In enacting the various statutes administered by CPSC, Congress provided specific sanctions which may be imposed against firms that violate any provision of the statutes. These sanctions include both civil and criminal fines against the responsible firm and individual, up to a maximum of $1.25 million and imprisonment of the responsible individual(s) for not more than one year. In addition, firms and individuals may be enjoined from continuing to violate CPSC statutes and regulations, and violative products may be seized to prevent distribution to consumers


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In enacting the various statutes administered by CPSC, Congress provided specific sanctions which may be imposed against firms that violate any provision of the statutes. These sanctions include both civil and criminal fines against the responsible firm and individual, up to a maximum of $1.25 million and imprisonment of the responsible individual(s) for not more than one year. In addition, firms and individuals may be enjoined from continuing to violate CPSC statutes and regulations, and violative products may be seized to prevent distribution to consumers. Following is a discussion of the penalties and other sanctions that may be imposed by CPSC for violations of its statutes.

PENALTIES APPLICABLE TO FIRMS AND INDIVIDUALS

When CPSC determines that a violation of its statutes has occurred, a Letter of Advice (LOA) is issued to the responsible firm and individuals. The LOA will state that a prohibited act has occurred and cite the specific statute which has been violated. The prohibited acts are contained in section 19 of the Consumer Product Safety Act (CPSA), section 4 of the Federal Hazardous Substances Act (FHSA), section 3 of the Flammable Fabrics Act (FFA), and section 403 of the Federal Food, Drug, and Cosmetics Act (FD&CA).

Once you have determined which prohibited act you are being charged with, you will want to determine the maximum sanctions you and your firm may be subject to. Generally, the LOA will not contain specific details regarding penalties but will refer you to this Handbook for assistance in determining the applicable penalties. Following is a summary of the penalties available under the CPSA, FHSA, FFA, and PPPA enforced through the FHSA and FD&CA.

Penalties Available Under The CPSA

Civil Penalties under CPSA - Under section 20 of the CPSA, any person who knowingly violates section 19 of the CPSA shall be subject to a civil penalty not to exceed $5,000 for each such violation. With some exceptions, a violation of 19(a)(1), (2), (4), (5), (6), (7), (8), (9), (10), or (11) shall constitute a separate offense with respect to each consumer product involved, except that the maximum civil penalty shall not exceed $1.25 million for any related series of violations.

Criminal Penalties under CPSA - Under section 21 of the CPSA, any person who knowingly and willfully violates section 19 of the CPSA after having received notice of noncompliance from the Commission shall be fined (as described below) or imprisoned for not more than one year, or both. The Criminal Fine Improvements Act of 1987 increased maximum criminal penalties under the CPSA to $100,000 for individuals and $200,000 for organizations unless a death occurred, in which case the maximum fine is $250,000 for individuals and $500,000 for organizations.

PENALTIES AVAILABLE UNDER THE FHSA

Civil Penalties under FHSA - The Consumer Product Safety Improvement Act of 1990, Public Law 101-608, amended section 5 of the FHSA, by adding a new section 5(c)(1) which gives the Commission the authority to seek civil penalties against any person who knowingly violates section 4 of the FHSA. The term knowingly is defined in section 5(c)(5) of the FHSA. The Commis- sion may seek a civil penalty of up to $5,000 per violative product, up to a maximum of $1.25 million for any related series of violations.

Criminal Penalties under FHSA - Under section 5(a) of the FHSA, any person who violates section 4 of the FHSA shall be guilty of a misdemeanor and shall upon conviction thereof be subject to a fine (described below) or to imprisonment for not more than 90 days (one year for violations committed with intent to defraud or mislead or for second and subsequent offenses), or both. The Criminal Fine Improvements Act of 1987 increased the maximum criminal penalties provided for in section 5(a) of the FHSA to $5,000 for individuals and $10,000 for organizations for first violations; $100,000 for individuals and $200,000 for organizations for second and subsequent offenses and for offenses committed with intent to defraud or mislead; and $250,000 for individuals and $500,000 for organizations for violations if a death results.

PENALTIES AVAILABLE UNDER THE FFA

Civil Penalties under FFA - The Consumer Product Safety Improvement Act of 1990, Public Law 101-608, amended section 5 of the FFA, by adding a new section 5(e) which gives the Commission the authority to seek civil penalties against any person who knowingly violates a regulation or standard issued under section 4 of the FFA. The term knowingly is defined in section 5(e)(4) of the FFA. The Commission may seek a civil penalty of up to $5,000 per violative product, up to a maximum penalty of $1.25 million for any related series of violations.

Criminal Penalties under FFA - Under section 7 of the FFA, any person who willfully violates section 3 or 8(b) of the FFA or fails to comply with section 15(c) of the FFA shall be guilty of a misdemeanor, and upon conviction thereof shall be fined as described below or imprisoned not more than one year or both. The Criminal Fine Improvements Act of 1987 increased the maximum criminal penalties provided for in section 7 of the FFA to $5,000 for individuals and $10,000 for organizations for first violations; $100,000 for individuals and $200,000 for organizations for second and subsequent offenses and for offenses committed with intent to defraud or mislead; and $250,000 for individuals and $500,000 for organizations for violations if a death results.

PENALTIES AVAILABLE UNDER THE PPPA

In enacting the PPPA, Congress chose to incorporate the penalties available under two existing statutes rather than provide separate penalties for prohibited acts involving products regulated under the PPPA. Depending on the type of product and the specific prohibited act involved, penalties provided for under the FHSA or the FD&CA may be applicable.

Civil Penalties - The failure to comply with a standard under the PPPA results in the product being classified as either a misbranded hazardous substance under the FHSA or a misbranded food, drug, or cosmetic under the FD&CA, as amended. If the product involved is classified as a misbranded hazardous substance, see Civil Penalties under FHSA, above. If the product involved is a misbranded food, drug, or cosmetic, refer to Criminal Penalties, below since no civil penalties are provided for under the FD&CA.

Criminal Penalties - If the product involved is a misbranded hazardous substance, see Criminal Penalties under FHSA, above. If the product involved is a misbranded food, drug, or cosmetic, criminal penalties for violations of the PPPA are spelled out in section 303(a)(1) of the FD&CA which states "Any person who violates a provision of section 301 shall be imprisoned for not more than one year or fined not more than $1000, or both. Section 303(a)(2) of the FD&CA, states "if any person commits such a violation after a conviction of him under this section has become final, or commits such a violation with the intent to defraud or mislead, such person shall be imprisoned for not more than three years or fined not more than $10,000 or both.

INJUNCTIVE ACTIONS

Following are the applicable provisions which authorize the Commission to seek to enjoin firms from violations of the CPSC statutes and regulations.

Injunctions Under The CPSA

Section 22(a) of the CPSA states: The United States district courts shall have jurisdiction to take the following action:

(1) Restrain any violation of section 19.

(2) Restrain any person from manufacturing for sale, offering for sale, distributing in commerce, or importing into the United States a product in violation of an order in effect under section 15(d).

(3) Restrain any person from distributing in commerce a product which does not comply with a consumer product safety rule.

Injunctions Under The FHSA

Section 8(a) of the FHSA states: "The United States district courts and the United States courts of the territories shall have jurisdiction, for cause shown and subject to the provisions of rule 65 (a) and (b) of the Federal Rules of Civil Procedure, to restrain violations of this Act."

Injunctions Under The FFA

Section 6(a) of the FFA states: "Whenever the Commission has reason to believe that any person is violating or is about to violate section 3, or a rule or regulation prescribed under section 5(c), of this Act, and that it would be in the public interest to enjoin such violation until complaint under the Federal Trade Commission Act is issued and dismissed by the Commission or until an order to cease and desist made thereon by the Commission has become final within the meaning of the Federal Trade Commission Act or is set aside by the court on review, the Commission may bring suit in the district court of the United States, for the district in which such person resides or transacts business ... to enjoin such violation and upon proper showing a temporary injunction or restraining order shall be granted without bond.

Injunctions Under The PPPA

For violations of the PPPA which result in a product being classified a misbranded hazardous substance, see Injunctions Under The FHSA, above. For PPPA violations which result in the product being classified a misbranded food, drug, or cosmetic, the injunctive provisions of the FD&CA apply.

Section 302(a) of the FD&CA states: "The district courts of the United States and the United States courts of the Territories shall have jurisdiction, for cause shown, and subject to the provisions of section 381 (relating to notice to opposite party) of title 28, to restrain violations of section 301 of this title, except paragraphs (h), (i), and (j) of said section."

SEIZURE OF VIOLATIVE PRODUCTS

Products which are in violation of an applicable standard or regulation are subject to seizure and condemnation proceedings under the various statutes.

Seizure Under The CPSA

Section 22(b) of the CPSA states "Any consumer product

(1) which fails to conform with an applicable consumer product safety rule, or

(2) the manufacture for sale, offering for sale, distribution in commerce or the importation into the United States of which has been prohibited by an order in effect under section 15(d), when introduced into or while in commerce or while held for sale after shipment in commerce shall be liable to be proceeded against on libel of information and condemned in any district court of the United States within the jurisdiction of which such consumer product is found."

Seizure Under The FHSA

Section 6(a) of the FHSA states "Any misbranded hazardous substance or banned hazardous substance when introduced into or while in interstate commerce or while held for sale (whether or not the first sale) after shipment in interstate commerce, or which may not, under the provisions of section 4(f), be introduced into interstate commerce, or which has been manufactured in violation of section 4(g), shall be liable to be proceeded against while in interstate commerce or at any time thereafter, on libel of information and condemned in any district court in the United States within the jurisdiction of which the hazardous substance is found: Provided, That this section shall not apply to a hazardous substance intended for export to any foreign country if it (1) is in a package branded in accordance with the specifications of the foreign purchaser, (2) is labeled in accordance with the laws of the foreign country, and (3) is labeled on the outside of the shipping package to show that it is intended for export, and (4) is so exported."

Seizure Under The FFA

Section 6(b) of the FFA states "Whenever the Commission has reason to believe that any product has been manufactured or introduced into commerce or any fabric or related material has been introduced into commerce in violation of section 3 of this Act, it may institute proceedings by process of libel for the seizure and confiscation of such product, fabric, or related material in any district court of the United States within the jurisdiction of which such product, fabric, or related material is found."

Seizure Under The FD&CA (For Products Regulated Under The PPPA)

Section 304(a) of the FD&CA states "Any article of food, drug, or cosmetic that is adulterated or misbranded when introduced into or while in interstate commerce or while held for sale (whether or not the first sale) after shipment in interstate commerce, or which may not, under the provisions of section 404 or 505, be introduced into interstate commerce, shall be liable to be proceeded against while in interstate commerce, or at any time thereafter, on libel of information and condemned in any district court of the United States or United States court of a Territory within the jurisdiction of which the article is found."
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excerpted from the REGULATED PRODUCTS HANDBOOK
U.S. Consumer Product Safety Commission, Office of Compliance
February 1994 - 2nd Edition*

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