The Consumer Product Safety Commission ("CPSC") recently announced a settlement with Whalen Furniture Manufacturing, Inc. (d/b/a Bayside Furnishings), resolving allegations that the company failed to file a timely Section 15(b) Report and imposing a $725,000 civil penalty. The penalty demonstrates that the CPSC will be particularly aggressive when it goes to a company to seek information, even if the product meets certain safety standards.
Over a two-year period, Whalen sold approximately 7,700 children’s boat-shaped beds that contain a toy chest with a 20-pound lid in the “bow.” The CPSC alleges that, in November 2007, Whalen received notice that a toddler had died after the toy chest lid fell on his head, but did not file a full incident report with the CPSC until March 2008 and only at the staff’s request. Whalen denies the allegations and states that it believed the reported death did not represent a "legitimate incident" and that the beds passed toy chest safety tests completed by third-party testing agencies.
The $725,000 civil penalty continues the trend of the CPSC seeking higher civil penalties for untimely reports. All penalties imposed since October 2011 have been for over $400,000, and this penalty is the second largest since September 2011.