Retco, Inc., Provisional Acceptance of a Settlement Agreement and Order, 17657-17658 [E9-8729]

Agencies

• Consumer Product Safety Commission

[Federal Register Volume 74, Number 72 (Thursday, April 16, 2009)]
[Notices]
[Pages 17657-17658]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E9-8729]


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CONSUMER PRODUCT SAFETY COMMISSION

[CPSC Docket No. 09-C0008]


Retco, 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 
Retco, Inc., containing a civil penalty of $45,000.00.

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 May 1, 2009.

ADDRESSES: Persons wishing to comment on this Settlement Agreement 
should send written comments to the Comment 09-C0008, Office of the 
Secretary, Consumer Product Safety Commission, 4330 East West Highway, 
Room 502, Bethesda, Maryland 20814-4408.

FOR FURTHER INFORMATION CONTACT: Renee K. Haslett, Trial Attorney, 
Division of Compliance, Office of the General Counsel, Consumer Product 
Safety Commission, 4330 East West Highway, Bethesda, Maryland 20814-
4408; telephone (301) 504-7673.

SUPPLEMENTARY INFORMATION: The text of the Agreement and Order appears 
below.

    Dated: April 9, 2009.
Todd A. Stevenson,
Secretary.

Settlement Agreement

    1. In accordance with 16 CFR 1118.20, Retco Inc. (``Retco'') 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. 2051-2089 (``CPSA'').
    3. Retco is a corporation organized and existing under the laws of 
Colorado, with its principal offices located in Breckenridge, Colorado. 
At all times relevant hereto, Retco sold apparel.

Staff Allegations

    4. From at least September 2005 to May 2008, Retco held for sale 
and/or sold children's hooded sweatshirts and jackets with drawstrings 
at the hood or neck, which were later recalled on August 28, 2008 
(``Garments'').
    5. Retco sold Garments to consumers.
    6. The Garments are ``consumer product[s],'' and, at all times 
relevant hereto, Retco was a ``retailer'' of those consumer products, 
which were ``distributed in commerce,'' as those terms are defined in 
CPSA sections 3(a)(5), (8), and (13), 15 U.S.C. 2052(a)(5), (8), and 
(13).
    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.

[[Page 17658]]

    10. Retco informed the Commission that there had been no incidents 
or injuries from the Garments.
    11. Retco's distribution in commerce of the Garments 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 August 28, 2008, the Commission, in cooperation with the 
importer of the Garments, announced a recall of the Garments.
    13. Retco had presumed an actual knowledge that the Garments 
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). Retco had obtained information that reasonably 
supported the conclusion that the Garments 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)(3) 
and (4), 15 U.S.C. 2064(b)(3) and (4), required Retco to immediately 
inform the Commission of the defect and risk.
    14. Retco knowingly failed to immediately inform the Commission 
about the Garments as required by CPSA sections 15(b)(3) and (4), 15 
U.S.C. 2064(b)(3) and (4), 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 Retco to civil penalties.

Retco's Responsive Allegation

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

Agreement of the Parties

    16. Under the CPSA, the Commission has jurisdiction over this 
matter and over Retco.
    17. The parties enter into the Agreement for settlement purposes 
only. The Agreement does not constitute an admission by Retco, or a 
determination by the Commission, that Retco knowingly violated the 
CPSA.
    18. In settlement of the Staff's allegations, Retco shall pay a 
civil penalty in the amount of forty-five thousand dollars ($45,000.00) 
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(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.
    20. Upon the Commission's final acceptance of the Agreement and 
issuance of the final Order, Retco 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 Retco 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. The Commission may publicize the terms of the Agreement and the 
Order.
    22. The Agreement and the Order shall apply to, and be binding 
upon, Retco and each of its successors and assigns.
    23. The Commission issues the Order under the provisions of the 
CPSA, and violation of the Order may subject Retco and each of its 
successors and assigns to appropriate legal action.
    24. 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.
    25. 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 Retco agree that severing the provision materially affects the 
purpose of the Agreement and the Order.

Retco, Inc.

    Dated: March 11, 2009.
    By:

Patrick Somers,
President, Retco, Inc., 7540 S. Grant Street, Littleton, CO 80122.

U.S. Consumer Product Safety Commission Staff.

Cheryl A. Falvey,
General Counsel.

Ronald G. Yelenik,
Assistant General Counsel, Office of the General Counsel.

    Dated: March 18, 2009.
    By:

Renee K. Haslett,
Trial Attorney, Division of Compliance Office of the General 
Counsel.

Order

    Upon consideration of the Settlement Agreement entered into between 
Retco, Inc. (``Retco'') and the U.S. Consumer Product Safety Commission 
(``Commission'') staff, and the Commission having jurisdiction over the 
subject matter and over Retco, 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 Retco shall pay a civil penalty in the 
amount of forty-five thousand dollars ($45,000.00) 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 Retco to make the 
foregoing payment when due, interest on the unpaid amount shall accrue 
and be paid by Retco 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 8th 
day of April, 2009.

    By Order of the Commission.

Todd A. Stevenson,
Secretary, U.S. Consumer Product Safety Commission.

[FR Doc. E9-8729 Filed 4-15-09; 8:45 am]
BILLING CODE 6355-01-P