Applying the responsible corporate officer doctrine articulated in United States v. Dotterweich, 320 U.S. 277 (1943) and United States v. Park, 421 U.S. 658 (1975), an administrative law judge (ALJ) has determined that the Consumer Product Safety Commission (CPSC) may amend its complaint against Maxfield & Oberton Holdings, LLC, the now-defunct company that made high-power magnetic desk toys alleged to be hazardous, by adding its CEO Craig Zucker as a respondent. In re Maxfield & Oberton Holdings, LLC, CPSC Nos. 12-1, -2, -3 (C.P.S.C., decided May 3, 2013).
According to the ALJ, courts have continued to apply the doctrine to statutes involving public health, safety and welfare since Dotterweich and Parks were decided. It allows liability against an individual if it is shown that “the person sought to be held liable actually participated in the liability-creating conduct.” “Here,” states the ALJ, “CPSC has alleged Mr. Zucker was responsible for ensuring Maxfield’s compliance with applicable statutes and regulations. CPSC has further alleged Mr. Zucker personally controlled the acts and practices of Maxfield, including the importation of Buckyballs and Buckycubes. The Commission did not allege that by virtue of his corporate position Mr. Zucker was automatically liable; on the contrary, CPSC specifically alleged that he assumed responsibility.” The ALJ also allowed the agency to add another to product, Neoballs, to its complaint against Zen Magnets, LLC, finding that this would not unduly broaden the issues in the proceeding or cause undue delay.