Sec. 15 Reporting Requirements, Corrective Action Plans, and Investigations

ICPHSO Midwest Regional
Product Safety Training Workshop
Sec. 15 Reporting Requirements,
Corrective Action Plans, and
Investigations
Blake Rose, Lead Compliance Officer
Views expressed in this presentation are those of the staff and do not necessarily
represent the views of the Commission.

Office of Compliance
• Regulatory Enforcement Division
• Defect Investigations Division
- Fast Track Team
- Children’s Hazards Team
- Electrical, Fire and Mechanical Hazards Team
2

Agenda
• Section 15 Reporting Obligations
• Online Reporting
• Conducting a Recall
• Staff Determinations
• Staff-Initiated Investigations
3

Reporting Requirements
4
 Section 15(b) of the Consumer Product
Safety Act establishes reporting
requirements for manufacturers, importers,
distributors and retailers of consumer
products, over which the Commission has
jurisdiction.
 Each must notify the Commission
immediately if it obtains information which
reasonably supports the conclusion that a
product distributed in commerce:

 (1) fails to comply with an applicable
consumer product safety rule or with a
voluntary consumer product safety standard
upon which the Commission has relied, or
5

 (2) fails to comply with any other rule,
regulation, standard or ban under the CPSA or
any other Act enforced by the Commission,
including the:
Flammable Fabrics Act;
 Federal Hazardous Substances Act;
 Children’s Gasoline Burn Prevention Act;
 Virginia Graeme Baker Pool and Spa Safety Act;
 Poison Prevention Packaging Act;
 Refrigerator Safety Act; or
6

 (3) contains a defect which could create a
substantial product hazard, or
 (4) creates an unreasonable risk of serious
injury or death.
7

How quickly must I report?
* Firm must report “immediately” once
information “reasonably supports the
conclusion” that a safety issue exists.
* “Immediately” means within 24 hours, but
firms may conduct “reasonably expeditious”
investigation.
* Investigations should not usually exceed ten
working days.
8

Reporting Do’s and Don’ts
* Don’t assume that an incident without
injury means there’s no problem.
* Do evaluate product failures to determine
what could have occurred in worst case.
* Don’t wait to finish exhaustive investigation
before telling CPSC .
9

FAQ
What can happen if I don’t report?
10

Civil Penalties !
11
Up to $100,000 per violation, maximum
$15.15 million for related series of
violations.

Agenda
12

Filing an Initial Report Online
Fig. 1
13

FAQ
 Can I send an initial report by email?
Section15@cpsc.gov
 Can I send an initial report by fax or mail?
Yes, but …
18

Decision Point
 Do Fast Track Recall: There’s a problem
with my product, and I want to take
corrective action by doing a full recall with
the CPSC;
OR
 Proceed with Staff Determination: Because
I don’t think this issue requires corrective
action; I’m only willing to take limited
action; or I’m unsure what to do.
19

Agenda
20

Objectives of a Recall
 To locate all defective products as quickly as
possible;
 To remove or correct defective products in the
distribution chain and in the possession of
consumers, and
 To communicate accurate and understandable
information in a timely manner to the public
about the product defect, the hazard, and the
corrective action.
21

What is a Fast Track Recall?
Requirements:
Firm must initiate an acceptable consumer-level
recall within 20 working days of report.
Advantages:
• Avoids written staff preliminary determination
of defect and hazard with your product;
• Reduces technical analysis (focus on notification
and remedy);
• Consumers get notice more quickly.
22

Elements of a Recall
 Stop production, distribution and retail sales;
 Submit a Full Report and product samples;
 Submit a proposed Corrective Action Plan
(CAP) with remedy (refund/repair/replace);
 Public notice (consumer letters, website notice,
retail posters, press release, social media);
 Monitoring of recall results.
23

FAQ
Can I be removed from the
Fast Track Program?
24

What is a Corrective Action Plan (CAP)?
A detailed written proposal that spells out the
steps the recalling firm will take to capture
and correct defective products in the
distribution chain, and in the hands of
consumers.
25

Coordination with Retailers
*Early notificAat Rioenc;all
*Lock out sales at register and
online;
*Isolate stock;
*Post notices on website;
*Display Recall Posters;
*Identify consumer purchasers through
credit card sales, extended warranty sales,
etc.

Choosing a Remedy
Options:
 Refund
 Replace
 Repair
27

Refund
 Fastest and easiest for consumers;
 Should be for full purchase price;
 Recalled product needs to be returned to
retailer or shipped back to recalling firm at
no cost to consumers.
28

Replacement
 Must be a comparable product;
 Staff will need to assess sample of proposed
replacement, review test reports on product,
and check for any incidents involving
replacement product;
 Recalled product needs to be returned to
retailer or shipped back to recalling firm at
no cost to consumers.
29

Repair
 Repair programs always need staff review;
 Can be done by consumer, technician at
home or local service facility, or pre-paid
return to recalling firm;
 If done by consumer, must be easy with
clear instructions;
 If tools are required, should be supplied by
recalling firm.
30

Consumer Notification
Goal: To reach as many of the
owners of the recalled products as
possible, and provide incentive for
them to stop using and correct the
recalled product.
31

Direct Notice is Best!
 Email, letter or phone call to known
purchasers of recalled product.
* Online/phone purchases
* Product/warranty registration
* Replacement part/accessory purchases
* Service requests
* Extended warranty customers
* Loyalty programs
32

Retail Posters
 Should be brief, eye-catching, and describe the
product, the hazard, and what consumers need
to do;
 Include the terms “safety” and “recall” in the
heading;
 Use a color photo of the product;
 Should be posted in several conspicuous
locations in the store for a minimum of 120
days.
33

Toll-Free Recall Number
 Have sufficient incoming lines to handle
call volume;
 Have live customer service representative
access during core business hours;
 Avoid extensive phone menus;
 Staff will want to review script being used
by customer service reps.
35

Website
 Clear, concise recall information easily
located on home page or link from home
page;
 Online registration for recall;
 Sufficient bandwidth to handle traffic.
36

Public Notice
 Press Release: joint notice with wide
distribution using a standard format.
 Recall Alert: similar in wording to a press
release, but with limited distribution. Firm
must be able to contact all consumers
directly, and must submit a list of those
consumers.
 Video News Release: a video version of the
written press release for use by the media.
38

Public Notice
 Social Media: Twitter, Facebook, blogs,
You Tube. CPSC Office of Communication
may use Twitter and blogs in conjunction
with a press release. Firms are expected to
announce recalls on their media platforms.
39

Surviving the Public Notice Process
Know that:
 This is a negotiation between the firm, CPSC
Compliance Officer, and CPSC Office of
Communication;
 Office of Communication strives to issue fair,
accurate and informative communications
which are easy for consumers to understand and
are presented in a consistent manner;
42

 Submit a draft press release in Microsoft
Word format using our standard captions.
Recalls involving deaths will be in a narrative
format. AP Stylebook is used as a guide.
Don’t expect exceptions!
 “Clearance” versions of the press release
from the Office of Communication must still
go through the agency approval process. On
occasion, this may result in last-minute
changes or a delay in the release date.
43

Other Measures
 Paid Advertisements
* Specialty publications
* National publications
 Consumer Incentives
* Gift cards
* Store credit
* Free or reduced-price accessories
44

Reverse Logistics
Reverse distribution or product return:
How you get the product back from the
distribution channel.
The goal is to avoid having recalled
products put back into commerce.
45

 Need to know where your recalled
products are at all times;
 Need to ensure that third-party
contractors and retailers are following the
disposition program;
 It is illegal to sell recalled products!
46

Recall Monitoring
 Recalling firm must submit Monthly
Progress Reports which track:
* Number of products corrected;
* Reports of pre- and post-recall incidents;
* Notification methods used.
47

CPSC Staff Recall Monitoring
 Field staff conducts Recall Verification
Inspections at recalling firm;
 Field staff and/or state investigators conduct
Recall Checks at point of sale;
 Internet Surveillance Unit checks for online
sales of recalled products;
 Compliance staff monitors correction results
and new incidents to assess effectiveness
48

FAQ
What happens if I report but I don’t choose to
do a Fast Track Recall?
49

Agenda
50

Staff Determinations
Staff investigates whether the product
contains a defect, and whether that defect
presents a risk of injury that rises to the level
of a substantial product hazard.
51

What is a defect?
A flaw, fault, or irregularity that causes
weakness, failure, or inadequacy in the form
or function of a product.
52

Defects can stem from:
 Manufacturing
 Production/assembly
 Design
 Materials used
 Construction
 Finish
 Packaging
 Warnings
 Instructions
 Failure to operate as intended
53

Substantial Product Hazard (SPH)
(1) A failure to comply with an applicable
consumer product safety rule which creates a
substantial risk of injury to the public, or
(2) A product defect which creates a substantial
risk of injury to the public.
54

Factors to Consider
 Pattern of defect
 Number of defective products distributed in
commerce
 Severity of risk
 Likelihood of injury
55

Staff Assessment Tools
 Incident analysis;
 Staff technical evaluation of defect and risk by
electrical, mechanical, chemical and fire science
engineers, health scientists, and industrial
psychologists;
 Legal guidance from staff attorneys.
56

Preliminary Determination (PD)
 Staff’s finding on defect and substantial
product hazard;
 Decision reached by panel including the
compliance officer, engineers, compliance
attorney and Compliance management;
 Firm is notified in writing of the decision.
May result in a request for corrective action
(recall).
57

Agenda
58

Staff-Initiated Investigation
An investigation launched by Compliance
staff as a result of information it receives
suggesting a possible product defect that
could lead to a risk of injury.
59

Sources
 Consumer incident reports;
 In-depth investigations by field staff;
 News reports;
 Notice from fire officials;
 Website product reviews and complaints;
 Trade complaints;
 Congressional inquiries;
 Medical examiner reports and death certificates;
 Hospital reports.
60

Process
 As with the staff determination, investigation
includes technical analysis of defect and hazard.
Full Report may or may not be requested from
firm.
 If staff evaluation finds a defect and significant
risk of injury, firm will be requested to take
corrective action (recall).
61

Civil Penalties !
62
Up to $100,000 per violation, maximum
$15.15 million for related series of
violations.

Industry Guidance:
www.cpsc.gov
Business & Manufacturing
Recall
Guidance
63

Topics include: Recall Handbook, Fast Track
Recalls, Recall Planning, How to Conduct a Recall,
Recall Effectiveness.
64

The U.S. Consumer Product Safety Commission
is charged with protecting the public from
unreasonable risks of serious injury and death
from over 15,000 types of products used by
consumers.
65

Contacts
 Tanya Topka, Team Lead, Fast Track Team
(301) 504-7594, ttopka@cpsc.gov
 Blake Rose, Team Lead, Electrical, Fire and Mechanical
Hazard Team
(301) 504-7613, brose@cpsc.gov
 Renae Rauchschwalbe, Team Lead, Children’s Hazards
Team
(301) 504-7664, rrauchschwalbe@cpsc.gov
 Scott Simmons, Director, Defect Investigations Division
(301) 504-7574, ssimmons@cpsc.gov
66

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