Liberty Apparel Co., Inc.; Provisional Acceptance of a Settlement Agreement and Order, 46879-46880 [E8-18402]

Agencies

• Consumer Product Safety Commission

[Federal Register Volume 73, Number 156 (Tuesday, August 12, 2008)]
[Notices]
[Pages 46879-46880]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E8-18402]


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CONSUMER PRODUCT SAFETY COMMISSION

[CPSC Docket No. 08-COO 15]


Liberty Apparel 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 16 CFR 1118.20(e). 
Published below is a provisionally accepted Settlement Agreement with 
Liberty Apparel Co., 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 Comment 08-COO 15, Office of the 
Secretary, Consumer Product Safety Commission, 4330 East West Highway, 
Room 502, Bethesda, Maryland 20814-4408.

FOR FURTHER INFORMATION CONTACT: Seth B. Popkin, Trial Attorney, Legal 
Division, Office of Compliance and Field Operations, Consumer Product 
Safety Commission, 4330 East West Highway, Bethesda, Maryland 20814-
4408; telephone (301) 504-7612.

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 Liberty Apparel Co., Inc., CPSC Docket No. 08-C15.

Settlement Agreement

    1. In accordance with 16 CFR 1118.20, Liberty Apparel Co., Inc. 
(``Liberty'') 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. Liberty is a corporation organized and existing under the 
laws of New York, with its principal offices located in New York, 
New York. At all times relevant hereto, Liberty sold apparel.

Staff Allegations

    4. In August 2007, Liberty imported 12,228 Jewel girls' hooded 
sweatshirts with drawstrings at the hood (``Sweatshirts''). From 
August to October 2007, Liberty sold and/or distributed in commerce 
the Sweatshirts.
    5. Retailers sold the Sweatshirts to consumers.
    6. The Sweatshirts are ``consumer product[s],'' and, at all 
times relevant hereto, Liberty was a ``manufacturer'' of those 
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. Liberty informed the Commission that, to the best of 
Liberty's knowledge, there had been no incidents or injuries from 
the Sweatshirts.
    11. Liberty's distribution in commerce of the Sweatshirts 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 21, 2007, the Commission and Liberty announced a 
recall of the Sweatshirts.
    13. Liberty had presumed and actual knowledge that the 
Sweatshirts 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)(1). Liberty had obtained 
information that reasonably supported the conclusion that the 
Sweatshirts 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 Liberty to immediately inform the 
Commission of the defect and risk.
    14. Liberty knowingly failed to immediately inform the 
Commission about the Sweatshirts 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 
Liberty to civil penalties.

Liberty's Response

    15. Liberty denies the Staff's allegations above that Liberty 
knowingly violated the CPSA.

Agreement of the Parties

    16. Under the CPSA, the Commission has jurisdiction over this 
matter and over Liberty.

[[Page 46880]]

    17. The parties enter into the Agreement for settlement purposes 
only. The Agreement does not constitute an admission by Liberty, or 
a determination by the Commission, that Liberty has knowingly 
violated the CPSA.
    18. In settlement of the Staff's allegations, Liberty 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.
    19. 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(e)(1), 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.
    20. Upon the Commission's final acceptance of the Agreement and 
issuance of the final Order, Liberty knowingly, voluntarily, and 
completely waives any rights it may have in this matter 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 Liberty 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.
    21. Upon issuance of, and Liberty's compliance with, the final 
Order, the Commission regards this matter as resolved and agrees not 
to bring a civil penalty action against Liberty based upon the 
Staff's allegations contained herein regarding the Sweatshirts.
    22. The Commission may publicize the terms of the Agreement and 
the Order.
    23. The Agreement and the Order shall apply to, and be binding 
upon, Liberty and each of its successors and assigns.
    24. The Commission issues the Order under the provisions of the 
CPSA, and violation of the Order may subject Liberty to appropriate 
legal action.
    25. 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.
    26. 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 Liberty agree that severing the provision materially 
affects the purpose of the Agreement and the Order.
    27. 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 firm 
violated 15 U.S.C. 2068, where the total amount of the settlement 
involves no more than 100,000.

Liberty Apparel Co., Inc.

    Dated: 7/3/08.

By: Hagai Laniado,
President, Liberty Apparel Co., Inc., 1407 Broadway, Suite 1500, New 
York, NY 10018.

    Dated: 7/3/08.

By: David Laniado, Esq.,
55 Atlantic Avenue, Lynbrook, NY 11563, Counsel for Liberty Apparel 
Co., 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: Seth B. Popkin,
Trial Attorney, Legal Division, Office of Compliance and Field 
Operations.

United States of America

Consumer Product Safety Commission

In the Matter of Liberty Apparel Co., Inc. CPSC Docket No. 08-COO15

Order

    Upon consideration of the Settlement Agreement entered into 
between Liberty Apparel Co., Inc. (``Liberty'') and the U.S. 
Consumer Product Safety Commission (``Commission'') staff, and the 
Commission having jurisdiction over the subject matter and over 
Liberty, 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 Liberty 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 Liberty to 
make the foregoing payment when due, interest on the unpaid amount 
shall accrue and be paid by Liberty 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. E8-18402 Filed 8-11-08; 8:45 am]
BILLING CODE 6355-01-M