CPSC Fines Cosco/Safety 1st $1.75 Million for Failing to Report Product DefectsLargest fine against children's product manufacturer in CPSC's history

The U.S. Consumer Product Safety Commission (CPSC) announced today that Cosco Inc., of Columbus, Ind., and Safety 1st Inc., of Canton, Mass., have agreed to pay a total of $1.75 million in civil penalties to settle CPSC charges that they failed to report product defects that caused serious injuries and deaths to children. Under federal law, companies are required to report to CPSC if they obtain information that reasonably suggests that one of their products could present a substantial risk of injury to consumers, or creates an unreasonable risk of serious injury or death. Both companies are subsidiaries of Dorel U.S.A. Inc., of Columbus, Ind.

Cosco has agreed to pay $1.3 million to settle CPSC charges that it knowingly withheld information about defects with its cribs, strollers, car seat carriers and high chairs. In each case, Cosco made design or label changes to the products after receiving injury and incident reports from consumers, but failed to inform CPSC about the hazards presented by those products in homes or on store shelves. Two babies died and more than 300 children were injured while using the products. Cosco is the largest manufacturer of strollers and car seats in the United States.

Safety 1st has agreed to pay $450,000 to settle CPSC charges that it knowingly withheld information about defects with its walkers and wipe warmers that caused six injuries to children. After receiving reports from consumers about problems with the products, Safety 1st made design changes, but failed to inform CPSC about the risks of those products in homes and on store shelves. Among the CPSC's charges:
 

- Cosco knew of 24 non-fatal incidents of children becoming entrapped in its full-sized metal cribs over a 2-year period before an 8-month- Old in White Lake, Mich., died of asphyxiation in one of the cribs on June 24, 1997. During that period, Cosco initiated a number of warning label and assembly instruction changes but did not inform the CPSC.
 

- Cosco knew about 10 incidents of the mattress sold with its cribs compressing allowing infants to become entrapped in the mattress platform. An 11-month-old in Joliet, Ill., died when he fell feet first through the slats of the mattress platform and became entrapped at the neck. Cosco knew about incidents occurring with the crib at the same time it was in talks with the CPSC to settle allegations from an earlier civil penalty case. Cosco paid a $725,000 fine in 1996 for not reporting incidents associated with its toddler beds.
 

- Cosco learned of children being injured in its Two Ways Tandem Strollers, but did not report this information to CPSC. In one case, the stroller with two children inside collapsed in the path of an oncoming car and was nearly hit. After a complaint from a retailer, Cosco added a secondary locking mechanism to all strollers in its inventory. Cosco also offered consumers, "upon request," a fix consisting of a secondary locking mechanism. When asked by the CPSC, Cosco reported it had received 3,000 complaints of locks failing, including 250 reports of strollers collapsing.
 

- Safety 1st discovered that children's teeth could get caught on the steering wheel of its Mobile 4 Wheelin' Walkers, but did not inform the CPSC until it had received reports of six incidents, including five where children had their teeth pulled out by the walker.

"This is the largest fine against a manufacturer of children's products in CPSC's history," said CPSC Chairman Ann Brown. "The law is there to help catch problems quickly so products can be recalled before a child is injured or, as in this case, killed. I want this fine to send the message that we won't tolerate companies that hide safety information from the public."

Although the companies agreed to pay the civil penalties, Cosco and Safety 1st deny the charges. Dorel, the parent company of Cosco and Safety 1st, has pledged to CPSC that it is making reforms to eliminate any future reporting problems and to continue to improve the quality of its products.

"I personally met with the Chief Operating Officer of Dorel who pledged to make safety improvements," said Brown. "I welcome this commitment."
 

Consumers can also view a partial video clip about this fine (transcript). This is in "streaming video" format.

For detailed information about these recalled products, consumers should contact CPSC at (800) 638-2772 or www.cpsc.gov. Consumers can participate in the recalls by calling Cosco at (800) 221-6736 or Safety 1st at (800) 964-8489.

In the past 10 years Cosco has had 12 recalls of children's products and Safety 1st has had five recalls. Both companies have been penalized in the past for failure to comply with reporting requirements. In 1996, Cosco paid a $725,000 civil penalty. In 1998, Safety 1st paid a $175,000 civil penalty.