The United States Consumer Product Safety Commission (“CPSC”) continues to seek significant civil penalties from companies that fail to “immediately” report potential product safety problems in a timely fashion. The newest installment in this trend occurred when CPSC announced a $4.5 million civil penalty against PetSmart. CPSC stated that, between 2011 and 2014, “PetSmart received at least 19 reports of fish bowls cracking, breaking, or shattering during normal use, resulting in serious injuries to consumers in at least 12 cases.” However, CPSC went on to say that the company failed to “immediately notify CPSC of the defect or risk posed by the fish bowls.” Moreover, CPSC claims that the company “failed to identify the correct amount and distribution dates of the fish bowls” during the initial recall of the product.
Under Federal law, once a reporting requirement arises under the Consumer Product Safety Act, it must be reported to CPSC “immediately” or within 24 hours of discovery.
The product originally sold in stores for approximately $20.
This latest penalty is no outlier. A quick review of CPSC announcements in 2015 and 2016 reveal the following penalty announcements:
9/8/2016 – Goodman $5.5M