Tuesday, September 17, 2013

Traps For the Unwary Under the Consumer Product Safety Act: Children's Products

Nestled in the morass known as the Consumer Product Safety Act (as amended by the dubiously titled Consumer Product Safety Improvement Act of 2008 and further amended in 2011) are provisions that can wreak havoc for businesses that manage, understandably, to overlook them.  What was once a rather straightforward reporting and recall system involving a relatively small number of federal safety standards has evolved into a complex beast of certifications, third-party testing, and training programs. While it is beyond the scope of this post to identify and discuss all of the requirements of these laws, there are some provisions that our readers should know about. This article addresses one of the thorniest of all: children’s products.

A host of new requirements apply to children’s products, and the determination of what is – and what is not – a children’s product is now no easy matter.  Generally speaking, a children’s product is one designed or intended primarily for children 12 years of age or younger, but the CPSC’s own complex “interpretive guidance” on the question betrays the superficial simplicity of this inquiry.  There are almost no clear rules, and, on matters that could lend clarity to the situation, like a reliable product labeling/marking regime that would put the onus on parents and other responsible adults to keep certain products away from children, the CPSC manages to make things even murkier.

The impact of regulatory uncertainty.   At the core is are very practical questions, including whether a company ought to take a risk that a product thought to appeal to, say, teenagers will be viewed in a manner that extends its likely usage to children within the regulated age range.  Once a product falls into such a gray zone, a company may find itself on the receiving end of a CPSC investigation requiring it to justify its failure to apply the children’s product requirements of federal law.  One might find regulators asking, "Why not?" -- as if the costs/compliance burdens were not a factor.   One can imagine the difficulty of such a burden if, for example, a child twelve or under was injured while using the product.  The CPSC, for its part, expects you to examine such amorphous questions as whether the product has a “declining appeal for teenagers,” and the CPSC’s regulations make clear that you are thin ice if you plan to rely on a manufacturer’s labeling to the effect that a product is not intended for use by children.  You are all but asked to assume that labels will be ignored by parents. The task of keeping inappropriate products out of the hands of children shifts from parents and guardians to the manufacturer or retailer who must guess and wonder whether a product might be viewed as appealing to children too young to use it.

Consumer perceptions?  Areas of close scrutiny include: how the product is marketed, e.g., whether children twelve years of age or younger (or perhaps even children who appear to fall within that age group) are depicted in advertising; where the product is sold, e.g., whether it is sold in catalogs or on Internet pages in close proximity to children’s products (this can be problematic if web pages generate product recommendations that could populate a page with children’s items; and the nebulous world of “consumer perception” as gleaned from sales data, market analyses, and focus groups.

In addition, a product may still be deemed a “children’s product” if it is sold with adult products (like candles, for example) as part of a set. Thus, if one part of that set is deemed to have some “play value” for a child twelve and under, the onerous children’s products rules could well apply – perhaps to the entire set.   Also, virtually anything – from an air purifier to tissue boxes to curtains and ceiling fans – can be converted into a “children’s product” if it is “decorated or embellished with a childish theme.” What themes would be viewed as designed or intended for thirteen year olds, as opposed to twelve year olds, or fourteen year olds, or sixteen year olds?  The lines of demarcation and sophistication between twelve year olds and older teens might be seen as negligible or rapidly diminishing.  The fact twelve was chosen, as opposed to a younger cut-off that might make "children" more readily distinguishable from young adults, renders the task for business markedly more difficult and risky, of course.

Conclusion.  All of this is important because the compliance requirements (and costs) for children's products are far more onerous than for non-children's products.  Among other things, children’s products are required to undergo third-party testing by a certified laboratory under a “reasonable testing program,” be certified under a special Children’s Product Certificate, and bear permanent tracking information on the product and label (with special requirements for durable infant and toddler products). Manufacturers and importers (which can include retailers) must also, for example, institute a program to train employees in avoiding undue influence on third-party testing laboratories, and obtain employee certifications of compliance.

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