set forth in 
paragraphs 5 through 15 above that it has knowingly caused the 
introduction into commerce of the aforesaid banned hazardous toys or 
rattles, or that it has violated the FHSA as alleged by the staff.

V. Agreement of the Parties

    17. The Consumer Product Safety Commission has jurisdiction over 
Concord and the subject matter of this Settlement Agreement under the 
following acts: Consumer Product Safety Act, 15 U.S.C. 2051 et seq., 
and the Federal Hazardous Substances Act, 15 U.S.C. 1261 et seq.
    18. Upon final acceptance by the Commission of this Settlement 
Agreement and issuance of the Final Order, Concord agrees to pay to the 
Commission a civil penalty in the amount of SIXTY THOUSAND AND 00/100 
DOLLARS ($60,000.00), in three (3) payments of TWENTY THOUSAND AND 00/
100 ($20,000.00) each. The first payment shall be due within twenty 
(20) days after service of the Final Order of the Commission accepting 
the Agreement, hereinafter, the ``anniversary date.'' The second 
payment shall be made within one year of the anniversary date, and the 
third payment shall be made within two years of the anniversary date. 
Payment of the full amount of the civil penalty shall settle fully the 
staff's allegations set forth in paragraphs 5 through 15 above that 
Concord violated the FHSA. Upon the failure by Concord to make a 
payment or upon the making of a late payment by Concord (a) the entire 
amount of the civil penalty shall be due and payable, and (b) interest 
on the outstanding balance shall accrue and be paid at the federal 
legal rate of interest under the provisions of 28 U.S.C. 1961(a) and 
(b).
    19. The Commission does not make any determination that Concord 
knowingly violated the FHSA. The Commission and Concord agree that this 
Agreement is entered into for the purposes of settlement only.
    20. Upon final acceptance of this Settlement Agreement by the 
Commission and issuance of the Final Order, Concord knowingly, 
voluntarily and completely, waives any rights it may have in this 
matter (1) to an administrative or judicial hearing, (2) to judicial 
review or other challenge or contest of the validity of the 
Commission's actions, (3) to a determination by the Commission as to 
whether Concord failed to comply with the FHSA as aforesaid, and (4) to 
a settlement of findings of fact and conclusions of law.
    21. For purposes of section 6(b) of the CPSA, 15 U.S.C. 2055(b), 
this matter shall be treated as if a complaint had issued; and, the 
Commission may publicize the terms of the Settlement Agreement and the 
Order.
    22. Upon provisional acceptance of this Settlement Agreement by the 
Commission, this Settlement Agreement and the Provisional Order shall 
be placed on the public record and shall be published in the Federal 
Register in accordance with the procedures set forth in 16 CFR 
1118.20(e)-(h). If the Commission does not receive any written request 
not to accept the Settlement Agreement within 15 days, the Settlement 
Agreement shall be deemed finally accepted and the Final Order shall be 
deemed issued on the 16th day after the date the Settlement Agreement 
is published in the Federal Register.
    23. The parties further agree that the Commission shall issue the 
attached Order incorporated herein by reference; and that a violation 
of the Order shall subject Concord to appropriate legal action.
    24. No agreement, understanding, representation, or interpretation 
not contained in this Settlement Agreement may be used to vary or to 
contradict its terms.
    25. The provisions of the Settlement Agreement and Final Order 
shall apply to Concord and each of its successors and assigns.

    Dated: May 10, 1994.

Respondent Concord Enterprises, Inc.
Hamid Shayan,
President, Concord Enterprises, Inc., 2957 E 46th Street, Los Angeles, 
CA 90058.

Commission Staff.
David Schmeltzer,
Assistant Executive Director, Office of Compliance and Enforcement.
Eric L. Stone,
Acting Director, Division of Administrative Litigation, Office of 
Compliance and Enforcement.

    Dated: May 13, 1994 by:
Earl A. Gershenow,
Trial Attorney, Division of Administrative Litigation, Office of 
Compliance and Enforcement.

    Dated: May 31, 1994 by:
Dennis C. Kacoyanis,
Trial Attorney, Division of Administrative Litigation, Office of 
Compliance and Enforcement.

Order

    Upon consideration of the Settlement Agreement entered into between 
respondent Concord Enterprises, Inc., a corporation, and the staff of 
the Consumer Product Safety Commission; and the Commission having 
jurisdiction over the subject matter and Concord Enterprises, Inc; and 
it appearing that the Settlement Agreement and Order is in the public 
interest, it is
    Ordered, that the Settlement Agreement and Order be and hereby is 
accepted, as indicated below; and it is
    Further Ordered, that upon final acceptance of the Settlement 
Agreement and Order, Concord Enterprises, Inc. shall pay to the 
Commission a civil penalty in the amount of SIXTY THOUSAND-FIVE AND 00/
100 DOLLARS ($60,000.00) in three (3) payments of TWENTY THOUSAND AND 
00/100 DOLLARS ($20,000.00) each. The first payment shall be due within 
twenty (20) days after service of the Final Order of the Commission 
accepting the Settlement Agreement, hereinafter, the ``anniversary 
date.'' The second payment shall be made within one year of the 
anniversary date, and the third payment shall be made within two years 
of the anniversary date. Payment of the full amount of the civil 
penalty shall settle fully the staff's allegations set forth in 
paragraphs 5 through 15 of the Settlement Agreement and Order that 
Concord Enterprises, Inc. violated the FHSA. Upon the failure by 
Concord to make a payment or upon the making of a late payment by 
Concord (a) the entire amount of the civil penalty shall be due and 
payable, and (b) interest on the outstanding balance shall accrue and 
be paid at the federal legal rate of interest under the provisions of 
28 U.S.C. 1961 (a) and (b).
    Provisionally accepted and Provisional Order issued on the 3rd day 
of November, 1994.

    By Order of the Commission
Sadye E. Dunn,
Secretary, Consumer Product Safety Commission.
[FR Doc. 94-27681 Filed 11-8-94; 8:45 am]
BILLING CODE 6355-01-M