Archive Page 4

Good Bye to a Dedicated Public Servant

 

Part of the satisfaction of working in government is the quality and dedication of your colleagues.  And, for a commissioner, that satisfaction is multiplied by having exceptional personal staff who can provide the necessary interface with the agency career experts.  I served as a CPSC commissioner for over eight years.  For five of those years, Joe Martyak served as my legal counsel, as chief of staff when I was acting chairman and also, for a time, as acting director of public affairs.  He did all these jobs with extraordinary competence and good grace.  After I left the commission, he continued to serve as an advisor to Commissioner Ann Marie Buerkle.  Joe has now announced that he will be leaving the CPSC, heading off to new adventures in Hawaii.  On his desk he had a sign that read:  “Just your average Joe.”  I beg to differ; Joe is anything but average.

While Joe will be greatly missed, Commissioner Buerkle has really scored a coup by enticing CPSC veteran Gib Mullan back to the agency.  Gib served as general counsel, director of compliance and was detailed to Customs when the agency was setting up its Import Surveillance Division—in other words, he has seen it all.  When he was at the agency, he was known for his deep intellect, his creativity in solving problems and his honesty—he understood the need to speak the truth even when those in power did not necessarily want to hear it. While no one can “replace” Joe, kudos to Commissioner Buerkle for bringing on such an asset as Gib Mullan.

Wanted: Corporate Psychic

§This past week the CPSC voted to publish for public comment a notice of proposed rulemaking to amend long-standing regulations (16 CFR 1101) dealing with psychic-readerinformation disclosure under §6(b) of the Consumer Product Safety Act. The stated rationale for the NPR is to “modernize” regulations written in 1983, and which, by most accounts, have been working well.  Given the opaque nature of the discussion around this NPR, a Ouija board may be a helpful tool as you read through this NPR.

The §6(b) proposed rule is a continuation of the apparent on-going effort of the Commission altering the collaborative partnership that, over many years,  resulted in successful results for consumers—altering it to one that is both more formalistic, rigid and in my view, less protective of consumers.  This effort includes mandating intrusive compliance programs in inappropriate settings, changing the voluntary recall process to add delay and rigidity among other things, and now, proposing to erode important information disclosure protections mandated by Congress and that form the basis for much of the success of the fast track recall program among other things.

Whether the agency has statutory authority to proceed as proposed is questionable but from the stand point of good public policy, there is no question that the agency seems set on a course that could change the balance that has been the hallmark of its success.

To quickly summarize, §6(b) of the statute, with accompanying regulations, states that before the agency can release information it obtains about a product that identifies a manufacturer or private labeler, it must take certain steps to assure that the disclosure is fair and accurate.  The regulations, written in 1983, seem to be working well except that they do not contemplate electronic communications (something that can be easily rectified).  Further, in its briefing to the Commissioners, the staff did not identify in specific terms how the changes would improve efficiencies.  Instead viewers of the briefing were treated to general statements, speculative scenarios and threats to go into executive session so the public could not benefit from the agency reasoning that provided the basis for the proposed rule.

The proposed rule makes a number of changes to the 1983 regulations that go well beyond “modernizing” those rules.  Taken as a whole, the proposal changes the emphasis from the agency having the proactive obligation to act in a careful and deliberate manner.  Instead information–perhaps in response to that pulled from the internet or from the latest (and generally flawed) toxic product hit list or perhaps stale information where context has changed–can go out the door and, only if the company has a psychic on staff, will it know the release is coming or be able to object. But even more important, this seems like an effort to minimize work for the agency without thought to whether consumers get better information or companies must correct inaccurate innuendos.   

The NPR will soon be available in the Federal Register for comment.  Stakeholders who care about this latest attempt to dilute the deliberate balance Congress struck in the Consumer Product Safety Act should read this proposal carefully and give the agency your views.

The $57 Million Shakedown

The CPSC’s action to force a recall of Buckyballs–small powerful magnets the Commission believes to be unsafe but which are still being legally sold by others—has raised many serious questions about whether the agency acted properly.  But its efforts to blow up the concept of limited liability by individually suing one of the company’s founders–absent any allegation of wrongdoing–has elevated this action into one that could impact all businesses. 

Recently Craig Zucker, a founder of the now-defunct company that sold Buckyballs and the object of CPSC’s ire, and I discussed this case with the U.S. Chamber of Commerce. Calling the long-term implications of this case shocking, the Chamber has now produced a video that details the concerns this case poses for American businesses.  As a former safety regulator, a mother and, of course, a consumer, I strongly believe the agency could have addressed any safety concerns with this product without the unprecedented overreach taken in this case.

Go to FreeEnterprise.com to see the video for yourself.  Here is a link:

The Side Effects of Tweaking

Much has been written here and in other publications about the substantive impacts of the CPSC’s proposed changes to the rules dealing with voluntary recalls.  The substantive nature of the proposed amendments cannot be discounted even though certain commissioners persist in describing them as only “tweaks.”

As commenters analyze the impacts of the proposed changes, it is important to look at how these changes impact other rules that stakeholders and the commission operate under, specifically those dealing with submission of information under §15(b) and disclosure of information under §6(b) of the Consumer Product Safety Act.  Former CPSC general counsel Cheryl Falvey has written an interesting piece that discusses that interrelationship.  It is worth reading and thinking about.

Information submitted to the agency under §15(b) is exempt from disclosure except under limited circumstances as described in §6(b)(5).  This protection is to provide incentive for companies to fully report information the agency needs to analyze a risk without having to worry that sensitive product information is made public unfairly or prematurely.  One of the exemptions to this protection is when the Commission has accepted in writing a “remedial settlement agreement” (see §6(b)(5)(B)).

Here is the question:  is the voluntary recall (or specifically the recall’s corrective action plan) a remedial settlement agreement?  The regulations currently say that the recall agreement is not enforceable.  The agency now proposes to make the recall agreement enforceable.  Is the effect of that to make any information submitted under §15(b) subject to disclosure where it otherwise would not have been?

What is the Commission’s current position on this issue?  Reading the NPR or listening to the debate does not provide any answers.  But one thing is clear:  with all this tweaking, some transparency is called for.

§6(b): Get Ready for More “Tweaking”

Rumor has it that the CPSC staff will soon be sending up to the Commission suggestions for “modernizing” the §6(b) regulations (16 CFR 1101) dealing with disclosure oftweak image company and product-specific information. “Modernizing” is a word that covers a lot of ground and it will be instructive to see how the agency staff and commissioners define it.

The §6(b) regulations were written in 1983 and do not, for example, contemplate communication by email—hence the perceived need for modernization. But if the Commission’s recent proposal with respect to voluntary recalls—where significant substantive changes are being proposed under the rubric of “tweaking” an interpretive rule—are any indicator, then interested stakeholders should pay close attention to the proposed §6(b) rule when it comes up for Commission review.

§6(b), along with §15(b) and the voluntary recall process are three legs of the stool that supports a collaborative and cooperative relationship between the Commission and product sellers.  This cooperation, in large part, is what makes the agency as effective as it is.  §15(b) requires submission of information indicating a product hazard, but most companies, up to now, heed the oft-stated advice of “when in doubt, report”, reporting information before, or even absent, the statutory obligation.   This happens because §6(b) protects the disclosure of information that is not fair or accurate.  (Here is a link to an article that discusses the consumer protection aspects of §6(b).) Taken together, the statute provides incentives for companies to give information to the agency earlier than they otherwise would because those companies have the assurance that information about specific products will be used internally but will not be prematurely released to the public, before the agency has determined if there is a problem.  The voluntary recall process compliments this statutory framework by allowing recalls to be made quickly and, in some cases, before there is a determination that a substantial hazard does, in fact, exist.

The important role that §6(b) plays in making the statute work is not appreciated by some within the agency.  That is unfortunate.  If the Commission decides to use this proposed §6(b) modernization rule as an opportunity to make more substantial changes (as it did with the voluntary recall proposed rule), it threatens to further erode the foundation of cooperation that is so vital to an effective CPSC.

Play at Your Own Risk

NO

Recently I was up in New York and met with two insightful and smart people I want to introduce if you do not already know them.

Phillip Howard is a lawyer, civic activist and the founder of an interesting organization, Common Good.  Part of the mission of the organization is to get back to a place where citizens can take responsibility for making sensible choices:  “Making choices for the common good is impossible if everyone is tied up in red tape. Reclaiming responsibility requires a basic shift—where law sets boundaries for free choice instead of dictating choices for the lowest common denominator. . .Common Good has developed practical solutions to bring reliability and balance to law in healthcare, education, and civil justice, as well as in areas such as children’s play. . .”.  With respect to this last item, the concern is that if all risk is taken out of play, our children will not be prepared for the risks that life inevitably throws at them as they mature.

This brings me to the second person I want to introduce—Lenore Skenazy.  Lenore is a journalist, mother, and the creator of Free Range Kids.  The (tongue-in-cheek) purpose of Free Range Kids is to fight “the belief that our children are in constant danger from creeps, kidnapping, germs, grades, flashers, frustration, failure, baby snatchers, bugs, bullies, men, sleepovers and/or the perils of a non-organic grape.” While Lenore’s writings are amusing, she does make the serious point that when the line between real and speculative risk becomes so blurred—which she contends is happening more and more—our children suffer as a result.

From my perspective as a former CPSC Commissioner, I do fear that the agency, when it is regulating, too often discounts the importance of personal responsibility on the part of consumers.  The result are regulations that try to address every possible risk, real or imagined, rather than actual risks that real-world data and science have demonstrated need addressing.   Imaging the worst-case scenario all the time cabins in our kids but gives government regulators a very wide swath indeed.

Finding the Needle in that Haystack

needleinahaystack1.1Anyone who has tried to use the CPSC website knows that finding information there is no easy task. When I was a commissioner I would get regular calls from the public asking for help in locating public documents that were on the site but buried in sub-directories and illogical places.

Therefore, I am pleased that a law firm has taken on the helpful task of making some sense out of the agency’s website. You can find the “CPSC Navigator” at www.CPSCNavigator.com. While it is unfortunate that an agency that regularly talks about “transparency” makes it so difficult to find important information, I am glad that the private sector has stepped up to the challenge that the agency’s opaqueness presents.


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