Along with all my colleagues on the Commission, I voted to approve a settlement agreement requiring HSN to pay $16.0 million in civil penalties. The settlement would resolve allegations that for at least seven years, HSN knowingly failed to report to CPSC that certain My Little Steamer products contained a defect that posed a serious burn hazard to consumers.
The penalty here essentially represents the most that CPSC can impose under current statutory authority (with $16.025 million set as the legal maximum in this instance). As set forth in the allegations, HSN had received numerous reports that the Steamers would spray, expel, and/or leak hot water, resulting in cases of serious and permanent injuries to unsuspecting consumers. Nevertheless, HSN, a multi-billion dollar corporation with vast resources, let at least seven years elapse before fulfilling its obligation to tell the Commission what it knew about this serious and ongoing risk of harm.
Indeed, I am concerned that companies with revenues in the hundreds of millions, and even billions, of dollars may consider the current penalty regime merely a cost of doing business. Companies like HSN are in the best position to know what is happening with their products, and it is critical to the American public that they report relevant safety information to CPSC in a timely way. Protecting the public requires a meaningful deterrent. To penalize bad actors and to incentivize companies of all sizes to make consumer safety a top priority, I have been urging Congress to significantly increase CPSC’s penalty authority.
My support for this agreement underscores my commitment to making sure all companies hold up their end of the bargain: CPSC does not provide pre-market approval of products, so when companies learn of safety problems or even information that a product contains a defect that could create a substantial product hazard, they must immediately inform the Commission. That is the law.