[Federal Register Volume 73, Number 156 (Tuesday, August 12, 2008)]
[Notices]
[Pages 46877-46879]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E8-18395]


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CONSUMER PRODUCT SAFETY COMMISSION

(CPSC Docket No. 08-C0018)


Cobmex, Inc., Provisional Acceptance of a Settlement Agreement 
and Order

AGENCY: Consumer Product Safety Commission

ACTION: Notice

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SUMMARY: It is the policy of the Commission to publish settlements 
which it provisionally accepts under the Consumer Product Safety Act in 
the Federal Register in accordance with the terms of 16 CFR 1118.20(e). 
Published below is a provisionally accepted Settlement Agreement with 
Cobmex, Inc., containing a civil penalty of $25,000.00.

DATES: Any interested person may ask the Commission not to accept this 
agreement or otherwise comment on its contents by filing a written 
request with the Office of the Secretary by (insert date that is 15 
calendar days from publication date).

ADDRESSES: Persons wishing to comment on this Settlement Agreement 
should send written comments to the Comment 08-C0018, Office of the 
Secretary, Consumer Product Safety Commission, 4330 East West Highway, 
Room 502, Bethesda, Maryland 20814-4408.

FOR FURTHER INFORMATION CONTACT: Dennis C. Kacoyanis, Trial Attorney, 
Legal Division, Office of Compliance and Field Operations, Consumer 
Product Safety Commission, 4330 East West Highway, Bethesda, Maryland 
20814-4408; telephone (301) 504-7587.

SUPPLEMENTARY INFORMATION: The text of the Agreement and Order appears 
below.

    August 5, 2008
Todd A. Stevenson
 Secretary

United States of America

Consumer Product Safety Commission

In the Matter of Cobmex, Inc., CPSC Docket No. 08-C0018.

[[Page 46878]]

Settlement Agreement

    1. In accordance with 16 CFR 1118.20, Cobmex, Inc. (``Cobmex'') 
and the staff (``Staff'') of the United States Consumer Product 
Safety Commission (``Commission'') enter into this Settlement 
Agreement (``Agreement''). The Agreement and the incorporated 
attached Order (``Order'') settle the Staffs allegations set forth 
below.

Parties

    2. The Commission is an independent federal regulatory agency 
established pursuant to, and responsible for the enforcement of, the 
Consumer Product Safety Act, 15 U.S.C. 2051-2084 (``CPSA'').
    3. Cobmex is a corporation organized and existing under the laws 
of California, with its principal offices located in Lakewood, CA. 
At all times relevant hereto, Cobmex imported and sold apparel.

Staff Allegations

    4. Between January 2006 and March 2007, Cobmex imported and/or 
sold to retailers at least 30,020 youth jackets with drawstrings 
(``Drawstring Jackets'')
    5. Retailers sold the Drawstring Jackets to consumers.
    6. The Drawstring Jackets are ``consumer product[s],'' and, at 
all times relevant hereto, Cobmex was a ``manufacturer'' of those 
consumer products, which were ``distributed in commerce,'' as those 
terms are defined in CPSA sections 3(a)(l), (4), (11), and (12), 15 
U.S.C. 2052(a)(1), (4), (11), and (12).
    7. In February 1996, the Staff issued the Guidelines for 
Drawstrings on Children's Upper Outerwear (``Guidelines'') to help 
prevent children from strangling or entangling on neck and waist 
drawstrings. The Guidelines state that drawstrings can cause, and 
have caused, injuries and deaths when they catch on items such as 
playground equipment, bus doors, or cribs. In the Guidelines, the 
Staff recommends that there be no hood and neck drawstrings in 
children's upper outerwear sized 2T to 12.
    8. In June 1997, ASTM adopted a voluntary standard, ASTM F1816-
97, that incorporated the Guidelines. The Guidelines state that 
firms should be aware of the hazards and should be sure garments 
they sell conform to the voluntary standard.
    9. On May 19, 2006, the Commission posted on its website a 
letter from the Commission's Director of the Office of Compliance to 
manufacturers, importers, and retailers of children's upper 
outerwear. The letter urges them to make certain that all children's 
upper outerwear sold in the United States complies with ASTM F1816-
97. The letter states that the Staff considers children's upper 
outerwear with drawstrings at the hood or neck area to be defective 
and to present a substantial risk of injury to young children under 
Federal Hazardous Substances Act (``FHSA'') section 15(c), 15 U.S.C. 
1274(c). The letter also notes the CPSA's section 15(b) reporting 
requirements.
    10. Cobmex reported to the Commission that there had been no 
incidents or injuries from the Drawstring Jackets.
    11. Cobmex's distribution in commerce of the Drawstring Jackets 
did not meet the Guidelines or ASTM F1816-97, failed to comport with 
the Staff's May 2006 defect notice, and posed a strangulation hazard 
to children.
    12. On March 8, 2007, the Commission and Cobmex announced a 
recall of the Drawstring Jackets, informing consumers that they 
should immediately remove the drawstrings to eliminate the hazard.
    13. Cobmex had presumed and actual knowledge that the Drawstring 
Jackets distributed in commerce posed a strangulation hazard and 
presented a substantial risk of injury to children under FHSA 
section 15(c)(l), 15 U.S.C. 1274(c)(1). Cobmex had obtained 
information that reasonably supported the conclusion that the 
Drawstring Jackets contained a defect that could create a 
substantial product hazard or that they created an unreasonable risk 
of serious injury or death. CPSA sections 15(b)(2) and (3), 15 
U.S.C. 2064(b)(2) and (3), required Cobmex to immediately inform the 
Commission of the defect and risk.
    14. Cobmex knowingly failed to immediately inform the Commission 
about the Drawstring Jackets as required by CPSA sections 15(b)(2) 
and (3), 15 U.S.C. 2064(b)(2) and (3), and as the term ``knowingly'' 
is defined in CPSA section 20(d), 15 U.S.C. 2069(d). This failure 
violated CPSA section 1 9(a)(4), 15 U.S.C. 2068(a)(4). Pursuant to 
CPSA section 20, 15 U.S.C. 2069, this failure subjected Cobmex to 
civil penalties.

Cobmex Response

    15. Cobmex denies the Staff's allegations above that Cobmex 
knowingly violated the CPSA.

Agreement of the Parties

    16. Under the CPSA, the Commission has jurisdiction over this 
matter and over Cobmex.
    17. The parties enter into the Agreement for settlement purposes 
only. The Agreement does not constitute an admission by Cobmex, or a 
determination by the Commission, that Cobmex has knowingly violated 
the CPSA.
    18. In settlement of the Staff's allegations, Cobmex shall pay a 
civil penalty in the amount of twenty-five thousand dollars 
($25,000.00) in two (2) installments as follows: The first 
installment payment of $10,000 shall be paid within twenty (20) 
calendar days of service of the Commission's final Order accepting 
the Agreement; the second installment payment of $15,000 shall be 
paid within one (1) year of service of the Commission's final Order 
accepting the Agreement. Each installment payment shall be by check 
payable to the order of the United States Treasury.
    19. Upon provisional acceptance of the Agreement, the Agreement 
shall be placed on the public record and published in the Federal 
Register in accordance with the procedures set forth in 16 CFR 
1118.20(e). In accordance with 16 CFR 1118.20(f), if the Commission 
does not receive any written request not to accept the Agreement 
within fifteen (15) calendar days, the Agreement shall be deemed 
finally accepted on the sixteenth (16th) calendar day after the date 
it is published in the Federal Register.
    20. Upon the Commission's final acceptance of the Agreement and 
issuance of the final Order, Cobmex knowingly, voluntarily, and 
completely waives any rights it may have regarding the Staff's 
allegations to the following: (1) an administrative or judicial 
hearing; (2) judicial review or other challenge or contest of the 
validity of the Order or of the Commission's actions; (3) a 
determination by the Commission of whether Cobmex failed to comply 
with the CPSA and its underlying regulations; (4) a statement of 
findings of fact and conclusions of law; and (5) any claims under 
the Equal Access to Justice Act.
    21. The Commission may publicize the terms of the Agreement and 
the Order.
    22. The Agreement and the Order shall apply to, and be binding 
upon, Cobmex and each of its successors and assigns.
    23. The Commission issues the Order under the provisions of the 
CPSA, and violation of the Order may subject Cobmex to appropriate 
legal action.
    24. The Agreement may be used in interpreting the Order. 
Understandings, agreements, representations, or interpretations 
apart from those contained in the Agreement and the Order may not be 
used to vary or contradict their terms. The Agreement shall not be 
waived, amended, modified, or otherwise altered without written 
agreement thereto executed by the party against whom such waiver, 
amendment, modification, or alteration is sought to be enforced.
    25. If any provision of the Agreement and the Order is held to 
be illegal, invalid, or unenforceable under present or future laws 
effective during the terms of the Agreement and the Order, such 
provision shall be fully severable. The balance of the Agreement and 
the Order shall remain in full force and effect, unless the 
Commission and Cobmex agree that severing the provision materially 
affects the purpose of the Agreement and the Order.
    26. Pursuant to section 6(d) of the Interim Delegation of 
Authority ordered by the Commission on February 1, 2008, the 
Commission delegated to the Assistant Executive Director for 
Compliance and Field Operations the authority to act, with the 
concurrence of the General Counsel, for the Commission under 16 CFR 
1118.20 with respect to Staff allegations that any person or firm 
violated 15 U.S.C. 2068, where the total amount of the settlement 
involves no more than $100,000.

    Cobmex, Inc.

    Dated: 5-29-08.

By: Scott Schwartz,
President and Chief Executive Officer, Cobmex, Inc., 3673 Industry 
Avenue, Unit 106, Lakewood, CA 90058.

U.S. Consumer Product Safety Commission Staff.

J. Gibson Mullan,
Assistant Executive Director, Office of Compliance and Field 
Operations.

Ronald G. Yelenik,
Acting Director, Legal Division, Office of Compliance and Field 
Operations.

    Dated: 5/30/08.

By: Dennis C. Kacoyanis,
Trial Attorney, Legal Division, Office of Compliance and Field 
Operations.

[[Page 46879]]

United States of America

Consumer Product Safety Commission

    In the Matter of Cobmex, Inc., CPSC Docket No. 08-C0018.

Order

    Upon consideration of the Settlement Agreement entered into 
between Cobmex, Inc. (``Cobmex'') and the U.S. Consumer Product 
Safety Commission (``Commission'') staff, and the Commission having 
jurisdiction over the subject matter and over Cobmex, and pursuant 
to the authority delegated in section 6(d) of the Interim Delegation 
of Authority ordered by the Commission on February 1, 2008, and it 
appearing that the Settlement Agreement and the Order are in the 
public interest, it is ordered, that the Settlement Agreement be, 
and hereby is, accepted; and it is further ordered, that Cobmex 
shall pay a civil penalty in the amount of twenty five thousand 
dollars ($25,000.00) in two (2) installments as follows: The first 
installment payment of $10,000 shall be paid within twenty (20) 
calendar days of service of the Commission's final Order accepting 
the Agreement; the second installment payment of $15,000 shall be 
paid within one (1) year of service of the Commission's final Order 
accepting the Agreement. Each installment payment shall be made by 
check payable to the order of the United States Treasury. Upon the 
failure of Cobmex to make the foregoing payments when due, interest 
on the unpaid amount shall accrue and be paid by Cobmex at the 
federal legal rate of interest set forth at 28 U.S.C. 1961 (a) and 
(b).

    Provisionally accepted and provisional Order issued on the 4th 
day of August, 2008.

    By Order of the Commission.

Todd A. Stevenson,
Secretary, U.S. Consumer Product Safety Commission.

[FR Doc. E8-18395 Filed 08-11-08; 8:45 am]
BILLING CODE 6355-01-M