[Federal Register Volume 76, Number 184 (Thursday, September 22, 2011)]
[Notices]
[Pages 58784-58786]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2011-24343]


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CONSUMER PRODUCT SAFETY COMMISSION

[CPSC Docket No. 11-C0011]


Bad Boy Enterprises, 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 
Bad Boy Enterprises, LLC, containing a civil penalty of $715,000.00.

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 October 7, 2011.

ADDRESSES: Persons wishing to comment on this Settlement Agreement 
should send written comments to the Comment 11-C0011, Office of the 
Secretary, Consumer Product Safety Commission, 4330 East West Highway, 
Room 820, Bethesda, Maryland 20814-4408.

FOR FURTHER INFORMATION CONTACT: Belinda V. Bell, Trial Attorney, 
Division of Compliance, Office of the General Counsel, Consumer Product 
Safety Commission, 4330 East West Highway, Bethesda, Maryland 20814-
4408; telephone (301) 504-7592.

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

    Dated: September 16, 2011.
Todd A. Stevenson,
 Secretary.

Settlement Agreement

    1. In accordance with 16 CFR 1118.20, Bad Boy Enterprises, LLC 
(``Bad Boy'') and staff (``Staff'') of the United States Consumer 
Product Safety Commission (``Commission'') hereby enter into this 
Settlement Agreement (``Agreement'') under the Consumer Product Safety 
Act (``CPSA''). The Agreement and the incorporated attached Order 
resolve Staff's allegations set forth below.

The Parties

    2. Staff is the staff of the Commission, an independent federal 
regulatory agency established pursuant to, and responsible for, the 
enforcement of the CPSA, 15 U.S.C. 2051-2089.
    3. Bad Boy is a corporation, organized and existing under the laws 
of the State of Mississippi, with its principal corporate office 
located at 413 Liberty Road, Natchez, Mississippi 39120.

Staff Allegations

    4. Between 2003 and October 2009, Bad Boy manufactured and 
distributed approximately nine thousand three hundred (9,300) off-road 
utility buggy vehicles (``Buggies''). Buggies distributed by Bad Boy 
between 2003 and 2007, were manufactured with the Series motor, and an 
accelerator and controller system designed for the Series motor 
(``Series Buggies''). Buggies distributed by Bad Boy between 2007 and 
2009, were manufactured with a ``separately excited'' motor, and an 
accelerator and controller system designed for the separately excited

[[Page 58785]]

motor (``SePex Buggies''). Retailers and authorized Bad Boy 
distributors sold the Series and SePex Buggies nationwide for 
approximately between $8,000 and $12,000.
    5. The Buggies are ``consumer products'' and, at all relevant 
times, Bad Boy was a ``manufacturer'' of these consumer products, which 
were ``distributed in commerce,'' as those terms are defined or used in 
sections 3(a)(5), (8), and (11) of the CPSA, 15 U.S.C. 2052(a)(5), (8), 
and (11).
    6. The Buggies are defective because they can accelerate suddenly 
during use or when the ignition is in the idle position, creating a 
runaway vehicle situation.
    7. Bad Boy received its first complaint involving sudden 
acceleration of a Series Buggy in April 2005.
    8. In spring 2007, Bad Boy began manufacturing and distributing 
SePex Buggies.
    9. By spring 2008, Bad Boy was aware of at least 10 reports of 
sudden acceleration Buggies.
    10. In May 2008, Bad Boy developed new software to remedy the 
sudden acceleration problem exhibited by the SePex Buggies. Bad Boy 
implemented the software repair program without notifying the 
Commission of the sudden acceleration problem. Despite knowledge of the 
information set forth in Paragraphs 5 through 9, Bad Boy did not report 
to the Commission until August 13, 2009. At that time, Bad Boy reported 
to the Commission about the SePex Buggies only. By that date, Bad Boy 
was aware of at least thirty two (32) reports involving sudden 
acceleration of the SePex Buggies and aware of at least twenty two (22) 
sudden acceleration reports of the Series Buggies. Bad Boy recalled the 
SePex Buggies on October 21, 2009.
    11. In May 2010, Bad Boy developed a second repair program for the 
SePex Buggies to address continued reports of sudden acceleration. On 
May 28, 2010, Bad Boy finally reported the Series Buggies and notified 
the Commission that the Firm was including them in the expanded repair 
program. By this time, Bad Boy was aware of thirty-three (33) reports 
of sudden acceleration involving the Series Buggies. On December 22, 
2010, Bad Boy announced the recall of the Series Buggies along with the 
second SePex Buggy recall.
    12. Although Bad Boy had obtained sufficient information to 
reasonably support the conclusion that the Buggies contained a defect 
which could create a substantial product hazard, or created an 
unreasonable risk of serious injury or death, Bad Boy failed to inform 
the Commission immediately of such defect or risk, as required by 
sections 15(b)(3) and (4) of the CPSA, 15 U.S.C. 2064(b)(3) and (4). In 
failing to inform the Commission immediately of the defect or advising 
that the defect involved the Buggies, Bad Boy knowingly violated 
section 19(a)(4) of the CPSA, 15 U.S.C. 2068(a)(4), as the term 
``knowingly'' is defined in section 20(d) of the CPSA, 15 U.S.C. 
2069(d).
    13. Pursuant to section 20 of the CPSA, 15 U.S.C. 2069, Bad Boy is 
subject to civil penalties for its knowing failure to report, as 
required under section 15(b) of the CPSA, 15 U.S.C. 2064(b).

Response of Bad Boy Enterprises LLC

    14. Bad Boy denies the allegations of Staff that the Buggies 
contain a defect which could create a substantial product hazard or 
create an unreasonable risk of serious injury or death, and denies that 
it violated the reporting requirements of Section 15(b) of the CPSA, 15 
U.S.C. Sec.  2064(b).

Agreement of the Parties

    15. Under the CPSA, the Commission has jurisdiction over this 
matter and over Bad Boy.
    16. In settlement of Staff's allegations, Bad Boy shall pay a civil 
penalty in the amount of seven hundred fifteen thousand dollars 
($715,000.00) within twenty (20) calendar days of receiving service of 
the Commission's final Order accepting the Agreement. The payment shall 
be made electronically to the CPSC via http://www.pay.gov.
    17. The parties enter into this Agreement for settlement purposes 
only. The Agreement does not constitute an admission by Bad Boy or a 
determination by the Commission that Bad Boy violated the CPSA's 
reporting requirements.
    18. Upon provisional acceptance of the Agreement by the Commission, 
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). 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 16th calendar day 
after the date it is published in the Federal Register, in accordance 
with 16 CFR 1118.20(f).
    19. Upon the Commission's final acceptance of the Agreement and 
issuance of the final Order, Bad Boy knowingly, voluntarily, and 
completely waives any rights it may have in this matter to the 
following: (a) An administrative or judicial hearing; (b) judicial 
review or other challenge or contest of the Commission's actions; (c) a 
determination by the Commission of whether Bad Boy failed to comply 
with the CPSA and the underlying regulations; (d) a statement of 
findings of fact and conclusions of law; and (e) any claims under the 
Equal Access to Justice Act.
    20. The Commission may publicize the terms of the Agreement and the 
Order.
    21. The Agreement and the Order shall apply to, and be binding 
upon, Bad Boy and each of its successors and/or assigns until the 
obligations described in Paragraph 16 have been fulfilled to the 
satisfaction of the Commission.
    22. The Commission issues the Order under the provisions of the 
CPSA, and a violation of the Order may subject Bad Boy and each of its 
successors and/or assigns to appropriate legal action until the 
obligations described in Paragraph 16 have been fulfilled to the 
satisfaction of the Commission.
    23. 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 the terms or the Agreement and the Order. 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.
    24. If any provision of the Agreement or 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 Bad Boy agree that severing the provision materially affects the 
purpose of the Agreement and Order.

Bad Boy Enterprises LLC

Dated: July 26, 2011.
By:--------------------------------------------------------------------

John Dale, IV,
Managing Member, Bad Boy Enterprises, LLC, 413 Liberty Road, 
Natchez, Mississippi 39120.

Dated: July 26, 2011.
By:--------------------------------------------------------------------
Patrick P. Burns, Jr.,
Managing Member, Bad Boy Enterprises, LLC, 413 Liberty Road, 
Natchez, Mississippi 39120.

Dated: August 1, 2011.
By:--------------------------------------------------------------------

Erika Z. Jones, Esquire,

[[Page 58786]]

Mayer Brown LLP, 1999 K Street, NW., Washington, DC 20006-1101, 
Counsel for Bad Boy Enterprises LLC.

U.S. Consumer Product Safety
Commission Staff.

Cheryl A. Falvey,
General Counsel.

Mary B. Murphy,
Assistant General Counsel.

Dated: September 6, 2011.
By:--------------------------------------------------------------------

Belinda V. Bell,
Trial Attorney, Division of Compliance, Office of the General 
Counsel.

CONSUMER PRODUCT SAFETY COMMISSION

[CPSC Docket No.: 11-C0011]

In the Matter of: Bad Boy Enterprises, LLC

Order

    Upon consideration of the Settlement Agreement entered into between 
Bad Boy Enterprises, LLC. (``Bad Boy''), and the U.S. Consumer Product 
Safety Commission (``Commission'') staff, and the Commission having 
jurisdiction over the subject matter and over Bad Boy, and it appearing 
that the Settlement Agreement and the Order are in the public interest, 
it is
    Ordered that the Settlement Agreement be, and is, hereby, accepted; 
and it is
    Further Ordered, that Bad Boy shall pay a civil penalty in the 
amount of seven hundred fifteen thousand dollars ($715,000.00) within 
twenty (20) days of service of the Commission's final Order accepting 
the Settlement Agreement upon counsel for Bad Boy identified in the 
Settlement Agreement. The payment shall be made electronically to the 
CPSC via http://www.pay.gov. Upon the failure of Bad Boy to make the 
foregoing payment when due, interest on the unpaid amount shall accrue 
and be paid by Bad Boy at the federal legal rate of interest set forth 
at 28 U.S.C. 1961(a) and (b).

    Provisionally accepted and provisional Order issued on the 16th 
day of September, 2011.

    By Order of the Commission.
Todd A. Stevenson,
Secretary, U.S. Consumer Product Safety Commission.
[FR Doc. 2011-24343 Filed 9-21-11; 8:45 am]
BILLING CODE 6355-01-P