[Federal Register: July 6, 2005 (Volume 70, Number 128)]
[Notices]
[Page 38885-38886]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr06jy05-56]
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CONSUMER PRODUCT SAFETY COMMISSION
[CPSC Docket No. 05-C0009]
Rose Art Industries, Inc., a Corporation, 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 Sec.
1118.20(e). Published below is a provisionally-accepted Settlement
Agreement with Rose Art Industries, Inc., a corporation, containing a
civil penalty of $300,000.00.
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 July 21, 2005.
ADDRESSES: Persons wishing to comment on this Settlement Agreement
should send written comments to the Comment 05-C0009, Office of the
Secretary, Consumer Product Safety Commission, Washington, DC 20207.
FOR FURTHER INFORMATION CONTACT: Ronald G. Yelnik, Trial Attorney,
Office of Compliance, Consumer Product Safety Commission, Washington,
DC 20207; telephone (301) 504-7582.
SUPPLEMENTARY INFORMATION: The text of the Agreement and Order appears
below.
Dated: June 30, 2005.
Todd A. Stevenson,
Secretary.
Settlement Agreement and Order
1. This Settlement Agreement is made by and between the staff (the
``staff'') of the U.S. Consumer Product Safety Commission (the
``Commission'') and Rose Art Industries, Inc. (``Rose Art'' or
``Respondent''), a corporation, in accordance with 16 CFR section
1118.20 of the Commission's procedures for Investigations, Inspections,
and Inquiries under the Consumer Product Safety Act (``CPSA''). This
Settlement Agreement and the incorporated attached Order settle the
staff's allegations set forth below.
The Parties
2. The Commission is an independent federal regulatory agency
responsible for the enforcement of the Consumer Product Safety Act, 15
U.S.C. sections 2051-2084.
3. Rose Art is a corporation organized and existing under the laws
of the State of New Jersey with its principal corporate offices located
in Livingston, New Jersey. Respondent manufactures are materials, toys
and stationery products.
Staff Allegations
4. Between August 1997 and December 2001, Rose Art manufactured and
sold nationwide approximately 124,000 Glamour Gear Soap Making Kits,
models 4054 and 4121 (the ``Kit(s)'' or the ``product(s)''. Each Kit
includes bars of soap, molds, and a plastic cup to melt soap chunks.
These Kits are intended for use by children eight years of age and
older.
5. The Kits are ``consumer products'' and Respondent is a
``manufacturer'' of ``consumer products,'' which were ``distributed in
commerce'' as those terms are defined in sections 3(a)(1), (4), (11)
and (12) of the CPSA, 15 U.S.C. 2052(a)(1), (4), (11), and (12).
6. The Kits are defective because the plastic cup used to heat the
soap in a microwave oven may become deformed or develop a hole in the
bottom, causing the hot soap contained therein to leak from the cup. If
this occurs, young children and others may sustain serious burn
injuries.
7. Between January 1998 and January 2002, Rose Art received reports
of 10 children who were burned by hot soap while removing the plastic
cup from a microwave oven. The majority of these children sustained
second and third degree burns.
8. Despite being aware of the aforementioned reports, Rose Art did
not inform the Commission about this information until February 14,
2002, when it submitted both a section 15 and a section 37 report.
9. Although Rose Art had obtained sufficient information to
reasonably support the conclusion that the Kits contained a defect
which could create a substantial product hazard, or created an
unreasonable risk of serious injury or death, long before February 14,
2002, it failed to immediately inform the Commission of such defect or
risk as required by sections 15(b)(2) and (3) of the CPSA, 15 U.S.C.
2064(b)(2) and (3). By failing to do so, Rose Art violated section
19(a)(4) of the CPSA, 15 U.S.C. 2068(a)(4).
10. Respondent committed this failure to immediately inform the
Commission of the subject defect or risk ``knowingly'' as the term
``knowingly'' is defined in section 20(d) of the CPSA, 15 U.S.C.
2069(d), and pursuant to section 20 of
[[Page 38886]]
the CPSA, 15 U.S.C. 2069, Respondent is subject to civil penalties.
Response of Rose Art
11. Rose Art denies the allegations of the staff that the Kits
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. 2064(b). Respondent also denies that the products when
maintained and used properly create a substantial product hazard or an
unreasonable risk of serious injury or death under section 15(b) of the
CPSA, 15 U.S.C. 2064(b). Respondent asserts that it did not
``knowingly'' violate any reporting requirements under the CPSA.
Respondent further asserts that any injury associated with the use of
its products was attributable to unreasonable consumer misuse of the
products contrary to instructions and without adequate adult
supervision.
12. Notwithstanding its denial that the Kits contain a defect which
could create a substantial product hazard, or create an unreasonable
risk of serious injury or death, Respondent nevertheless, cooperated
with the staff in recalling the products.
Agreement of The Parties
13. The Commission has jurisdiction over this matter and over Rose
Art Under the CPSA, 15 U.S.C. 2051-2084.
14. In settlement of the staff's allegations, Rose Art agrees to
pay a civil penalty of three hundred thousand dollars ($300,000.00) in
two installments. The first installment of one hundred fifty thousand
dollars ($150,000.00) shall be paid within twenty (20) calendar days of
service of the Final Order of the Commission accepting this Settlement
Agreement. The second installment of one hundred fifty thousand dollars
($150.000.00) shall be paid on or before January 31, 2006. These
payments shall be made by check payable to the order of the United
States Treasury.
15. The parties enter into this Settlement Agreement for settlement
purposes only. The Settlement Agreement does not constitute an
admission by Rose Art, or a determination by the Commission that Rose
Art has violated the CPSA's reporting requirements.
16. Upon provisional acceptance of this Settlement Agreement and
Order by the Commission, the Commission shall place this Agreement and
Order on the public record and shall publish it in the Federal Register
in accordance with he procedure set forth in 16 C.F.R. 1118.20(e). If
the Commission does not receive any written request not to accept the
Settlement Agreement and Order within 15 days, the Agreement and Order
shall be deemed finally accepted on the 16th day after the date it is
published in the Federal Register
17. Upon final acceptance of this Settlement Agreement by the
Commission and issuance of the Final Order, Rose Art knowingly,
voluntarily and completely waives any rights it may have in this matter
to the following: (i) An administrative or judicial hearing; (ii)
judicial review or other challenge or contest of the validity of the
Commission's actions; (iii) a determination by the Commission as to
whether Respondent failed to comply with the CPSA and its underlying
regulations; (iv) a statement of findings of fact and conclusions of
law; and (v) any claims under the Equal Access to Justice Act.
18. The Commission may publicize the terms of the Settlement
Agreement and Order.
19. This Settlement Agreement and Order shall apply to, and be
binding upon Respondent and each of its successors and assigns.
20. The Commission's Order in this matter is issued under the
provisions of the CPSA, 15 U.S.C. 2051-2084, and a violation of the
Order may subject Respondent to appropriate legal action.
21. This Settlement Agreement may be used in interpreting the
Order. Agreements, understandings, representations, or interpretations
made outside of this Settlement Agreement and Order may not be used to
vary or to contradict its terms.
22. The Settlement Agreement and Order shall not be waived,
changed, amended, modified, or otherwise altered, except in writing
executed by the party against whom such amendment, modification,
alteration, or waiver is sought to be enforced, and approved by the
Commission.
23. If, after the effective date hereof, any provision of this
Settlement Agreement and Order is held to be illegal, invalid, or
unenforceable under present or future laws effective during the terms
of the Settlement Agreement and Order shall remain in full effect,
unless the Commission and Respondent determine that severing the
provision materially impacts the purpose of the Settlement Agreement
and Order.
Rose Art Industries, Inc.
Dated: April 25, 2005
Jeffrey Rosen,
Chief Operating Officer, Rose Art Industries, Inc., 6 Regent Street,
Livingston, NJ 07039.
Frederick B. Locker, Esq.,
Locker, Brainin & Greenberg, 420 Fifth Avenue, New York, NY 10018,
Counsel for Rose Art Industries, Inc.
U.S. Consumer Product Safety Commission.
John Gibson Mullan,
Director, Office of Compliance.
Eric L. Stone, Director,
Legal Division, Office of Compliance.
Dated: April 27, 2005.
Ronald G. Yelenik,
Senior Attorney, M. Reza Malihi, Trial Attorney, Legal Division,
Office of Compliance.
Order
Upon consideration of the Settlement Agreement entered into between
Rose Art Industries, Inc. (``Rose Art'') and the staff of the U.S.
Consumer Product Safety Commission (the ``Commission''), and the
Commission having jurisdiction over the subject matter and over Rose
Art, and it appearing that the Settlement Agreement is in the public
interest, it is
Ordered, that the Settlement Agreement be, and hereby is, accepted;
and it is
Further Ordered, that Rose Art shall pay a civil penalty of three
hundred thousand dollars ($300,000.00) in two installments. The first
installment of one hundred fifty thousand dollars ($150,000.00) shall
be paid within twenty (20) calendar days of service of the Final Order
of the Commission accepting the Settlement Agreement. The second
installment of one hundred fifty thousand dollars ($150,000.00) shall
be paid on or before January 31, 2006. These payments shall be made by
check payable to the order of the United States Treasury. Upon the
failure of Rose Art to make a payment or upon the making of a late
payment, (i) the entire amount of the civil penalty shall become due
and payable, and (ii) interest on the outstanding balance shall accrue
and be paid at the federal legal rate of interest under the provisions
of 28 U.S.C. 1961(a) and (b).
Provisionally accepted and Provisional Order issued on the 30th
day of June, 2005.
By Order of the Commission,
Todd A. Stevenson,
Secretary, Consumer Product Safety Commission.
[FR Doc. 05-13288 Filed 7-5-05; 8:45 am]
BILLING CODE 6355-01-M