In March 2011, the U.S. Consumer Product Safety Commission (CPSC), launched the first-ever public database of consumer product safety complaints: http://www.saferproducts.gov The CPSC has been around for more than 30 years and works to ensure the safety of such products as toys, cribs, power tools, cigarette lighters, and household chemicals. Reports of harm or risks of harm to the database will be restricted to the types of goods under the jurisdiction of the CPSC, and excludes food, drugs, medical devices, cosmetics, tobacco, automobiles, or tires. The database accepts reports about product defects that may cause injury or death, but not complaints regarding reliability or quality.
Complaints can be made by virtually anyone, and that is at the heart of the debate about the reliability of the database. Those who file a complaint must identify themselves, but the complainant’s identity will not be disclosed on the database, or to the manufacturer without the complainant’s consent.
Manufacturers have expressed concerns about the ease with which inaccurate or fictitious complaints could be submitted by competitors, disgruntled employees, or others with less-than-honorable motives. In late 2010, one of five Commissioners of the CPSC, Nancy Nord, expressed concern that, “the database will not differentiate between complaints entered by lawyers, competitors, labor unions and advocacy groups who may have their own reasons to ‘salt’ the database, from those of actual consumers with firsthand experience with a product.”
While the CPSC technically has procedures in place to allow manufacturers to respond to reports before they are posted, the CPSC itself admits that its relatively small staff will be ill equipped to verify the accuracy of information in the large number of complaints they receive, recently estimated to be about 30 a day. This calls into question the reliability of the information contained within the database for consumers; and it could also cast manufacturers in a false light.
What Are Manufacturers to Do?
Once a complaint is filed, the CPSC has five days to send an official notice to the manufacturer. The manufacturer then has ten days to respond, and can either: (1) submit a response; (2) challenge the complaint as false; or (3) assert that it will disclose a trade secret. After the ten-day period, the CPSC will post the report for the public to see, along with any comments submitted by the manufacturer, even if a determination of “material inaccuracy” is still being investigated. The CPSC states that it will remove information already published in the database within seven business days of determining that there has been a “material inaccuracy” in the report of the complainant.
New Best Practices for Manufacturers
The new database requires manufacturers to integrate a new set of best practices into their existing operations policies. The following should be but a few of the key components:
Register with the database online;
Designated point of contact should understand the importance of the 10-day response deadline;
Never forget that your comments may be used against you in future litigation as they will become part of the public record;
Comment within the response period. Leaving a report of harm unanswered could reflect poorly on your company and spiral into a public relations nightmare (particularly if it spreads through social media);
Challenge reports that are materially inaccurate, if for instance, you were incorrectly listed as a manufacturer of a product;
Review all reports for confidential information or trade secrets and immediately request that the CPSC prevent that information from being viewed by the public;
Highlight your company’s commitment to safety.
The new burden placed upon manufacturers to respond to reports of harm adds one more layer to a manufacturer’s risk management strategy, and consequently, one more cost of doing business. These costs will undoubtedly get passed on to consumers, or they could cost manufacturing jobs.
Who Benefits Most?
While consumer advocacy groups argue that the database allows ordinary citizens a way to voice their concerns about product safety, there is another group that stands to benefit from the database in unanticipated ways: the Plaintiff’s bar. The CPSC site offers a way for Plaintiff’s lawyers to troll for complainants and injured parties.
An Uncertain Future for the Database
The Government Accountability Office is required to report how the database is functioning to Congress within 180 days of the March 2011 launch. Meanwhile, Republican lawmakers are continuing their attempts to change the rules governing the database, saying that the new regulations go too far. They would like to allow only those who have been injured, or members of their families, or people authorized by them to have the ability to file complaints. They would also like additional time for manufacturers to respond, and the CPSC to investigate reports more carefully before posting them.
Until this legislation is changed, manufacturers must be vigilant in the monitoring and defense of complaints filed within the database. Updating operational policies to include the handling of these new regulations and strict adherence to those policies continues to remain the best defense for claims against manufacturers.
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