CPSC Recall Form Update Causes Concern Over New Industry Responsibilities
An update to the Consumer Product Safety Commission’s standard form for companies to submit monthly progress reports on recalls is causing some consternation that it may create new obligations for industry. The commission’s “Monthly Progress Report Form” that companies use to submit progress reports, which are required for corrective action plans, recently underwent an overhaul that included the addition of new fields related to the use of social media and online auction sites. Several law firms have since said that the additions could be an indication that CPSC intends to include the new obligations in recall corrective action plans.
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The new version of the form (here) includes fields for reporting the number of Facebook and Twitter posts, as well as the number of “shares” and “likes” on Facebook and the number of “re-tweets” and followers on Twitter. It also asks whether the recalled product has been found on online action sites. The addition of social media reporting to the form is part of CPSC’s focus on use of social media to enhance the effectiveness of recalls, said Morrison Foerster (here). But it raises several questions about what CPSC will require companies to do in the future, it said. For example, it’s unclear how companies with no social media presence will be affected or whether traditional posters in retail locations will still be sufficient.
The question on whether the recalled product has been found on online action sites could be more troubling. “CPSC’s authority to require a company to monitor online web sites is questionable,” said Tim Mullin of Miles & Stockbridge (here). “Even assuming CPSC can require that activity, there is no direction on what sites to monitor, how frequently or for how long. Furthermore, it is really the CPSC that has the authority to take action on illegal sales of recalled products, not the manufacturer.”
Companies will now have to take the additions to the form into account when they’re negotiating corrective action plans, said Matt Howsare and Chuck Samuels of Mintz Levin (here). “For companies currently engaged in recall discussions or that may need to have such discussions in the future, you’re likely to see most, if not all of these new provisions inserted into the corrective action plan proposed by and negotiated with the CPSC,” they said. “It will be up to each individual company and their counsel to negotiate these and other provisions of the voluntary recall and ensure all corresponding obligations and reporting requirements are well understood by both parties and clearly stated in the agreement.”