[Federal Register Volume 73, Number 62 (Monday, March 31, 2008)]
[Notices]
[Pages 16842-16844]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E8-6407]


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CONSUMER PRODUCT SAFETY COMMISSION

[CPSC Docket No. 08-C0004]


Reebok International Ltd., a Corporation, 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 Federal Hazardous Substances 
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 Reebok International Ltd., a corporation, containing a 
civil penalty of $1,000,000.00.

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 April 15, 2008.

ADDRESSES: Persons wishing to comment on this Settlement Agreement 
should send written comments to the Comment 08-C0004, Office of the 
Secretary, Consumer Product Safety Commission, 4330 East West Highway,

[[Page 16843]]

Room 502, Bethesda, Maryland 20814-4408.

FOR FURTHER INFORMATION CONTACT: Dennis C. Kacoyanis, Trial Attorney, 
Office of Compliance and Field Operations, Consumer Product Safety 
Commission, 4330 East West Highway, Bethesda, Maryland 20814-4408; 
telephone (301) 504-7587.

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

    Dated: March 17. 2008.
Todd A. Stevenson,
Secretary.

United States of America Consumer Product Safety Commission

[CPSC DOCKET NO. 08-C0084]

In the Matter of Reebok International Ltd., a Corporation

Settlement Agreement

    1. This Settlement Agreement (``Agreement'') is made by and between 
the staff (``the staff'') of the United States Consumer Product Safety 
Commission (``the Commission'') and Reebok International Ltd. 
(``Reebok''), a corporation. This Agreement and the incorporated 
attached Order (``Order'') settle the staff's allegations set forth 
below.

The Parties

    2. The Commission is an independent federal regulatory agency 
responsible for the enforcement of the Federal Hazardous Substances 
Act, 15 U.S.C. 1261-1278, (``FHSA'').
    3. Reebok is a corporation organized and existing under the laws of 
the Commonwealth of Massachusetts, with its principal corporate office 
located at 1895 J. W. Foster Boulevard, Canton, MA 02021. Reebok is a 
manufacturer of athletic footwear and apparel.

Staff Allegations

    4. Between May 2004 and March 2006, Reebok introduced or caused the 
introduction into interstate commerce, or received in interstate 
commerce and delivered or proffered delivery thereof for pay or 
otherwise approximately 300,000 Heart-Shaped Charm Bracelets (``charm 
bracelets''). The charm bracelets were provided as free gifts with the 
purchase of various styles of children's footwear.
    5. Reebok failed to take action to ensure that the charm bracelets 
did not contain toxic levels of lead, thereby creating a risk of lead 
poisoning and adverse health effects to children.
    6. In March 2006, Reebok received a report of the death of a four-
year-old child allegedly caused by lead poisoning. The child reportedly 
swallowed the charm bracelet's heart-shaped pendant. Reebok immediately 
reported to the Commission.
    7. In March 2006, the Commission staff obtained samples of the 
charm bracelets, which were tested at the CPSC Laboratory. The test 
results demonstrated that certain components of the charm bracelets 
contained a total lead content from 78 to 93 percent and accessible 
lead from 3,441 to 9,856 micrograms of lead. These levels of lead are 
``toxic'' within the meaning of the FHSA.
    8. The charm bracelets are a hazardous substance because they are 
toxic and may cause substantial personal injury or substantial illness 
during or as a proximate result of any customary foreseeable handling 
or use, including reasonably foreseeable ingestion by children. 
Accordingly, the charm bracelets are hazardous substances under section 
2(f)(l)(A) of the FHSA, 15 U.S.C. 1261(f)(l)(A).
    9. The charm bracelets were marketed with children's footwear and 
were intended for use by children. Therefore, the charm bracelets 
constitute banned hazardous substances under section 2(q)(1)(A) of the 
FHSA, 15 U.S.C. 1261(q)(1)(A).
    10. Reebok knowingly introduced or delivered for introduction into 
interstate commerce, or caused such acts, or received in interstate 
commerce and delivered or proffered delivery thereof for pay or 
otherwise or caused such acts, with respect to the aforesaid banned 
hazardous charm bracelets, as the term ``knowingly'' is defined in 
section 5(c)(5) of the FHSA, 15 U.S.C. 1264(c)(5), in violation of 
section 4(a) and (c) of the FHSA, 15 U.S.C. 1263(a) and (c).
    11. Pursuant to section 5(c)(1) of the FHSA, 15 U.S.C. 1264(c)(1), 
Reebok is subject to civil penalties for the aforementioned violation.

Reebok's Response

    12. Reebok denies the staff's allegations that it violated the FHSA 
as set forth in paragraphs 4 through 11 above.

Agreement of the Parties

    13. Under the FHSA, the Commission has jurisdiction over this 
matter and over Reebok.
    14. In settlement of the staff's allegations, Reebok shall pay a 
civil penalty in the amount of one million dollars ($1,000,000.00) 
within twenty (20) calendar days of service of the final Order of the 
Commission. This payment shall be made by check payable to the order of 
the United States Treasury.
    15. The parties enter into this Agreement for settlement purposes 
only. The Agreement does not constitute an admission by Reebok or a 
determination by the Commission that Reebok knowingly violated the 
FHSA.
    16. Upon provisional acceptance of this Agreement, the Agreement 
shall be placed on the public record and 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 request not 
to accept the Agreement within 15 days, the Agreement shall be deemed 
finally accepted on the 16th calendar day after the date it is 
published in the Federal Register in accordance with 16 CFR 1118.20(f).
    17. Upon the Commission's final acceptance of the Agreement and 
issuance of the final Order, Reebok knowingly, voluntarily, and 
completely waives any rights it may have in this matter to the 
following: (i) An administrative or judicial hearing, (ii) judicial 
review or other challenge or contest of the validity of the 
Commission's actions, (iii) a determination by the Commission as to 
whether Reebok failed to comply with the FHSA, (iv) a statement of 
findings of fact or conclusions of law, and (v) any claims under the 
Equal Access to Justice Act.
    18. This Agreement and Order resolves the staffs allegations 
contained in paragraphs 4 through 11 herein. Upon final acceptance of 
this Agreement by the Commission and issuance of the final Order, the 
Commission and those acting on its behalf agree not to initiate any 
civil penalty action against Reebok based on the aforementioned 
allegations under the FHSA, 15 U.S.C. 1261-1278 or the Consumer Product 
Safety Act, 15 U.S.C. 2051-2084.
    19. The Commission may publicize the terms of the Agreement and 
Order.
    20. The Agreement and Order shall apply to, and be binding upon 
Reebok and each of its successors and assigns.
    21. The Commission issues the Order under the provisions of the 
FHSA, 15 U.S.C. 1264(c)(4), and a violation of this Order may subject 
Reebok to appropriate legal action.
    22. This Agreement may be used in interpreting the Order. 
Agreements, understandings, representations, or interpretations made 
outside of this Agreement and Order may not be used to vary or 
contradict its terms.
    23. This Agreement shall not be waived, changed, amended, modified, 
or otherwise altered without written agreement thereto executed by the 
party

[[Page 16844]]

against whom such amendment, modification, alteration, or waiver is 
sought to be enforced.
    24. If after the effective date hereof, any provision of this 
Settlement Agreement and Order is held to be illegal, invalid, or 
unenforceable under present or future laws effective during the terms 
of the Agreement and Order, such provision shall be fully severable. 
The balance of the Agreement and Order shall remain in full effect, 
unless the Commission and Reebok agree that severing the provision 
materially changes the purpose of the Settlement Agreement and Order.
    25. Pursuant to section 6(b) of the Interim Delegation of Authority 
ordered by the Commission on February 1, 2008, the Commission delegated 
to the Assistant Executive Director for Compliance and Field Operations 
the authority to act, with the concurrence of the General Counsel, for 
the Commission under 16 CFR 1118.20 with respect to Staff allegations 
that Reebok and affiliated entities violated 15 U.S.C. 1263 and are 
therefore subject to civil penalties under 15 U.S.C. 1264.

Reebok International Ltd.
Dated: March 12, 2008.
    Joseph W. Keane, Chief Financial Officer Reebok International 
Ltd., 1895 J. W. Foster Boulevard Canton, MA 02021.

Dated: March 12, 2008.
    Peter L. Winik, Esquire, Latham & Watkins LLP, 555 Eleventh 
Street, NW., Washington, DC 20004-1304 Attorneys for Reebok 
International Ltd.

U.S. Consumer Product Safety Commission.

    John Gibson Mullan, Assistant Executive Director, Office of 
Compliance and Field Operations U. S. Consumer Product, Safety 
Commission, 4330 East West Highway Bethesda, MD 20814,
    Ronald O. Yelenik, Acting Director, Legal Division.

Office of Compliance and Field Operations.

Dated: March 12, 2008.
    Dennis C. Kacoyanis, Trial Attorney, Legal Division, Office of 
Compliance and Field Operations.

United States of America Consumer Product Safety Commission

[CPSC DOCKET NO. 08-C0004]

In the Matter of Reebok International Ltd., a Corporation

Order

    Upon consideration of the Settlement Agreement entered into between 
Reebok International Ltd. (``Reebok'') and the staff of the Consumer 
Product Safety Commission (``the Commission''); and the Commission 
having jurisdiction over the subject matter and Reebok; and pursuant to 
the authority delegated in section 6(b) of the Interim Delegation of 
Authority ordered by the Commission on February 1, 200; 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 Reebok shall pay a civil 
penalty of one million dollars ($1,000,000.00). This payment shall be 
made by check payable to the order of the United States Treasury within 
(20) calendar days of service of the final Order of the Commission upon 
Reebok. Upon the failure of Reebok to make full payment in the 
prescribed time, interest on the outstanding balance shall accrue and 
be paid at the federal rate of interest under the provisions of 28 
U.S.C. 1961(a) and (b).

    Provisionally accepted and provisional Order issued on the 17th 
day of March, 2008.

    By Order of the Commission.

Todd A. Stevenson,
Secretary Consumer Product Safety Commission.
 [FR Doc. E8-6407 Filed 3-28-08; 8:45 am]
BILLING CODE 6355-01-M