Best Buy Co., Inc., Provisional Acceptance of a Settlement Agreement and Order, 69047-69050 [2016-24075]
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Federal Register / Vol. 81, No. 193 / Wednesday, October 5, 2016 / Notices
towards consumers learning about their
credit history, checking their credit
report, and ultimately making decisions
about credit that serve their own
financial and life goals. The Bureau is
exploring how to produce a list of
companies offering existing customers
free access to a credit score (‘‘the
service’’). The Bureau could leverage
this list to bring consumer attention to
the topic of credit scores, and follow up
with content to educate, inform and
empower consumers on the availability
of credit scores and credit reports and
how consumers can use this
information. The responses to this
notice will help us to launch this public
list.
asabaliauskas on DSK3SPTVN1PROD with NOTICES
II. Criteria To Be Included in the Public
List
If your company is a credit card
issuer, fits the criteria outlined below
and would like to be included in the list
the Bureau plans to publish, contact us
by following the instructions included
in this Notice for how to submit your
comments. To be included in this list,
you must meet the following criteria:
• Be a credit card issuer.1
• Offer existing customers 2 (at least
some, but not necessarily all) the ability
to obtain free of charge a credit score 3
which either your company, or other
lenders use, for account origination,
portfolio management, or for other
business purposes.
• Offer this access to a credit score on
a continuous basis, as opposed to on a
time-limited or promotional basis, and
periodically update the score.
You may include other information
you think is relevant for consumers
reading the public list to understand
whether the service applies to them.
Depending on the information received,
the Bureau may decide to include, or
not to include, some or all of this
information in the list.
By responding to this Federal
Register Notice (FRN) you are stating
that you meet the criteria and are
consenting to include the name of your
company in a public list of credit card
issuers offering free access to credit
scores to their existing customers. The
1 ‘‘Credit card issuer’’ refers to any entity to
which a consumer is legally obligated, or would be
legally obligated, under the terms of a credit card
agreement. Alternatively, you can also be included
in this list, if you are a bank or a credit union and
you contract with a third party to issue credit cards
on your behalf and under your brand name.
2 ‘‘Customers’’ refers to individuals, not
corporations or small businesses.
3 By credit score we refer to a score that is
empirically derived, demonstrably and statistically
sound, and based on current data from a consumer
reporting agency to predict the likelihood of certain
credit behavior for the applicant.
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Bureau reserves the right to conduct due
diligence on a company’s assertions
about meeting the criteria stated in this
notice. Your response to this FRN and
inclusion in this public list are
completely voluntary, and your choice
to do so, or refrain from doing so, is not
connected to supervisory activity by the
Bureau.
If your company is not a credit card
issuer, but offers existing consumer
customers free access to a credit score,
fits the criteria outlined below, and
would like to be included in a list for
companies in other markets, you may
contact us as well. Depending on the
feedback received, the Bureau may
decide to expand the scope of the initial
list of companies offering free credit
scores beyond credit card issuers to
companies in some other markets,
include such companies in a future
separate list, or decide not to publish a
list of companies in other markets
offering this service.
To be considered for this potential
list, you must meet the following
criteria:
• Offer or provide a consumer
financial product or service;
• Offer your existing customers 4 (at
least some, but not necessarily all) the
ability to obtain free of charge a credit
score 5 which either your company, or
other lenders use, for account
origination, portfolio management, or
for other business purposes.
• Offer this access to a credit score on
a continuous basis, as opposed to on a
time-limited or promotional basis, and
periodically update the score.
You may include other information
you think is relevant for consumers
reading the public list to understand
whether the service applies to them.
Depending on the information received,
the Bureau may decide to include, or
not to include, some or all of this
information in the list.
By responding to this Federal
Register Notice (FRN) you are stating
that you meet the criteria and are
consenting to include the name of your
company in a public list of companies
offering free access to credit scores to
their existing customers. The Bureau
reserves the right to conduct due
diligence on a company’s assertions
about meeting the criteria stated in this
notice. Your response to this FRN and
inclusion in this public list are
completely voluntary, and your choice
4 ‘‘Customers’’ refers to individuals, not
corporations or small businesses.
5 By credit score we refer to a score that is
empirically derived, demonstrably and statistically
sound, and based on current data from a consumer
reporting agency to predict the likelihood of certain
credit behavior for the applicant.
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69047
to do so, or refrain from doing so, is not
connected to supervisory activity by the
Bureau.
We emphasize that these lists will be
created to further inform the public
about where to find a credit score, and
will not be an endorsement of the
financial institutions, credit card
issuers, or any other company
mentioned in any document the Bureau
publishes.
Thank you for your contribution to
improve consumer financial awareness.
Dated: September 27, 2016.
Richard Cordray,
Director, Bureau of Consumer Financial
Protection.
[FR Doc. 2016–24014 Filed 10–4–16; 8:45 am]
BILLING CODE 4810–AM–P
CONSUMER PRODUCT SAFETY
COMMISSION
[CPSC Docket No. 16–C0005]
Best Buy Co., Inc., Provisional
Acceptance of a Settlement Agreement
and Order
Consumer Product Safety
Commission.
ACTION: Notice.
AGENCY:
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 the Consumer Product Safety
Commission’s regulations. Published
below is a provisionally-accepted
Settlement Agreement with Best Buy
Co., Inc., containing a civil penalty in
the amount of 3.8 million dollars
($3,800,000) within thirty (30) days of
service of the Commission’s final Order
accepting the Settlement Agreement.
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 October
20, 2016.
ADDRESSES: Persons wishing to
comment on this Settlement Agreement
should send written comments to the
Comment 16–C0005 Office of the
Secretary, Consumer Product Safety
Commission, 4330 East-West Highway,
Room 820, Bethesda, Maryland 20814–
4408.
FOR FURTHER INFORMATION CONTACT:
Laura Thomson, Trial Attorney,
Division of Compliance, Office of the
General Counsel, Consumer Product
Safety Commission, 4330 East-West
Highway, Bethesda, Maryland 20814–
4408; telephone (301) 504–7263.
SUMMARY:
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Federal Register / Vol. 81, No. 193 / Wednesday, October 5, 2016 / Notices
The text of
the Agreement and Order appears
below.1
SUPPLEMENTARY INFORMATION:
Dated: September 30, 2016.
Todd A. Stevenson,
Secretary.
United States of America Consumer
Product Safety Commission
In the Matter of: Best Buy Co., Inc., CPSC
Docket No.: 16–C0005.
Settlement Agreement
1. In accordance with the Consumer
Product Safety Act, 15 U.S.C.
§§ 2051¥2089 (‘‘CPSA’’) and 16 CFR
§ 1118.20, Best Buy Co., Inc., and its
subsidiaries (collectively, ‘‘Best Buy’’),
and the United States Consumer
Product Safety Commission
(‘‘Commission’’), through its staff,
hereby enter into this Settlement
Agreement (‘‘Agreement’’). The
Agreement and the incorporated
attached Order resolve staff’s charges set
forth below.
The Parties
2. The Commission is an independent
federal regulatory agency, established
pursuant to, and responsible for, the
enforcement of the CPSA, 15 U.S.C.
§§‘‘2051¥2089. By executing the
Agreement, staff is acting on behalf of
the Commission, pursuant to 16 CFR
§ 1118.20(b). The Commission issues the
Order under the provisions of the CPSA.
3. Best Buy is a corporation, organized
and existing under the laws of the state
of Minnesota, with its principal place of
business in Richfield, MN.
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Staff Charges
4. Between September 2010 and
October 2015, Best Buy knowingly sold,
offered for sale, and distributed in
commerce recalled consumer products
in violation of Section 19(a)(2)(B) of the
CPSA, 15 U.S.C. § 2068(a)(2)(B). Over
the course of five years, Best Buy sold
units from 16 separate recalls of
consumer products, totaling
approximately 600 units of recalled
products (the ‘‘Recalled Products’’), at
its retail stores, online, and through Best
Buy’s secondary market sales channels,
more than 400 of which were the Canon
Cameras described in paragraph 5,
below.
5. The Recalled Products include:
1 The Commission voted (4–1) to provisionally
accept the Settlement Agreement and Order
regarding Best Buy Co., Inc. Chairman Kaye,
Commissioner Adler, Commissioner Robinson and
Commissioner Mohorovic voted to provisionally
accept the Settlement Agreement and Order.
Commissioner Buerkle voted to reject the
Settlement Agreement and Order.
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• Toshiba Satellite Notebook
Computers, recalled on September 2,
2010 (‘‘Toshiba Notebooks’’)
• iSi North America Twist ‘n Sparkle
Beverage Carbonation Systems,
recalled on July 5, 2012 (‘‘Twist ‘n
Sparkles’’)
• LG Electronics Gas Dryers, recalled on
August 2, 2012 (‘‘LG Dryers’’)
• GE Dishwashers, recalled on August
9, 2012 (‘‘GE Dishwashers’’)
• Canon EOS Rebel T4i Digital Cameras,
recalled on August 14, 2012 (‘‘Canon
Cameras’’)
• GE Profile Front Load Washer,
recalled on October 3, 2012 (‘‘GE
Washers’’)
• Sauder Woodworking Company Gruga
Office Chairs, recalled on November
7, 2012 (‘‘Office Chairs’’)
• LG Electronics Electric Ranges,
recalled on November 8, 2012 (‘‘LG
Ranges’’)
• LG Electronics Top-Loading Washing
Machines, recalled on December 18,
2012 (‘‘LG Washers’’)
• Samsonite Dual-Wattage Travel
Converters, recalled on February 12,
2013 (‘‘Samsonite Converters’’)
• Definitive Technology SuperCube
2000 Subwoofers, recalled on March
28, 2013 (‘‘SuperCubes’’)
• Gree Dehumidifiers, recalled on
September 12, 2013, expanded in
January 2014 and reannounced in
May 2014 (‘‘Dehumidifiers’’)
• Frigidaire Professional Blenders,
recalled on September 19, 2013
(‘‘Blenders’’)
• Schneider Electric APC Surge Arrest
Surge Protector, recalled on October
3, 2013 (‘‘Surge Protectors’’)
• Coby 32-inch Flat Screen TV, recalled
on December 12, 2013 (‘‘Coby TVs’’),
and
• Whirlpool Jenn-Air Wall Oven,
recalled on July 29, 2015 (Jenn-Air
Wall Ovens’’)
6. Post-recall sales of the Recalled
Products resulted in one reported
injury. A consumer who purchased a
recalled Canon Camera at a Best Buy
store developed a skin irritation, which
was the hazard for which the product
had been recalled eight months before
the purchase.
7. On September 12, 2013, Gree
dehumidifiers were recalled due to a
defect that caused them to overheat and
catch fire. Two weeks later, Best Buy
sold a Gree dehumidifier with a model
number within the scope of the recall.
The unit subsequently caught fire
internally. Best Buy’s recordkeeping did
not enable it to identify whether the
sold unit bore the date range identified
in the recall announcement.
8. Fifteen of the 16 Recalled Products
were subject to voluntary corrective
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action plans taken by the manufacturers
in consultation with the Commission.
Each of these recalls was also publicized
by each respective manufacturer and by
the Commission. The remaining
Recalled Product was recalled by Best
Buy and other retailers in consultation
with the Commission because the
manufacturer had ceased operations at
the time of the recall; this recall was
publicized by Best Buy, the other
retailers, and by the Commission.
9. The Recalled Products are
‘‘consumer products,’’ and, at all
relevant times, Best Buy was a ‘‘retailer’’
of these consumer products, which were
‘‘distributed in commerce,’’ as those
terms are defined or used in sections
3(a)(5), (8) and (13), of the CPSA, 15
U.S.C. 2052(a)(5), (8) and (13).
10. Under CPSA section 19(a)(2)(B), it
is unlawful for any person to sell, offer
for sale, manufacture for sale, distribute
in commerce, or import into the United
States, any consumer product that is
subject to voluntary corrective action
taken by the manufacturer, in
consultation with the Commission, of
which action the Commission has
notified the public, or if the seller,
distributor, or manufacturer knew, or
should have known, of such voluntary
corrective action.
11. Pursuant to section 20(a)(l) of the
CPSA, 15 U.S.C. 2069(a)(1), any person
who ‘‘knowingly’’ violates CPSA section
19 is subject to civil penalties. Under
section 20(d) of the CPSA, 15 U.S.C.
2069(d), the term ‘‘knowingly’’ means:
‘‘(1) the having of actual knowledge, or
(2) the presumed having of knowledge
deemed to be possessed by a reasonable
man who acts in the circumstances,
including knowledge obtainable upon
the exercise of due care to ascertain the
truth of representations.’’
12. Best Buy sold and distributed
Recalled Products because Best Buy
failed to implement adequate
procedures to accurately identify,
quarantine, and prevent the sales of the
Recalled Products across all its supply
channels. For example, Best Buy added
an ‘‘Inactive’’ or ‘‘Do Not Sell’’ marker
to the product codes of some Recalled
Products to block entry of the code into
the register and prevent the sale. In
some cases, however, product codes
were not permanently blocked based on
inaccurate information that the Recalled
Product had never been, or was no
longer in, inventory; at other times, the
blocked codes were ‘‘turned back on’’
prematurely, and in a few cases,
overridden.
13. Best Buy communications show
that, in July 2011, Best Buy secondary
markets personnel reported to a
manager that recalled Toshiba
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Notebooks were in inventory and sought
guidance on protocol for handling the
Recalled Product. Despite this
information, immediate action was not
taken to prevent future sales. The next
month Best Buy sold at least five
recalled Toshiba Notebooks, and
approximately 15 the following month.
Best Buy sold an additional 44 recalled
Toshiba Notebooks over the next three
years, the last sale occurring in October
2014.
14. In May 2013, staff notified Best
Buy that it was conducting an
investigation into the sale of the recalled
Canon Cameras. Shortly thereafter, Best
Buy notified staff of sales of additional
Recalled Products. At staff’s request,
Best Buy then audited its sales records
for the prior two years and reported
sales of other Recalled Products.
15. Even though Best Buy advised
staff of system enhancements Best Buy
had implemented to reduce the risk of
post-recall sales, Best Buy’s sales of
Recalled Products continued from June
2013 through October 2015 (including
during staff’s civil penalty
investigation), during which time Best
Buy sold approximately 35 units of
Recalled Products.
16. Best Buy knew and/or should
have known of these sales of Recalled
Products.
17. Best Buy’s sale and distribution of
the Recalled Products was ‘‘knowing,’’
as that term is defined in section 20(d)
of the CPSA, 15 U.S.C. 2069(d).
18. Pursuant to section 20 of the
CPSA, 15 U.S.C. 2069, Best Buy is
subject to civil penalties for its knowing
sale of the Recalled Products, in
violation of section 19(a)(2)(B) of the
CPSA, 15 U.S.C. 2068(a)(2)(B).
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Response of Best Buy
19. Best Buy’s settlement of this
matter does not constitute an admission
of the staff’s charges as set forth in
paragraphs 4 through 21.
20. Before any post-recall sales were
identified, Best Buy had begun
enhancing its procedures to help
prevent the sale of recalled products.
Moreover, in connection with this
matter, Best Buy worked cooperatively
with CPSC staff to identify additional
process enhancements to further reduce
the risk of such sales.
Agreement of the Parties
21. Under the CPSA, the Commission
has jurisdiction over the matter
involving the Recalled Products
described in this Agreement and over
Best Buy.
22. The parties enter into the
Agreement for settlement purposes only.
The Agreement does not constitute an
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admission by Best Buy, or a
determination by the Commission, that
Best Buy knowingly violated the CPSA.
23. In settlement of staff’s charges,
and to avoid the cost, distraction, delay,
uncertainty, and inconvenience of
protracted litigation or other
proceedings, Best Buy shall pay a civil
penalty in the amount of 3.8 million
dollars ($3,800,000) within thirty (30)
calendar days after receiving service of
the Commission’s final Order accepting
the Agreement. All payments to be
made under the Agreement shall
constitute debts owing to the United
States and shall be made by electronic
wire transfer to the United States via:
https://www.pay.gov for allocation to and
credit against the payment obligations of
Best Buy under this Agreement. Failure
to make such payment by the date
specified in the Commission’s final
Order shall constitute Default.
24. All unpaid amounts, if any, due
and owing under the Agreement, shall
constitute a debt due and immediately
owing by Best Buy to the United States,
and interest shall accrue and be paid by
Best Buy at the federal legal rate of
interest set forth at 28 U.S.C. 1961(a)
and (b), from the date of Default, until
all amounts due have been paid in full
(hereinafter ‘‘Default Payment Amount’’
and ‘‘Default Interest Balance’’). Best
Buy shall consent to a Consent
Judgment in the amount of the Default
Payment Amount and Default Interest
Balance, and the United States, at its
sole option, may collect the entire
Default Payment Amount and Default
Interest Balance, or exercise any other
rights granted by law or in equity,
including, but not limited to, referring
such matters for private collection; and
Best Buy agrees not to contest, and
hereby waives and discharges any
defenses to, any collection action
undertaken by the United States or its
agents or contractors pursuant to this
paragraph. Best Buy shall pay the
United States all reasonable costs of
collection and enforcement under this
paragraph, respectively, including
reasonable attorney’s fees and expenses.
25. After staff receives this Agreement
executed on behalf of Best Buy, staff
shall promptly submit the Agreement to
the Commission for provisional
acceptance. Promptly following
provisional acceptance of the
Agreement by the Commission, 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). If the Commission does not
receive any written request not to accept
the Agreement within fifteen (15)
calendar days, the Agreement shall be
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69049
deemed finally accepted on the 16th
calendar day after the date the
Agreement is published in the Federal
Register, in accordance with 16 CFR
1118.20(f).
26. This Agreement is conditioned
upon, and subject to, the Commission’s
final acceptance, as set forth above, and
it is subject to the provisions of 16 CFR
1118.20(h). Upon the later of: (i)
Commission’s final acceptance of this
Agreement and service of the accepted
Agreement upon Best Buy, and (ii) the
date of issuance of the final Order, this
Agreement shall be in full force and
effect and shall be binding upon the
parties.
27. Effective upon the later of: (i) The
Commission’s final acceptance of the
Agreement and service of the accepted
Agreement upon Best Buy, and (ii) and
the date of issuance of the final Order,
for good and valuable consideration,
Best Buy hereby expressly and
irrevocably waives and agrees not to
assert any past, present, or future rights
to the following, in connection with the
matter described in this Agreement: (i)
An administrative or judicial hearing;
(ii) judicial review or other challenge or
contest of the Commission’s actions; (iii)
a determination by the Commission of
whether Best Buy failed to comply with
the CPSA and the underlying
regulations; (iv) a statement of findings
of fact and conclusions of law; and (v)
any claims under the Equal Access to
Justice Act.
28. Best Buy represents and agrees
that it has and will maintain a
compliance program designed to ensure
compliance with the CPSA with respect
to any consumer product imported,
manufactured, distributed or sold by the
Firm. The compliance program does and
shall contain the following elements:
Written standards, policies, and
procedures designed to ensure
compliance with CPSA statutes and
regulations; procedures to ensure that
relevant information is conveyed
effectively to appropriate personnel
responsible for CPSA compliance;
mechanisms to communicate to all
applicable Best Buy employees through
training programs or otherwise,
company policies and procedures to
prevent violations of CPSA § 19; a
program for the appropriate disposition
of recalled goods; management oversight
of that program, including a mechanism
for confidential employee reporting of
compliance-related questions or
concerns to either a compliance officer
or to another senior manager with
authority to act as necessary; senior
management responsibility for, and
general board oversight of, CPSA
compliance; and retention of all CPSA
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compliance-related records for at least
five (5) years; and availability of such
records to staff upon reasonable request.
29. Best Buy represents and agrees
that it has and will maintain and
enforce a system of internal controls and
procedures designed to ensure that,
with respect to all consumer products
manufactured, imported, distributed, or
sold by Best Buy: Information required
to be disclosed by Best Buy to the
Commission is recorded, processed, and
reported in accordance with applicable
law; all reporting made to the
Commission is timely, truthful,
complete, accurate, and in accordance
with applicable law; and prompt
disclosure is made to Best Buy’s
management of any significant
deficiencies or material weaknesses in
the design or operation of such internal
controls that are reasonably likely to
affect adversely, in any material respect,
Best Buy’s ability to record, process, and
report to the Commission in accordance
with applicable law.
30. Upon reasonable request of staff,
Best Buy shall provide written
documentation of its internal controls
and procedures, including, but not
limited to, the effective dates of the
procedures and improvements thereto.
Best Buy shall cooperate fully and
truthfully with staff and shall make
available all non-privileged information
and materials, and personnel deemed
necessary by staff to evaluate Best Buy’s
compliance with the terms of the
Agreement.
31. The parties acknowledge and
agree that the Commission may
publicize the terms of the Agreement
and the Order.
32. Best Buy represents that the
Agreement: (i) Is entered into freely and
voluntarily, without any degree of
duress or compulsion whatsoever; (ii)
has been duly authorized; and (iii)
constitutes the valid and binding
obligation of Best Buy, and each of its
successors, transferees, and assigns,
enforceable against Best Buy in
accordance with the Agreement’s terms.
The individuals signing the Agreement
on behalf of Best Buy represent and
warrant that they are duly authorized by
Best Buy to execute the Agreement.
33. The signatories represent that they
are authorized to execute this
Agreement.
34. The Agreement is governed by the
laws of the United States.
35. The Agreement and the Order
shall apply to, and be binding upon,
Best Buy and each of its successors,
transferees, and assigns, and a violation
of the Agreement or Order may subject
Best Buy, and each of its successors,
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transferees, and assigns, to appropriate
legal action.
36. The Agreement and the Order
constitute the complete agreement
between the parties on the subject
matter contained therein.
37. 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. For purposes of
construction, the Agreement shall be
deemed to have been drafted by both of
the parties and shall not, therefore, be
construed against any party for that
reason in any subsequent dispute.
38. The Agreement may not be
waived, amended, modified, or
otherwise altered, except as in
accordance with the provisions of 16
CFR § 1118.20(h). The Agreement may
be executed in counterparts.
39. If any provision of the Agreement
or 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 Best Buy
agree in writing that severing the
provision materially affects the purpose
of the Agreement and the Order.
BEST BUY CO., INC.
United States of America Consumer
Product Safety Commission
In the Matter of: Best Buy Co, Inc.
CPSC Docket No.: 16–C0005
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[FR Doc. 2016–24075 Filed 10–4–16; 8:45 am]
BILLING CODE 6355–01–P
Date: September 20, 2016.
By: lllllllllllllllllll
Todd Hartman,
Senior Vice President, Deputy General
Counsel and Chief Compliance Officer, Best
Buy Co., Inc., 7601 Penn Ave. S., Richfield,
MN 55423.
Date: September 22, 2016.
By: lllllllllllllllllll
Eric Rubel, Esq.
Arnold & Porter LLP, 601 Massachusetts Ave.
NW., Washington, DC 20001–3743, Counsel
for Best Buy.
U.S. CONSUMER PRODUCT SAFETY
COMMISSION
Mary T. Boyle,
General Counsel.
Mary B. Murphy,
Assistant General Counsel.
Date: September 22, 2016.
By: lllllllllllllllllll
Laura Thomson,
Trial Attorney, Division of Compliance,
Office of the General Counsel.
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ORDER
Upon consideration of the Settlement
Agreement entered into between Best Buy
Co., Inc. (‘‘Best Buy’’), and the U.S.
Consumer Product Safety Commission
(‘‘Commission’’), and the Commission having
jurisdiction over the subject matter and over
Best Buy, and it appearing that the
Settlement Agreement and the Order are in
the public interest, it is:
ORDERED that the Settlement Agreement
be, and is, hereby, accepted; and it is
FURTHER ORDERED that Best Buy shall
comply with the terms of the Settlement
Agreement and shall pay a civil penalty in
the amount of 3.8 million dollars
($3,800,000) within thirty (30) days after
service of the Commission’s final Order
accepting the Settlement Agreement. The
payment shall be made by electronic wire
transfer to the Commission via: https://
www.pay.gov. Upon the failure of Best Buy to
make the foregoing payment when due,
interest on the unpaid amount shall accrue
and be paid by Best Buy at the federal legal
rate of interest set forth at 28 U.S.C. § 1961(a)
and (b). If Best Buy fails to make such
payment or to comply in full with any other
provision of the Settlement Agreement, such
conduct will be considered a violation of the
Settlement Agreement and Order.
Provisionally accepted and provisional
Order issued on the 30th day of September,
2016.
BY ORDER OF THE COMMISSION:
lllllllllllllllllllll
Todd A. Stevenson,
Secretary, U.S. Consumer Product Safety
Commission.
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Advisory Committee on Arlington
National Cemetery, Honor
Subcommittee and the Remember and
Explore Subcommittee Meeting Notice
Department of the Army, DoD.
Notice of open subcommittee
meetings.
AGENCY:
ACTION:
The Department of the Army
is publishing this notice to announce
the following Federal advisory
subcommittee meetings of the Honor
Subcommittee and the Remember and
Explore Subcommittee of the Advisory
Committee on Arlington National
Cemetery (ACANC). These meetings are
open to the public. For more
information about the Committee and
the Subcommittees, please visit https://
www.arlingtoncemetery.mil/AboutUs/
FocusAreas.aspx.
DATES: The Honor Subcommittee will
meet from 8:30 a.m. to 11:00 a.m. and
the Remember and Explore
SUMMARY:
E:\FR\FM\05OCN1.SGM
05OCN1
]]>Agencies
[Federal Register Volume 81, Number 193 (Wednesday, October 5, 2016)]
[Notices]
[Pages 69047-69050]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2016-24075]
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CONSUMER PRODUCT SAFETY COMMISSION
[CPSC Docket No. 16-C0005]
Best Buy Co., 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 the Consumer
Product Safety Commission's regulations. Published below is a
provisionally-accepted Settlement Agreement with Best Buy Co., Inc.,
containing a civil penalty in the amount of 3.8 million dollars
($3,800,000) within thirty (30) days of service of the Commission's
final Order accepting the Settlement Agreement.
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 October 20, 2016.
ADDRESSES: Persons wishing to comment on this Settlement Agreement
should send written comments to the Comment 16-C0005 Office of the
Secretary, Consumer Product Safety Commission, 4330 East-West Highway,
Room 820, Bethesda, Maryland 20814-4408.
FOR FURTHER INFORMATION CONTACT: Laura Thomson, Trial Attorney,
Division of Compliance, Office of the General Counsel, Consumer Product
Safety Commission, 4330 East-West Highway, Bethesda, Maryland 20814-
4408; telephone (301) 504-7263.
[[Page 69048]]
SUPPLEMENTARY INFORMATION: The text of the Agreement and Order appears
below.\1\
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\1\ The Commission voted (4-1) to provisionally accept the
Settlement Agreement and Order regarding Best Buy Co., Inc. Chairman
Kaye, Commissioner Adler, Commissioner Robinson and Commissioner
Mohorovic voted to provisionally accept the Settlement Agreement and
Order. Commissioner Buerkle voted to reject the Settlement Agreement
and Order.
Dated: September 30, 2016.
Todd A. Stevenson,
Secretary.
United States of America Consumer Product Safety Commission
In the Matter of: Best Buy Co., Inc., CPSC Docket No.: 16-C0005.
Settlement Agreement
1. In accordance with the Consumer Product Safety Act, 15 U.S.C.
Sec. Sec. 2051-2089 (``CPSA'') and 16 CFR Sec. 1118.20, Best Buy Co.,
Inc., and its subsidiaries (collectively, ``Best Buy''), and the United
States Consumer Product Safety Commission (``Commission''), through its
staff, hereby enter into this Settlement Agreement (``Agreement''). The
Agreement and the incorporated attached Order resolve staff's charges
set forth below.
The Parties
2. The Commission is an independent federal regulatory agency,
established pursuant to, and responsible for, the enforcement of the
CPSA, 15 U.S.C. Sec. Sec. ``2051-2089. By executing the Agreement,
staff is acting on behalf of the Commission, pursuant to 16 CFR Sec.
1118.20(b). The Commission issues the Order under the provisions of the
CPSA.
3. Best Buy is a corporation, organized and existing under the laws
of the state of Minnesota, with its principal place of business in
Richfield, MN.
Staff Charges
4. Between September 2010 and October 2015, Best Buy knowingly
sold, offered for sale, and distributed in commerce recalled consumer
products in violation of Section 19(a)(2)(B) of the CPSA, 15 U.S.C.
Sec. 2068(a)(2)(B). Over the course of five years, Best Buy sold units
from 16 separate recalls of consumer products, totaling approximately
600 units of recalled products (the ``Recalled Products''), at its
retail stores, online, and through Best Buy's secondary market sales
channels, more than 400 of which were the Canon Cameras described in
paragraph 5, below.
5. The Recalled Products include:
Toshiba Satellite Notebook Computers, recalled on September 2,
2010 (``Toshiba Notebooks'')
iSi North America Twist `n Sparkle Beverage Carbonation
Systems, recalled on July 5, 2012 (``Twist `n Sparkles'')
LG Electronics Gas Dryers, recalled on August 2, 2012 (``LG
Dryers'')
GE Dishwashers, recalled on August 9, 2012 (``GE
Dishwashers'')
Canon EOS Rebel T4i Digital Cameras, recalled on August 14,
2012 (``Canon Cameras'')
GE Profile Front Load Washer, recalled on October 3, 2012
(``GE Washers'')
Sauder Woodworking Company Gruga Office Chairs, recalled on
November 7, 2012 (``Office Chairs'')
LG Electronics Electric Ranges, recalled on November 8, 2012
(``LG Ranges'')
LG Electronics Top-Loading Washing Machines, recalled on
December 18, 2012 (``LG Washers'')
Samsonite Dual-Wattage Travel Converters, recalled on February
12, 2013 (``Samsonite Converters'')
Definitive Technology SuperCube 2000 Subwoofers, recalled on
March 28, 2013 (``SuperCubes'')
Gree Dehumidifiers, recalled on September 12, 2013, expanded
in January 2014 and reannounced in May 2014 (``Dehumidifiers'')
Frigidaire Professional Blenders, recalled on September 19,
2013 (``Blenders'')
Schneider Electric APC Surge Arrest Surge Protector, recalled
on October 3, 2013 (``Surge Protectors'')
Coby 32-inch Flat Screen TV, recalled on December 12, 2013
(``Coby TVs''), and
Whirlpool Jenn-Air Wall Oven, recalled on July 29, 2015 (Jenn-
Air Wall Ovens'')
6. Post-recall sales of the Recalled Products resulted in one
reported injury. A consumer who purchased a recalled Canon Camera at a
Best Buy store developed a skin irritation, which was the hazard for
which the product had been recalled eight months before the purchase.
7. On September 12, 2013, Gree dehumidifiers were recalled due to a
defect that caused them to overheat and catch fire. Two weeks later,
Best Buy sold a Gree dehumidifier with a model number within the scope
of the recall. The unit subsequently caught fire internally. Best Buy's
recordkeeping did not enable it to identify whether the sold unit bore
the date range identified in the recall announcement.
8. Fifteen of the 16 Recalled Products were subject to voluntary
corrective action plans taken by the manufacturers in consultation with
the Commission. Each of these recalls was also publicized by each
respective manufacturer and by the Commission. The remaining Recalled
Product was recalled by Best Buy and other retailers in consultation
with the Commission because the manufacturer had ceased operations at
the time of the recall; this recall was publicized by Best Buy, the
other retailers, and by the Commission.
9. The Recalled Products are ``consumer products,'' and, at all
relevant times, Best Buy was a ``retailer'' of these consumer products,
which were ``distributed in commerce,'' as those terms are defined or
used in sections 3(a)(5), (8) and (13), of the CPSA, 15 U.S.C.
2052(a)(5), (8) and (13).
10. Under CPSA section 19(a)(2)(B), it is unlawful for any person
to sell, offer for sale, manufacture for sale, distribute in commerce,
or import into the United States, any consumer product that is subject
to voluntary corrective action taken by the manufacturer, in
consultation with the Commission, of which action the Commission has
notified the public, or if the seller, distributor, or manufacturer
knew, or should have known, of such voluntary corrective action.
11. Pursuant to section 20(a)(l) of the CPSA, 15 U.S.C. 2069(a)(1),
any person who ``knowingly'' violates CPSA section 19 is subject to
civil penalties. Under section 20(d) of the CPSA, 15 U.S.C. 2069(d),
the term ``knowingly'' means: ``(1) the having of actual knowledge, or
(2) the presumed having of knowledge deemed to be possessed by a
reasonable man who acts in the circumstances, including knowledge
obtainable upon the exercise of due care to ascertain the truth of
representations.''
12. Best Buy sold and distributed Recalled Products because Best
Buy failed to implement adequate procedures to accurately identify,
quarantine, and prevent the sales of the Recalled Products across all
its supply channels. For example, Best Buy added an ``Inactive'' or
``Do Not Sell'' marker to the product codes of some Recalled Products
to block entry of the code into the register and prevent the sale. In
some cases, however, product codes were not permanently blocked based
on inaccurate information that the Recalled Product had never been, or
was no longer in, inventory; at other times, the blocked codes were
``turned back on'' prematurely, and in a few cases, overridden.
13. Best Buy communications show that, in July 2011, Best Buy
secondary markets personnel reported to a manager that recalled Toshiba
[[Page 69049]]
Notebooks were in inventory and sought guidance on protocol for
handling the Recalled Product. Despite this information, immediate
action was not taken to prevent future sales. The next month Best Buy
sold at least five recalled Toshiba Notebooks, and approximately 15 the
following month. Best Buy sold an additional 44 recalled Toshiba
Notebooks over the next three years, the last sale occurring in October
2014.
14. In May 2013, staff notified Best Buy that it was conducting an
investigation into the sale of the recalled Canon Cameras. Shortly
thereafter, Best Buy notified staff of sales of additional Recalled
Products. At staff's request, Best Buy then audited its sales records
for the prior two years and reported sales of other Recalled Products.
15. Even though Best Buy advised staff of system enhancements Best
Buy had implemented to reduce the risk of post-recall sales, Best Buy's
sales of Recalled Products continued from June 2013 through October
2015 (including during staff's civil penalty investigation), during
which time Best Buy sold approximately 35 units of Recalled Products.
16. Best Buy knew and/or should have known of these sales of
Recalled Products.
17. Best Buy's sale and distribution of the Recalled Products was
``knowing,'' as that term is defined in section 20(d) of the CPSA, 15
U.S.C. 2069(d).
18. Pursuant to section 20 of the CPSA, 15 U.S.C. 2069, Best Buy is
subject to civil penalties for its knowing sale of the Recalled
Products, in violation of section 19(a)(2)(B) of the CPSA, 15 U.S.C.
2068(a)(2)(B).
Response of Best Buy
19. Best Buy's settlement of this matter does not constitute an
admission of the staff's charges as set forth in paragraphs 4 through
21.
20. Before any post-recall sales were identified, Best Buy had
begun enhancing its procedures to help prevent the sale of recalled
products. Moreover, in connection with this matter, Best Buy worked
cooperatively with CPSC staff to identify additional process
enhancements to further reduce the risk of such sales.
Agreement of the Parties
21. Under the CPSA, the Commission has jurisdiction over the matter
involving the Recalled Products described in this Agreement and over
Best Buy.
22. The parties enter into the Agreement for settlement purposes
only. The Agreement does not constitute an admission by Best Buy, or a
determination by the Commission, that Best Buy knowingly violated the
CPSA.
23. In settlement of staff's charges, and to avoid the cost,
distraction, delay, uncertainty, and inconvenience of protracted
litigation or other proceedings, Best Buy shall pay a civil penalty in
the amount of 3.8 million dollars ($3,800,000) within thirty (30)
calendar days after receiving service of the Commission's final Order
accepting the Agreement. All payments to be made under the Agreement
shall constitute debts owing to the United States and shall be made by
electronic wire transfer to the United States via: https://www.pay.gov
for allocation to and credit against the payment obligations of Best
Buy under this Agreement. Failure to make such payment by the date
specified in the Commission's final Order shall constitute Default.
24. All unpaid amounts, if any, due and owing under the Agreement,
shall constitute a debt due and immediately owing by Best Buy to the
United States, and interest shall accrue and be paid by Best Buy at the
federal legal rate of interest set forth at 28 U.S.C. 1961(a) and (b),
from the date of Default, until all amounts due have been paid in full
(hereinafter ``Default Payment Amount'' and ``Default Interest
Balance''). Best Buy shall consent to a Consent Judgment in the amount
of the Default Payment Amount and Default Interest Balance, and the
United States, at its sole option, may collect the entire Default
Payment Amount and Default Interest Balance, or exercise any other
rights granted by law or in equity, including, but not limited to,
referring such matters for private collection; and Best Buy agrees not
to contest, and hereby waives and discharges any defenses to, any
collection action undertaken by the United States or its agents or
contractors pursuant to this paragraph. Best Buy shall pay the United
States all reasonable costs of collection and enforcement under this
paragraph, respectively, including reasonable attorney's fees and
expenses.
25. After staff receives this Agreement executed on behalf of Best
Buy, staff shall promptly submit the Agreement to the Commission for
provisional acceptance. Promptly following provisional acceptance of
the Agreement by the Commission, 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). 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 16th calendar day after the date the Agreement is
published in the Federal Register, in accordance with 16 CFR
1118.20(f).
26. This Agreement is conditioned upon, and subject to, the
Commission's final acceptance, as set forth above, and it is subject to
the provisions of 16 CFR 1118.20(h). Upon the later of: (i)
Commission's final acceptance of this Agreement and service of the
accepted Agreement upon Best Buy, and (ii) the date of issuance of the
final Order, this Agreement shall be in full force and effect and shall
be binding upon the parties.
27. Effective upon the later of: (i) The Commission's final
acceptance of the Agreement and service of the accepted Agreement upon
Best Buy, and (ii) and the date of issuance of the final Order, for
good and valuable consideration, Best Buy hereby expressly and
irrevocably waives and agrees not to assert any past, present, or
future rights to the following, in connection with the matter described
in this Agreement: (i) An administrative or judicial hearing; (ii)
judicial review or other challenge or contest of the Commission's
actions; (iii) a determination by the Commission of whether Best Buy
failed to comply with the CPSA and the underlying regulations; (iv) a
statement of findings of fact and conclusions of law; and (v) any
claims under the Equal Access to Justice Act.
28. Best Buy represents and agrees that it has and will maintain a
compliance program designed to ensure compliance with the CPSA with
respect to any consumer product imported, manufactured, distributed or
sold by the Firm. The compliance program does and shall contain the
following elements: Written standards, policies, and procedures
designed to ensure compliance with CPSA statutes and regulations;
procedures to ensure that relevant information is conveyed effectively
to appropriate personnel responsible for CPSA compliance; mechanisms to
communicate to all applicable Best Buy employees through training
programs or otherwise, company policies and procedures to prevent
violations of CPSA Sec. 19; a program for the appropriate disposition
of recalled goods; management oversight of that program, including a
mechanism for confidential employee reporting of compliance-related
questions or concerns to either a compliance officer or to another
senior manager with authority to act as necessary; senior management
responsibility for, and general board oversight of, CPSA compliance;
and retention of all CPSA
[[Page 69050]]
compliance-related records for at least five (5) years; and
availability of such records to staff upon reasonable request.
29. Best Buy represents and agrees that it has and will maintain
and enforce a system of internal controls and procedures designed to
ensure that, with respect to all consumer products manufactured,
imported, distributed, or sold by Best Buy: Information required to be
disclosed by Best Buy to the Commission is recorded, processed, and
reported in accordance with applicable law; all reporting made to the
Commission is timely, truthful, complete, accurate, and in accordance
with applicable law; and prompt disclosure is made to Best Buy's
management of any significant deficiencies or material weaknesses in
the design or operation of such internal controls that are reasonably
likely to affect adversely, in any material respect, Best Buy's ability
to record, process, and report to the Commission in accordance with
applicable law.
30. Upon reasonable request of staff, Best Buy shall provide
written documentation of its internal controls and procedures,
including, but not limited to, the effective dates of the procedures
and improvements thereto. Best Buy shall cooperate fully and truthfully
with staff and shall make available all non-privileged information and
materials, and personnel deemed necessary by staff to evaluate Best
Buy's compliance with the terms of the Agreement.
31. The parties acknowledge and agree that the Commission may
publicize the terms of the Agreement and the Order.
32. Best Buy represents that the Agreement: (i) Is entered into
freely and voluntarily, without any degree of duress or compulsion
whatsoever; (ii) has been duly authorized; and (iii) constitutes the
valid and binding obligation of Best Buy, and each of its successors,
transferees, and assigns, enforceable against Best Buy in accordance
with the Agreement's terms. The individuals signing the Agreement on
behalf of Best Buy represent and warrant that they are duly authorized
by Best Buy to execute the Agreement.
33. The signatories represent that they are authorized to execute
this Agreement.
34. The Agreement is governed by the laws of the United States.
35. The Agreement and the Order shall apply to, and be binding
upon, Best Buy and each of its successors, transferees, and assigns,
and a violation of the Agreement or Order may subject Best Buy, and
each of its successors, transferees, and assigns, to appropriate legal
action.
36. The Agreement and the Order constitute the complete agreement
between the parties on the subject matter contained therein.
37. 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. For purposes of construction, the
Agreement shall be deemed to have been drafted by both of the parties
and shall not, therefore, be construed against any party for that
reason in any subsequent dispute.
38. The Agreement may not be waived, amended, modified, or
otherwise altered, except as in accordance with the provisions of 16
CFR Sec. 1118.20(h). The Agreement may be executed in counterparts.
39. If any provision of the Agreement or 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 Best Buy agree in writing that severing the provision materially
affects the purpose of the Agreement and the Order.
BEST BUY CO., INC.
Date: September 20, 2016.
By:--------------------------------------------------------------------
Todd Hartman,
Senior Vice President, Deputy General Counsel and Chief Compliance
Officer, Best Buy Co., Inc., 7601 Penn Ave. S., Richfield, MN 55423.
Date: September 22, 2016.
By:--------------------------------------------------------------------
Eric Rubel, Esq.
Arnold & Porter LLP, 601 Massachusetts Ave. NW., Washington, DC
20001-3743, Counsel for Best Buy.
U.S. CONSUMER PRODUCT SAFETY COMMISSION
Mary T. Boyle,
General Counsel.
Mary B. Murphy,
Assistant General Counsel.
Date: September 22, 2016.
By:--------------------------------------------------------------------
Laura Thomson,
Trial Attorney, Division of Compliance, Office of the General
Counsel.
United States of America Consumer Product Safety Commission
In the Matter of: Best Buy Co, Inc.
CPSC Docket No.: 16-C0005
ORDER
Upon consideration of the Settlement Agreement entered into
between Best Buy Co., Inc. (``Best Buy''), and the U.S. Consumer
Product Safety Commission (``Commission''), and the Commission
having jurisdiction over the subject matter and over Best Buy, and
it appearing that the Settlement Agreement and the Order are in the
public interest, it is:
ORDERED that the Settlement Agreement be, and is, hereby,
accepted; and it is
FURTHER ORDERED that Best Buy shall comply with the terms of the
Settlement Agreement and shall pay a civil penalty in the amount of
3.8 million dollars ($3,800,000) within thirty (30) days after
service of the Commission's final Order accepting the Settlement
Agreement. The payment shall be made by electronic wire transfer to
the Commission via: https://www.pay.gov. Upon the failure of Best Buy
to make the foregoing payment when due, interest on the unpaid
amount shall accrue and be paid by Best Buy at the federal legal
rate of interest set forth at 28 U.S.C. Sec. 1961(a) and (b). If
Best Buy fails to make such payment or to comply in full with any
other provision of the Settlement Agreement, such conduct will be
considered a violation of the Settlement Agreement and Order.
Provisionally accepted and provisional Order issued on the 30th
day of September, 2016.
BY ORDER OF THE COMMISSION:
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Todd A. Stevenson,
Secretary, U.S. Consumer Product Safety Commission.
[FR Doc. 2016-24075 Filed 10-4-16; 8:45 am]
BILLING CODE 6355-01-P
