[Federal Register Volume 62, Number 135 (Tuesday, July 15, 1997)]
[Notices]
[Pages 37887-37888]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 97-18575]


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CONSUMER PRODUCT SAFETY COMMISSION

[CPSC Docket No. 97-C0009]


CSA, 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). 
Published below is a provisionally-accepted Settlement Agreement with 
CSA, Inc., a corporation.

DATES: Any interested persons 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 July 30, 1997.

ADDRESSES: Persons wishing to comment on this Settlement Agreement 
should send written comments to the Comment 97-C0009, Office of the 
Secretary, Consumer Product Safety Commission, Washington, DC 20207.

FOR FURTHER INFORMATION CONTACT:
Melvin I. Kramer, 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: July 9, 1997.
Sadye E. Dunn,
Secretary.

Settlement Agreement and Order

    1. This Settlement Agreement and Order, entered into between CSA, 
Inc., a corporation (hereinafter, ``CSA''), and the staff of the 
Consumer Product Safety Commission (hereinafter, ``staff''), pursuant 
to the procedures set forth in 16 CFR 1118.20, is a compromise 
resolution of the matter described herein, without a hearing or 
determination of issues of law and fact.

The Parties

    2. The ``Staff'' is the staff of the Consumer Product Safety 
Commission (hereinafter, ``Commission''), an independent federal 
regulatory agency of the United States government, established by 
Congress pursuant to section 4 of the Consumer Product Safety Act 
(hereinafter, ``CPSA''), as amended, 15 U.S.C. 2053.
    3. Respondent CSA is a corporation organized and existing under the 
laws of the State of Massachusetts with its principal corporate offices 
located at 14 Norfolk Ave., South Easton, MA 02375.

Staff Allegations

    4. Section 15(b) of the CPSA, 15 U.S.C. 2064(b), requires a 
manufacturer of a consumer product who, inter alia, obtains information 
that reasonably supports the conclusion that the product either, (1) 
contains a defect which could create a substantial product hazard or 
(2) creates an unreasonable risk of serious injury or death, to 
immediately inform the Commission of the defect or risk.
    5. From approximately February 1995-April 1996 CSA imported and 
sold in the U.S. under its private label, ``E-Force'', approximately 
340,000 rider-type exercise products, style T1200 Cross Trainer.
    6. Beginning in April of 1995, CSA began receiving consumer 
complaints about welds on the apparatus breaking or failing, suddenly 
and without warning, causing the user to fall and be injured. CSA 
failed to report this to the Commission.
    7. Not until April 18, 1996, after learning of at least 52 such 
incidents of weld failure, many of which reported suffering personal 
injuries, did CSA finally file a report with the Commission.
    8. Although CSA obtained sufficient information to reasonably 
support the conclusion that the exercise apparatus contained a defect 
which could create a substantial product hazard, or created an 
unreasonable risk of serious injury or death, it failed to report such 
information to the Commission as required by section 15(b) of the CPSA, 
15 U.S.C. 2064(b). This is a violation of section 19(a)(4) of the CPSA, 
15 U.S.C. 2068(a)(4).
    9. CSA's failure to report to the Commission, as required by 
section 15(b) of the CPSA, 15 U.S.C. 2064(b), was committed 
``knowingly'', as that term is defined in Section 20(d) of the CPSA, 15 
U.S.C. 2069(d), and CSA is subject to civil penalties under section 20 
of the CPSA.

Response of CSA

    10. CSA denies that its exercise apparatus identified in paragraph 
5 above contains a defect which creates or could create a substantial 
product hazard within the meaning of section 15(a) of the CPSA, 15 
U.S.C. 2064(a), or creates an unreasonable risk of serious injury or 
death, and further denies an obligation to report information to the 
Commission under section 15(b) of the CPSA, 15 U.S.C. 2064(b). Since 
CSA believes that it had no obligation to report the incidents of 
injury regarding the E-Force to the Commission, it did not knowingly 
fail to report these incidents to the Commission as required by section 
15(b) of the CPSA, 15 U.S.C. 2064(b), and thus denies it is subject to 
civil penalties under section 20 of the CPSA, 15 U.S.C. 2069.
    11. Despite believing that its product was not defective or unsafe, 
CSA voluntarily reported to the CPSC and voluntarily conducted a 
corrective repair of the E-Force.
    12. By entering into the Settlement Agreement and Order, CSA does 
not admit any liability or wrongdoing. This Settlement Agreement and 
Order is agreed to by CSA to avoid incurring legal costs and adverse 
publicity and does not constitute, and is not evidence of, or admission 
of any liability or wrongdoing by CSA.

[[Page 37888]]

Agreement of the Parties

    13. The Commission has jurisdiction in this matter for purposes of 
entry and enforcement of this Settlement Agreement and Order.
    14. CSA knowingly, voluntarily and completely waives any rights it 
may have (1) to an administrative or judicial hearing with respect to 
the Commission's claim for a civil penalty, (2) to judicial review or 
other challenge or contest of the validity of the Commission's action 
with regard to its claim for a civil penalty, (3) to a determination by 
the Commission as to whether a violation of section 15(b) of the CPSA, 
15 U.S.C. 2064(b), has occurred, (4) to a statement of findings of fact 
and conclusions of law with regard to the Commission's claim for a 
civil penalty, and (5) to any claims under the Equal Access to Justice 
Act.
    15. This Settlement Agreement and Order settles any allegations of 
violation of section 15(b) of the CPSA regarding the exercise apparatus 
described above. It becomes effective only upon its final acceptance by 
the Commission and service of the incorporated Order upon Respondent.
    16. Upon provisional acceptance of this Settlement Agreement and 
Order by the Commission, the Commission shall place this Agreement and 
Order on the public record and shall publish it in the Federal Register 
in accordance with the procedure set forth in 16 CFR 1118.20(e). If the 
Commission does not receive any written request not to accept the 
Settlement Agreement and Order within 15 days, the Agreement and Order 
shall be deemed finally accepted on the 16th day after the date it is 
published in the Federal Register, in accordance with 16 CFR 118.20(f).
    17. Upon final acceptance of this Settlement Agreement and Order, 
the Commission shall issue the attached Order, incorporated herein by 
reference.
    18. The provisions of this Settlement Agreement and Order shall 
apply to CSA and its successors and assigns.
    19. 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 
Order.
    20. This Agreement may be issued in interpreting the Order. 
Agreements, understandings, representations, or interpretations made 
outside of this Settlement Agreement and Order may not be used to vary 
or to contradict its terms.

    Dated: May 8, 1997.

CSA, Inc.

Frederic Snyderman,
President and Treasurer.

The Consumer Product Safety Commission

David Schmeltzer,
Associate Executive Director, Office of Compliance.
Eric L. Stone,
Director, Division of Administrative Litigation, Office of Compliance.

    Dated: May 22, 1997.
Melvin I. Kramer,
Trial Attorney, Division of Administrative Litigation, Office of 
Compliance.

Order

    Upon consideration of the Settlement Agreement between Respondent 
CSA, Inc. (``CSA''), a corporation, and the staff of the Consumer 
Product Safety Commission, and the Commission having jurisdiction over 
the subject matter and over CSA, and it appearing the Settlement 
Agreement is in the public interest, it is
    Ordered, that the Settlement Agreement be and hereby is accepted, 
and it is
    Further Ordered, that upon final acceptance of the Settlement 
Agreement, CSA shall pay to the Order of the Consumer Product Safety 
Commission a civil penalty in the amount of One Hundred Thousand and 
00/100 Dollars ($100,000.00) to be paid in three installments of 
$25,000, $25,000 and $50,000. The first $25,000 payment will be due 
within twenty (20) days after service upon Respondent of the Final 
Order of the Commission accepting this Settlement Agreement. 
Thereafter, CSA agrees to pay $25,000 within one year of the date of 
the first payment, and $50,000 within two years of the date of the 
first payment. Payment of the total $100,000 civil penalty shall settle 
fully the staff's allegations set forth in paragraphs 4 through 9 of 
the Settlement Agreement and Order. Upon the failure by CSA to make a 
payment or upon the making of a late payment (as determined by the 
postmark on the envelope) by CSA (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 9th 
day of July, 1997.

    By Order of the Commission.
Sadye E. Dunn,
Secretary, Consumer Product Safety Commission.
[FR Doc. 97-18575 Filed 7-14-97; 8:45 am]
BILLING CODE 6355-01-M