[Federal Register Volume 69, Number 17 (Tuesday, January 27, 2004)]
[Notices]
[Pages 3895-3897]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 04-1607]


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CONSUMER PRODUCT SAFETY COMMISSION

[CPSC Docket No. 04-C0002]


E&B Giftware, LLC, Provisional Acceptance of a Settlement 
Agreement and Order

AGENCY: Consumer Product Safety Commission.

ACTION: Notice.

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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 
E&B

[[Page 3896]]

Giftware, LLC., containing a civil penalty of $100,000.

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 February 11, 2004.

ADDRESSES: Persons wishing to comment on this Settlement Agreement 
should send written comments to Comment 04-C0002, Office of the 
Secretary, Consumer Product Safety Commission, Washington, DC 20207.

FOR FURTHER INFORMATION CONTACT: Michelle F. Gillice, Trial Attorney, 
Office of Compliance, Consumer Product Safety Commission, Washington, 
DC 20207; telephone (301) 504-7667.

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

    Dated: January 20, 2004.
Todd A. Stevenson,
Secretary.

Settlement Agreement and Order

    1. E&B Giftware, LLC enters into this Settlement Agreement and 
Order (hereinafter, ``Settlement Agreement'' or ``Agreement'') with the 
staff of the Consumer Product Safety Commission (the ``Commission''), 
and agrees to the entry of the attached Order incorporated by reference 
herein. The Settlement Agreement settles the Commission staff's 
allegations set forth below.

I. The Parties

    2. The Commission is an independent federal regulatory agency 
responsible for the enforcement of the Consumer Product Safety Act 
(``CPSA''), 15 U.S.C. 2051 et seq.
    3.(a) E&B Giftware, LLC, established in June 2000, is a limited 
liability company, organized and existing under the laws of the State 
of Delaware, with its principal office located at 4 Executive Plaza, 
Yonkers, New York, 10701.
    (b) Sun-It Corporation (``Sun-It'') was a partially-owned 
subsidiary of E&B Giftware, Inc. (``Giftware, Inc.'').
    (c) E&B Giftware, Inc. owned 80% of the stock of Sun-It at the time 
of the events discussed in this Agreement. Without admitting that it is 
a successor in interest, E&B Giftware, LLC (hereinafter, 
``Respondent'') agrees to be bound by and comply with this Settlement 
Agreement and Order.

II. Staff Allegations

    4. Between February 1997 and September 1997, Sun-It (a subsidiary 
of E&B Giftware, Inc.) manufactured and distributed approximately 
47,000 ``Money to Burn Torch'' citronella candles (``candles''), style 
number 330N.
    5. The candles were sold to and/or used by consumers for use in or 
around a permanent or temporary household or residence, a school, in 
recreation, or otherwise and are, therefore, ``consumer products'' as 
defined in section 3(a)(1) of the CPSA, 15 U.S.C. 2052(a)(1). Sun-It 
was a ``manufacturer'' and ``distributor'' of the candles which were 
``distributed into commerce'' as those terms are defined in sections 
3(a)(4), (5), (11) and (12) of the CPSA, 15 U.S.C. 2052(a)(4), (5), 
(11) and (12).
    6. The candle is defective because the wrapper which surrounds the 
candle traps a pool of hot wax which becomes super heated. Consumers 
were exposed to a burn risk because the candles could release molten 
wax when the consumer blew on the candle in an attempt to extinguish 
it, bumped into the candle, or when the candle unexpectedly flared up.
    7. Between May 1997 and October 1997, E&B Giftware, Inc. through 
its subsidiary Sun-It, received notice of fourteen incidents in which 
consumers suffered serious burns. Several consumers reported that the 
burns left permanent scarring. One consumer reported receiving third 
degree burns.
    8. In the fall of 1997, E&B Giftware, Inc. approved of Sun-It's 
decision to stop sale of the candles and notify retailers to return 
candles in their inventory. Sun-It contacted the retailers to recall 
the candles.
    9. Respondent claims that 13,424 candles were returned and 
subsequently destroyed along with 3,382 units of unshipped inventory. 
E&B Giftware, Inc. received notice of another three incidents after its 
unilateral recall. In one of these post recall incidents, a consumer 
reported receiving third degree burns.
    10. On August 24, 1999, the Commission contacted E&B Giftware, Inc. 
regarding two incidents that it had become aware of and requested that 
E&B Giftware, Inc. submit a full report pursuant to Section 15 of the 
CPSA.
    11. E&B Giftware, Inc. provided a full report on September 27, 
1999.
    12. By the time E&B Giftware, Inc. initiated a stop sale and recall 
of inventory in the fall of 1997, it had obtained information which 
reasonably supported the conclusion that the candles described in 
paragraph 4 above contained a defect which could create a substantial 
product hazard or created an unreasonable risk of serious injury or 
death, but failed to report such information in a timely manner to the 
Commission as required by sections 15(b)(2) and (3) of the CPSA, 15 
U.S.C. 2064(b)(2), (3).
    13. By failing to provide the information to the Commission in a 
timely manner as required by section 15(b) of the CPSA, 15 U.S.C. 
2064(b), E&B Giftware, Inc. violated 19(a)(4) of the CPSA, 15 U.S.C. 
2068(a)(4).
    14. E&B Giftware, Inc. committed this failure to report to the 
Commission ``knowingly'' as the term ``knowingly'' is defined in 
section 20(d) of the CPSA, 15 U.S.C. 2069(d), thus, subjecting E&B 
Giftware to civil penalties under section 20 of the CPSA, 15 U.S.C. 
2069.

III. E&B Giftware LLC Response

    15. Respondent denies the staff's allegations in paragraph 6 that 
the candles were defective and that it violates the CPSA as set forth 
in paragraphs 12 through 14.

IV. Agreement of the Parties

    16. The Consumer Product Safety Commission has jurisdiction over 
this matter and over E&B Giftware, LLC under the Consumer Product 
Safety Act, 15 U.S.C. 2051 et seq.
    17. This Agreement is entered into for settlement purposes only and 
does not constitute an admission by Respondent or a determination by 
the Commission that E&B Giftware, Inc. knowingly violated the CPSA's 
reporting requirement.
    18. In settlement of the staff's allegations, Respondent agrees to 
pay a civil penalty of one hundred thousand and 00/100 dollars 
($100,000.00), in full settlement of this matter, and payable within 
twenty (20) calendar days of receiving service of the final Settlement 
Agreement and Order, or by December 31, 2003, whichever occurs later.
    19. Upon final acceptance of this Agreement by the Commission and 
issuance of the Final Order, Respondent knowingly, voluntarily, and 
completely waives any rights it may have in this matter (1) to an 
administrative 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 Respondent failed to 
comply with CPSA and the underlying regulations, (4) to a statement of 
findings of fact and conclusions of law and (5) to any claims under the 
Equal Access to Justice Act.
    20. Upon provisional acceptance of this Agreement by the 
Commission, this Agreement 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). If the Commission does not 
receive any written objections within 15

[[Page 3897]]

days, the Agreement will be deemed finally accepted on the 16th day 
after the date it is published in the Federal Register.
    21. The Commission may publicize the terms of the Settlement 
Agreement and Order.
    22. The Commissioner's Order in this matter is issued under the 
provisions of the CPSA, 15 U.S.C. 2051 et seq. Violation of this Order 
may subject Respondent to appropriate legal action.
    23. This Settlement Agreement may be used in interpreting the 
Order. Agreements, understandings, representations, or interpretations 
apart from those contained in this Settlement Agreement and Order may 
not be used to vary or contradict its terms.
    24. The provisions of this Settlement Agreement and Order shall 
apply to E&B Giftware, LLC and each of its successors and assigns.

E&B Giftware, LLC.
Dated: November 10, 2003

Edward Sacks,

Chief Executive Officer.

William Walsh,

Esquire, Respondent's Attorney.

The U.S. Consumer Product Safety Commission.

Alan H. Schoem,

Director, Office of Compliance.

Eric L. Stone,

Director, Legal Division, Office of Compliance.

January 16, 2004.

    Michelle F. Gillice,

Trial Attorney, Legal Division, Office of Compliance.

Order

    Upon consideration of the Settlement Agreement between Respondent 
E&B Giftware, LLC and the staff of the Consumer Product Safety 
Commission, and the Commission having jurisdiction over the subject 
matter and over E&B Giftware LLC, and it appearing that the Settlement 
Agreement and Order is in the public interest, it is
    Ordered that the Settlement Agreement be, and hereby is, accepted 
and it is
    Further Ordered that E&B Giftware, LLC shall pay the United States 
Treasury a civil penalty in the amount of one hundred thousand and 00/
100 dollars, ($100,000.00), payable within twenty (20) days of the 
service of the Final Order upon E&B Giftware, LLC, or by December 31, 
2003, whichever occurs later.

    Provisionally accepted and Provisional Order issued on the 20th 
day of January, 2004.

    By Order of the Commission.
Todd A. Stevens,
Secretary, Consumer Product Safety Commission.
[FR Doc. 04-1607 Filed 1-26-04; 8:45 am]
BILLING CODE 6355-01-M