The Consumer Product Safety Commission (CPSC) is a federal public-health authority that protects the public from unreasonably dangerous consumer products. To do its job, the CPSC must receive timely information regarding consumer product-related safety hazards. The CPSC relies on manufacturers to report potential product hazards. Despite a mandatory reporting requirement, manufacturers may fail to report hazards in a timely manner – if the hazards are reported at all. In fact, manufacturers often use confidentiality provisions in protective orders and settlement agreements to make sure the public never learns of the injuries and death its products are causing. These protective orders and settlement agreements prevent anyone from reporting the defective product to the CPSC.
The CPSC has now recommended that “all parties seek to include a provision in any private protective order or settlement agreement that – despite whatever restrictions on confidentiality are imposed, and whatever entered into by consent or judicial fiat – specially allows for disclosure of relevant [consumer product] safety information to [the CPSC] and other applicable authorities.” This applies to parties that are in the process of agreeing to or have already agreed to confidentiality provisions. The CPSC recommends that each protective order or settlement agreement contain the following language to allow parties to report defects to the CPSC:
• nothing herein shall be construed to prohibit any party from disclosing relevant consumer product safety information to the Consumer Product Safety Commission; or
• nothing herein shall be construed to prohibit any party from disclosing relevant safety information to a regulatory agency or government entity that has an interest in the subject matter of the underlying suit.
The CPSC found that manufacturers of playground equipment, collapsible cribs, and all-terrain vehicles have kept defects from the CPSC through protective orders. This means that these manufacturers could have received incident reports on their equipment, but the CPSC would be kept in the dark if those incident reports were covered by the protective order. The CPSC believes its recommendation to add a provision allowing disclosure to the agency to protective orders and settlement agreements will prevent cover-ups of defects through litigation. If you need more information on this subject contact Stephanie Monplaisir, a lawyer in our firm’s Personal Injury & Products Liability Section, at 800-898-2034 or by email at Stephanie.Monplaisir@beasleyallen.com.
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