[Federal Register Volume 73, Number 156 (Tuesday, August 12, 2008)]
[Notices]
[Pages 46886-46888]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E8-18400]


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CONSUMER PRODUCT SAFETY COMMISSION

[CPSC Docket No. 08-C0020]


Vacation Clothing Exchange, Inc., d/b/a Basix USA, 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 
Vacation Clothing Exchange, Inc., d/b/a Basix USA, containing a civil 
penalty of $25,000.00.

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 August 27, 2008.

ADDRESSES: Persons wishing to comment on this Settlement Agreement 
should send written comments to the Comment 08-C0020, Office of the 
Secretary, Consumer Product Safety Commission, 4330 East-West Highway, 
Room 502, Bethesda, Maryland 20814-4408.

FOR FURTHER INFORMATION CONTACT: Dennis C. Kacoyanis, Trial Attorney, 
Legal Division, 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: August 5, 2008.
Todd A. Stevenson,
Secretary.

United States of America

Consumer Product Safety Commission

In the Matter of
Vacation Clothing Exchange, Inc. d/b/a Basix USA.
CPSC Docket No. 08-C0020.

Settlement Agreement

    1. In accordance with 16 CFR 1118.20, Vacation Clothing 
Exchange, Inc., d/b/a Basix USA (``Vacation Clothing'') and the 
staff (``Staff'') of the United States Consumer Product Safety 
Commission (``Commission'') enter into this Settlement Agreement 
(``Agreement''). The Agreement and the incorporated attached Order 
(``Order'') settle the Staffs allegations set forth below.

[[Page 46887]]

Parties

    2. The Commission is an independent federal regulatory agency 
established pursuant to, and responsible for the enforcement of, the 
Consumer Product Safety Act, 15 U.S.C. 2051-2084 (``CPSA'').
    3. Vacation Clothing is a corporation organized and existing 
under the laws of Florida, with its principal offices located in 
Lauderdale Lakes, FL. At all times relevant hereto, Vacation 
Clothing imported and sold apparel.

Staff Allegations

    4. Between May 2003 and December 2006, Vacation Clothing 
imported and/or sold to retailers at least 22,420 children's 
sweatshirts and windbreakers with drawstrings in the hoods 
(``Drawstring Sweatshirts and Windbreakers'').
    5. Retailers sold the Drawstring Sweatshirts and Windbreakers to 
consumers.
    6. The Drawstring Sweatshirts and Windbreakers are ``consumer 
product[s],'' and, at all times relevant hereto, Vacation Clothing 
was a ``manufacturer'' of those consumer products, which were 
``distributed in commerce,'' as those terms are defined in CPSA 
sections 3(a)(1), (4), (11), and (12), 15 U.S.C. 2052(a)(1), (4), 
(11), and (12).
    7. In February 1996, the Staff issued the Guidelines for 
Drawstrings on Children's Upper Outerwear (``Guidelines'') to help 
prevent children from strangling or entangling on drawstrings. The 
Guidelines state that drawstrings can cause, and have caused, 
injuries and deaths when they catch on items such as playground 
equipment, bus doors, or cribs. In the Guidelines, the Staff 
recommends that there be no hood and neck drawstrings in children's 
upper outerwear sized 2T to 12.
    8. In June 1997, ASTM adopted a voluntary standard, ASTM F1816-
97, that incorporated the Guidelines. The Guidelines state that 
firms should be aware of the hazards and should be sure garments 
they sell conform to the voluntary standard.
    9. On May 19, 2006, the Commission posted on its Web site a 
letter from the Commission's Director of the Office of Compliance to 
manufacturers, importers, and retailers of children's upper 
outerwear. The letter urges them to make certain that all children's 
upper outerwear sold in the United States complies with ASTM F1816-
97. The letter states that the Staff considers children's upper 
outerwear with drawstrings at the hood or neck area to be defective 
and to present a substantial risk of injury to young children under 
Federal Hazardous Substances Act (``FHSA'') section 15(c), 15 U.S.C. 
1274(c). The letter also notes the CPSA's section 15(b) reporting 
requirements.
    10. The Commission was not informed of any incidents or injuries 
from the Drawstring Sweatshirts and Windbreakers.
    11. Vacation Clothing's distribution in commerce of the 
Drawstring Sweatshirts and Windbreakers did not meet the Guidelines 
or ASTM F1816-97, failed to comport with the Staff's May 2006 defect 
notice, and posed a strangulation hazard to children.
    12. On February 13, 2007, the Commission and Vacation Clothing 
announced a recall of the Drawstring Sweatshirts and Windbreakers, 
informing consumers that they should immediately remove the 
drawstrings to eliminate the hazard.
    13. Vacation Clothing had presumed and actual knowledge that the 
Drawstring Sweatshirts and Windbreakers distributed in commerce 
posed a strangulation hazard and presented a substantial risk of 
injury to children under FHSA section 15(c)(l), 15 U.S.C. 
1274(c)(1). Vacation Clothing had obtained information that 
reasonably supported the conclusion that the Drawstring Sweatshirts 
and Windbreakers contained a defect that could create a substantial 
product hazard or that they created an unreasonable risk of serious 
injury or death. CPSA sections 15(b)(2) and (3), 15 U.S.C. 
2064(b)(2) and (3), required Vacation Clothing to immediately inform 
the Commission of the defect and risk.
    14. Vacation Clothing knowingly failed to immediately inform the 
Commission about the Drawstring Sweatshirts and Windbreakers as 
required by CPSA sections 15(b)(2) and (3), 15 U.S.C. 2064(b)(2) and 
(3), and as the term ``knowingly'' is defined in CPSA section 20(d), 
15 U.S.C. 2069(d). This failure violated CPSA section l9(a)(4), 15 
U.S.C. 2068(a)(4). Pursuant to CPSA section 20, 15 U.S.C. 2069, this 
failure subjected Vacation Clothing to civil penalties.

Vacation Clothing Response

    15. Vacation Clothing denies the Staff's allegations above that 
Vacation Clothing knowingly violated the CPSA.

Agreement of the Parties

    16. Under the CPSA, the Commission has jurisdiction over this 
matter and over Vacation Clothing.
    17. The parties enter into the Agreement for settlement purposes 
only. The Agreement does not constitute an admission by Vacation 
Clothing, or a determination by the Commission, that Vacation 
Clothing has knowingly violated the CPSA.
    18. In settlement of the Staff's allegations, Vacation Clothing 
shall pay a civil penalty in the amount of twenty-five thousand 
dollars ($25,000.00) in five (5) installments as follows: The first 
installment of five-thousand dollars ($5,000.00) shall be paid 
within twenty (20) calendar days of service of the Commission's 
final Order accepting the Agreement; the second payment of five-
thousand dollars ($5,000.00) shall be paid within six (6) months of 
service of the Commission's final Order accepting the Agreement; the 
third payment of five-thousand dollars ($5,000.00) shall be paid 
within twelve (12) months of service of the Commission's final Order 
accepting the Agreement; the fourth payment of five-thousand dollars 
($5,000.00) shall be paid within eighteen (18) months of service of 
the Commission's final Order accepting the Agreement; and the fifth 
payment of five-thousand dollars ($5,000.00) shall be paid within 
twenty-four (24) months of service of the Commission's final Order 
accepting the Agreement. Each payment shall be by check payable to 
the order of the United States Treasury.
    19. Upon provisional acceptance of the Agreement, the Agreement 
shall be placed on the public record and published in the Federal 
Register in accordance with the procedures set forth in 16 CFR 
1118.20(e). In accordance with 16 CFR 1118.20(f), if the Commission 
does not receive any written request not to accept the Agreement 
within fifteen (15) calendar days, the Agreement shall be deemed 
finally accepted on the sixteenth (16th) calendar day after the date 
it is published in the Federal Register.
    20. Upon the Commission's final acceptance of the Agreement and 
issuance of the final Order, Vacation Clothing knowingly, 
voluntarily, and completely waives any rights it may have regarding 
the Staffs allegations to the following: (1) an administrative or 
judicial hearing; (2) judicial review or other challenge or contest 
of the validity of the Order or of the Commission's actions; (3) a 
determination by the Commission of whether Vacation Clothing failed 
to comply with the CPSA and its underlying regulations; (4) a 
statement of findings of fact and conclusions of law; and (5) any 
claims under the Equal Access to Justice Act.
    21. The Commission may publicize the terms of the Agreement and 
the Order.
    22. The Agreement and the Order shall apply to, and be binding 
upon, Vacation Clothing and each of its successors and assigns.
    23. The Commission issues the Order under the provisions of the 
CPSA, and violation of the Order may subject Vacation Clothing to 
appropriate legal action.
    24. The Agreement may be used in interpreting the Order. 
Understandings, agreements, representations, or interpretations 
apart from those contained in the Agreement and the Order may not be 
used to vary or contradict their terms. The Agreement shall not be 
waived, amended, modified, or otherwise altered without written 
agreement thereto executed by the party against whom such waiver, 
amendment, modification, or alteration is sought to be enforced.
    25. If any provision of the Agreement and the Order is held to 
be illegal, invalid, or unenforceable under present or future laws 
effective during the terms of the Agreement and the Order, such 
provision shall be fully severable. The balance of the Agreement and 
the Order shall remain in full force and effect, unless the 
Commission and Vacation Clothing agree that severing the provision 
materially affects the purpose of the Agreement and the Order.
    26. Pursuant to section 6(d) 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 any person or firm 
violated 15 U.S.C. 2068, where the total amount of the settlement 
involves no more than $100,000.

Vacation Clothing Exchange, Inc. d/b/a Basix USA
    Dated: 7/21/08 By:

Benjamin Perelmutter,

[[Page 46888]]

Vice President, Vacation Clothing Exchange, Inc., d/b/a Basix USA.
2778 NW 31st Avenue.
Lauderdale Lakes, FL 33311.
    Dated: 7/21/08 By:

Brian Kopelowitz, Esquire,
The Kopelowitz Ostrow Law Firm, P.A.
200 SW 1st Avenue, 12th Floor
Fort Lauderdale, FL 33301
Attorney for Vacation Clothing Exchange, Inc., d/b/a Basix USA.

U.S. Consumer Product Safety Commission Staff

J. Gibson Mullan,
Assistant Executive Director,
Office of Compliance and Field Operations.
Ronald G. Yelenik,
Acting Director,
Legal Division,
Office of Compliance and Field Operations.

    Dated: 7/31/08 By:

Dennis C. Kacoyanis,
Trial Attorney,
Legal Division,
Office of Compliance and Field Operations.

United States of America

Consumer Product Safety Commission

In the Matter of Vacation Clothing Exchange, Inc. d/b/a Basix USA. 
CPSC Docket No. 08-C0020

Order

    Upon consideration of the Settlement Agreement entered into 
between Vacation Clothing Exchange, Inc., d/b/a Basix USA 
(``Vacation Clothing'') and the U.S. Consumer Product Safety 
Commission (``Commission'') staff, and the Commission having 
jurisdiction over the subject matter and over Vacation Clothing, and 
pursuant to the authority delegated in section 6(d) of the Interim 
Delegation of Authority ordered by the Commission on February 1, 
2008, and it appearing that the Settlement Agreement and the Order 
are in the public interest, it is
    Ordered, that the Settlement Agreement be, and hereby is, 
accepted; and it is
    Further ordered, that Vacation Clothing shall pay a civil 
penalty in the amount of twenty-five thousand dollars ($25,000.00) 
in five (5) installments as follows: The first payment of five-
thousand dollars ($5,000.00) shall be paid within twenty (20) 
calendar days of service of the Commission's final Order accepting 
the Agreement; the second payment of five-thousand dollars 
($5,000.00) shall be paid within six (6) months of service of the 
Commission's final Order accepting the Agreement; the third payment 
of five-thousand dollars ($5,000.00) shall be paid within twelve 
(12) months of service of the Commission's final Order accepting the 
Agreement; the fourth payment of five-thousand dollars ($5,000.00) 
shall be paid within eighteen (18) months of service of the 
Commission's final Order accepting the Agreement; and the fifth 
payment of five-thousand dollars ($5,000.00) shall be paid within 
twenty-four (24) months of service of the Commission's final Order 
accepting the Agreement. Each payment shall be made by check payable 
to the order of the United States Treasury. Upon the failure 
Vacation Clothing to make the foregoing payments when due, interest 
on the unpaid amount shall accrue and be paid by Vacation Clothing 
at the federal legal rate of interest set forth at U.S.C. 1961(a) 
and (b).


    Provisionally accepted and provisional Order issued on the 4th 
day of August 2008.

By order of the commission:
Todd A. Stevenson,
Secretary, U.S. Consumer Product Safety Commission.
[FR Doc. E8-18400 Filed 8-11-08; 8:45 am]
BILLING CODE 6355-01-M