Risks of the Consumer Product Safety Commission’s Database

On May 24, the Consumer Product Safety Commission (“CPSC”) issued a notice of proposed rulemaking[1] to effectuate the establishment of a statutorily mandated, publicly available, searchable online database containing consumer product safety information. The database is required by Section 212 of the Consumer Product Safety Improvement Act of 2008, which created a new Section 6A of the Consumer Product Safety Act (“CPSA”), titled ‘Publicly Available Consumer Product Safety Information Database.’

The proposed rule would establish requirements pertaining to the information to be included in the database and also would establish provisions regarding submitting reports of harm; providing notice of reports of harm to manufacturers; publishing reports of harm and manufacturer comments in the database; and dealing with confidential and materially inaccurate information.[2]

The database, which can be accessed already at saferproducts.gov, is potentially a worthwhile tool, providing both consumers and manufacturers with information that might be valuable. But it also portends significant product liability concerns for companies, including for those that are falsely accused.

To be sure, the Internet’s impact on product liability litigation has already been profound. The unregulated and unregulatable prevalence of consumer complaint forums, company specific “gripe sites,” and  product specific product liability Web sites are resources for evidence as to product defects, substantiation of allegations of awareness by a manufacturer as to the prevalence of a problem, and even as a source of potential litigants. However, the CPSC database may offer an imprimatur of reliability to its contents by its mere association with the CPSC, despite the fact that the source of the data is outside the CPSC.  As such, the proposal should carefully be considered as to its likely impact on product litigation.

For several decades, the CPSC has gathered and maintained a database of consumer complaints, known as consumer product incident reports, involving a description of incidents related to the use of consumer products that fell within the scope of the CPSC’s jurisdiction.[3] However, the data that the CPSC collected on a particular product’s safety was not immediately available and searchable by the public. Instead, the CPSC was required to follow the notice provisions of Section 6 of the CPSA, which require the CPSC to take reasonable steps to assure that disclosure of such information is accurate, fair in the circumstances, and reasonably related to effectuating the purposes of the CPSA before publicly disclosing any information that allowed the public to readily ascertain the identity of a manufacturer or private labeler of a consumer product.[4] The establishment of the new database under proposed rule 16 CFR part 1102, ‘Publicly Available Consumer Product Database’ may, in many ways, be inconsistent with the CPSC’s prior practices.  

The proposed rule contains a number of important definitions. For example, ‘consumer product’ has the same meaning as in the CPSA, but also includes any other products or substances regulated by the CPSC under the CPSA, Federal Hazardous Substances Act, Flammable Fabrics Act, the Poison Prevention Packaging Act, the Children’s Gasoline Burn Prevention Act, the Virginia Graeme Baker Pool and Spa Safety Act, and any other statute that the CPSC enforces.[5] In addition, ‘report of harm’ is defined as any information submitted to the CPSC through the manner described in § 1102.10(b) regarding an incident concerning an injury, illness, or death, or any risk of injury, illness, or death as determined by the CPSC relating to the use of the consumer product.[6]

Generally speaking, Section 6A(b) of the CPSA states that the database must include: (1) reports of harm; (2) information derived by the CPSC from notice under Section 15(c), and any notice to the public relating to a voluntary corrective action taken by a manufacturer, in consultation with the CPSC, of which the CPSC has notified the public; and (3) manufacturer comments received by the CPSC on a report of harm and requested for inclusion in the database.

Proposed § 1102.10 explains who may submit reports of harm in the public database. In brief, proposed § 1102.10(a) identifies those submitters specified in Section 6A(b)(1)(A) of the CPSA and discusses the categories that may fall within each of the identified groups. The list of persons under each group is not exclusive. Thus, for example, ‘consumers’ include not only users of consumer products, but also family members, relatives, parents, guardians, friends, and observers of a consumer product being used by another.

The proposal adds a category of ‘other’ to include those persons who may not clearly fit within the statutorily identified categories; for example, ‘other’ persons include, but are not limited to, attorneys, professional engineers, investigators, nongovernmental organizations, consumer advocates, consumer advocacy organizations, and trade associations.[7]

Proposed § 1102.10(d)(1) states that a description of a consumer product must include a word or phrase sufficient to distinguish a product identified in a report of harm as a consumer product or a component of a consumer product or some other word or phrase to show it is a consumer product or a product or substance regulated by the CPSC. Under proposed § 1102.10(d)(2), a report of harm must contain the identity of the manufacturer or private labeler for the report to be published.

In addition, proposed § 1102.10(d)(3) provides that a description of harm should include a narrative describing the harm or risk of harm. The proposal contains a nonexclusive list of examples of the types of harm that could be included. The proposal allows for a description to include a risk of harm where no actual harm occurred, although this section explains that information unrelated to bodily harm or a risk of bodily harm, such as information on cost or quality of a consumer product, will not satisfy the regulatory requirement for a description of harm.

‘Helpful’ Information

Importantly, information such as the date on which the harm occurred or manifested itself, the severity of any injury, or whether medical treatment was sought is identified as “helpful,” but not required, information to include in a description.[8]

Under proposed § 1102.10(f), the information that will not be published in the database includes the name and contact information of the submitter of a report of harm; the victim’s name and contact information (if provided), photographs depicting a person or injury because of privacy concerns or because the CPSC has determined that they are not in the public interest; medical records without the consent of the person about whom such records pertain (or that person’s parent or guardian if the person is a minor); confidential information; materially inaccurate information; reports of harm retracted by submitters who indicate in writing to the CPSC that they supplied materially inaccurate information; and/or any other material submitted on or with a report of harm that the CPSC determines is not in the public interest to publish. This proposed section identifies the criteria and explains that the public interest determination will be based on the criteria relating to whether or not the information helps database users to identify a consumer product; identify the manufacturer or private labeler of a consumer product; understand the risk of harm related to the use of a consumer product; or understand the relationship between the submitter of a report of harm and the victim.

Procedural Requirements

The proposal explains what information in a report of harm will and will not be transmitted to a manufacturer or private labeler. As set forth in Section 6A(b)(2)(B) of the CPSA, the name and contact information of the submitter will not be transmitted to a manufacturer or private labeler unless the submitter of the report consents to transmit this information. The proposal incorporates the limitation in Section 6A on the use of submitter contact information by the manufacturer for any purpose other than verification of information contained in a report of harm.

Under proposed § 1102.20(c), reports will be transmitted to the manufacturer “to the extent practicable” within five business days after the CPSC receives a completed report of harm. It is impracticable where the identified manufacturer or private labeler is out of business with no identifiable successor; the submitter misidentified the manufacturer or private labeler; the report of harm contained inaccurate or insufficient information for identification of a manufacturer or private labeler, or when the CPSC cannot locate valid contact information for a manufacturer or private labeler.

A manufacturer may designate portions of information contained in a report of harm as confidential and proposed § 1102.24(b) describes, at paragraphs (b)(1) through (b)(6), the statements required to support the claim of confidential information. For instance, a manufacturer must support a confidentiality claim by describing how release of the information could cause competitive harm.

Under proposed § 1102.24(g), if a portion of a report is not deemed confidential, the CPSC will notify the manufacturer or private labeler of the CPSC’s determination and will publish the report of harm in the database. A manufacturer or private labeler has the right to sue in federal district court to seek removal of alleged confidential information published in the database.[9]

The proposed rule explains the process for how claims of materially inaccurate information contained in reports of harm and manufacturer comments may be asserted and how they will be evaluated.[10] It defines ‘materially inaccurate information in a report of harm’ as information that is false or misleading in a significant and relevant way that it creates or has the potential to create a substantially erroneous or substantially mistaken belief about information in a report of harm.

Moreover, the proposed rule allows any person or entity to request that a report of harm or manufacturer comment or portions thereof be excluded from the database or corrected by the CPSC because such report or comment contains materially inaccurate information as defined in proposed § 1102.26(a).

Importantly, proposed § 1102.28 explains that reports of harm will be published in the database as soon as practicable, but no later than 10 days after such report of harm is transmitted by the CPSC to the manufacturer or private labeler. Under proposed § 1102.30, the CPSC will publish manufacturer comments that meet the minimum requirements in proposed § 1102.12(c) at the same time as a report of harm is published or as soon as practicable thereafter.

During the process leading to the proposed rule, the CPSC considered what, if any, measures it should employ to prevent the submission of fraudulent reports of harm while not discouraging the submission of valid reports. The proposed new incident report form requires that a user check a box that indicates that he or she is certifying the incident report to be true and accurate to the best of the user’s knowledge.

The CPSC is considering implementation of CAPTCHA[11] types of challenge-response tests to ensure that the incident report form is not being generated by a computer. The CPSC also says that it will examine technical options to detect if multiple reports are submitted from the same IP address.

The proposed rule provides that the database will contain a notice to users of the public database that the CPSC does not guarantee the accuracy, completeness, or adequacy of the contents of the database and that the submitters of a report of harm verify that the information they have provided is accurate to the best of their knowledge.

Conclusion

There are numerous Internet sites that allow consumers and others to complain about companies and products.[12] The government connection to the CPSC’s database, however, makes it more problematical for manufacturers. The CPSC’s database is, no doubt, well-intentioned and designed to provide greater public awareness of unsafe consumer products and remedial measures undertaken to address them.  However, reports that cite the wrong manufacturer or the wrong injury can damage a company’s reputation irreparably.

One also can imagine that plaintiffs’ lawyers will attempt to use the database in an effort to find clients to initiate litigation rather than to cure or avoid legitimate problems.

Also of concern is the deliberate manipulation of the database to create false records of multiple incidences or injuries where none may exist. These concerns are exacerbated by the speed at which the reports are required to be posted, the limited time provided for manufacturer response, the broad range of individuals, beyond the allegedly injured party who may file a report of an injury or risk of injury, including mere “observers” and even lawyers, and the technology involved, which makes it difficult for the CPSC to confirm the source of the reports. 

As Commissioner Anne M. Northrup has stated, in addition to “reputational black eyes, the database is apt to generate more lawsuits against consumer product manufacturers,” leading to “higher prices for consumers, some safe products getting pulled from the market, and even some good companies going out of business.”[13]

How the database will turn out in practice, and what courts will have to say about lawyers using it to attract plaintiffs to bring suit against manufacturers and about the use of information in the database in products liability litigation, remains to be seen.

Written comments on the proposed rule must be received by the CPSC by July 23, 2010. There may be an opportunity for manufacturers to correct the most egregious problems likely to result from the database as currently envisioned. In any event, they must gear up to respond – promptly – to false or inaccurate complaints that appear on the database.

[1] The CPSC’s issuance of the notice of proposed rulemaking, see, http://www.cpsc.gov/businfo/frnotices/fr10/databaseNPR.pdf, followed a 3-2 vote on April 15 by CPSC commissioners.

[2] A summary of the CPSC’s work on the database is available at http://www.cpsc.gov/about/cpsia/sect212.html.

[3] The CPSC’s jurisdiction does not extend to all consumer products.  Notably, the CPSC does not have jurisdiction over vehicles, tires, boats, food, cosmetics, drugs, medical devices, pesticides, and certain other products that have been implicated in numerous product liability cases.  The CPSC also does not vet the safety of consumer products at the pre-market stage. Instead, its mandate is to promulgate industry standards, identify and educate the public as to product problems that develop after products are placed in the market, and effectuate recalls where necessary. See, http://www.cpsc.gov/about/faq.html#jur.

[4] Regulations interpreting the Section 6 requirements are at 16 CFR part 1101.

[5] See, proposed § 1102.6(b)(3).

[6] See, proposed § 1102.6(b)(8) (emphasis added).

[7] The proposed rule may go beyond the set of people authorized by the statute who may submit reports of harm. See, STATEMENT OF COMMISSIONER ANNE M. NORTHUP REGARDING THE NOTICE OF PROPOSED RULEMAKING ON THE PUBLICLY AVAILABLE CONSUMER PRODUCT SAFETY INFORMATION DATABASE, Apr. 22, 2010, available at http://www.cpsc.gov/pr/northup04232010.pdf.

[8] Commissioner Northrup is concerned that, by not requiring the date and geographic location of reported harms, the proposed rule reduces the accuracy of database information. Id.

[9] An interesting problem may arise as to whether the right to “remove” confidential information from the database rectifies the disclosure, especially in those jurisdictions that consider that once publication of confidential information has occurred, it cannot be undone.

[10] See, proposed § 1102.26.

[11] Completely Automated Public Turing test to tell Computers and Humans Apart.  CAPTCHA is a challenge response test used to ascertain whether the user is human or a computer. Most commonly, it involves responding with an alphanumeric string that is presented on the access screen in a way that cannot be read by a computer.

[12] See, e.g., Dan Frosch, “Venting Online, Consumers Can Find Themselves in Court,” N.Y. Times, May 31, 2010, available at http://www.nytimes.com/2010/06/01/us/01slapp.html?emc=eta1&pagewanted=print.

[13] See, STATEMENT OF COMMISSIONER ANNE M. NORTHUP REGARDING THE NOTICE OF PROPOSED RULEMAKING ON THE PUBLICLY AVAILABLE CONSUMER PRODUCT SAFETY INFORMATION DATABASE, supra.

Reprinted with permission from the June 15, 2010 issue of the New York Law Journal. Copyright ALM Properties, Inc. All rights reserved. Further duplication without permission is prohibited.