Baja and One World Technologies Agree to $4.3 Million Civil Penalty, Internal Compliance Improvements for Failure to Report Defective Minibikes and Go-Carts

WASHINGTON, D.C. – The U.S. Consumer Product Safety Commission (CPSC) announced today that Baja Inc., and its corporate affiliate, One World Technologies Inc., of Anderson, S.C., agreed to pay a $4.3 million civil penalty. 

The settlement resolves CPSC staff’s charges that the firm knowingly failed to report to CPSC immediately, as required by federal law, defects and an unreasonable risk of serious injury involving 11 models of minibikes and go-carts.

CPSC staff charged that the gas cap can leak or detach from the fuel tank on the recalled  minibikes and go-carts, posing fire and burn hazards.  In addition, staff charged that the throttle can stick, due to an improperly positioned fuel line and throttle cable, posing a sudden acceleration hazard. 

Baja sold the vehicles nationwide from November 2004 through June 2010 for $200 to $2,000.  In July 2010, Baja and CPSC announced the recall of 308,000 minibikes and go-carts.

Baja did not file its Full Report with CPSC until June 2010.  CPSC staff charged that by that time, Baja had received four reports of fires from leaking gas caps and burn injuries to consumers, including a serious burn injury to a child.  Baja had also received two dozen consumer reports of stuck throttles.  Baja had implemented design changes to remedy the throttle hazard, but the firm had not notified consumers or CPSC of these changes.

Federal law requires manufacturers, distributors, and retailers to report to CPSC immediately (within 24 hours) after obtaining information reasonably supporting the conclusion that a product contains a defect which could create a substantial product hazard, creates an unreasonable risk of serious injury or death, or fails to comply with any consumer product safety rule or any other rule, regulation, standard, or ban enforced by CPSC.

In addition to agreeing to pay the $4.3 million civil penalty, Baja and One World have agreed to maintain a program designed to ensure compliance with the safety statutes and regulations enforced by the Commission and that includes:

• written standards and policies;
• systematic procedures for reviewing and referring consumer and retailer incident reports for potential safety issues;
• confidential employee reporting of compliance concerns to a senior manager;
• effective communication of compliance policies and procedures, including training;
• senior manager responsibility for compliance and accountability for violations;
• oversight of compliance by the firm’s governing body; and
• records retention requirements. 

In agreeing to the settlement, Baja and One World did not admit to CPSC staff’s charges that its minibikes and go-carts contained a defect which could create a substantial product hazard or created an unreasonable risk of serious injury or death, or that the company failed to notify the Commission in a timely manner, in accordance with the reporting requirements of the Consumer Product Safety Act.

The CPSC investigation that led to the settlement of this matter was initiated by the Office of Compliance and Field Operations, and the  Office of the General Counsel has been handling the enforcement action. 

The penalty agreement has been accepted provisionally by the Commission in a 4 to 1 vote.