[Federal Register: August 12, 2008 (Volume 73, Number 156)]
[Notices]
[Page 46874-46876]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr12au08-37]
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CONSUMER PRODUCT SAFETY COMMISSION
(CPSC Docket No. 08-COO 16)
A & R Knitwear, Inc., Provisional Acceptance of a Settlement
Agreement and Order
AGENCY: Consumer Product Safety Commission.
ACTION: Notice.
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SUMMARY: It is the policy of the Commission to publish settlements
which it provisionally accepts under the Consumer Product Safety Act in
the Federal Register in accordance with the terms of 16 CFR 1118.20(e).
Published below is a provisionally accepted Settlement Agreement with A
& R Knitwear, Inc., containing a civil penalty of $35,000.00.
DATES: Any interested person may ask the Commission not to accept this
agreement or otherwise comment on its contents by filing a written
request with the Office of the Secretary by August 27, 2008.
ADDRESSES: Persons wishing to comment on this Settlement Agreement
should send written comments to the Comment 08-C0016, Office of the
Secretary, Consumer Product Safety Commission, 4330 East West Highway,
Room 502, Bethesda, Maryland 20814-4408.
FOR FURTHER INFORMATION CONTACT: Dennis C. Kacoyanis, Trial Attorney,
Legal Division, Office of Compliance and Field Operations, Consumer
Product Safety Commission, 4330 East West Highway, Bethesda, Maryland
20814-4408; telephone (301) 504-7587.
SUPPLEMENTARY INFORMATION: The text of the Agreement and Order appears
below.
August 5, 2008.
Todd A. Stevenson,
Secretary.
United States of America
Consumer Product Safety Commission
In the Matter of A & R Knitwear, Inc., CPSC Docket No. 08-C0016
Settlement Agreement
1. In accordance with 16 CFR 1118.20, A & R Knitwear, Inc. (``A
& R'') and the staff (``Staff'') of the United States Consumer
Product Safety Commission (``Commission'') enter into this
Settlement Agreement (``Agreement''). The Agreement and the
incorporated attached Order (``Order'') settle the Staff's
allegations set forth below.
Parties
2. The Commission is an independent federal regulatory agency
established pursuant to, and responsible for the enforcement of, the
Consumer Product Safety Act, 15 U.S.C. 2051-2084 (``CPSA'').
3. A & R is a corporation organized and existing under the laws
of New York, with its principal offices located in New York, NY. At
all times relevant hereto, A & R imported and sold apparel.
Staff Allegations
4. In 2007, A & R imported and sold to a nationwide retailer at
least 5,214 Personal Identity V-neck sweaters with hood and neck
drawstrings (``Drawstring Sweaters'').
5. The nationwide retailer sold the Drawstring Sweaters to
consumers.
6. The Drawstring Sweaters are ``consumer product[s],'' and, at
all times relevant hereto, A & R was a ``manufacturer'' of those
[[Page 46875]]
consumer products, which were ``distributed in commerce,'' as those
terms are defined in CPSA sections 3(a)(1), (4), (11), and (12), 15
U.S.C. 2052(a)(1), (4), (11), and (12).
7. In February 1996, the Staff issued the Guidelines for
Drawstrings on Children's Upper Outerwear (``Guidelines'') to help
prevent children from strangling or entangling on neck and waist
drawstrings. The Guidelines state that drawstrings can cause, and
have caused, injuries and deaths when they catch on items such as
playground equipment, bus doors, or cribs. In the Guidelines, the
Staff recommends that there be no hood and neck drawstrings in
children's upper outerwear sized 2T to 12.
8. In June 1997, ASTM adopted a voluntary standard, ASTM F1816-
97, that incorporated the Guidelines. The Guidelines state that
firms should be aware of the hazards and should be sure garments
they sell conform to the voluntary standard.
9. On May 19, 2006, the Commission posted on its Web site a
letter from the Commission's Director of the Office of Compliance to
manufacturers, importers, and retailers of children's upper
outerwear. The letter urges them to make certain that all children's
upper outerwear sold in the United States complies with ASTM F1816-
97. The letter states that the Staff considers children's upper
outerwear with drawstrings at the hood or neck area to be defective
and to present a substantial risk of injury to young children under
Federal Hazardous Substances Act (``FHSA'') section 15(c), 15 U.S.C.
1274(c). The letter also notes the CPSA's section 15(b) reporting
requirements.
10. The Commission was not informed of any incidents or injuries
from the Drawstring Sweaters.
11. A & R's distribution in commerce of the Drawstring Sweaters
did not meet the Guidelines or ASTM F1816-97, failed to comport with
the Staff's May 2006 defect notice, and posed a strangulation hazard
to children.
12. On December 6, 2007, the Commission and the nationwide
retailer announced a recall of the Drawstring Sweaters, informing
consumers that they should immediately remove the drawstrings to
eliminate the hazard.
13. A & R had presumed and actual knowledge that the Drawstring
Sweaters distributed in commerce posed a strangulation hazard and
presented a substantial risk of injury to children under FHSA
section 15(c)(1), 15 U.S.C. 1274(c)(l). A & R had obtained
information that reasonably supported the conclusion that the
Drawstring Sweaters contained a defect that could create a
substantial product hazard or that they created an unreasonable risk
of serious injury or death. CPSA sections 15(b)(2) and (3), 15
U.S.C. 2064(b)(2) and (3), required A & R to immediately inform the
Commission of the defect and risk.
14. A & R knowingly failed to immediately inform the Commission
about the Drawstring Sweaters as required by CPSA sections 15(b)(2)
and (3), 15 U.S.C. 2064(b)(2) and (3), and as the term ``knowingly''
is defined in CPSA section 20(d), 15 U.S.C. 2069(d). This failure
violated CPSA section 19(a)(4), 15 U.S.C. 2068(a)(4). Pursuant to
CPSA section 20, 15 U.S.C. 2069, this failure subjected A & R to
civil penalties.
A & R Response
15. A & R denies the Staff's allegations above, including, but
not limited to, the allegations that A & R failed to immediately
inform the Commission about the Drawstring Sweaters as required by
CPSA sections 15(b)(2) and (3), 15 U.S.C. 2064(b)(2) and (3), or
otherwise violated the CPSA or FHSA.
16. A & R specifically denies that A & R violated the CPSA or
the FHSA and that the Drawstring Sweaters contained a defect that
could create a substantial product hazard or created an unreasonable
risk of serious injury or death. A & R denies that it violated the
reporting requirements of CPSA section 15(b), 15 U.S.C. 2064(b).
17. A & R received no reports of incidents or injury related to
the Drawstring Sweaters, and A & R was unaware of both the
Guidelines and the May 2006 letter posted on the Commission's Web
site stating that the staff of the Commission's Office of Compliance
considers children's upper outerwear with drawstrings at the head or
neck area to be defective and to present a substantial risk of
injury to young children. Accordingly, A & R denies that any alleged
violation of the CPSA or FHSA occurred ``knowingly'' as defined in
CPSA section 20(d), 15 U.S.C. 2069(d).
18. Between November 2006 and June 2008, the CPSC posted on its
Web site at least twenty-two recall announcements involving
children's drawstring garments. These twenty-two recall
announcements referenced and linked electronically to the
Guidelines. The Guidelines, which are entitled in part ``Recommended
Guidelines,'' state that the ``CPSC's drawstring guidelines do not
represent a standard or mandatory requirement set by the agency.''
Accordingly, at the time A & R imported and sold the Drawstring
Sweaters, the Commission had not provided adequate notice that civil
penalties could arise from A & R's conduct.
19. As soon as A & R was alerted by the retailer about safety
concerns with the drawstrings in the Drawstring Sweaters, it
undertook efforts to have the drawstrings removed from the garments.
In addition, A & R fully cooperated with the retailer and the
Commission in connection with the December 2007 recall of the
Drawstring Sweaters, which resulted in A & R's removal of the
drawstrings from 2,332 Drawstring Sweaters in the possession of A &
R.
20. A & R has entered into the Agreement for settlement purposes
only, and has made a business decision to avoid additional expenses
and distractions related to further administrative procedures and
litigation. The Agreement and Order do not constitute and are not
evidence of any fault or wrongdoing on the part of A & R.
Agreement of the Parties
21. Under the CPSA, the Commission has jurisdiction over this
matter and over A & R.
22. The parties enter into the Agreement for settlement purposes
only. The Agreement does not constitute an admission by A & R, or a
determination by the Commission, that A & R has knowingly violated
the CPSA.
23. In settlement of the Staff's allegations, A & R shall pay a
civil penalty in the amount of thirty-five thousand dollars
($35,000.00) within twenty (20) calendar days of service of the
Commission's final Order accepting the Agreement. The payment shall
be by check payable to the order of the United States Treasury.
24. Upon provisional acceptance of the Agreement, the Agreement
shall be placed on the public record and published in the Federal
Register in accordance with the procedures set forth in 16 CFR
1118.20(e). In accordance with 16 CFR 1118.20(f), if the Commission
does not receive any written request not to accept the Agreement
within fifteen (15) calendar days, the Agreement shall be deemed
finally accepted on the sixteenth (16th) calendar day after the date
it is published in the Federal Register.
25. Upon the Commission's final acceptance of the Agreement and
issuance of the final Order, A & R knowingly, voluntarily, and
completely waives any rights it may have regarding the Staff's
allegations to the following: (1) An administrative or judicial
hearing; (2) judicial review or other challenge or contest of the
validity of the Order or of the Commission's actions; (3) a
determination by the Commission of whether A & R failed to comply
with the CPSA and its underlying regulations; (4) a statement of
findings of fact and conclusions of law; and (5) any claims under
the Equal Access to Justice Act.
26. The Commission may publicize the terms of the Agreement and
the Order.
27. The Agreement and the Order shall apply to, and be binding
upon, A & R and each of its successors and assigns.
28. The Commission issues the Order under the provisions of the
CPSA, and violation of the Order may subject A & R to appropriate
legal action.
29. The Agreement may be used in interpreting the Order.
Understandings, agreements, representations, or interpretations
apart from those contained in the Agreement and the Order may not be
used to vary or contradict their terms. The Agreement shall not be
waived, amended, modified, or otherwise altered without written
agreement thereto executed by the party against whom such waiver,
amendment, modification, or alteration is sought to be enforced.
30. If any provision of the Agreement and the Order is held to
be illegal, invalid, or unenforceable under present or future laws
effective during the terms of the Agreement and the Order, such
provision shall be fully severable. The balance of the Agreement and
the Order shall remain in full force and effect, unless the
Commission and A & R agree that severing the provision materially
affects the purpose of the Agreement and the Order.
31. Pursuant to section 6(d) of the Interim Delegation of
Authority ordered by the Commission on February 1, 2008, the
Commission delegated to the Assistant Executive Director for
Compliance and Field Operations the authority to act, with the
concurrence of the General Counsel, for the Commission under 16 CFR
1118.20 with respect to Staff allegations that any person or
[[Page 46876]]
firm violated 15 U.S.C. 2068, where the total amount of the
settlement involves no more than $100,000.
A & R Knitwear, Inc.
Dated: 7/21/08.
By: /s/ David Rosenbluth,
David Rosenbluth,
President, A & R Knitwear, Inc., 530 7th Avenue, Suite 901, New
York, NY 10018.
Dated: 7/25/08.
By: /s/ Michael T. Cone,
Michael T. Cone, Esquire,
Neville Peterson, LLP 17 State Street, 19th Floor, New York, NY
10004, Attorney for A & R Knitwear, Inc.
U.S. Consumer Product Safety Commission Staff
J. Gibson Mullan,
Assistant Executive Director, Office of Compliance and Field
Operations.
Ronald G. Yelenik,
Acting Director, Legal Division, Office of Compliance and Field
Operations.
Dated: 7/31/08.
By: /s/ Dennis C. Kacoyams,
Dennis C. Kacoyams,
Trial Attorney, Legal Division, Office of Compliance and Field
Operations.
United States of America
Consumer Product Safety Commission
In the Matter of A & R Knitwear, Inc., CPSC Docket No. 08-C16
Order
Upon consideration of the Settlement Agreement entered into
between A & R Knitwear, Inc. (``A & R'') and the U.S. Consumer
Product Safety Commission (``Commission'') staff, and the Commission
having jurisdiction over the subject matter and over A & R, and
pursuant to the authority delegated in section 6(d) of the Interim
Delegation of Authority ordered by the Commission on February 1,
2008, and it appearing that the Settlement Agreement and the Order
are in the public interest, it is Ordered, that the Settlement
Agreement be, and hereby is, accepted; and it is Further ordered,
that A & R shall pay a civil penalty in the amount of thirty-five
thousand dollars ($35,000.00) within twenty (20) calendar days of
service of the Commission's final Order accepting the Agreement. The
payment shall be made by check payable to the order of the United
States Treasury. Upon the failure of A & R to make the foregoing
payment when due, interest on the unpaid amount shall accrue and be
paid by A & R at the federal legal rate of interest set forth at 28
U.S.C. 1961(a) and (b).
Provisionally accepted and provisional Order issued on the 4th
day of August, 2008.
By Order of the Commission.
Todd A. Stevenson,
Secretary, U.S. Consumer Product Safety Commission.
[FR Doc. E8-18403 Filed 8-11-08; 8:45 am]
BILLING CODE 6355-01-M