Family Dollar Stores, Inc., Provisional Acceptance of a Settlement Agreement and Order, 38411-38412 [E9-18519]

Agencies

• Consumer Product Safety Commission

[Federal Register Volume 74, Number 147 (Monday, August 3, 2009)]
[Notices]
[Pages 38411-38412]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E9-18519]


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CONSUMER PRODUCT SAFETY COMMISSION

[CPSC Docket No. 09-C0023]


Family Dollar Stores, 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 
Family Dollar Stores, Inc., containing a civil penalty of $75,000.00.

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 18, 2009.

ADDRESSES: Persons wishing to comment on this Settlement Agreement 
should send written comments to the Comment 09-C0023, Office of the 
Secretary, Consumer Product Safety Commission, 4330 East West Highway, 
Room 502, Bethesda, Maryland 20814-4408.

FOR FURTHER INFORMATION CONTACT: Belinda V. Bell, Trial Attorney, 
Division of Compliance, Office of the General Counsel, Consumer Product 
Safety Commission, 4330 East West Highway, Bethesda, Maryland 20814-
4408; telephone (301) 504-7592 or M. Reza Malihi, Trial Attorney, (same 
address); telephone (301) 504-7733.

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

    Dated: July 28, 2009.
Todd A. Stevenson,
Secretary.

United States of America--Consumer Product Safety Commission

    In the Matter of Family Dollar Stores, Inc., CPSC Docket No. 09-
C0023.

Settlement Agreement

    1. In accordance with 16 CFR 1118.20, Family Dollar Stores, Inc. 
(``Family Dollar'') and the staff (``Staff'') of the United States 
Consumer Product Safety Commission (``CPSC'' or the ``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. Family Dollar is a corporation organized and existing under 
the laws of Delaware, with its principal offices located in 
Matthews, North Carolina. At all times relevant hereto, Family 
Dollar imported and/or sold toys and children's products, among 
other merchandise.

Staff Allegations

    4. During 2006 and 2007, Family Dollar, through its subsidiary 
Family Dollar Services, Inc., imported into the United States a 
total of about 142,000 units of certain Halloween-themed plastic 
pails (SKU number 1033953, and UPC number 017845000591) 
(``Pail(s)''). Specifically, Family Dollar imported 28,725 of the 
Pails during 2006, and an additional 112,560 in July 2007. From 
August 2007 through October 2007, Family Dollar stores nationwide 
offered the Pails for sale or sold them to consumers.
    5. The Pails are ``consumer product(s),'' and, at all times 
relevant hereto, Family Dollar was a ``manufacturer'' and/or a 
``retailer'' of those consumer product(s), which were ``distributed 
in commerce,'' as those terms are defined in CPSA sections 3(a)(3), 
(5), (8), (11), and (13), 15 U.S.C. 2052(a)(3), (5), (8), (11), and 
(13).
    6. The Pails are articles intended to be entrusted to or for use 
by children, and, therefore, are subject to the requirements of the 
Commission's Ban of Lead-Containing Paint and Certain Consumer 
Products Bearing Lead-Containing Paint, 16 CFR part 1303 (the 
``Ban''). Under the Ban, toys and other children's articles must not 
bear ``lead-containing paint,'' defined as paint or other surface 
coating materials whose lead content is more than 0.06 percent of 
the weight of the total nonvolatile content of the paint or the 
weight of the dried paint film. 16 CFR 1303.2(b)(1)
    7. On September 28, 2007, the Staff obtained third-party 
laboratory results relating to, in pertinent part, testing for the 
presence of lead in the surface coating of a sample of the Pails 
purchased from a Family Dollar retail store in Ashland, Ohio. The 
test results demonstrated that a green coating on the outside 
surface of the Pail contained a total lead content of 2.1% by 
weight. This level of lead is in excess of the permissible 0.06 
percent limit set forth in the Ban.
    8. In October 2007, Family Dollar reported to CPSC that it had 
commissioned an independent laboratory to conduct further testing 
for the presence of lead in surface coatings of another twelve (12) 
Pail samples. As expressed in a test report issued October 5, 2007, 
the test results demonstrated that the Pails' green surface coating 
contained a total lead content of 1200 mg/kg. These levels of lead 
are in excess of the permissible 0.06 percent limit set forth in the 
Ban.
    9. On October 25, 2007, the Commission and Family Dollar 
announced a consumer-level recall of about 142,000 units of the 
Pails because ``[t]he green paint on the pails contains excessive 
levels of lead, violating the Federal lead paint standard.''
    10. Although Family Dollar reported no incidents or injuries 
associated with the Pails, it failed to take adequate action to 
ensure that none would bear or contain lead-containing paint, 
thereby creating a risk of lead poisoning and adverse health effects 
to children.
    11. The Pails constitute ``banned hazardous products'' under 
CPSA section 8 and the Ban, 15 U.S.C. 2057 and 16 CFR 1303.1(a)(1), 
1303.4(b), in that they bear or contain paint or other surface 
coating materials whose lead

[[Page 38412]]

content exceeds the permissible limit of 0.06 percent of the weight 
of the total nonvolatile content of the paint or the weight of the 
dried paint film.
    12. Beginning in 2006 and ending in October 2007, Family Dollar 
sold, manufactured for sale, offered for sale, distributed in 
commerce, or imported into the United States, or caused one or more 
of such acts, with respect to the Pails, in violation of section 
19(a)(1) of the CPSA, 15 U.S.C. 2068(a)(1). Family Dollar committed 
these prohibited acts ``knowingly,'' as that term is defined in 
section 20(d) of the CPSA, 15 U.S.C. 2069(d).
    13. Pursuant to section 20 of the CPSA, 15 U.S.C. 2069, Family 
Dollar is subject to civil penalties for the aforementioned 
violations.

Family Dollar Response

    14. Family Dollar denies the Staff's allegations set forth above 
that Family Dollar knowingly violated the CPSA.

Agreement of the Parties

    15. Under the CPSA, the Commission has jurisdiction over this 
matter and over Family Dollar.
    16. The parties enter into the Agreement for settlement purposes 
only. The Agreement does not constitute an admission by Family 
Dollar, or a determination by the Commission, that Family Dollar has 
knowingly violated the CPSA.
    17. In settlement of the Staff's allegations, Family Dollar 
shall pay a civil penalty in the amount of seventy five thousand 
dollars ($75,000.00) within twenty (20) calendar days of service of 
the Commission's final Order accepting the Agreement. This payment 
shall be made by check payable to the order of the United States 
Treasury.
    18. Upon the Commission's 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) days, the Agreement 
shall be deemed finally accepted on the sixteenth (16th) day after 
the date it is published in the Federal Register.
    19. Upon the Commission's final acceptance of the Agreement and 
issuance of the final Order, Family Dollar 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 
Commission's Order or actions; (3) a determination by the Commission 
of whether Family Dollar 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.
    20. The Commission may publicize the terms of the Agreement and 
Order.
    21. The Agreement and Order shall apply to, and be binding upon, 
Family Dollar and each of its successors and assigns.
    22. The Commission issues the Order under the provisions of the 
CPSA, and violation of the Order may subject Family Dollar to 
appropriate legal action.
    23. The Agreement may be used in interpreting the Order. 
Understandings, agreements, representations, or interpretations 
apart from those contained in the Agreement and Order may not be 
used to vary or contradict its terms. The Agreement shall not be 
waived, amended, modified, or otherwise altered, except in a writing 
that is executed by the party against whom such waiver, amendment, 
modification, or alteration is sought to be enforced.
    24. If any provision of the Agreement and Order is held to be 
illegal, invalid, or unenforceable under present or future laws 
effective during the terms of the Agreement and Order, such 
provision shall be fully severable. The balance of the Agreement and 
Order shall remain in full force and effect, unless the Commission 
and Family Dollar agree that severing the provision materially 
affects the purpose of the Agreement and Order.

Family Dollar Stores, Inc.

    Dated: 3/19/09.

By:--------------------------------------------------------------------
Jacob Modla, Esq.,
Assistant Secretary and Interim General Counsel, Family Dollar 
Stores, Inc., 10401 Monroe Road, Matthews, NC 28105-5349.

    Dated: 3/23/09.

By:--------------------------------------------------------------------
Michael J. Gidding, Esq.
Brown & Gidding, P.C., 3201 N. Mexico Ave, NW., Washington, DC 
20016, Counsel for Family Dollar Stores, Inc.

U.S. Consumer Product Safety Commission Staff.

Cheryl A. Falvey,
General Counsel, Office of the General Counsel, Ronald G. Yelenik, 
Assistant General Counsel, Division of Compliance, Office of the 
General Counsel.

    Dated: 3/31/09.
By:--------------------------------------------------------------------
Belinda V. Bell,
Trial Attorney, M. Reza Malihi, Trial Attorney, Division of 
Compliance, Office of the General Counsel.

United States of America--Consumer Product Safety Commission

    In the Matter of Family Dollar Stores, Inc., CPSC Docket No. 09-
C0023.

Order

    Upon consideration of the Settlement Agreement entered into 
between Family Dollar Stores, Inc. (``Family Dollar'') and the U.S. 
Consumer Product Safety Commission (``Commission'') staff, and the 
Commission having jurisdiction over the subject matter and over 
Family Dollar, and it appearing that the Settlement Agreement and 
Order are in the public interest, it is
    Ordered, that the Settlement Agreement be, and hereby is, 
accepted; and it is
    Further ordered, that Family Dollar shall pay a civil penalty in 
the amount of seventy five thousand dollars ($75,000.00) 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 
Family Dollar to make any of the foregoing payments when due, 
interest on the unpaid amount shall accrue and be paid by Family 
Dollar 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 July, 2009.

    By Order of the Commission.
Todd A. Stevenson,
Secretary, U.S. Consumer Product Safety Commission.

[FR Doc. E9-18519 Filed 7-31-09; 8:45 am]
BILLING CODE 6355-01-P