The Consumer Product Safety Improvement Act, its implementation and its liability implications.

• Author: Leone, Frank

ALTHOUGH ENACTED before Election Day, the Consumer Product Safety Improvement Act of 2008 (CPSIA or the Act), (1) may be the first of a series of new legislative initiatives that will strengthen federal regulatory power, increase funding for federal agencies, impose new requirements on businesses, and assist plaintiffs in pursuit of product and toxics liability lawsuits. Because the scope of the CPSIA may be interpreted more broadly than was initially anticipated, defense lawyers should be aware of the many requirements of the Act. This article (1) provides a brief overview of the CPSIA and reviews some of the steps that the Consumer Product Safety Commission (CPSC) has taken already to implement the Act; (2) discusses the potentially broader impacts of provisions which were designed to address children's products; and (3) discusses provisions which affect all consumer products.

1. CPSIA Overview

   The CPSIA implements the most sweeping revision of United States consumer product safety laws since 1972, when Congress enacted the original Consumer Product Safety Act (CPSA). (2) The Act expands the regulatory and enforcement powers of the Consumer Product Safety Commission (CPSC or Commission) and imposes new obligations on manufacturers, importers, and retailers of consumer products. Moreover, Congress has curbed CPSC's discretion by enacting specific product standards and setting 42 deadlines for agency action over the next five years.

   Congress drafted the CPSIA as a reaction to a number of high-profile product safety recalls, most notably recalls of Chinese-manufactured jewelry and painted toys that contained excessive, and in some cases dangerous, amounts of lead. (3) The Act addresses toys and children's products, and, over a short time period, (1) lowers permissible lead levels in paint; (2) imposes maximum permissible limits for lead in product substrates and components; (3) bans certain uses of six phthalates (plasticizers); and (4) incorporates an ASTM (American Society for Testing and Materials) toy standard as a CPSC rule. Furthermore, the CPSIA adds new requirements governing children's products, including for testing and certification of compliance with regulations, use of tracking labels, and warnings in connection with advertisements.

   The CPSIA also imposes additional new requirements affecting all consumer products (not just children's products), including:

   * greater CPSC recall authority,

   * mandatory recall notice standards,

   * broadened reporting requirements,

   * adoption of a class-wide product hazard list, and

   * creation of a publicly accessible Consumer Product Safety Database identifying harmful products.

   The Act also weakens protections designed to prevent public disclosure of confidential business information, allows enhanced State Attorney General enforcement of standards through injunctive relief, increased civil and criminal penalties for violations, requires a GAO (Government Accountability Office) study of formaldehyde, and limits the preemptive effects of consumer protection statutes.

   The numerous specific requirements and short deadlines the CPSIA imposed have placed a great burden on the CPSC staff, as well as on the regulated community. Although the CPSIA anticipates increased funding and staffing for the CPSC, Congress has been slow in adopting specific appropriations. (4) In response to the CPSIA mandates, CPSC has engaged in a flurry of activity, including issuance of Office of General Counsel opinions, publication of guidance, accelerated rulemaking, and adoption of interim final rules. (5) CPSC established a new CPSIA website, (6) and provides almost daily e-mail notices of updates. (7)

   In recent days, many members of Congress, unhappy with the public reaction to legislation that most of them supported, have introduced a variety of bills to amend the Act, primarily by postponing compliance dates or excepting specific products, such as ATVs, or specific industries, such as thrift stores, from lead limits. (8) CPSC, in fact, has taken the fairly extraordinary step of proposing changes to the Act, primarily to limit retroactive application to products where exposure poses a health and safety risk to children, lower the age limit of certain products, and allow CPSC to address certain requirements on a logical basis, using risk assessment to establish need and priorities. (9) President Obama has recently nominated, and the Senate has recently confirmed, Inez Tenenbaum as the new Chair of the Commission* Congress may consider statutory amendments this session.

   From a product liability and toxic tort defense perspective, the general argument can be made that much of this legislative and regulatory action is not scientifically based (and therefore not admissible under Daubert v. Merrell Dow Pharms.), (10) is not determinative of chemical hazard or product defect, and may not even be relevant to products liability or toxics litigation. (11) For example, although lead exposure can be harmful, setting strict limits on lead content of components that do not actually release any lead is not scientifically sound. Likewise, debate continues about the potential health hazards of phthalates. Nevertheless, many of the provisions discussed below will be encountered in litigation, and defense lawyers should be aware of them.

2. CPSIA Provisions Relating to Children's Products and Their Potential Broader Impact

   The CPSIA requirements for children's products are of great interest to the manufacturers, importers, retailers, and distributors of such products. (12) The provisions also are of more general interest because plaintiffs in civil litigation may contend that agency findings regarding chemicals and standards of care in the context of children's products may be relevant to other products. Moreover, Congress may elect to extend legislative actions that begin with children's products to other areas of chemical manufacture, use, and disposal.

   1. Lead Ban, CPSIA Sec. 101 (13)

      The CPSIA greatly expands the universe of products subject to lead limitations and reduces acceptable levels of lead. (14) Specifically, the Act applies the current lead paint standard of 600 parts-per-million (ppm) to children's products for sale as of February 10, 2009. (15) This standard will be lowered to 300 ppm by August 14, 2009, and to as low as 100 ppm (if technologically feasible) by August 14, 2011. (16) The lead content limit applies to any component of a product, e.g., a metal button would be evaluated separately from a jacket. (17) The Act does not apply risk assessment methodology that the agency would typically apply in determining the appropriate standards for protection of public health. (18) Congress circumvented this risk assessment process and determined on its own that any product that contains over 600 ppm lead is banned (with a few exceptions)--regardless of the potential for exposure or ingestion or consideration of dose or risk. The Act imposes this ban despite the absence of scientific evidence that correlates lead content of product substrates with actual lead exposure, ingestion, and risk.

      The Act provides for exceptions for component parts that are not accessible and for electronic products (e.g., those containing batteries) where elimination of lead is not technically feasible. (19) CPSC is currently evaluating the use of an "accessibility probe," which is normally used to test products to see if children's fingers will be exposed to sharp parts, to determine lead accessibility. (20) Thus, consistent with the Act, the agency seeks to ensure that children cannot even touch components containing over 600 ppm of lead, even if there is no actual lead exposure from such touching and even though there are disputes as to whether lead is likely to be absorbed by the skin even if there were some contact.

      CPSC also may, by regulation, exclude a specific product or material from the lead ban if, after notice and a hearing, it "determines on the basis of the best-available, objective, peer-reviewed, scientific evidence that lead in such product or material will neither (A) result in the absorption of any lead into the human body, taking into account normal and reasonably foreseeable use and abuse of such product by a child ...; nor (B) have any other adverse impact on public health or safety." (21) CPSC, again restricted by the legislative language, stated that "any lead" means "any lead" no matter how little. (22) It will be challenging for a manufacturer to prove that an accessible lead component, not otherwise excluded, would not result in the absorption of "any lead." In fact, manufacturers of youth ATVs recently submitted a scientific analysis, which, using conservative assumptions, concluded that lead ingested from exposure, e.g., to brass (lead-containing) tire valves, was far less than acceptable lead levels in food and water. (23) CPSC, however, concluded that the study failed to show no absorption of "any lead" and denied the exception request. (24) CPSC, however, granted an enforcement stay until August 2011. (25)

      On February 6, 2009, CPSC issued an enforcement policy which stated that certain products were not likely to contain lead levels exceeding regulatory standards, including products made of all natural materials, such as wood and cotton, children's books printed after 1985 and (3) most dyed or undyed textiles (without plastic or metal fasteners). CPSC stated that it would not bring enforcement actions regarding these products, even if they exceed lead limits, unless the seller had knowledge that the products did not comply with the ban. (26)

      Although the CPSIA lead limits are based on legislative fiat, not scientific analysis, plaintiffs in civil litigation can be expected to invoke them in litigation as to classes of products primarily used by children. Moreover, Congress' aggressive regulation of lead content, without regard to risk, may presage new chemical-specific...