Mattel Magnetic Toy Set Recall: Company Has History of Ignoring Product Safety Disclosure Laws. Did It Do So Again?Sep 4, 2007 | Parker Waichman LLP, LLP
Mattel, Inc., the toy-giant responsible for recalling over 10 million toys this summer, doesn’t like US laws that dictate when and how a company should report product safety issues to the Consumer Product Safety Commission (CPSC). So, it just doesn’t follow the statutes. According to the Wall Street Journal, Mattel has been fined repeatedly by the CPSC for violating reporting statutes. Now, questions have arisen regarding the way Mattel handled this summer’s recall of dangerous magnetic toy sets, prompting a CPSC investigation into that recall timeline
The law governing recalls says that a manufacturer must inform the CPSC of potentially hazardous products within 24 hours of first hearing of problems. But Mattel’s Chief Executive Robert Eckert told the Wall Street Journal that the law is “unreasonable”. And regardless of what the law says, Mattel has chosen on several occasions to conduct its own evaluations of possible hazards. As a result, Mattel often does not inform the CPSC of hazardous toys for months, thereby exposing millions of children to possible harm.
According to the Wall Street Journal, Mattel has been ignoring safety notification laws for at least a decade. In 1998, the company recalled its popular motorized Power Wheels cars for a fire hazard. The CPSC had 150 reports of fires caused by the cars, as well as reports of electrical components overheating or short-circuiting. The CPSC said that Mattel knew of the problems with Power Wheels for years, but did nothing. As a result, the CPSC fined Mattel $1.1 million for failing to notify the agency of the fire hazards in a timely manner. Mattel paid the fine, but to this day, the company refuses to admit that the toy vehicles were dangerous.
The Power Wheels fine did not keep Mattel from further violations of the law. In the fall of 2002, Mattel began getting reports that screws used on its Little People Sounds Farm could come loose and pose a choking hazard to children. According to the Wall Street Journal, one case involved a toddler who had inhaled a screw, which punctured a lung. Despite such reports, Mattel didn’t bother to inform the CPSC until March of 2003. Because of its late disclosure, the CPSC again fined Mattel $975,000. Again, Mattel paid the fine, but insisted it had done nothing wrong.
Now, Mattel is under scrutiny for the way it handled a recall of dangerous magnetic toy sets this summer. If swallowed, the magnets on these toys could cause serious intestinal injuries. Last November, Mattel recalled 2 million Polly Pocket toys because of the magnet hazard. But according to the Wall Street Journal, Mattel received 400 more reports of problems with magnets in other toy lines in the eight month period following the November recall. Now, the CPSC wants to know how long Mattel knew of other magnet hazards before it let the agency know.
But even if the CPSC concludes that Mattel did delay informing the agency of problems with its magnetic toys, there is little the CPSC can do to chastise the company. The stiffest penalty available to the CPSC is the imposition of monetary fines. But those fines are capped at under $2 million – pocket change for a company like Mattel that racks up millions of dollars in sales each day. For Mattel and other corporations, such paltry fines are simply the cost of doing business. It is little wonder that big companies like Mattel have nothing but contempt for the CPSC and recall laws. Unless something is done to give the CPSC more power, it is likely that defective toys will continue to threaten American children.