Statement of Acting Chairman Robert S. Adler on the Notice of Proposed Rulemaking Regarding an Amendment to the Regulation on Information Disclosure Under Section 6(b) of the Consumer Product Safety

February 13, 2014

This week, the Commission voted to publish in the Federal Register a Notice of Proposed Rulemaking (NPR) regarding an amendment to the CPSC’s regulation (16 C.F.R. part 1101) of information disclosure under section 6(b) of the Consumer Product Safety Act (CPSA).  I believe this proposed rule will modernize and streamline our regulation – and, more importantly, better align it to comply with our statutory obligations to assure the accuracy and fairness of information the agency discloses to the public.

 

I have never hidden my dislike for section 6(b) of the CPSA.  I have long believed it inappropriately puts the agency in the role of a national data nanny of vital consumer product safety information.  To cite only a few problems with this section:

 

  • Section 6(b)’s cumbersome procedures and unnecessary delays put consumers’ lives and limbs at risk by requiring the CPSC to restrict the flow of critical safety information to the public.
  • The Commission, unlike any of our sister agencies, must spend hundreds of thousands of dollars a year following wasteful 6(b) procedures –­ procedures that were visited exclusively on the CPSC 40 years ago and have never been imposed on any other agency since then.
  • Section 6(b) has been interpreted by the U.S. Supreme Court to apply to FOIA requests for information in agency files.  This means that information that no one would ever think carried the agency’s blessing or imprimatur still must be run through section 6(b) procedures – adding time and expense to the process.
  • One particularly bad example:  A document that simply lists the names of the 50 firms in an industry must be processed through section 6(b) by sending 50 different notices – each with the other 49 names redacted (especially since the firms likely already know all of the names on the list). 
  • The Commission cannot post information on its website that has been previously disclosed simply and solely because we have given firms the right to be notified again before it’s released again – especially when most companies don’t even bother to file comments when they’re re-notified.
  • The average time to process section 6(b) requests is roughly four times as long as the time to process non-6(b) requests.
  • Read literally, section 6(b) prevents CPSC staff from saying even favorable or nice things about manufacturers unless we follow the cumbersome procedures of the Act.

 

To be clear, the NPR we passed today removes none of the agency’s responsibility to follow the law when it comes to information that it has obtained under the Act or disclosed to the public in connection with the Act.  Yet, it also stays within the parameters of the statute because there is simply no safety reason to expand its reach.

 

The changes the Commission has proposed to section 1101 of our regulations are quite modest – and long overdue.  In thirty years, the Commission has revised this regulation only once – and that was to make technical changes required by the Consumer Product Safety Improvement Act of 2008.   The changes proposed in this amendment will bring us into the modern age and account for the reality that we live in an era where most communication takes place electronically. 

 

Our proposal will have one major effect – to remove the agency’s unnecessary and unjustifiable “renotification” provision.  This provision is not required by our statute and has provided no safety benefit to the public.  To the contrary, it has provided firms an absolute right to demand that the agency follow the time consuming and cumbersome procedures of 6(b) over and over again for information the Commission has previously released to the public.  Under current Commission procedures, once information has been processed through 6(b), the information is then eligible for public release, including being posted on our web site.  Under our current renotification rule, however, if a firm demands notification each time the Commission proposes to re-release information in which the manufacturer is identified, the information is effectively embargoed.  That is, it is not made available to the public until someone requests it and the agency goes through 6(b) procedures again.  To say the least, this completely undermines the concepts of transparency and openness so carefully nurtured at the CPSC.[1] 

 

Four Amendments to the Staff Draft NPR

While I believe the CPSC staff drafted a thoughtful package, my colleague, Commissioner Robinson, and I proposed amendments to the staff draft rule to address several valid concerns of our colleague Commissioner Buerkle.  I commend Commissioner Buerkle for raising concerns that led to greater clarity in the proposal (keeping in mind that she still disagreed with most of our amendments). 

 

I will briefly explain our amendments.  First, we clarified that while section 1101.11(a)(2) will now track the statute by using only the word “obtained” rather than adding the words “generated” and “received” when explaining the scope of the information that it will process through section 6(b),[2] amended § 1101.2 has not been narrowed, only streamlined.

 

Second, our amendment expanded on staff’s clarification that section 6(b) does not apply to information already publicly available or disseminated in a manner intended to reach the public.[3]  We added language to the preamble of the NPR to remove any doubt that, notwithstanding the inapplicability of 6(b), existing agency policy and federal law require the CPSC to assure that information disclosed by the agency to the public is presented in an accurate, clear, complete, and unbiased manner.  Moreover, we pointed out that other federal health and safety agencies that do not operate under 6(b)’s restrictions generally coordinate the release of information identifying specific manufacturers with those manufacturers in the interest of accuracy and fairness.  Needless to say, we wholly endorse such an approach whether or not 6(b) applies to the agency.

 

Third, we added language to make clear that staff’s proposed deletion of a confusing and subjective standard for determining when the Commission would follow 6(b) procedures made perfect sense.[4]   Our amendment clarified that the Commission will continue to use the well-established “reasonable person standard” when analyzing whether one can readily ascertain from information proposed to be disclosed the identity of the manufacturer or private labeler of a particular product.  In the interest of clarity, our amendment added a sentence to the preamble to make clear that while this unnecessary language was removed from the rule, in practice, the reasonable person standard as described in section 1101.13 errs in favor of providing notice to manufacturers and private labelers.

 

Finally, our amendment clarified our understanding of staff’s recommendation to revise the Commission’s current policy of automatically withholding comments, upon request, from firms about information the Commission proposes to release.[5]  In fact, this policy goes well beyond the requirements of 6(b), which generally grants a firm the right to have its comment included in a release.  It does not, however, grant a firm the absolute right to have its comment withheld from release.  Therefore, the staff’s proposed revision requires a firm to demonstrate why its comment should be withheld from the public when the Commission releases information the firm has commented on.   Commissioner Robinson and I added language to our substitute amendment to clarify that the change in the staff’s draft seeks to find a balance between the public interest in transparency and the rights of the identified firm to be assured that disclosure is fair under the circumstances. 

 

Conclusion

In sum, the amendments offered by Commissioner Robinson and me and the staff’s draft NPR taken as a whole are intended to make CPSC’s enforcement of the statutory requirements under section 6(b) more efficient and effective for all concerned.

 

Finally, I note the Commission has and will continue to enforce section 6(b) of our statute and no one, least of all me, opposes taking steps to check the accuracy and fairness of information about manufacturers when we initiate the release of information and vouch for it.  Every agency that I know of – none of whom have 6(b) restrictions – takes care to be certain that its press releases and other affirmative disclosures of information have been run by the firms named in the press releases.  That is a far cry, however, from the broad restrictions in our section 6(b) regulations.



[1] Even here, the Commission’s NPR retains protections for firms.  The staff draft still provides for renotification to manufacturers if the Commission has reason to question the accuracy of the information we are re-releasing.

[2] This provision currently reads as follows:

The information must be obtained, generated or received by the Commission as an entity or be individual members, employees, agents, contractors or representatives of the Commission acting in their official capacity.  (§ 1101.11(a)(2)) (emphasis added).  Staff recommended deleting the words “generated or received” as they did not track the words of the statute.  We concurred.

[3] See § 1101.11(b)(7) of the staff draft.

[4] The deleted sentence reads as follows:

The Commission will provide the advance notice and opportunity to comment if there is a question whether the public could readily ascertain the identity of a manufacturer or private labeler. (§ 1101.13).

Staff correctly pointed out that the words “a question” did not necessarily comport with the “reasonable person” standard that our regulation calls for in the requirement for deciding whether information should be processed through 6(b).

[5] See §1101.31(b)(5).