>> ANN MARIE BUERKLE:
Good morning,
and welcome to this public
meeting of the United States
Consumer Product
Safety Commission.
We have one item on the
agenda this morning,
the federal register notice
removing the safety standard
for magnets sets from the
Code of Federal Regulations.
Before we begin the
hearing this morning,
I just want to take a moment
here to acknowledge, obviously,
the change in seating.
And I want to first
of all express really
how proud I am and honored I
am to be the acting chair here
at the Consumer Product
Safety Commission.
But I also want to
take this opportunity
to publicly thank,
as I have been
doing since I took over,
the service of Elliot
Kaye as our chairman.
So I want to just
take a moment here
to recognize all of
his service and what
he has done for the Consumer
Product Safety Commission,
both as chair and his former
capacities before that
as chief of staff as well
as executive director,
and now as a commissioner.
So if you would join me in
just recognizing and thanking
Elliot for his service.
[APPLAUSE]
So this is the
maiden voyage here.
And I have two experts
on either side of me,
so I expect everything
to go swimmingly well.
It's clear from discussions
with individual commissioners
that there is an interest
in a renewed attempt
to promulgate a
magnet standard that
will pass muster in the courts.
Therefore I have asked
staff this morning
to be prepared to answer
questions on this topic
generally.
For discussion this morning,
the CPSC staff members
are Mr. DeWane Ray,
Deputy Executive Director
of Safety Operations,
Dr. George Borlase,
Assistant Executive Director
for Hazard Information
and Reduction, and Miss Patricia
Pollitzer from OGC's office.
As a reminder too, I just
want to remind my colleagues
that OGC has sent out some
rules of the road to all of us.
I just want to confirm that
everyone received them.
And I'm sure Mary
and OGC will not
hesitate to keep us
out of the ditches
this morning as we
proceed with our hearing.
So this morning we're going
to open it up for questions.
And I will begin with
my round of questions.
And then each of
the commissioners
will have five minutes as well.
So good morning and thank
you to staff for being here.
First of all, to
begin with, I do
want to clarify a
point for the record,
and that is that I didn't vote
for the magnet standard that
was vacated by the Tenth
Circuit Court of Appeals.
Although I was on the
commission at the time,
I was concerned about voting
on the magnet standard
while there were
contested recalls
involving the same magnets
pending adjudication.
But because this action
today is removing the rule
from the federal register,
I don't think it causes me
and it does not cause
me the same concern.
It merely implements
the court order for us
to vacate the rule.
So my first question
actually is for OGC.
Does the Tenth
Circuit court decision
requiring us to vacate the
magnet rule also require us now
to promulgate another rule?
>> PATRICIA POLLITZER: No, it
doesn't require the commission
to do that.
So as you noted, the
court, the Tenth Circuit,
vacated the commission's rule,
but it also remanded the rule
to the commission.
So vacating the rule means
it's no longer in effect.
But remanding the rule means
the commission has the option
to address the issues that the
court raised in its opinion
and issue--
conduct a new rule making.
>> ANN MARIE BUERKLE: Thank you.
Thank you.
For Mr. Ray, for DeWane,
can you explain to us
how the original magnet
rulemaking got started?
Was it staff recommending
the rulemaking
or was it from
the commissioners?
>> DEWANE RAY: Sure.
I think I've shared
with some, I still
remember the day in one
of the conference rooms
where I felt like there was
a consensus to move forward.
It was definitely a
staff-motivated push
to get there.
But as with all of
these things, we
were definitely engaged
with the chairman
at the time, Inez
Tenenbaum's office
to get the full support
to move forward on that.
But yeah, I can still
vividly remember
that day and that meeting
that we made that decision
to move ahead.
>> ANN MARIE BUERKLE: Thank you.
When that rulemaking began, was
it part of an operating plan
or was it independent
of an operating plan?
>> DEWANE RAY: My memory, it was
in between those time periods
that this kind of came.
And then eventually it did
make it into the operating plan
as it began to take place.
>> ANN MARIE BUERKLE: Thank you.
If the staff-- and this
is for Dr. Borlase--
if the staff were asked
to consider whether or not
to recommend
rulemaking, can you talk
to me and the
commissioners, what factors
would they consider?
>> GEORGE BORLASE: In
proposing the rules,
staff would consider all the
factors that we do in every
rulemaking.
There is some
specific information.
For example, should
the commission
direct us to repropose a rule
that we could already rely on--
a lot of the information from
our engineering sciences,
for example, on
magnetic flux index,
that hasn't changed in
the last couple of years.
The health science information
on the health effect
if a child swallows more
than two magnets, that
hasn't changed in the
last couple of years.
But we would go through
the same process
we do with respect to the full
epidemiological analysis of all
the incident reports
where they've
come in from NIESS,
et cetera, as we've
proposed the economic analysis
regulatory analysis, the reg
flex analysis.
One unique aspect
of this clearly
is making sure we
address the issues that
were brought forth by the
Tenth Circuit Court of Appeals.
But that work has
also been incorporated
in the project plan.
>> ANN MARIE BUERKLE: Thank you.
From what I can recognize
from where we were then
and where we are
now, several factors
have changed in terms of
when we first initiated
rulemaking on magnets.
Probably the most significant
to me is exposure.
So even if we determine the
hazard is the same, clearly
since the ban and the
rule was put into place,
the number of magnet sets
has diminished greatly.
So one could argue, even
if the hazard still exists,
the exposure to the hazard
is significantly diminished.
So will the staff take
that into consideration
as they're going
through this analysis?
>> GEORGE BORLASE: The staff
would look at that as they
establish what their
regulatory baseline would be.
In the last package,
we had a baseline
of what was before a lot
of the compliance action
took into effect, and that is
our starting position on it
with respect to it.
But we would have
to look at that.
>> ANN MARIE BUERKLE: Thank you.
My time is up.
So I'm going to move to
have Commissioner Adler ask
his questions.
>> ROBERT ADLER: Thank
you Madam Chairman.
And I welcome you as
our acting chairman.
I'm sure you're going
to do a superb job.
And I look forward
to working with you.
So I don't know where this
question is for Mr. Ray or Dr.
Borlase, but let me ask it.
And whoever feels more inclined
to answer it, please do.
And this goes to the point of
exposure that the chair raised.
If you recall at the time of
this decision, all but one
of the 13 largest distributors
of small-- and not
all of the distributors,
just the 13
largest of these small
high powered magnets sets
had ceased distributing
the product.
But since the court's
decision, it's my understanding
that one or more companies
have announced an intention
to resume sales
of these magnets.
Can either of you share
any information generally
about whether companies
have announced an intention
to resume sales
of these magnets?
>> DEWANE RAY: Yeah,
I can take that.
We, in the Office
of Compliance, have
done some initial surveillance
both at brick and mortar stores
and also online.
We are aware of at least
three companies online that
are currently
selling what appear
to be the similar
magnets that were
subject to the rule in the past.
some are on back order,
meaning they're not
going to be ready until
March time frame, and later.
But we are in the process
of collecting samples
and analyzing what is in
the market from the online.
Our initial assessment
of the retail,
we did not find them
readily available in retail.
But I do think we are
seeing the market begin
to reengage in this, in the
sale of these magnet sets.
>> ROBERT ADLER: And
to your knowledge,
have any of the companies that
have announced an intention
to market or they are
currently marketing,
have any of them modified
these magnet sets in terms
of the size or the
strength of the magnets?
>> DEWANE RAY: We are
aware of a company,
when the rule was
still in place,
that basically made them smaller
and less powerful to meet
the flux that was
specified in the rule.
So there was at
least one company,
to my knowledge, that had
compliant magnets, compliant
to the rule.
>> ROBERT ADLER: But you said
there were three companies.
Of the three companies,
have you seen
anything that would suggest
they're planning on modifying
the size of the
design of the magnets,
or the strength of the magnets?
>> DEWANE RAY: Yeah, so at least
the one that we've actually got
a sample of, it appears
to be a strong flux,
much greater than 50.
>> ROBERT ADLER: So
the Tenth Circuit,
when they invalidated the
rule, in part said they did
so because, quote, "The
commission offered no
explanation or rationale for
its apparent assumption that
the observed reduction in
injury rates would not endure."
But if companies are
planning on re-entering
the high powered
magnet market now
that the standard's
been invalided,
that would tend to be fairly
strong evidence that the injury
rates are likely to increase.
Is staff prepared
to do an analysis
of the likelihood of increased
injuries and the likelihood
of increased incidence
of sales of magnet sets?
Was that clear?
>> DEWANE RAY: You mean as the
commission directs us to move
ahead with--
I think our proposal that we
were looking at and trying
to provide some resource
estimates was basically focused
on the epidemiological side
where the court had indicated
it had concerns.
And so we would focus on getting
an update on the injuries
there, and then on
the economics memo
where the baseline that was used
for the benefit-cost analysis
[INAUDIBLE].
>> ROBERT ADLER: Yeah,
and on the epidemiology,
the court said that 90% of
the injury reports on which we
relied--
and this was their
favorite word--
only possibly involved
the subject magnet sets.
So the court said we hadn't
provided a proper conclusion
that the rule was reasonably
necessary to eliminate
or reduce the risk of injury.
You don't have to
go into detail,
but can you tell
me whether staff
is prepared to explain
in greater detail why
the data on injuries is
reliable and trustworthy?
>> DEWANE RAY: We are.
And that's what we would plan
if the commission directed staff
to take that on.
>> DEWANE RAY: Yeah, and
I would also just commend
to the staff's attention that
the dissent in the case pointed
to additional data sources.
And I would hope that the
commission staff would explain,
if we were to move to
continue this rule,
to explain that
in greater detail.
And the final issue
that the court addressed
was the utility of
the magnet sets,
whether that was
outweighed by the benefits.
Is staff also
prepared to address
that concern of the court?
Should we move forward?
>> GEORGE BORLASE: Yes we are.
>> ROBERT ADLER: OK, and in
final-- oh, I'm out of time.
Thank you.
>> ANN MARIE BUERKLE:
Commissioner Robinson?
>> MARIETTA ROBINSON: Thank
you Acting Chair Buerkle,
and I also welcome you, as I
have privately and in a much
more public forum than this.
And I look forward
to working with you.
I also want to thank
you and your staff for,
on such quick notice, or
relatively short notice I
should say, putting
this hearing together.
I just want to say that, in
rereading the Tenth Circuit
opinion within
the last 36 hours,
I can tell you that my
view of the opinion--
and I'm delighted at this--
is that the court's ruling is
very narrow and fact-specific.
And it only requires
us to address
some specific technicalities
of our cost-benefit analysis.
And I don't mean
to influence you,
because I know you'll
do your own analysis.
But I just wanted
to make sure that
in the analysis that you're
going to do for purposes
of the next proposal
to us, hopefully,
will be to decide whether
some aspects of the analysis
need to be explained more
fully, whether to analyze
additional data,
and whether to weigh
any additional factors relating
to the anticipated costs
and benefits?
Are those are all questions
that you anticipate addressing?
>> DEWANE RAY: Yes.
>> MARIETTA ROBINSON: OK,
I have nothing further.
Thank you very much.
>> ANN MARIE BUERKLE: Thank you.
Commissioner Kaye?
>> ELLIOT KAYE: Thank
you Chairman Buerkle.
Thank you for your kind
words that you have said here
and and in other fora.
From the first time
that I called you
after your confirmation and
called Commissioner Robinson
after her confirmation, when
I was Chairman Tanenbaum's
chief of staff and offered my
assistance to you in any way,
and then was in
essence your staffer
for the first couple of weeks
that you got to the commission,
I think we've been able
to develop a working
relationship and a bond that
is not typical of this city.
And we've done it in many
different capacities now.
And I'm looking
forward to continuing
to do it in this capacity.
>> ANN MARIE BUERKLE: Would
the commissioner yield for--
>> ELLIOT KAYE: Absolutely.
>> ANN MARIE BUERKLE: So when
Elliot came into my office
as executive director, and
it was myself and Nancy--
I think was just the two of us,
maybe the first or second day--
his first words of
advice to me were,
"If you say the word phtalates,
don't say 'puh-thal-ates.'
They'll know you're a rookie.
It's 'thal-ates.'"
>> ELLIOT KAYE: That's true.
And I think that was
a sense of goodwill,
that we didn't set you up.
Thank you Miss Pollitzer, Mr.
Ray Dr. Borlase for appearing
and for, of course,
your excellent good work
and assistance to us.
Mr. Ray, if I can ask
you, or Dr. Borlase--
I'll leave it up
to whoever feels
it's more appropriate-- if the
commission were to direct staff
to prepare and send
to the commission
as soon as possible a draft
notice of proposed rulemaking
to address the holding of
the Tenth Circuit opinion
that was issued in
November of last year, what
would the resource implications,
please, be for that?
>> GEORGE BORLASE: Sure.
Based on the project plan and
the staff we plan to assign,
most of the implications
would be two things.
First for this year,
internal EXHR improvement
projects that we
were working on,
and then separately,
some work in '17
that we were doing
in preparation
for '18 rulemakings,
specifically econ
on portable generators.
>> ELLIOT KAYE: And do you have
an estimate of the staff months
associated with it?
It can just be an estimate.
I'm not going to hold you to it.
>> GEORGE BORLASE: Sure.
From the project
sheet, we estimated
11 staff months total across
EXHR and general counsel.
>> ELLIOT KAYE:
Thank you for that.
And do you anticipate, when the
commission does a midyear later
this year, that that
would have any material
changes to the midyear?
>> GEORGE BORLASE: None
beyond what I just described.
>> ELLIOT KAYE: OK, thank you.
No more questions Madam Chair.
>> ANN MARIE BUERKLE: Thank you.
Commissioner Mohorovic?
>> JOE MOHOROVIC: Thank
you Madam Chairman.
Commissioner Kaye, welcome
to this side of the dais.
You know unlike the
Jeffersons, Louise and George,
they moved up to the east side.
So you are moving east,
but Chairman Buerkle, you
moved west to a
loftier position.
So take that as you well.
But welcome to the neighborhood.
Look forward to
having you nearby.
You've already made me lose my
composure with a little joke
once already, Commissioner Kaye.
Welcome staff.
And I do have some technical
questions around exposure.
As I think the
chairman brought up,
any sound risk
assessment's going
to be a consideration of
hazard times exposure.
And I agree with much
that's been said.
Dr. Borlase, as you
pointed out that,
that our staff doesn't feel like
the hazard potential of small,
high powered rare earth
magnets has changed.
But I do want to get
to whether or not
there is the exposure that
then compels the commission
to allocate its very scarce
resources towards addressing it
in the most heavy handed way
that we can do so as an agency
through regulation.
The first thing I want to
know is, in terms of evidence
of magnet importation--
I think Commissioner
Adler was talking
about some of the stated
desires of different firms
to get back into
the magnet sale.
And when I mean
magnets, I mean those
that would be potentially
subject to the rule.
Is there any evidence that these
magnets are being imported?
I think I recall,
and I don't think
it's been disputed, that these
products are all primarily
imported and they're
not mined or--
to be honest, I don't know
how a magnet is created,
but I understood them all to be
imports primarily from China.
Do we have any evidence
from our import staff,
through the identification
of HTS codes
that their magnets are coming
back into the United States?
>> DEWANE RAY: I don't
have data in front of me,
but we do have situations where
direct to consumer sales are
happening and occurring.
And those are
primarily imported.
>> JOE MOHOROVIC: Mr. Ray,
are they coming in in any kind
of numbers?
I respect the fact that you
said you don't have any data.
But do we have anything
that causes concern
for the agency in
terms of magnets coming
in any particular
high volume that
would merit a priority
for the agency to address?
>> DEWANE RAY: Yeah, again,
I don't have numbers.
I think we've
talked about what I
think we view right
now as a potential
of that re-establishing.
And we are seeing
that beginning.
So I think that's
about as much as I
can say at this point in time.
>> JOE MOHOROVIC: Right.
And of course, having a seller
and having a potential buyer
are only parts of the equation.
There still needs to be
a distribution channel.
And I think I recall,
and can you confirm,
that of the 2.7 million
units of magnet sets
that were identified in
the previous package,
over 95% of those
were sold through
traditional retail
channels as opposed
to direct to consumer
distribution channels?
>> DEWANE RAY: I don't have that
information for you right now,
but I can get back
to you on that.
>> JOE MOHOROVIC: Do you recall
at the time that magnets were
coming into the market, and
however you want to categorize
2.7 million sets being sold--
that's what we estimated.
I think our recall numbers
were a little bit different
in terms of identifying
some of the major players.
But from what I recall
from before I joined
the agency is that one of the
first activities of the agency
was to cut off the
means of distribution.
And that is by working
directly with retailers
to advise them of the
hazard, the concern
that it posed from the
CPSC's perspective,
and to see if they
would voluntarily
stop selling the product.
And I believe that the
agency was mostly successful
in that effort.
Do you do you recall the same
in terms of how people were
actually buying magnet sets?
>> DEWANE RAY: Yeah, I think
you correctly articulated
the compliance actions that were
taken at the beginning of this
activity.
And like Commissioner
Adler mentioned,
we got the bulk of
the companies that
were selling to
voluntarily agree
to stop selling and
recall their products.
>> JOE MOHOROVIC: Do you have
any evidence of the fact that
retailers, by virtue of the rule
being thrown out by the Tenth
Circuit, plan on changing their
tune and now starting to offer
their retail channels as
distribution channels to sell
these products?
>> DEWANE RAY: Beyond the
online sites that we've seen,
that's all I'm aware of.
>> JOE MOHOROVIC: But you're not
aware of any retail sites that
are now changing their business
decision and now deciding
to open up magnets for
sale to their customers.
>> DEWANE RAY: That's correct.
>> JOE MOHOROVIC: OK.
And without getting--
oh, I'm out of time.
I beg your pardon.
Thank you Madam Chairman.
Thank you staff.
>> ANN MARIE BUERKLE: Thank you.
I think we'll have a
second round of questions
if any of the commissioners
have any additional questions.
I know I do.
Dr. Borlase, I just
want to go back
to where we kind of left
off so that if we argue
that the exposure-- excuse me,
that the risk of the hazard
is the same but the exposure
seemingly would be less,
given the ban that's been in
place for a few years now,
do you sense that this
issue or this risk
demands immediate attention,
or is it something that we can
put within the
context of an ops plan
and have staff assess it
within all of the other risks
and hazards they're looking at?
>> GEORGE BORLASE: We don't have
a recommendation on the timing,
At This time.
I mean, I know it's come
up today as part of it.
So we put the work together
as part of the timing.
And a lot of the
discussion about exposure,
et cetera, is exactly
the work staff
would do if directed
by the commission.
I know we've got a limited
amount of information
now to answer.
And the plan would be to
do the additional work
necessary to have
that information
to bring it to the commission
as part of the proposed rule.
>> ANN MARIE BUERKLE: Thank you.
I want to talk a little
bit about what Commissioner
Adler brought up, and that
was the court's language
about the possibility.
So when we're looking
at the NEISS data,
has anything changed?
Is there a more specific
code now within NEISS
that would give us more
certainty as to any harm
or injury that's caused?
What's going to change
to make that possibly
where it would be certain?
>> GEORGE BORLASE:
When looking at it,
I think staff would be much
clearer in describing the work
that was done and in analyzing
all of the incidents,
and better describing
the confidence they have
in their analysis.
Previously when it was
described as possibly,
I don't know that
that fully captured
the confidence that staff
had that it was probably.
And so that is something staff,
if directed by the commission,
would go back and do as
part of the re-analysis.
>> ANN MARIE BUERKLE: And have
there been any coding changes?
I recall during one hearing
we had specifically where
it was raised that the coding is
not precise for the NEISS data.
Have there been any changes when
it comes to the NEISS coding?
>> GEORGE BORLASE:
Coding specifically,
I'm not aware of
a coding change.
>> ANN MARIE BUERKLE: I want
to talk a little bit more about
the issue with retailers.
And so we've done
some surveillance,
online surveillance as
to whether they're coming
in either via retailers--
you say that--
was that done online, or did
you actually go into stores?
>> DEWANE RAY: No, the
retail surveillance,
we physically visited 23
stores throughout the country,
primarily looking at toy stores
and things like that where we
had seen the product
sold in the past.
And we did not see the
magnet sets for sale.
>> ANN MARIE BUERKLE: And when
they visited the retailers,
were there conversations about
the possibility that they might
come back into the market?
>> DEWANE RAY: I think that
that's likely happened when
our investigator did--
I have not talked to
all the investigators
that went through that to be
able to say with certainty
how those conversations went.
But I'm sure that's
a possibility there.
>> ANN MARIE BUERKLE:
One of the concerns--
and when we talk about certainty
and this market research,
that we're sort of-- we've
done some, obviously,
both the internet as well as
in brick and mortar stores.
But is there any certainty that
these magnets were a passing
fad, and now the
consumer has moved on,
and despite the fact that
they may be available again,
the consumer has moved on
to a different desk toy?
>> DEWANE RAY: I don't know
that we're going to be able
to answer that question.
I think if the demand is
the same as it was before,
I think that's part
of the concern,
if we get back to
that situation again.
But you're right.
Things change.
There's fads, products that
are hot today and not tomorrow.
So that's also a
possibility also.
>> ANN MARIE BUERKLE: Will that
be part of the consideration
as we move forward, if we
move forward with rulemaking?
>> DEWANE RAY: I'm not exactly
sure how, in consideration,
in what context.
>> ANN MARIE BUERKLE: Well just
to make sure that we're not
chasing something that may
not even be a problem or this
product may not be back in
the market, in full force,
like it was a few years back.
>> DEWANE RAY: OK, I'm not
entirely sure how we're going
to capture that.
But there may be
some thought that we
would have to put to that.
I'm thinking more on
our economics team.
They're pretty creative
at trying to provide
this kind of information.
So I don't have an
answer on it right now,
but I think we could
get back to you on that.
>> ANN MARIE BUERKLE: Thank you.
Commissioner Adler?
>> ROBERT ADLER:
Thank you very much.
And continuing on
the line of inquiry
that the chairman
has raised, it's
my recollection that
these were introduced
in the market in the year 2009.
And within a very, very
short time, the sales of them
had exploded and jumped
into the millions of sets.
Am I correct in my recollection?
>> DEWANE RAY: That's correct.
>> ROBERT ADLER: And
so I'm also curious.
That was 2009.
We're in the year of 2017.
Has the actual internet
market grown, stayed the same,
or dropped over time in terms
of just products generally sold?
Do you think our economics
team could give us
some insight into that?
>> DEWANE RAY: Yeah,
I'm sure we could.
I think it's clear to
see from 2009 to now,
there's definitely
a lot more sales
online in general of
consumer products.
So I don't think
that's a hard one to--
I don't have the exact numbers,
but I think that's definitely
been a growing [INAUDIBLE].
≫> ROBERT ADLER: Yeah, and
I think that would be very
helpful in terms of figuring out
what the distribution channel
would be for the magnets.
And I would just--
this is not a question.
This is just a brief comment--
is that it is true that
we worry about exposure.
But exposure also is one
aspect of our concern.
The other, it's always
frequency times severity.
And I see nothing in the
indication of these products
that the severity of the
hazard has gone away at all.
So that I think the
court wasn't saying
you need a certain minimal
level of sales for us
to make a proper finding.
I think that what
they were saying is,
tell us what the best
quantification you can come up
with respect to your
cost-benefit analysis
of the sales of these products.
And one of the things
that I think we're seeing
is that it's an
incredibly moving target,
and you're never going to be
able, other than a snapshot
at any point in time, to
give that quantification.
No further questions.
>> ANN MARIE BUERKLE: Thank you.
Commissioner Robinson?
>> MARIETTA ROBINSON: Thank you.
I very much respect
the time frame
that staff has come
up with in terms
of what's going to be needed
for further analysis in light
of the Tenth Circuit opinion.
So I'm not going to ask you
to engage in conjecture as
to what you might find
during that re-analysis.
I think that the, as I've
said, that the Tenth Circuit
opinion, in terms of
the remand parameters,
is extremely limited.
And I think our hearing
today is extremely limited.
It's simply whether we're going
to ask you to do an analysis
and repropose.
And I'm going to presume that
once the reproposal comes
before us that we'll have the
analysis that you're being
asked to guess about today.
And then we'll make the
decision at that time.
So I have no further questions.
>> ANN MARIE BUERKLE: Thank you.
Commissioner Kaye.
>> ELLIOT KAYE: Thanks
Chairman Buerkle.
Miss Pollitzer,
just quickly, we've
heard a few times that the
rule is referred to as a ban.
Is that accurate or is it
a performance standard?
>> PATRICIA POLLITZER: Really
it's written as a performance
standard.
It sets out the
requirements that
must be met based on
the ASTM toy standards,
certain flux index
for the magnets
that they have to pass
in order to be available,
in order to meet the standard.
>> ELLIOT KAYE: Great.
Thank you for that
clarification.
No further questions.
>> ANN MARIE BUERKLE:
Commissioner Mohorovic?
>> JOE MOHOROVIC: Thank
you Madam Chairman.
I want to further
explore something
that Commissioner Adler brought
up with regards to frequency
in the hazard assessment and
frequency of the incidents that
have been reported
to the agency.
So I'll start with the
Tenth Circuit's opinion.
And I'm reading from page 13.
And I just want to
find out whether or not
staff disagrees with any
of the citations provided
by the court.
But the court recognized that
in 2012, there were 52 reported
incidents to the agency.
In 2013, that number
fell down to 13.
And in 2014, that number
was further reduced
to two incidents
reported to the agency.
Would you agree
with those numbers
as provided by the Tenth?
They align with your statistics?
It's page 13.
>> DEWANE RAY: I'm not exactly
sure where they're referencing,
but I'm sure it probably--
I cannot answer your
question, sorry.
>> JOE MOHOROVIC: OK.
Well here's a
question that you were
able to answer for me
prior to the hearing.
And I want to be able to provide
that to the public as well.
Well the court said in
2012 the number was 52.
And then it went down to 13.
And then about halfway
through 2014, it was two.
And then you were kind enough
to provide some additional data
subsequent to the 2014 number
which showed an additional two
incidents in 2014.
So that would be four.
And then you also provided
that in 2015, there
was one incident.
And 2016, there
was one incident.
So for those keeping score at
home, over a five year period
it went from 52 to 13
to four to one to one.
Now in terms of frequency,
that would demonstrate
that this is a very
infrequent occurrence,
that we're seeing incidents
related to these magnets.
And I think that
in terms of a look
no further than item number one
in our interpretive rule, which
identifies the means with
which the CPSC will prioritize
its activities,
severity and frequency
are the first considerations.
And we certainly have a lack
of frequency established here.
That's just a comment that
I'd like to make as opposed
to a question.
Sorry for putting
you on the spot
to confirm the court's
numbers, but I haven't seen
those argued subsequent
to the issue of the court.
Thank you Madam Chairman.
>> ANN MARIE BUERKLE: Thank you.
I have no other questions.
Commissioner Adler, do
you have any questions?
>> ROBERT ADLER: I
have none, thank you.
>> ANN MARIE BUERKLE:
Commissioner Robinson?
>> MARIETTA ROBINSON: None.
>> ANN MARIE BUERKLE:
Commissioner Kaye?
>> ELLIOT KAYE: Nope, thank you.
>> ANN MARIE BUERKLE:
Commissioner Mohorovic?
>> JOE MOHOROVIC: No I do not.
>> ANN MARIE BUERKLE: Thank you.
Having heard no
further questions,
staff is excused from the table.
And we're now going to consider
any amendments or motions.
Does anyone have any
amendments or motions
for the underlying matter?
>> ELLIOT KAYE: Madam
Chairman, I have a motion.
>> ANN MARIE BUERKLE: Mr.
Kay, I will recognize you
for your motion, and I will
ask you to describe it,
up to three minutes.
And then after the conclusion of
that, I will ask for a second.
Thank you.
>> ELLIOT KAYE: Great.
Those words sound familiar.
Thank you.
The text of my motion
I'll read as follows.
I move that the
commission directs staff
to prepare and send
to the commission,
as soon as possible, a
draft notice of proposed
rulemaking for commission
consideration addressing
the holding in the
Tenth Circuit opinion
issued on November 22, 2016
in Zen Magnets LLC v. CPSC.
And the motion has been
distributed both prior
to this meeting and is currently
being distributed again.
I'll give it a few
minutes just to describe.
As my colleagues
know, in addition
to vacating the commission's
magnet set safety standard,
the Tenth Circuit
panel explicitly
remanded the rule back
to the commission for,
quote, "further proceedings
consistent with its opinion,"
end quote.
As Commissioner Robinson
has noted a few times,
and I agree with strongly,
this is a relatively--
or I would say this is a narrow
ruling, or was a narrow ruling.
The court simply
determined that it did not
have enough information
to ascertain
whether two of the commission's
findings were supported.
I firmly believe it is
our duty as public safety
officials entrusted with
keeping children and consumers
safe to follow the
court's instruction
and to address the remand
without further delay.
Doctors who treat
children have recently
publicly noted their
concerns with the results
from the Tenth Circuit decision.
My motion calls
for the commission
to direct staff to prepare
and send to the commission,
as soon as possible,
a draft NPR,
or notice of
proposed rulemaking,
for commission consideration
addressing the narrow holding
in the Tenth Circuit opinion.
Thank you Madam Chair.
>> ANN MARIE BUERKLE:
Thank you very much.
Is there a second?
>> ROBERT ADLER: Second.
>> ANN MARIE BUERKLE:
Having heard a second,
we will now moved to
consideration of Commissioner
Kaye's motion.
Commissioners will
ask their questions,
and then we'll come back to you
at the end, Commissioner Kaye,
unless any of the
other commissioners
want to yield their time to you.
So I will begin the questioning.
In your motion, there is
language addressing the holding
of the Tenth Circuit opinion.
Can you just explain
what you mean by that?
>> ELLIOT KAYE: I think again
as Commissioner Robinson has
noted, it was a narrow holding.
And the staff is aware
of the court decision
and can use the court
decision's holding as guidance
as to what the issues
are that the court felt
needed to be addressed.
>> ANN MARIE BUERKLE: And
so maybe can you define how
you're seeing the holding?
What is your--
>> ELLIOT KAYE: Yeah, so my
opinion in this in my mind is
irrelevant.
But I think the holding
is what the holding is,
and staff will read
the court opinion
and send us, if we
approve this, send up
what staff believes is
an appropriate response
to that holding.
>> ANN MARIE BUERKLE: Thank you.
I have no further questions.
Commissioner Adler?
>> ROBERT ADLER: Yeah,
I do have one question,
and that is consistent with
what the chairman was asking.
And that is, does your motion
contemplate any staff action
or work beyond the
work to address
the concerns raised in the
Tenth Circuit's decision?
And as I look at
the decision, there
were three concerns they raised.
One was the time frame.
The court sought an explanation
as to why CPSC relied on this
particular time frame for
its cost-benefit analysis,
the quality of the data-- back
to the concern about the use
of the word possibly--
and the utility of the product.
Those are three discrete issues.
They're narrow issues.
And again I repeat my question.
Does your motion contemplate
staff doing any work
beyond addressing
those types of issues?
>> ELLIOT KAYE: No.
>> ROBERT ADLER: No
further questions.
Thank you.
>> ANN MARIE BUERKLE:
Commissioner Robinson?
>> MARIETTA ROBINSON: I want
to thank Commissioner Kaye
for bringing this motion.
I think this is precisely
what we need to do next.
And I also want to thank staff
for so quickly putting together
their estimate of
the time that it
would take to address the
Tenth Circuit's findings.
And even though I
fully appreciate that,
like Commissioner Kaye, my
opinion is irrelevant here,
but nevertheless sometimes I
feel the need to express it.
So I shall, that I completely
disagree with the Tenth
Circuit's findings.
In rereading it, they started
with a fundamental flaw
in the basis from
which they then
went off on their findings.
But I disagree with
their findings regarding
the inadequacies
of our carefully
prepared cost-benefit analysis
in support of the standard.
And I believe the
court willfully ignore
the CPSC's explanations
of the basis for the time
frame of incidents to
review and analyze.
They ignored the wealth of
data from NEISS as well as
from the physicians
from [INAUDIBLE]
on the number of incidents.
They willfully ignored
the methodology
we used for analyzing
the NEISS data.
And they willfully
ignored our analysis
of the value of
high powered magnets
in its review of the estimated
cost and safety standard.
But as I said, my
opinion is irrelevant.
The court vacated it.
And this is now
what we need to do.
I felt strongly that
my vote for this rule
was correct when it was made.
And apparently unlike
Commissioner Mohorovic,
I have found
absolutely no reason
to question the original
vote in this matter.
And we must address
the court's holdings
and repropose the rule to
deal with this emerging issue.
And I think that
anything else would
be an abdication of our duties.
So I thank you for
bringing this motion.
>> ANN MARIE BUERKLE: Thank you.
Commissioner Mohorovic?
>> JOE MOHOROVIC: Thank
you Madam Chairman.
I think Marti,
Commissioner Robinson,
we've found an area
that we completely
agree with, as you said twice,
how irrelevant your opinion is.
I couldn't agree more.
Thank you.
And I'm not yielding any of my
valuable time to you for that.
>> MARIETTA
ROBINSON: No comment.
>> JOE MOHOROVIC: I've got
a feeling you'll come around
to it, as irrelevant
as it might be.
Commissioner Kaye, I've got a
question in terms of process
and the orderly running of
the agency and what I think
is an inconsistency with the way
that, while you were the chair,
you were addressing
items that identified
the allocation of resources,
beyond just the merits of what
we have before us right here.
So when you were
chairman you insisted
that items in consideration
before the agency that
identified the
allocation of resources
were to really
only be considered
during the normal preparation
of our operating plan,
as well as the consideration
of our midyear adjustment.
And in doing so, we
would be able to take
full advantage of our
technical staff's expertise
and their consideration of
whether something merits
in terms of all of the
enumerable activities
that we have before us.
And this is different.
Your amendment is suggesting
that the agency directs staff
to go into rulemaking
as soon as possible,
as if almost this was
an imminent hazard
before the agency when the
facts of the lack of frequency
of incidents suggest otherwise.
I would like to yield 60 seconds
of my time, if you would,
to address why you think
this change in course,
different than the
2 and 1/2 years
that I've had the pleasure of
working with you at chairman.
>> ELLIOT KAYE: Sure.
And I don't think I need
60 seconds to answer it,
in that, one, we've
already heard from staff.
This will have no impact on
the midyear or the operating
plan, no discernible impact,
no impact that would require
substantive changes to it.
So I don't know why we'd wait.
And more importantly in
the time, you're correct.
Every time that
somebody had offered
to change resource
allocations materially,
I felt it was more
appropriate to do that.
But we never faced a situation
before where somebody
was offering to change the
operating plan in a way
that would enhance safety
or address a safety issue,
or even a court holding, which
I think is a unique situation.
So from my perspective,
as long as it's
in furtherance of safety--
and it's especially in this case
responsive to a federal court
ruling, and staff has
assured us that it
will have no discernible
impact on the operating plan,
I'm comfortable with that.
If you have other
ideas that you feel
like are in further
into safety and you
want to work with me on that
are outside the normal midyear
operating plan or
budget cycles, I'm
happy to work with you on those.
>> JOE MOHOROVIC: Thank you.
Thank you commissioner.
And thank you for
your brevity as well.
I do think that an alternative
to the one that you've proposed
is to direct staff to take
this into consideration
for our midyear adjustments.
And then we would
have the opportunity
to see whether or not
staff felt that it
was a proper allocation
of resources,
given all of the priorities
that we have before us.
Now there was another element
of your tenure as chairmanship
which I recognized and
certainly found it very hard
to disagree with, is that
quite often, if not always,
there was a refusal to strongly
consider a proposal unless--
and you spoke in
the first person,
I think, as opposed
to the commission--
unless you had a
recommendation from staff,
unless you had something
that takes into consideration
whether or not the staff feels
that this is meritorious.
And in doing this in
quick order without that,
I would like to yield maybe
the remainder of my time
to you for an understanding
of why now it's different.
I don't think the
difference in terms
of the chair you sit
in really matters here.
It's a matter of the orderly
running of the agency.
And you've always
consistently said that,
and very often, not
always, agreed and went
with the staff's opinion,
direction, recommendation--
not always, but
most of the time.
And yet you're asking
us to consider this,
which would reorder the
priorities before the agency
and reorder the staff's
work, without taking
into consideration that, and
without us having an in-depth
legal memo from our general
counsel's office to let us know
our potential--
right.
So with that, I'll yield.
>> ELLIOT KAYE: The staff's
opinion is always going to be
the most important factor for
me whenever I consider anything,
hands down.
That's always been the case as
long as I worked at the agency
and it always will
continue to be the case,
but it's not the only factor.
Again, there is a
court order here.
And I think as Commissioner
Adler has aptly
said on many occasions,
we exist for a reason.
And Commissioner Robinson
has said that too.
We were presidentially
appointed,
Senate confirmed, put on
the commission for a reason.
And there have been times
when you have come to me
and asked me to support
something that the staff does
not support, and I
have supported it
and joined you in that
even if the staff has not
agreed with that.
It was a worthwhile
use of resources.
≫> ANN MARIE BUERKLE: I
have a couple of additional
questions for Commissioner Kaye.
Number one, Commissioner
Adler mentioned,
he referred to the dissent
and some additional sources
of data.
And I'm wondering
if in your motion,
you're considering part of the
holding that information that
was in the dissent.
>> ELLIOT KAYE:
Again, if you yield.
I'm going to leave
it up to staff
to interpret the
holding of the case
and to send us the
staff's recommendation.
>> ANN MARIE BUERKLE: Well
we're directing staff.
I would guess, and
maybe I would ask OGC,
will there be a
further analysis,
a legal memorandum
with the package that
will come to the commission?
>> MARY BOYLE: Well there's
always a legal analysis with
the package that comes
to the commission.
>> ANN MARIE BUERKLE: Additional
from what we already--
we've been hearing that a
lot of it will not change.
But given this
fact, this dissent,
will the dissent be
factored into this direction
we're giving the
commission, or the staff?
>> MARY BOYLE: I just don't
think that's a question I can
answer here.
>> ANN MARIE BUERKLE:
OK, all right.
My second question to you is--
and again, this has to
do with the holding.
We're directing staff to
address the holding in the Tenth
Circuit opinion.
Is it your intent
that staff would
be precluded from
addressing any other issues?
>> ELLIOT KAYE: My intent
is that staff should follow
the motion as written and
addressed the holding.
>> ANN MARIE BUERKLE: Thank you.
I have no further questions.
Commissioner Adler?
>> ROBERT ADLER: Well thank
you for asking those questions.
And as a point of clarification,
my notion of the holding
is what the court, in
its totality, decided.
And you can't really understand
the holding until you also
understand the dissent.
And it seems to me that the
issues raised by the dissent
are issues properly addressable.
And it seems to me that
the staff appropriately
would look into that.
But I'm glad you raised that
question because at least I
get to clarify my view
of what the motion is.
>> ANN MARIE BUERKLE: Thank you.
Commissioner Robinson?
>> MARIETTA ROBINSON:
Nothing further.
>> ANN MARIE BUERKLE:
Commissioner Mohorovic?
>> JOE MOHOROVIC:
Nothing further.
>> ANN MARIE BUERKLE: Having
heard no further questions,
Commissioner Kaye, we'll move
to consideration of the motion.
Commission Adler,
how do you vote?
>> ROBERT ADLER: I vote aye.
>> MARIETTA ROBINSON:
Commissioner Robinson?
>> MARIETTA ROBINSON: Aye.
>> ANN MARIE BUERKLE:
Commissioner Kaye?
>> ELLIOT KAYE: Aye.
>> ANN MARIE BUERKLE:
Commissioner Mohorovic?
>> JOE MOHOROVIC: No.
>> ANN MARIE BUERKLE:
And I vote no.
The yeas are three
and the nays are two.
The motion by Commissioner
Kaye has been approved.
Are there any more amendments
or motions to be considered here
this morning?
Having heard no further
amendments or motions,
we will now turn to the final
rule on the federal register
notice with removing safety
standards for magnet sets
from the Code of
Federal Regulations.
We will have time
for closing remarks,
but that certainly doesn't--
but does anyone else
wish to be heard
before we take the vote on
the underlying question?
Commissioner Adler?
>> ROBERT ADLER: No.
Robinson?
Commissioner Kaye?
>> ELLIOT KAYE: No thank you.
>> ANN MARIE BUERKLE: And
I have no further comments.
Having heard no
further comments,
we'll now turn to
the final vote.
And I will call it.
This is on the federal
register notice
removing safety
standard for magnet sets
from the Code of
Federal Regulations.
Commissioner Adler,
how do you vote?
>> ROBERT ADLER: I
need a clarification.
Does this vote have to
do with the amended vote
that we're taking?
what I've voting I'm not
clear what I'm voting on.
>> MARY BOYLE: No, the
vote is just on publication
of the federal register
notice providing notification
to the public that we're
removing the magnets rule from
the CFR.
That's what the vote
is on the table.
The motion was independent.
>> ROBERT ADLER: OK, I vote aye.
>> ANN MARIE BUERKLE:
Commissioner Robinson?
>> MARIETTA ROBINSON: Aye.
>> ANN MARIE BUERKLE:
Commissioner Kaye?
>> ELLIOT KAYE: And if I
could just seek further
clarification, the motion stands
regardless of the vote that we
are currently taking
though, correct?
≫> MARY BOYLE: Yes it does.
The motion was-- it was not an
amendment to the package that
was on the table.
There was an independent
motion as I understand it.
>> ELLIOT KAYE:
Thank you Miss Boyle.
I vote aye.
>> ANN MARIE BUERKLE:
Commissioner Mohorovic?
>> JOE MOHOROVIC:
Further clarification,
this is to cut red tape, to
tear a rule out of the Code
of Federal Regulations?
Is that right?
[LAUGHTER]
>> ANN MARIE BUERKLE: No legal--
>> ANN MARIE
BUERKLE: I vote aye.
Thank you chair.
>> ANN MARIE BUERKLE: No legal--
the ayes are five and
the nays are zero.
The federal register notice
removing safety standard
for magnet sets from the
Code of Federal Regulations
has been approved.
We now turn to
closing statements.
We will have 10 minutes per
commissioner for those closing
remarks.
And I will begin.
To begin with, I do believe
it was appropriate for us
to remove the magnet
rule from the CFR.
And I appreciate
staff's initiative
in putting the package
together for all of us.
I am opposed to directing
staff to prepare
a new proposed standard at
this time for several reasons.
First, circumstances
have changed
since the standard
for magnet sets
was originally
promulgated in 2014.
In fact a major reason for the
Tenth Circuit court's decision
to vacate the magnet
standard was a concern
that circumstances
have changed, even
before the original
standard was promulgated.
It seems to me that
before we charge ahead,
we should be asking the staff
to pull together the updated
information that would
help inform the decision as
to whether or not it even makes
sense to once again propose
a standard.
Second, the decision
to repropose a standard
should not be made in a vacuum.
Instead it should be considered
in light of the other projects
and possibilities
we have to consider.
Rather than make a
preemptory decision,
we should be asking
how the magnet
risk now and in the future
is likely to compare
with the other
risks we consider.
Work on this issue
will take people away
from other projects.
It seems to me that
the appropriate way
to address this issue and
address those tradeoffs
and priorities would be made
through the normal commission
vehicle, which is
the operating plan.
Third, we currently
have under consideration
the appeal of the administrative
law judge's decision
rejecting the staff's request to
order a recall of Zen Magnets.
I believe that moving ahead
with new rulemaking at this time
may now create more problems
for the commissioners
in that other matter.
Finally, I believe
this court's decision
is an important
reminder as to why
it is very important and
appropriate not only for us
to be thoughtful but also to be
data-driven in our rulemaking.
As we look ahead, we know
that the budget environment
is likely to be
challenging not only for us
but for all agencies,
more now than ever.
I believe that we
need to utilize
our resources more efficiently
and effectively than ever.
Thank you.
Commissioner Adler?
>> ROBERT ADLER:
Thank you Madam Chair.
I just wanted to make a quick
comment about the Tenth Circuit
decision, and just to say
that I have a great respect
for our independent judiciary.
I think it's one
of the strengths
of our system of government.
So even though I disagree with
some of the court's reasoning,
I think we do need to pay
careful attention to it,
and we need to respond
to its concerns
in a careful, well-documented,
and thorough manner.
Commission Kaye's
motion does not
ask the commission
to reinvent the wheel
to expend massive
amounts of resources.
In fact it's a very modest
amount of resources.
It's less than one staff year.
And we don't need to do that.
The Tenth Circuit did not
need any new information
regarding the hazards of
small high powered magnets.
And I just want to read an
excerpt from that opinion.
"The strength of these magnets
is part of their appeal.
It can also pose a grave danger
when magnets are misused.
Specifically if
two or more magnets
are ingested, a temptation to
which children are especially
at risk, they can
cause serious damage
to intestinal
tissue that becomes
tightly clamped between them.
Attendant medical consequences
can include hospitalization
and surgery for such
injury, injuries
as perforations, infections,
gastrointestinal bleeding,
and tissue death.
The danger is compounded when
parents and medical personnel
remain unaware of the
type of magnets ingested
and their heightened risks."
This court very well
recognized that this was
an extremely serious hazard.
What the court said was we need
to give a greater explanation
for how and why the
commission reached
its conclusions in accordance
with what the law requires.
We need to do that,
and we can do that.
The hazards of this product
have not disappeared.
And if recent
information is correct,
the hazard is extremely
likely to grow significantly
as new firms enter
the magnet market.
Now, this is just a thought.
I doubt that we can ever
precisely quantify the risk
because it's a moving target.
And that's not just
with respect to magnets.
That's with respect to most
of the products we regulate.
And therefore I hope that
any future reviewing court
will take notice of that fact.
We can give a snapshot, but
this is a moving picture.
And we need to be
cognizant of that.
But I do think that we can
provide reasonable estimates
of the costs and benefits
of commission action
in ways that will
meet this court's
requirements and the
requirements of the Consumer
Product Safety Act.
Thank you.
>> ANN MARIE BUERKLE:
Commissioner Robinson?
>> MARIETTA ROBINSON: I'd just
like to preliminarily say that
nothing that I've said
today should be read as any
disrespect for our
judicial branch.
The judicial branch has been
my life and I very, very much
respect it.
In my world of litigation
for most of my adult life,
this would be the equivalent of
trying a case for six months,
coming to a decision, and
then the appellate court
sending the case back for a
few limited questions that
need to be addressed before
the judgment can become final.
And to then just drop the
case would seem something
that's very counterproductive.
And when we're dealing with
a situation like the CPSC
where we have always
been flexible in using
our resources to respond
to emerging issues,
the Tenth Circuit has
given us an emerging issue.
And I would counter what
Acting Chair Buerkle said
in terms of impacting
other projects
because the staff has found
very specifically and explicitly
that it would not impact
2017 projects to address
this very limited holding.
We are not starting
rulemaking all over again.
It's a quite different
situation than if we
were making that decision.
So I also would just
like to address this.
I've done it before,
but I feel the need
to repeat it given Acting
Chair Buerkle's comments.
We were given very,
very different authority
under section 7.9
and under section 15.
And one doesn't have anything
to do with the other.
And I feel very comfortable
in going forward
with asking the staff to analyze
the data that we have now,
the data that we have in light
of the Tenth Circuit opinion
and come back to us with
their recommendations,
and that having nothing to
do with the litigation that's
pending under section 15.
I also would just--
I feel the need to say that this
notion that this Tenth Circuit
opinion is a reminder
to us to be data-driven,
I think that staff did an
absolutely fantastic job
in this rulemaking process
in analyzing the data.
And as I've said, I very
much disagree with the way
that Tenth Circuit has
omitted a lot of the data
that we had before us
when we made our decision.
So I look forward
to staff's analysis
under this limited ruling
from the Tenth Circuit.
And thank you so much for all
the work you've put into today.
>> ANN MARIE BUERKLE: Thank you.
Commissioner Kaye?
>> ELLIOT KAYE: Thank
you Chairman Buerkle.
I'll note at the outset that
I have been speaking today
and will continue
to speak today only
with respect to the
commission's rulemaking efforts.
And I'm not speaking
in any way with respect
to any other specific product
matter or other proceeding.
We are here today because the
Tenth Circuit Court of Appeals
vacated our magnet
set safety standards.
And in my view, we are
obligated to remove--
or we are obligated to
remove it from our rule book.
While I voted for the rule,
for this removal of this rule,
we have to respect the
courts-- because we have
to respect the court's opinion.
I want to echo the
comments that were
made by my colleagues,
Commissioners
Adler and Robinson
about the importance
of the independent judiciary.
One of the benefits
of my career is
having served in
all three branches
and valuing the role
that each of them plays
and appreciating the
role of the courts,
even though I vehemently
disagreed with the opinion
in this case.
And I hope it doesn't end up
being that you have only three
members of one party defending
the independent judiciary
and silence from
the other party,
because I think that
would be unfortunate.
I think we should all agree
of the value and the role
of the courts that they play.
This was a narrow ruling.
The court simply
determined that it did not
have enough information
to ascertain
whether two of the commission's
findings were supported.
As I noted earlier,
doctors who treat children
have recently publicly noted
their concerns with the results
from the Tenth
Circuit's decision.
It is incumbent upon us,
as public safety officials,
to at least attempt to
address the court's concerns
without delays.
I am very, very pleased
that commissioners Adler
and Robinson
supported my motion,
and that we were
able to give staff
the direction to move forward.
Thank you to Commissioners
Adler and Robinson,
and also of course to the staff
for their continued safety
efforts.
Thank you.
>> ANN MARIE BUERKLE: Thank you.
Commissioner Mohorovic?
>> JOE MOHOROVIC: Thank
you Madam Chairman.
Again we hear the term being
data-driven, the priority,
the theme of this agency.
I think it's one that
ought to be banned,
like the word amazing
and reality shows.
Let's just clear
it from the deck
because I think that it's
too often one that's abused
and it's manipulated.
We use it when we
think it's convenient.
We like to say that we're
data-driven in this activity
to allocate scarce resources
to mandatory rulemaking
after we had our rule thrown
out when we see the numbers have
gone over the last five
years from 52 to 13 to four
to one to one.
And yet, in the spirit
of being data-driven,
we want to allocate
scarce resources
into mandatory rulemaking.
I can't see that there is, in
any sense of an understanding
of what being data-driven
is, would lead one
to go back into rulemaking,
given the fact that we have
opinion from the
court that threw out
and vacated our previous rule.
There is a recognized lack of
fidelity in the CPSC's ability
to differentiate a magnet hazard
as being one from a magnet
set versus one that was the
result of a liberated magnet,
a liberated, high
powerful, strong rare earth
magnet from a toy.
And we looked at
those previous numbers
that I've given of the
incident patterns falling
so dramatically.
And you'd have to ask
yourself, well why did it fall?
Well first of all, how
about the fact that the CPSC
recalled 20 million units
of toys for magnet hazards?
This was a crisis.
It was a crisis that was
missed from everybody.
It was missed from safety
agencies, industry, et cetera.
If you look at 20
million recalled
units versus the total
number of magnet sets
that were sold-- there were only
2.7 million magnet sets that
were sold.
Furthermore, toys
that were manufactured
after August 17th of 2009
had to comply with virtually
the same magnet
performance standards that
are incorporated in this rule.
So that means that if
somebody knows about
when products are
produced for sale,
and if it was based on a
manufactured date, that
means Christmas sales
from 2009 included
toys that didn't have to comply
with the aspects of F963, which
are now mandatory, which ensure
that magnets can't be released
from toys and they have to
be of a certain reduced flex.
And yes, also these
numbers were reduced
by the compliance actions that
were taken against magnet set
distributors.
We currently have no
evidence of strong rare earth
magnets coming back into the
market in a significant way.
We have no evidence that the
traditional retail distribution
channels that provided
the opportunity
in the past for magnet sets
to go from seller to buyer
are coming back in the
market in a meaningful way.
They're not.
And it's a matter
of scarce resources.
This is a zero sum
game at the agency.
And every operating
plan and every midyear,
we fight and claw for the
most valuable dedication
of resources to look where the
highest return on investment.
And I point out that
while we can just go back
into rulemaking in the
absence of any evidence
that these products are going
to get back in the market
and create exposure,
we still have
a child dying every two
weeks from furniture tip over
and 25,000 emergency
room visits a year,
yet this commission refuses
to put even $1 into an award
winning campaign
to raise awareness
of this lethal
hidden home hazard.
And that's what
we're supposed to be
about making those
determinations
and making the smartest
allocation of taxpayer dollars.
We also have a commission rule
that further identifies it.
CFR 1009.8 defines how
we should prioritize
our scarce resources.
The first condition is
frequency and severity.
We've already proven that
there is no frequency.
And I quote from the
regulation, "two major criteria
in determining priorities are
the frequency and severity
of injuries associated
with consumer products."
Our goal should not be
just about writing red tape
for the sense of
writing red tape.
I don't know what
this fascination is.
And what we should be
about hazard mitigation,
through any means possible.
A regulation, a rule,
red tape, that's
just one of the
tools in our toolbox.
I think that this has
gotten so personal
with this agency of having
a rule being thrown out
that we're ready to just
hurl ourselves headlong back
into rulemaking.
And to do it, quote,
as soon as possible,
end quote, it really baffles
me, other than the very personal
nature of this issue as it's
confronted the agency now
for years and coming
on maybe a decade.
We're doing this
without taking the time
to either learn the
lessons about why we failed
the first time or to
figure out if there's still
any need for the rule.
Those are two
questions I would want
to have answered
before I even voted
to allow staff to go
back into rulemaking,
much less demand it.
I think this is a
factor of pure ego.
And this agency has taken
the thoughtful opinions
of the Tenth Circuit personally.
And we just want to
win for winning's sake.
Anybody who has heard me speak
lately or was in the conference
last week at
[INAUDIBLE], they've
heard me talk about
regulatory humility.
And it's a virtue
that is very scarce.
It's lacking here,
and it's lacking
across the administrative state.
And no one is more
humbled than I
am by the thoughtful
criticism of two
federal appellate judges,
two exceedingly intelligent
and well-credentialed
legal scholars.
It's an exercise in
pure regulatory hubris
to ignore that criticism
and stitch together
the tattered scraps
of this rule and run
it back up the flagpole.
I would rather want to
learn from this epic failure
and not repeat it at a
cost to taxpayers footing
the bill and more
worthy activities
around demonstrable safety
risks that consumers actually
face today.
I wish we were not going to
make the same mistake twice
when there are so many new
mistakes we could be making.
That's what the
motion does today.
That's what the activity and
the actions of this commission
does today.
And that's why I'm
not in support of it.
Thank you Madam Chairman.
>> ANN MARIE BUERKLE: Thank you.
Once again, thank you to
my fellow commissioners
and to staff for being
here this morning.
This concludes this public
meeting of the Consumer Product
Safety Commission.