[Federal Register: November 4, 1996 (Volume 61, Number 214)] [Notices] [Page 56669-56673] From the Federal Register Online via GPO Access [wais.access.gpo.gov] [DOCID:fr04no96-45] ----------------------------------------------------------------------- CONSUMER PRODUCT SAFETY COMMISSION [CPSC Docket No. 97-C0003] Four Seasons General Merchandise, Inc. a corporation; Settlement Agreement and Order 1. Four Seasons General Merchandise, Inc. (hereinafter, ``Four Seasons''), a corporation, enters into this Settlement Agreement (hereinafter, ``Agreement'') with the staff of the Consumer Product Safety Commission, and agrees to the entry of the Order described herein. The purpose of the Agreement and Order is to settle the staffs allegations that Four Seasons knowingly introduced or caused the introduction in interstate commerce; and received in interstate commerce and delivered or proffered delivery thereof for pay or otherwise, certain banned hazardous toys, baby rattles, pacifiers, water timers, and magic diamond and certain misbranded hazardous art materials and butane lighters, in violation of sections 4(a) and (c) of the Federal Hazardous Substances. Act (FHSA), 15 U.S.C. Secs. 1263(a) and (c). I. The Parties 2. The ``staff'' is the staff of the Consumer Product Safety Commission, an independent regulatory commission of the United States established pursuant to section 4 of the Consumer Product Safety Act (CPSA), 15 U.S.C. Sec. 2053. 3. Four Seasons is a corporation organized and existing under the laws of the State of California, since 1995, with its principal corporate offices located at 2801 E. Vernon Avenue, Vernon, CA 90058. Four Seasons is engaged in the import, distribution, and re-export of a wide variety of consumer products. Approximately 5% of Four Seasons' business involves toys or other articles intended for children. II. Allegations of the Staff A. Toys With Small Parts 4. On five occasions between October 16, 1991, and January 11, 1995, Four Seasons introduced or caused the introduction in interstate commerce; and received in interstate commerce and delivered or proffered delivery thereof for pay or otherwise, eight kinds of toys (96,530 units) intended for use by [[Page 56670]] children under three years of age. These toys are identified and described as follows: ---------------------------------------------------------------------------------------------------------------- Collect date* Sample No. Product Entry date Expt./Mfg. Quantity ---------------------------------------------------------------------------------------------------------------- P-867-7637............. Toy Train.................. 10/16/91 CSK World.................. 24,336 P-867-7638............. Toy Elephant............... ................ ........................... ........... P-867-7745............. Telephone Money Box........ 01/22/92 Canada, Inc................ 20,304 P-867-7746............. Boy/Girl Doll Set.......... 01/22/92 CSK World Wide Ltd......... 18,864 R-867-8215............. Hexagon Telephone.......... 04/17/93 Lee Shing Fat Industries... 2,400 R-867-8216............. Hexagon Clock.............. 04/17/93 Lee Shing Fat Industries... 2,400 R-867-8217............. Hexagon Speaker............ 04/17/93 Lee Shing Fat Industries... 2,400 S-867-8220............. Toy Train.................. 04/16/94 Lee Shing Fat Industries... 25,751 S-867-8221............. Toy Elephant............... ................ ........................... ........... T-830-4906............. Pull Along Wooden Snail.... *01/11/95 Unknown.................... 75 ---------------------------------------------------------------------------------------------------------------- 5. The toys identified in paragraph 4 above are subject to, but failed to comply with, the Commission's Small Parts Regulation, 16 CFR Part 1501, in that when tested under the ``use and abuse'' test methods specified in 16 CFR Secs. 1500.51 and 1500.52, (a) one or more parts of each tested toy separated and (b) one or more of the separated parts from each of the toys fit completely within the small parts test cylinder, as set forth in 16 CFR Sec. 1501.4. 6. Because the separated parts fit completely within the test cylinder as described in paragraph 5 above, each of the toys identified in paragraph 4 above presents a ``mechanical hazard'' within the meaning of section 2(s) of the FHSA, 15 U.S.C. Sec. 1261(s) (choking, aspiration, and/or ingestion of small parts). 7. Each of the toys identified in paragraph 4 above is a ``hazardous substance'' pursuant to section 2(f)(1)(D) of the FHSA, 15 U.S.C. Sec. 1261(f)(1)(D). 8. Each of the toys identified in paragraph 4 above is a ``banned hazardous substance'' pursuant to section 2(q)(1)(A) of the FHSA, 15 U.S.C. Sec. 1261(q)(1)(A) and 16 CFR Sec. 1500.18(a)(9) because it is intended for use by children under three years of age and bears or contains a hazardous substance; and because it presents a mechanical hazard as described in paragraph 6 above. 9. Four Seasons knowingly introduced or caused the introduction in interstate commerce; and received in interstate commerce and delivered or proffered delivery thereof for pay or otherwise, the aforesaid banned hazardous toys, identified in paragraph 5 above, in violation of sections 4 (a) and (c) of the FHSA, 15 U.S.C. Secs. 1263 (a) and (c), for which a civil penalty may be imposed pursuant to section 5(c)(1) of the FHSA, 15 U.S.C. Sec. 1264(c)(1). B. Baby Rattle 10. On one occasion in 1992, Four Seasons introduced or caused the introduction in interstate commerce; and received in interstate commerce and delivered or proffered delivery thereof for pay or otherwise, one kind of baby rattle (14,400 units) intended for use by children. This baby rattle is identified and described as follows: ---------------------------------------------------------------------------------------------------------------- Collect date* Sample No. Product Entry date Expt./Mfg. Quantity ---------------------------------------------------------------------------------------------------------------- P-867-8580............. Baby Rattle................ 08/16/92 Lee Shing Fat Industries... 14,400 ---------------------------------------------------------------------------------------------------------------- 11. The baby rattle identified in paragraph 10 above is subject to, but failed to comply with, the Commission's Rattle Regulations, 16 CFR Part 1510, in that when tested under the procedures specified in 16 CFR Sec. 1510.4, the handle of the baby rattle penetrated the full depth of the cavity of the test fixture. 12. Because the handle of the baby rattle identified in paragraph 10 above penetrated the full depth of the cavity of the test fixture as specified in 16 CFR Sec. 1510.4 and described in paragraph 11 above, the baby rattle identified in paragraph 10 above presents a ``mechanical hazard'' within the meaning of section 2(s) of the FHSA, 15 U.S.C. Sec. 1261(s) (choking). 13. The rattle identified in paragraph 10 above is a ``hazardous substance'' pursuant to section 2(f)(1)(D) of the FHSA, 15 U.S.C. Sec. 1261(f)(1)(D). 14. The rattle identified in paragraph 10 above is a ``banned hazardous substance'' pursuant to section 2(q)(1)(A) of the FHSA, 15 U.S.C. Sec. 1261(q)(1)(A) and 16 CFR Sec. 1500.18(a)(15) because it is intended for use by children and bears and contains a hazardous substance; and because it presents a mechanical hazard as defined in paragraph 12 above. 15. Four Seasons knowingly introduced or caused the introduction in interstate commerce; and received in interstate commerce and delivered or proffered delivery thereof for pay or otherwise, the aforesaid banned hazardous baby rattle identified in paragraph 10 above, in violation of sections 4 (a) and (c) of the FHSA, 15 U.S.C. Secs. 1263 (a) and (c), for which a civil penalty may be imposed pursuant to section 5(c)(1) of the FHSA, 15 U.S.C. Sec. 1264(c)(1). C. Art Material 16. On one occasion in 1993, Four Seasons introduced or caused the introduction in interstate commerce; and received in interstate commerce and delivered or proffered delivery thereof for pay or otherwise, one type of art material (41,520 units). This art material product is identified and described as follows: ---------------------------------------------------------------------------------------------------------------- Collect date* Sample No. Product Entry date Expt./Mfg. Quantity ---------------------------------------------------------------------------------------------------------------- R-867-8321............. Multi-Colored Crayons...... *06/07/93 CSK World Wide Ltd......... 41,520 ---------------------------------------------------------------------------------------------------------------- [[Page 56671]] 17. The art material product identified in paragraph 16 above is subject to, but failed to comply with the requirements for the Labeling of Art Materials Act in that (a) Four Seasons did not submit this art material product for review by a toxicologist as required by section 23(a) of the FHSA, 15 U.S.C. Sec. 1277(a) and 16 CFR Sec. 1500.14(b)(8)(C)(1); and (b) this art material product did not bear the statement of conformance with ASTM D-4236, as required by section 23(a) of the FHSA, 15 U.S.C. Sec. 1277(a) and 16 CFR Sec. 1500.14(b)(8)(C)(7). 18. The art material product identified in paragraph 16 above is a ``misbranded hazardous substance'' pursuant to section 3(b) of the FHSA, 15 U.S.C. Sec. 1262(b) and 16 CFR Secs. 1500.14(b)(8)(C) (1) and (7). 19. Four Seasons knowingly introduced or caused the introduction in interstate commerce; and received in interstate commerce and delivered or proffered delivery thereof for pay or otherwise, the aforesaid misbranded hazardous art material product identified in paragraph 16 above, in violation of sections 4 (a) and (c) of the FHSA, 15 U.S.C. Secs. 1263 (a) and (c), for which a civil penalty may be imposed pursuant to section 5(c)(1) of the FHSA, 15 U.S.C. Sec. 1264(c)(1). D. Pacifier 20. On one occasion in 1993, Four Seasons knowingly introduced or caused the introduction in interstate commerce; and received in interstate commerce and delivered or proffer delivery thereof for pay or otherwise, one kind of pacifier (24 units) intended for use by children. The pacifier is identified and described below: ---------------------------------------------------------------------------------------------------------------- Collect date* Sample No. Product Entry date Expt./Mfg. Quantity ---------------------------------------------------------------------------------------------------------------- R-863-7316............. Diplomat Pacifier.......... *07/30/93 Unknown.................... 24 ---------------------------------------------------------------------------------------------------------------- 21. The pacifier identified in paragraph 20 above failed to comply with the Requirements For Pacifiers, 16 CFR Part 1511 (structural integrity of nipples, guard or shield requirements, and labeling requirements). 22. Because the pacifier identified in paragraph 20 failed to comply with the Requirements For Pacifiers, 16 CFR Part 1511, the pacifier presents a ``mechanical hazard'' within the meaning of section 2(s) of the FHSA, 15 U.S.C. Sec. 1261(s) (choking). 23. The pacifier identified in paragraph 20 above is a ``hazardous substance'' pursuant to section 2(f)(1)(D) of the FHSA, 15 U.S.C. Sec. 1261(f)(1)(D). 24. The pacifier identified in paragraph 20 above is a ``banned hazardous substance'' pursuant to section 2(q)(1)(A) of the FHSA, 15 U.S.C. Sec. 1261(q)(1)(A) and 16 CFR 1500.18(a)(8) because it is intended for use by children and bears or contains a hazardous substance; and because it presents a mechanical hazard as described in paragraph 22 above. 25. Four Seasons knowingly introduced or caused the introduction in interstate commerce; and received in interstate commerce and delivered or proffered delivery thereof for pay or otherwise, the aforesaid banned hazardous pacifier, in violation of sections 4 (a) and (c) of the FHSA, 15 U.S.C. Secs. 1263 (a) and (c), for which a civil penalty may be imposed pursuant to section 5(c)(1) of the FHSA, 15 U.S.C. Sec. 1264(c)(1). E. Water Timers 26. On one occasion in 1995, Four Seasons introduced or caused the introduction in interstate commerce; and received in interstate commerce and delivered or proffered delivery thereof for pay or otherwise, two kinds of water timers with adjacent tubes (384 units) intended for use by children. The tubes contain fluid of various colors. Within each tube there is an upper chamber from which fluid drops into a lower chamber that spins an internal wheel as the fluid drops. The water timers are identified and described as follows: ---------------------------------------------------------------------------------------------------------------- Collect date* Sample No. Product Entry date Expt./Mfg. Quantity ---------------------------------------------------------------------------------------------------------------- T-800-3386............... Two Column Water Timer.... * 02/13/95 Unknown................... 240 T-800-3387............... Three-Tube Water Timer.... * 02/13/95 Unknown................... 144 ---------------------------------------------------------------------------------------------------------------- 27. Because each tube of water timers identified in paragraph 26 above contains 10 percent or more by weight of ethylene glycol, each water timer is a ``hazardous substance'' pursuant to section 2(f)(1)(A)(i) of the FHSA, 15 U.S.C. Sec. 1261(f)(1)(A)(i) and 16 CFR Sec. 1500.14(a)(2). 28. Each of the water timers identified in paragraph 26 above is a ``banned hazardous substance'' pursuant to section 2(q)(1)(A) of the FHSA, 15 U.S.C. Sec. 1261(q)(1)(A), because it is intended for use by children and bears or contains 10 percent or more by weight of ethylene glycol, a hazardous substance. 29. Four Seasons knowingly introduced or caused the introduction in interstate commerce; and received in interstate commerce and delivered or proffered delivery thereof for pay or otherwise, the aforesaid banned hazardous water timers, identified in paragraph 26 above, in violation of sections 4(a) and (c) of the FHSA, 15 U.S.C. Secs. 1263(a) and (c), for which a civil penalty may be imposed pursuant to section 5(c)(1) of the FHSA, 15 U.S.C. Sec. 1264(c)(1). F. Magic Diamond 30. On one occasion in 1995, Four Seasons knowingly introduced or caused the introduction in interstate commerce; and received in interstate commerce and delivered or proffered delivery thereof for pay or otherwise, the Magic Diamond (864 units) intended for use by children. The Magic Diamond is identified and described as follows: ---------------------------------------------------------------------------------------------------------------- Collect date* Sample No. Product Entry date Expt/Mfg. Quantity ---------------------------------------------------------------------------------------------------------------- T-867-8196......................... Magic Diamond........ *03/09/95 Kab Trade............ 864 ---------------------------------------------------------------------------------------------------------------- [[Page 56672]] 31. Because the Magic Diamond identified in paragraph 30 above is filled with 10 percent or more by weight of petroleum distillates, the Magic Diamond is a ``hazardous substance'' pursuant to section 2(f)(1)(A) (i) and (v) of the FHSA, 15 U.S.C. Sec. 1261(f)(1)(A) (i) and (v) and 16 C.F.R. Sec. 1500.14(a)(3). 32. The Magic Diamond identified in paragraph 30 above is a ``banned hazardous substance'' pursuant to section 2(q)(1)(A) of the FHSA, 15 U.S.C. Sec. 1261(q)(1)(A) because it is intended for use by children and bears or contains 10 percent or more by weight of petroleum distillates, a hazardous substance. 33. Four Seasons knowingly introduced or caused the introduction in interstate commerce; and received in interstate commerce and delivered or proffered delivery thereof for pay or otherwise, the aforesaid banned hazardous Magic Diamond, identified in paragraph 30 above, in violation of sections 4(a) and (c) of the FHSA, 15 U.S.C. Secs. 1263 (a) and (c), for which a civil penalty may be imposed pursuant to section 5(c)(1) of the FHSA, 15 U.S.C. Sec. 1264(c)(1). G. Butane Lighter 34. On one occasion in 1995, Four Seasons introduced or caused the introduction in interstate commerce; and received in interstate commerce and delivered or proffered delivery thereof for pay or otherwise, one kind of butane lighter (480 units). The butane lighter is identified and described as follows: ---------------------------------------------------------------------------------------------------------------- Collect date* Sample No. Product Entry date Expt/Mfg. Quantity ---------------------------------------------------------------------------------------------------------------- T-867-6231......................... Butane Utility *04/06/95 Rubin's.............. 480 Lighter. ---------------------------------------------------------------------------------------------------------------- 35. The butane lighter identified in paragraph 34 above contains a flammable gas that generates pressure and is, therefore, a ``hazardous substance'' pursuant to sections 2(f)(1)(A)(v) and (vi) of the FHSA, 15 U.S.C. Secs. 1261(f)(1)(A) (v) and (vi). 36. The butane lighter identified in paragraph 34 above is a ``misbranded hazardous substance'' pursuant to section 2(p)(1) of the FHSA, 15 U.S.C. Sec. 1261(p)(1), because it is a hazardous substance intended, or packaged in a form suitable, for use in the household, and fails to bear on the front panel of the lighters and their packaging, as required by section 2(p)(1) of the FHSA, 15 U.S.C. Sec. 1261(p)(1) and 16 CFR Sec. 1500.130(b) the signal word, ``DANGER;'' the statement of hazards: ``EXTREMELY FLAMMABLE. CONTENTS UNDER PRESSURE;'' and the additional statements of the product and packaging: ``Do not use near sparks or flame,'' and ``Do not store at a temperature above 120 degrees F.'' 37. Four Seasons knowingly introduced or caused the introduction in interstate commerce; and received in interstate commerce and delivered or proffered delivery thereof for pay or otherwise, the aforesaid misbranded hazardous butane lighter, identified in paragraph 34 above, in violation of sections 4 (a) and (c) of the FHSA, 15 U.S.C. Sec. 1263 (a) and (c), for which a civil penalty may be imposed pursuant to section 5(c)(1) of the FHSA, 15 U.S.C. Sec. 1264(c)(1). III. Response of Four Seasons 38. Four Seasons denies the allegations of the staff set forth in paragraphs 4 through 37 above that it has knowingly introduced or caused the introduction in interstate commerce; and received in interstate commerce and delivered or proffered delivery thereof for pay or otherwise, the banned hazardous toys, baby rattle, pacifier, water timers, and magic diamond and the misbranded hazardous art material and butane lighter, in violation of the FHSA. Four Seasons states that (i) it has acted reasonably and in good faith to comply with the aforementioned regulations promulgated under the FHSA, (ii) the violations of those regulations were inadvertent, (iii) many of the violations involved differences of opinion as to appropriate age grading, (iv) it cooperated fully with the Commission's compliance actions, and (v) most of the products were detained at the port of entry and never sold or distributed after receipt in interstate commerce. IV. Agreement of the Parties 39. The Consumer Product Safety Commission has jurisdiction over Four Seasons and the subject matter of this Settlement Agreement and Order under the Consumer Product Safety Act, 15 U.S.C. 2051 et seq., and the Federal Hazardous Substances Act, 15 U.S.C. 1261 et seq. 40. Upon final acceptance by the Commission of this Settlement Agreement and Order, the Commission shall issue the attached Order incorporated herein by reference. 41. The Commission does not make any determination that Four Seasons knowingly violated the FHSA. The Commission and Four Seasons agree that this Agreement is entered into for the purposes of settlement only. 42. Upon final acceptance of this Settlement Agreement by the Commission and Issuance of the Final Order, Four Seasons knowingly, voluntarily, and completely waives any rights it may have in this matter (1) To an administrative or judicial hearing, (2) to judicial review or other challenge or contest of the validity of the Commission's actions; (3) to a determination by the Commission as to whether Four Seasons failed to comply with the FHSA as aforesaid, (4) to a statement of findings of fact and conclusions of law; and (5) to any claims under the Equal Access to Justice Act. 43. For purposes of section 6(b) of the FHSA, 15 U.S.C. Sec. 2055(b), this matter shall be treated as if a complaint had issued; and the Commission may publicize the terms of the Settlement Agreement and Order. 44. Upon provisional acceptance of this Settlement Agreement and Order by the Commission, this Settlement Agreement and Order shall be placed on the public record and shall be published in the Federal Register in accordance with the procedures set forth in 16 CFR Sec. 1118.20 (e)-(h). If the Commission does not receive any written request not to accept the Settlement Agreement and Order within 15 days, the Settlement Agreement and Order will be deemed to be finally accepted on the 16th day after the date it is published in the Federal Register. 45. The parties further agree that the Commission shall issue the attached Order; and that a violation of the Order shall subject Four Seasons to appropriate legal action. 46. Agreements, understandings, representations, or interpretations made outside this Settlement Agreement and Order may not be used to vary or contradict its terms. 47. The provisions of the Settlement Agreement and Order shall apply to Four Seasons and each of its successors and assigns. [[Page 56673]] Dated: September 19, 1996. John Pourmoradi, President, Four Seasons General Merchandise, Inc., 2801 E. Vernon Avenue, Vernon, CA 90058. Commission Staff David Schmeltzer, Assistant Executive Director, Office of Compliance and Enforcement. Eric L. Stone, Acting Director, Division of Administrative Litigation, Office of Compliance and Enforcement. Dated: September 25, 1996. Earl A. Gershenow, Trial Attorney, Division of Administrative Litigation, Office of Compliance and Enforcement. Dated: September 25, 1996. Dennis C. Kacoyanis, Trial Attorney, Division of Administrative Litigation, Office of Compliance and Enforcement. Consumer Product Safety Commission Order In the Matter of FOUR SEASONS GENERAL MERCHANDISE, INC. a corporation. [CPSC Docket No. 97-C0003]. Upon consideration of the Settlement Agreement entered into between respondent Four Seasons General Merchandise, Inc., a corporation, and the staff of the Consumer Product Safety Commission; and the Commission having jurisdiction over the subject matter and Four Seasons General Merchandise, Inc.; and it appearing that the Settlement Agreement and Order is in the public interest, it is Ordered, That the Settlement Agreement and Order be and hereby is accepted, as indicated below; and is Further Ordered, That upon final acceptance of the Settlement Agreement and Order, Four Seasons General Merchandise, Inc. shall pay to the Commission a civil penalty in the amount of ONE HUNDRED AND TEN THOUSAND AND 00/100 DOLLARS ($110,000.00) in four payments consisting of TWENTY-SEVEN THOUSAND FIVE HUNDRED AND 00/100 DOLLARS ($27,500.00) each. The first payment of TWENTY-SEVEN THOUSAND FIVE HUNDRED AND 00/ 100 DOLLARS ($27,500.00) shall be due within twenty (20) days after the service of the Final Order accepting the Settlement Agreement and Order (hereinafter the anniversary date). The second payment of TWENTY-SEVEN THOUSAND FIVE HUNDRED AND 00/100 DOLLARS ($27,500.00) shall be paid within one year of the anniversary date. The third payment of TWENTY- SEVEN THOUSAND FIVE HUNDRED AND 00/100 DOLLARS ($27,500.00) shall be paid within two years of the anniversary date. The fourth payment of TWENTY-SEVEN THOUSAND FIVE HUNDRED AND 00/100 DOLLARS ($27,500.00) shall be paid within three years of the anniversary date. Payment of the full amount of the civil penalty shall settle fully the staff's allegations set forth in paragraphs 4 through 37 of the Settlement Agreement and Order that Four Seasons General Merchandise, Inc. violated the FHSA. Upon failure of Four Seasons General Merchandise, Inc. to make payment or upon the making of a late payment by Four Seasons General Merchandise, Inc. (a) the entire amount of the civil penalty shall be due and payable, and (b) interest on the outstanding balance shall accrue and be paid at the federal legal rate under the provisions of 28 U.S.C. Secs. 1961 (a) and (b). Provisionally accepted and Provisional Order issued on the 30th day of October, 1996. By Order of the Commission. Sadye E. Dunn, Secretary, Consumer Product Safety Commission. [FR Doc. 96-28289 Filed 11-1-96; 8:45 am] BILLING CODE 6355-01-M