Hewlett-Packard Company, Provisional Acceptance of a Settlement Agreement and Order, 4023-4025 [2012-1644]

Agencies

• Consumer Product Safety Commission

[Federal Register Volume 77, Number 17 (Thursday, January 26, 2012)]
[Notices]
[Pages 4023-4025]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2012-1644]


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CONSUMER PRODUCT SAFETY COMMISSION

[CPSC Docket No. 12-C0006]


Hewlett-Packard Company, 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 
Hewlett-Packard Company, containing a civil penalty of $425,000.00, 
within twenty (20) days of service of the Commission's final Order 
accepting the Settlement Agreement.\1\
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    \1\ The Commission voted 3-1 to provisionally accept this 
Settlement Agreement and Order. Chairman Inez M. Tenenbaum and 
Commissioners Nancy A. Nord and Anne M. Northup voted to 
provisionally accept the Settlement Agreement and Order. 
Commissioner Robert S. Adler voted to reject the Settlement 
Agreement and Order. Chairman Tenenbaum and Commissioner Adler filed 
statements concerning this action which may be viewed on the 
Commission's Web site at https://www.cpsc.gov/pr/tenenbaum01192012.pdf and https://www.cpsc.gov/pr/adler01192012.pdf, 
respectively, or obtained from the Commission's Secretariat.

DATES: Any interested person may ask the Commission not to accept this 
agreement or otherwise comment on its contents by filing a written 
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request with the Office of the Secretary by February 10, 2012.

ADDRESSES: Persons wishing to comment on this Settlement Agreement 
should send written comments to the Comment 12-C0006, Office of the 
Secretary, Consumer Product Safety Commission, 4330 East West Highway, 
Room 820, Bethesda, Maryland 20814-4408.

FOR FURTHER INFORMATION CONTACT: Amy S. Colvin, General Attorney, 
Division of Enforcement and Information, Office of the General Counsel, 
Consumer Product Safety Commission, 4330 East West Highway, Bethesda, 
Maryland 20814-4408; telephone (301) 504-7639.

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

    Dated: January 20, 2012.
Todd A. Stevenson,
Secretary.

Settlement Agreement

    1. In accordance with 16 CFR 1118.20, Hewlett-Packard Company 
(``HP'') and the staff (``Staff'') of the United States Consumer 
Product Safety Commission (``Commission'') hereby enter into this 
Settlement Agreement (``Agreement'') under the Consumer Product Safety 
Act (``CPSA''). The Agreement and the incorporated attached Order 
(``Order'') resolve the Staff's allegations set forth below.

Parties

    2. The Staff is the staff of the U.S. Consumer Product Safety 
Commission, an independent federal regulatory agency established 
pursuant to, and responsible for, the enforcement of the CPSA, 15 
U.S.C. 2051-2089.
    3. HP is a corporation, organized and existing under the laws of 
Delaware, with its principal executive office located in Palo Alto, 
California.

Staff Allegations

    4. Between December 2004 and July 2006, HP imported approximately 
32,000 lithium-ion battery packs (the ``Products'') that were shipped 
with, sold as accessories for use with, or provided as spare parts for 
the following HP notebook computers: the HP Pavilion dv1000, dv8000, 
and zd8000 series; the Compaq Presario v2000 and v2400 series; and the 
HP Compaq nc6110, nc6120, nc6140, nc6220, nc6230, nx4800, nx4820, 
nx6110, nx6120, and nx9600 models. HP, in addition to computer and 
electronics stores nationwide, as well as various Web retailers, sold 
notebook computers that contained the Products for between $700 and 
$3,000. The Products that were sold separately for use with the

[[Page 4024]]

notebook computers retailed for between $100 and $160.
    5. The Products are ``consumer products'' and, at all relevant 
times, HP was a ``manufacturer'' of these consumer products, which were 
``distributed in commerce,'' as those terms are defined or used in 
sections 3(a)(5), (8), and (11) of the CPSA, 15 U.S.C. 2052(a)(5), (8), 
and (11).
    6. The Products can overheat, posing a fire and burn hazard to 
consumers.
    7. Between June 2005 and March 2007, HP received 17 reports of 
Product incidents, some of which involved flames or fires.
    8. Between March 2007 and April 2007, HP conducted a study, from 
which it obtained additional information about the Products.
    9. By September 2007, HP knew of approximately 22 reports of 
incidents involving the Products. In at least two of those incidents, 
the Products caused injury to consumers. In at least one of those 
incidents, the consumer apparently went to the hospital. HP did not 
receive any information on the consumer's injuries or treatment, if 
any.
    10. Despite being aware of the information set forth in Paragraphs 
6 through 9, HP did not report to the Commission until July 25, 2008. 
By that time, HP was aware of at least 31 reports of incidents 
involving the Products, which had caused injuries to at least two 
consumers. HP also was aware that at least one consumer apparently went 
to the hospital because of an incident involving the Product. Following 
consultation with the Commission from July to October 2008, the 
Products were recalled in October 2008.
    11. Although HP had obtained sufficient information to reasonably 
support the conclusion that the Products contained a defect which could 
create a substantial product hazard, or created an unreasonable risk of 
serious injury or death, HP failed to immediately inform the Commission 
of such defect or risk, as required by sections 15(b)(3) and (4) of the 
CPSA, 15 U.S.C. 2064(b)(3) and (4). In failing to immediately inform 
the Commission, HP knowingly violated section 19(a)(4) of the CPSA, 15 
U.S.C. 2068(a)(4), as the term ``knowingly'' is defined in section 
20(d) of the CPSA, 15 U.S.C. 2069(d).
    12. Pursuant to section 20 of the CPSA, 15 U.S.C. 2069, HP is 
subject to civil penalties for its knowing failure to report, as 
required under section 15(b) of the CPSA, 15 U.S.C. 2064(b).

Response Of Hewlett-Packard Company

    13. On or about October 30, 2008, the Commission, in cooperation 
with HP and other companies, announced a voluntary recall of the 
Products. The recall announcement can be accessed at: https://www.cpsc.gov/cpscpub/prerel/prhtml09/09035.html.
    14. HP denies all of the Staff's allegations, including, but not 
limited to, the allegations that the Products (or the notebooks with 
which the Products were used) could create an unreasonable risk of 
serious injury or death, or that HP violated the reporting requirements 
of the CPSA. HP further denies that it committed any violation of the 
CPSA ``knowingly,'' as that term is defined in Section 20(d) of the 
CPSA, 15 U.S.C. 2069(d). With respect to the voluntary recall of the 
Products and the communications/reports leading up to that recall, HP 
acted in accordance with the CPSA and in its customers' best interests.

Agreement of the Parties

    15. Under the CPSA, the Commission has jurisdiction over this 
matter and over HP.
    16. In settlement of the Staff's allegations, HP shall pay a civil 
penalty in the amount of four hundred twenty-five thousand dollars 
($425,000.00) within 20 calendar days of receiving 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.
    17. In consideration of HP's payment, the Commission agrees to 
release HP, as well as its current and former directors, officers, 
trustees, employees, agents, and representatives from any civil claim 
that the Commission has or may have against those parties arising out 
of or relating to the recall of October 30, 2008, or the Staff's 
allegations that HP failed to report in a timely manner a potential 
hazard involving the Products.
    18. The parties enter into this Agreement for settlement purposes 
only. The Agreement does not constitute an admission by HP or a 
determination by the Commission that HP knowingly violated the CPSA's 
reporting requirements. The Agreement by the parties of the terms and 
conditions set forth herein is without any adjudication of any issue of 
fact or law.
    19. Upon 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 it is published in the Federal Register, in accordance 
with 16 CFR 1118.20(f).
    20. Upon the Commission's final acceptance of the Agreement and 
issuance of the final Order, HP knowingly, voluntarily, and completely 
waives any rights it may have in this matter to the following: (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 HP 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.
    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, HP and each of its successors and/or assigns.
    23. The Commission issues the Order under the provisions of the 
CPSA, and a violation of the Order may subject HP and each of its 
successors and/or 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 
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 HP agree that severing the provision materially affects the purpose 
of the Agreement and Order.
    26. This Agreement may be signed in counterparts.

    Hewlett-Packard Company
    Dated: December 15, 2011.

By:--------------------------------------------------------------------

James Mouton,
Hewlett-Packard Company,
Senior Vice President & General Manager,
Personal Systems Group,
PC Global Business Unit,
11445 Compaq Center Dr W,
Houston, TX 77070.

    Dated: December 20, 2011.

Sarah L. Wilson, Esquire,
Covington & Burling LLP,

[[Page 4025]]

1201 Pennsylvania Ave. NW.,
Washington, DC 20004,
Counsel for Hewlett-Packard Company.
U.S. Consumer Product Safety Commission Staff.
Cheryl A. Falvey,
General Counsel.
Melissa V. Hampshire,
Assistant General Counsel.

    Dated: January 9, 2012.
By:--------------------------------------------------------------------

Amy S. Colvin,
General Attorney, Division of Enforcement and Information, Office of 
the General Counsel.

Order

    Upon consideration of the Settlement Agreement entered into between 
Hewlett-Packard Company (``HP''), and the U.S. Consumer Product Safety 
Commission (``Commission'') staff, and the Commission having 
jurisdiction over the subject matter and over HP, 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 HP shall pay a civil penalty in the amount of 
four hundred twenty-five thousand dollars ($425,000.00) within twenty 
(20) calendar days of service of the Commission's final Order accepting 
the Settlement Agreement. The payment shall be made by check payable to 
the order of the United States Treasury. Upon the failure of HP to make 
the foregoing payment when due, interest on the unpaid amount shall 
accrue and be paid by HP 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 20th 
day of January, 2012.
    By Order of the Commission:

Todd A. Stevenson,
Secretary, U.S. Consumer Product Safety Commission.
[FR Doc. 2012-1644 Filed 1-25-12; 8:45 am]
BILLING CODE 6355-01-P