CPSC Chairman Elliot Kaye and Commissioner Robert Adler July 20 jointly addressed six issues related to concerns with the agency's civil penalty activities. Their remarks follow ongoing discussion among commissioners and others on whether CPSC is being too aggressive and too opaque, most recently at the priorities hearing in June (PSL, 6/20/16). The commissioners' points included:
- Quantity: Noting that penalties almost always involve late reporting, they pointed out that civil penalties account for about 2% of the 500-600 Section 15(b) reports annually. That is "hardly the measure of an agency run amok," they wrote.
- Purpose: They cited legislative record to support the assertion that congressional intent in raising the penalty cap was to increase amounts assessed. Acknowledging that it is not necessarily unethical for firms to consider the costs of potential fines in pricing decisions, they said CPSC's job is to provide a disincentive to failing to give enough attention to the "moral component."
- Transparency: They echoed previous criticism of complaints, writing, "The most polite response we can offer is that our critics want it both ways" – firms block information release via 6(b) but want more information about what happened to others. They did express openness to looking at Commissioner Mohorovic's call to "anonymize" past cases to outline common "salient facts."
- Clarity: They defended CPSC's guidelines as sufficient, repeating the frequent observations that no guide can "address every nuance" and that the link between fines and late reporting is well established. They rejected complaints that similar cases led to significantly disparate fines or that "different injury patterns automatically deserve different civil penalties" (their emphasis).
- Due Process: They listed the steps CPSC takes when it handles cases and also pointed to the protections firm have in the subset of cases in which impasses lead to suits being handled by DOJ. They wrote, "We find it difficult to see how anyone could seriously argue that the agency has denied them due process."
- Hindsight: They separated the concepts of hazard and incident, rejecting the defense that lack of injuries means there were no reportable problems. The "good fortune" that no one was hurt should not mean firms get a pass on paying, they wrote.
Their statement is at bit.ly/29TUgmD.
