CPSC Seeks Comments on $715K Settlement for not Reporting Off-Road Vehicle Defect
The Consumer Product Safety Commission is seeking comments on a provisionally accepted settlement agreement with Bad Boy Enterprises, LLC, containing a civil penalty of $715,000 to settle allegations that the company knowingly failed to immediately notify CPSC, as required by statute, of sudden acceleration defects in certain of its off-road utility “buggy” vehicles.
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Any interested person may ask CPSC not to accept this agreement or otherwise comment on its contents by filing a written request by October 7, 2011.
Allegedly Waited Several Years to Inform CPSC of Sudden Acceleration Defect
The company received ten complaints involving sudden acceleration and runaway vehicle situations from 2005-2008. In 2008, it developed software to remedy the problem in its “SePex” line of buggies but still received at least 32 complaints. Bad Boy did not inform CPSC of the problem until August 2009, when it recalled the SePex buggies.
In May 2010, Bad Boy developed a second repair program for the SePex buggies and informed CPSC that it was also including its “Series” buggies in the repair program. By this time, Bad Boy was aware of 33 reports of sudden acceleration involving this other line of “Series” buggies. In December 2010, Bad Boy announced the recall of the Series buggies along with the second SePex buggy recall.
CPSC states that 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, it failed to inform the agency immediately of such defect as required by statute.
(The settlement agreement does not constitute an admission by Bad Boy or a determination by CPSC that Bad Boy violated the CPSA’s reporting requirements.)
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.
CPSC press release available here.
(FR Pub 09/22/11, D/N 11-C0011)