CVS Agrees to $45K Penalty for CPSC Drawstring Reporting Failure
The Consumer Product Safety Commission announced that on August 4, 2011, CVS Pharmacy, Inc. agreed to pay a civil penalty of $45,000 to settle staff allegations that it failed to immediately report that it had sold children’s hooded jackets with drawstrings at the neck. The settlement agreement has been provisionally accepted by the Commission.
Sign up for a free preview to unlock the rest of this article
Timely, relevant coverage of court proceedings and agency rulings involving tariffs, classification, valuation, origin and antidumping and countervailing duties. Each day, Trade Law Daily subscribers receive a daily headline email, in-depth PDF edition and access to all relevant documents via our trade law source document library and website.
Staff Alleges CVS Failed to Immediately Report 2008-2009 Drawstring Violations
CPSC staff alleges that CVS knowingly1 failed to report to CPSC immediately that it had sold children’s hooded jackets with drawstrings at the neck from August 2008 to January 2009.
According to CPSC, federal law requires manufacturers, distributors, and retailers to report to CPSC immediately (within 24 hours) after obtaining information reasonably supporting the conclusion that a product contains a defect which could create a substantial product hazard, creates an unreasonable risk of serious injury or death, or fails to comply with any consumer product safety rule or any other rule, regulation, standard, or ban enforced by CPSC.
In March 2009, CPSC and the importer of the jackets announced a recall of the products, which were sold under the brand names Golden Grove and Young USA.
Agreement Would Settle Allegations, CVS Would Deny Knowing Violations
The settlement would resolve staff allegations and in agreeing to the settlement, CVS would deny that it knowingly violated the law.
July Rule Makes Drawstrings Substantial Product Hazard, Allows CPSC to Refuse Entry, Etc.
In July 2011, CPSC issued a final rule which determined that children’s upper outerwear in sizes 2T to 12 or the equivalent, which have neck or hood drawstrings, and in sizes 2T to 16 or the equivalent, which have waist or bottom drawstrings that do not meet specified criteria, present substantial product hazards and are subject to immediate reporting requirements, recalls, and will be refused admission into the U.S. See ITT’s Online Archives or 07/19/11 news, 11071907, for BP summary.)
(Prior to that, CPSC issued drawstring guidelines in 1996 and announced in 2006 that children’s upper outerwear with drawstrings at the hood or neck would be regarded as defective, presenting a substantial risk of injury to young children.)
1Under CPSC’s statute, the term "knowingly" means: (1) the having of actual knowledge, or (2) the presumed having of knowledge deemed to be possessed by a reasonable man who acts in the circumstances, including knowledge obtainable upon the exercise of due care to ascertain the truth of representations.