81 FR 81086 - PetSmart, Inc., Provisional Acceptance of a Settlement Agreement and Order
CONSUMER PRODUCT SAFETY COMMISSION Federal Register Volume 81, Issue 222 (November 17, 2016)
Federal Register Volume 81, Issue 222 (November 17, 2016)
| Page Range | 81086-81089 | |
| FR Document | 2016-27644 |
[Federal Register Volume 81, Number 222 (Thursday, November 17, 2016)] [Notices] [Pages 81086-81089] From the Federal Register Online [www.thefederalregister.org] [FR Doc No: 2016-27644] ======================================================================= ----------------------------------------------------------------------- CONSUMER PRODUCT SAFETY COMMISSION [CPSC Docket No. 17-C0001] PetSmart, Inc., Provisional Acceptance of a Settlement Agreement and Order AGENCY: Consumer Product Safety Commission ACTION: Notice. ----------------------------------------------------------------------- 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 the Consumer Product Safety Commission's regulations. Published below is a provisionally-accepted Settlement Agreement with PetSmart, Inc., containing a civil penalty in the amount of four million, two hundred fifty thousand dollars ($4,250,000) within thirty (30) days of service of the Commission's final Order accepting the Settlement Agreement. 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 December 2, 2016. ADDRESSES: Persons wishing to comment on this Settlement Agreement should send written comments to the Comment 17-C0001, Office of the Secretary, Consumer Product Safety Commission, 4330 East-West Highway, Room 820, Bethesda, Maryland 20814-4408. FOR FURTHER INFORMATION CONTACT: Philip Z. Brown, Trial Attorney, Division of Compliance, Office of the General Counsel, Consumer Product Safety Commission, 4330 East-West Highway, Bethesda, Maryland 20814- 4408; telephone (301) 504-7645. SUPPLEMENTARY INFORMATION: The text of the Agreement and Order appears below.\1\ --------------------------------------------------------------------------- \1\ The Commission voted (4-1) to provisionally accept the Settlement Agreement and Order regarding PetSmart, Inc. Chairman Kaye, Commissioner Adler, Commissioner Robinson and Commissioner Mohorovic voted to provisionally accept the Settlement Agreement and Order. Commissioner Buerkle voted to reject the Settlement Agreement and Order. [[Page 81087]] --------------------------------------------------------------------------- Dated: November 14, 2016. Todd A. Stevenson, Secretary. UNITED STATES OF AMERICA CONSUMER PRODUCT SAFETY COMMISSION In the Matter of: PETSMART, INC. CPSC Docket No.: 17-C0001 SETTLEMENT AGREEMENT 1. In accordance with the Consumer Product Safety Act, 15 U.S.C. 2051-2089 (``CPSA'') and 16 CFR 1118.20, PetSmart, Inc. (``PetSmart''), and the United States Consumer Product Safety Commission (``Commission''), through its staff, hereby enter into this Settlement Agreement (``Agreement''). The Agreement and the incorporated attached Order resolve staff's charges set forth below. THE PARTIES 2. The Commission is an independent federal regulatory agency, established pursuant to, and responsible for, the enforcement of the CPSA, 15 U.S.C. 2051-2089. By executing the Agreement, staff is acting on behalf of the Commission, pursuant to 16 CFR 1118.20(b). The Commission issues the Order under the provisions of the CPSA. 3. PetSmart is a corporation, organized and existing under the laws of the state of Delaware, with its principal place of business in Phoenix, AZ. STAFF CHARGES 4. Between April 2009 and September 2013, PetSmart imported and offered for sale in the United States, approximately 127,444 ``Great Choice'' or ``Top Fin'' brand 1.75 gallon, brandy snifter-style glass fish bowls (``Fish Bowls'' or ``Subject Products'') . 5. The Fish Bowls are a ``consumer product,'' ``distribut[ed] in commerce,'' as those terms are defined or used in sections 3(a)(5) and (8) of the CPSA, 15 U.S.C. 2052(a)(5) and (8). PetSmart is an ``importer,'' ``manufacturer'' and ``retailer'' of the Fish Bowls, as such terms are defined in sections 3(a)(11) and (13) of the CPSA, 15 U.S.C. 2052(a)(11) and (13). Violation of CPSA Section 19(a)(4) 6. The Fish Bowls contain a defect which could create a substantial product hazard and create an unreasonable risk of serious injury because they can crack, shatter, or break during normal use, posing a laceration hazard to consumers. 7. Between August 2011 and January 2014, PetSmart received at least 19 incident reports of Fish Bowls cracking, breaking, or shattering during normal use, which, in at least 12 instances, resulted in serious injuries, including deep lacerations requiring stitches and severed tendons necessitating surgery. 8. PetSmart received at least three reports of consumers sustaining serious injuries during normal use of the Fish Bowls between August 2011 and September 2011 but neither initiated an investigation into the Subject Products in response to these reports of serious injury nor immediately reported to the Commission. 9. In May 2013, after receiving additional reports, including two reports of serious injuries to consumers, PetSmart initiated an investigation and evaluation of the defect and risk associated with the Fish Bowls. That investigation, which concluded in July 2013, identified deficiencies in the thickness and distribution of the glass in the Fish Bowls. During its investigation, PetSmart continued to receive reports of serious injury caused by the Fish Bowls. Firms may conduct a reasonably expeditious investigation, not normally exceeding 10 days, to evaluate their reporting obligations. See 16 CFR 1115.14(d). PetSmart's investigation took over two months to complete. 10. PetSmart stopped sale of the Fish Bowls in September 2013. At the time PetSmart stopped sale of the Fish Bowls, PetSmart had received at least 12 reports of consumers being injured during normal use of the Subject Products. 11. PetSmart did not file a Full Report with the Commission until January 31, 2014, pursuant to 15 U.S.C. 2064(b). PetSmart and the Commission jointly announced a recall of 10,200 Fish Bowls on April 24, 2014. 12. PetSmart's Full Report contained information on only 10,211 Fish Bowls imported and sold between February 2013 and September 2013. However, information produced by PetSmart during staff's civil penalty investigation revealed that PetSmart had actually sold a total of 91,500 Fish Bowls between March 2010 and September 2013 that posed the same laceration hazard. PetSmart and the Commission jointly announced an expanded recall of 91,500 Fish Bowls on November 17, 2015. 13. By the date of the expanded recall, PetSmart received at least 32 reports of Fish Bowls cracking, breaking or shattering during normal use, including 18 reports of injury. PetSmart received at least six of these reports of injury after the first recall. 14. Despite having information that the Fish Bowls contained a defect and created an unreasonable risk of serious injury, PetSmart did not notify the Commission immediately of such defect or risk, as required by sections 15(b)(3) and (4) of the CPSA, 15 U.S.C. 2064(b)(3) and (4), in violation of section 19(a)(4) of the CPSA, 15 U.S.C. 2068(a)(4). 15. Because the information in PetSmart's possession constituted actual and presumed knowledge, PetSmart knowingly violated section 19(a)(4) of the CPSA, 15 U.S.C. 2068(a)(4), as the term ``knowingly'' is defined in section 20(d) of the CPSA, 15 U.S.C. 2069(d). 16. Pursuant to Section 20 of the CPSA, 15 U.S.C. 2069, PetSmart is subject to civil penalties for its knowing violation of section 19(a)(4) of the CPSA, 15 U.S.C. 2068(a)(4). Violation of CPSA Section 19(a)(13) 17. PetSmart's January 31, 2014 Full Report identified the Subject Products as 10,211 Fish Bowls, sold between February 2013 and September 2013, which posed a laceration hazard to consumers. The Full Report did not identify an additional 81,300 units of Subject Products that were sold prior to February 2013 that posed the same hazard and had been the subject of incident and injury reports received by PetSmart. 18. By failing to identify the correct amount and distribution dates of the Subject Products in PetSmart's Full Report, PetSmart knowingly misrepresented the scope of consumer products subject to an action required under section 15 of the CPSA. As a result of PetSmart's misrepresentation, the April 24, 2014 CPSC press release announcing the recall inaccurately stated that ``[a]bout 10,200'' Fish Bowls were affected by the hazard posed by the Fish Bowls. An expansion of the recall was announced on November 17, 2015. 19. By knowingly misrepresenting the scope of consumer products subject to an action under section 15 of the CPSA, PetSmart knowingly violated section 19(a)(13) of the CPSA, 15 U.S.C. 2068(a)(13), as the term ``knowingly'' is defined in section 20(d) of the CPSA, 15 U.S.C. 2069(d). 20. Pursuant to section 20 of the CPSA, 15 U.S.C. 2069, PetSmart is subject to civil penalties for its knowing violation of section 19(a)(13) of the CPSA, 15 U.S.C. 2068(a)(13). RESPONSE OF PETSMART 21. PetSmart's settlement of this matter does not constitute an admission of staff's charges in paragraphs 4 through 20 above. 22. Between November 2013 and January 2014, PetSmart corresponded with CPSC staff regarding certain Fish [[Page 81088]] Bowl incidents. In this correspondence, PetSmart clearly stated that it first began selling the Fish Bowls in 2009. PetSmart also stated that it believed any product issues were limited to Fish Bowls manufactured for sale in 2013. CPSC staff did not ask PetSmart anything further regarding PetSmart's determination that the issues were limited to Fish Bowls sold between February 2013 and September 2013. 23. Following this correspondence, in January 2014, PetSmart provided the Commission with its report under section 15(b) of the CPSA, 15 U.S.C. 2064(b) concerning PetSmart's receipt of complaints and incident reports about the Fish Bowls. PetSmart's report provided information related only to Fish Bowls manufactured for sale in 2013, consistent with its communications to CPSC staff. CPSC staff did not ask PetSmart anything further regarding Fish Bowls sold prior to 2013. 24. On April 24, 2014, in conjunction with the Commission, PetSmart voluntarily announced a recall of Fish Bowls sold at PetSmart between February 2013 and September 2013. 25. PetSmart conducted the April 24, 2014, voluntary recall of the Fish Bowls, as well as the section 15(b) reporting, out of an abundance of caution and without PetSmart having concluded that the Fish Bowls contained a defect, posed a substantial product hazard, or created an unreasonable risk of serious injury or death. 26. On November 17, 2015, in conjunction with the Commission, PetSmart voluntarily expanded the recall of Fish Bowls to include units sold at PetSmart between March 2010 and February 2013. PetSmart disputes Staff's allegation that PetSmart had information that the Fish Bowls manufactured prior to 2013 contained a defect and created an unreasonable risk of serious injury. 27. PetSmart denies Staff's allegations that PetSmart knowingly misrepresented the scope of consumer products subject to an action under section 15 of the CPSA and that PetSmart knowingly violated section 19(a)(13). AGREEMENT OF THE PARTIES 28. Under the CPSA, the Commission has jurisdiction over the matter involving the Fish Bowls and over PetSmart. 29. The parties enter into the Agreement for settlement purposes only. The Agreement does not constitute an admission by PetSmart or a determination by the Commission that PetSmart violated the CPSA's reporting requirements. 30. In settlement of staff's charges, and to avoid the cost, distraction, delay, uncertainty, and inconvenience of protracted litigation or other proceedings, PetSmart shall pay a civil penalty in the amount of four million, two hundred fifty thousand dollars ($4,250,000) within thirty (30) calendar days after receiving service of the Commission's final Order accepting the Agreement. All payments to be made under the Agreement shall constitute debts owing to the United States and shall be made by electronic wire transfer to the United States via: http://www.pay.gov, for allocation to, and credit against, the payment obligations of PetSmart under this Agreement. Failure to make such payment by the date specified in the Commission's final Order shall constitute Default. 31. All unpaid amounts, if any, due and owing under the Agreement, shall constitute a debt due and immediately owing by PetSmart to the United States, and interest shall accrue and be paid by PetSmart at the federal legal rate of interest set forth at 28 U.S.C. 1961(a) and (b) from the date of Default, until all amounts due have been paid in full (hereinafter ``Default Payment Amount'' and ``Default Interest Balance''). PetSmart shall consent to a Consent Judgment in the amount of the Default Payment Amount and Default Interest Balance, and the United States, at its sole option, may collect the entire Default Payment Amount and Default Interest Balance, or exercise any other rights granted by law or in equity, including, but not limited to, referring such matters for private collection, and PetSmart agrees not to contest, and hereby waives and discharges any defenses to, any collection action undertaken by the United States, or its agents or contractors, pursuant to this paragraph. PetSmart shall pay the United States all reasonable costs of collection and enforcement under this paragraph, respectively, including reasonable attorney's fees and expenses. 32. After staff receives this Agreement executed on behalf of PetSmart, staff shall promptly submit the Agreement to the Commission for provisional acceptance. Promptly following provisional acceptance of the Agreement by the Commission, 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). 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 16th calendar day after the date the Agreement is published in the Federal Register, in accordance with 16 CFR 1118.20(f). 33. This Agreement is conditioned upon, and subject to, the Commission's final acceptance, as set forth above, and it is subject to the provisions of 16 CFR 1118.20(h). Upon the later of: (i) Commission's final acceptance of this Agreement and service of the accepted Agreement upon PetSmart, and (ii) the date of issuance of the final Order, this Agreement shall be in full force and effect, and shall be binding upon the parties. 34. Effective upon the later of: (i) the Commission's final acceptance of the Agreement and service of the accepted Agreement upon PetSmart, and (ii) and the date of issuance of the final Order, for good and valuable consideration, PetSmart hereby expressly and irrevocably waives and agrees not to assert any past, present, or future rights to the following, in connection with the matter described in this Agreement: (i) an administrative or judicial hearing; (ii) judicial review or other challenge or contest of the Commission's actions; (iii) a determination by the Commission of whether PetSmart failed to comply with the CPSA and the underlying regulations; (iv) a statement of findings of fact and conclusions of law; and (v) any claims under the Equal Access to Justice Act. 35. PetSmart represents and agrees that it has enhanced its compliance program to ensure compliance with the CPSA with respect to any consumer product imported, manufactured, distributed or sold by the Firm and will maintain said compliance program. PetSmart represents that the ongoing compliance program contains: (i) written standards, policies and procedures including those designed to ensure that information that may relate to or impact CPSA compliance (including information obtained by quality control personnel) is conveyed effectively to personnel responsible for CPSA compliance, whether or not an injury is referenced; (ii) a mechanism for confidential employee reporting of compliance-related questions or concerns to either a compliance officer or to another senior manager with authority to act as necessary; (iii) effective communication of company compliance- related policies and procedures regarding the CPSA to all applicable employees through training programs or otherwise; (iv) management oversight of and responsibility for compliance; and (v) retention of all CPSA compliance-related records for at [[Page 81089]] least five (5) years, and availability of such records to staff upon reasonable request. 36. PetSmart represents and agrees that it has designed and implemented internal controls and procedures designed to ensure that, with respect to all consumer products imported, manufactured, distributed or sold by PetSmart: (i) information required to be disclosed by PetSmart to the Commission is recorded, processed and reported in accordance with applicable law; (ii) all reporting made to the Commission is timely, truthful, complete, accurate and in accordance with applicable law; and (iii) prompt disclosure is made to PetSmart's management of any significant deficiencies or material weaknesses in the design or operation of such internal controls that are reasonably likely to affect adversely, in any material respect, PetSmart's ability to record, process and report to the Commission in accordance with applicable law. 37. Upon reasonable request of staff, PetSmart shall provide written documentation of its internal controls and procedures, including, but not limited to, the effective dates of the procedures and improvements thereto. PetSmart shall cooperate fully and truthfully with staff and shall, upon reasonable notice make available all non- privileged information and materials, and personnel with direct involvement in such procedures and deemed necessary by staff to evaluate PetSmart's compliance with the terms of the Agreement. 38. The parties acknowledge and agree that the Commission may publicize the terms of the Agreement and the Order. 39. PetSmart represents that the Agreement: (i) is entered into freely and voluntarily, without any degree of duress or compulsion whatsoever; (ii) has been duly authorized; and (iii) constitutes the valid and binding obligation of PetSmart, enforceable against PetSmart in accordance with its terms. PetSmart will not directly or indirectly receive any reimbursement, indemnification, insurance related payment, or other payment in connection with the civil penalty to be paid by PetSmart pursuant to the Agreement and Order. The individuals signing the Agreement on behalf of PetSmart represent and warrant that they are duly authorized by PetSmart to execute the Agreement. 40. The signatories represent that they are authorized to execute this Agreement. 41. The Agreement is governed by the laws of the United States. 42. The Agreement and the Order shall apply to, and be binding upon, PetSmart and each of its successors, transferees, and assigns; and a violation of the Agreement or Order may subject PetSmart, and each of its successors, transferees, and assigns, to appropriate legal action. 43. The Agreement and the Order constitute the complete agreement between the parties on the subject matter contained therein. 44. 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. For purposes of construction, the Agreement shall be deemed to have been drafted by both of the parties and shall not, therefore, be construed against any party, for that reason, in any subsequent dispute. 45. The Agreement may not be waived, amended, modified, or otherwise altered, except as in accordance with the provisions of 16 CFR 1118.20(h). The Agreement may be executed in counterparts. 46. If any provision of the Agreement or 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 PetSmart agree in writing that severing the provision materially affects the purpose of the Agreement and the Order. PETSMART, INC. Dated: October 28, 2016 By:-------------------------------------------------------------------- Michael J. Massey President and Chief Executive Officer PetSmart, Inc. Dated: October 28, 2016 By:-------------------------------------------------------------------- Jeffrey B. Margulies, Esq. Norton Rose Fulbright US LLP Counsel to PetSmart, Inc. U.S. CONSUMER PRODUCT SAFETY COMMISSION Mary T. Boyle General Counsel Mary B. Murphy Assistant General Counsel Dated: October 27, 2016 By:-------------------------------------------------------------------- Philip Z. Brown Trial Attorney Division of Compliance Office of the General Counsel UNITED STATES OF AMERICA CONSUMER PRODUCT SAFETY COMMISSION In the Matter of: PETSMART, INC. CPSC Docket No.: 17-C0001 ORDER Upon consideration of the Settlement Agreement entered into between PetSmart, Inc. (``PetSmart''), and the U.S. Consumer Product Safety Commission (``Commission''), and the Commission having jurisdiction over the subject matter and over PetSmart, and it appearing that the Settlement Agreement and the Order are in the public interest, it is: ORDERED that the Settlement Agreement be, and is, hereby, accepted; and it is FURTHER ORDERED that PetSmart shall comply with the terms of the Settlement Agreement and shall pay a civil penalty in the amount of four million, two hundred fifty thousand dollars ($4,250,000), within thirty (30) days after service of the Commission's final Order accepting the Settlement Agreement. The payment shall be made by electronic wire transfer to the Commission via: http://www.pay.gov. Upon the failure of PetSmart to make the foregoing payment when due, interest on the unpaid amount shall accrue and be paid by PetSmart at the federal legal rate of interest set forth at 28 U.S.C. 1961(a) and (b). If PetSmart fails to make such payment or to comply in full with any other provision of the Settlement Agreement, such conduct will be considered a violation of the Settlement Agreement and Order. Provisionally accepted and provisional Order issued on the 14th day of November, 2016. BY ORDER OF THE COMMISSION: ----------------------------------------------------------------------- Todd A. Stevenson, Secretary U.S. Consumer Product Safety Commission [FR Doc. 2016-27644 Filed 11-16-16; 8:45 am] BILLING CODE 6355-01-P
![81086 Federal Register / Vol. 81, No. 222 / Thursday, November 17, 2016 / Notices
weak. The strongest support for marked for discreteness but do not meet the Dated: November 10, 2016.
separation comes from the best available criteria for significance. As such, the Samuel D. Rauch, III,
genetic data which, although limited harbor seals in Iliamna Lake do not meet Deputy Assistant Administrator for
and preliminary, support a conclusion all the criteria necessary to constitute a Regulatory Programs, National Marine
that at least some of the harbor seals in DPS, and thus are not a listable entity Fisheries Service.
Iliamna Lake are likely isolated from under the ESA. Therefore, we find that [FR Doc. 2016–27690 Filed 11–16–16; 8:45 am]
harbor seals in the Egegik and Ugashik the petitioned actions to list the harbor BILLING CODE 3510–22–P
regions of eastern Bristol Bay. Thus, we seals in Iliamna Lake as a threatened or
conclude that the harbor seal population endangered species under the ESA, and
in Iliamna Lake is separated from other
to designate critical habitat, are not CONSUMER PRODUCT SAFETY
populations of the taxon and meet the
warranted. COMMISSION
discreteness criterion of our DPS policy
(61 FR 4722; February 7, 1996). In our 90-day finding (78 FR 29098;
May 17, 2013), we indicated we were [CPSC Docket No. 17–C0001]
Per the second component of our DPS
Policy, we are to consider available commencing a status review of the PetSmart, Inc., Provisional Acceptance
scientific evidence of the discrete harbor seals in Iliamna Lake. To assist of a Settlement Agreement and Order
population’s importance to the taxon to our evaluation of whether the seals in
which it belongs (61 FR 4722; February Iliamna Lake constitute a DPS, the BRT AGENCY: Consumer Product Safety
7, 1996). Our review of the best prepared a report which compiled Commission
available information suggests the only background information about the ACTION: Notice.
characteristic which may make this harbor seals in Iliamna Lake and
population of harbor seals unique evaluated the scientific information SUMMARY: It is the policy of the
within its taxon is the fact that they relevant to the DPS criteria (Boveng et Commission to publish settlements
persist year-round in a freshwater which it provisionally accepts under the
al., 2016). Upon our determination that
system which freezes over to some Consumer Product Safety Act in the
the DPS criteria were not met and the
degree in most winters. While that Federal Register in accordance with the
characteristic is unique within the seals in Iliamna Lake are not a ‘‘species’’
terms of the Consumer Product Safety
subspecies P. v. richardii, we under the ESA, there is no need to Commission’s regulations. Published
determined such persistence is not complete the status review by below is a provisionally-accepted
biologically or ecologically important to conducting a threats assessment or Settlement Agreement with PetSmart,
the taxon as a whole. Furthermore, the extinction risk assessment in light of the Inc., containing a civil penalty in the
information available supports a factors in section 4(a)(1) of the ESA. amount of four million, two hundred
conclusion that loss of this population In some instances, where we find a fifty thousand dollars ($4,250,000)
would not be detrimental to the petitioned action is not warranted within thirty (30) days of service of the
persistence of the taxon or constitute a because the petitioned population does Commission’s final Order accepting the
gap in the range of the taxon; this not constitute a ‘‘species’’ under the Settlement Agreement.
population is not the only natural ESA, we have initiated a status review DATES: Any interested person may ask
surviving population; and there are no of a related or larger population (e.g., the Commission not to accept this
unique genetic characteristics conveying agreement or otherwise comment on its
the 12-month determination that the
significance of this population to the contents by filing a written request with
petitioned action to list Lynn Canal
taxon. After reviewing the best available the Office of the Secretary by December
data as they apply to the significance Pacific herring was not warranted,
followed by a status review of the 2, 2016.
criterion, we conclude that the harbor
Southeast Alaska population of Pacific ADDRESSES: Persons wishing to
seals in Iliamna Lake are not significant
to the taxon P. v. richardii. herring; 73 FR 19824; April 11, 2008). comment on this Settlement Agreement
Under our DPS Policy, both the Here, the scope of the petition was should send written comments to the
discreteness and significance elements limited to the seals in Iliamna Lake, and Comment 17–C0001, Office of the
must be met to qualify as a DPS. Our since the most recent abundance data Secretary, Consumer Product Safety
review has determined that the seals for the Bristol Bay harbor seal stock (the Commission, 4330 East-West Highway,
persisting year-round in Iliamna Lake stock that includes seals in Iliamna Room 820, Bethesda, Maryland 20814–
are discrete but not significant; Lake) indicates this stock increased 4408.
therefore, the harbor seals in Iliamna from an estimated 18,577 seals in 2005 FOR FURTHER INFORMATION CONTACT:
Lake do not qualify as a DPS and are not to an estimated 32,350 seals in 2011 Philip Z. Brown, Trial Attorney,
a listable entity under the ESA. (Allen and Angliss 2014; Muto and Division of Compliance, Office of the
Angliss 2015), we are not initiating a General Counsel, Consumer Product
Finding Safety Commission, 4330 East-West
status review of the Bristol Bay harbor
In assessing whether the actions in Highway, Bethesda, Maryland 20814–
seal stock at this time.
the petition are warranted, we reviewed 4408; telephone (301) 504–7645.
the best available scientific and References SUPPLEMENTARY INFORMATION: The text of
commercial information available, the Agreement and Order appears
including the BRT report, the petition A complete list of all references cited
asabaliauskas on DSK3SPTVN1PROD with NOTICES
below.1
and literature cited in the petition, herein is available upon request (see
published and grey literature relevant to ADDRESSES). 1 The Commission voted (4–1) to provisionally
the topic, correspondence with experts Authority accept the Settlement Agreement and Order
in academic and government regarding PetSmart, Inc. Chairman Kaye,
institutions, documentation of LTK, and Commissioner Adler, Commissioner Robinson and
The authority for this action is the Commissioner Mohorovic voted to provisionally
public comments. On the basis of this Endangered Species act of 1973, as accept the Settlement Agreement and Order.
review, we have determined that harbor amended (16 U.S.C. 1531 et seq.). Commissioner Buerkle voted to reject the
seals in Iliamna Lake meet the criteria Settlement Agreement and Order.
VerDate Sep<11>2014 21:24 Nov 16, 2016 Jkt 241001 PO 00000 Frm 00034 Fmt 4703 Sfmt 4703 E:\FR\FM\17NON1.SGM 17NON1](https://thefederalregister.org/doc/81_FR_81308/page/1.svg)
![Federal Register / Vol. 81, No. 222 / Thursday, November 17, 2016 / Notices 81087
Dated: November 14, 2016. breaking, or shattering during normal Commission immediately of such defect
Todd A. Stevenson, use, which, in at least 12 instances, or risk, as required by sections 15(b)(3)
Secretary. resulted in serious injuries, including and (4) of the CPSA, 15 U.S.C.
deep lacerations requiring stitches and 2064(b)(3) and (4), in violation of
UNITED STATES OF AMERICA severed tendons necessitating surgery. section 19(a)(4) of the CPSA, 15 U.S.C.
CONSUMER PRODUCT SAFETY 8. PetSmart received at least three 2068(a)(4).
COMMISSION reports of consumers sustaining serious 15. Because the information in
In the Matter of: PETSMART, INC. CPSC injuries during normal use of the Fish PetSmart’s possession constituted actual
Docket No.: 17–C0001 Bowls between August 2011 and and presumed knowledge, PetSmart
September 2011 but neither initiated an knowingly violated section 19(a)(4) of
SETTLEMENT AGREEMENT investigation into the Subject Products the CPSA, 15 U.S.C. 2068(a)(4), as the
1. In accordance with the Consumer in response to these reports of serious term ‘‘knowingly’’ is defined in section
Product Safety Act, 15 U.S.C. injury nor immediately reported to the 20(d) of the CPSA, 15 U.S.C. 2069(d).
2051¥2089 (‘‘CPSA’’) and 16 CFR Commission. 16. Pursuant to Section 20 of the
1118.20, PetSmart, Inc. (‘‘PetSmart’’), 9. In May 2013, after receiving CPSA, 15 U.S.C. 2069, PetSmart is
and the United States Consumer additional reports, including two subject to civil penalties for its knowing
Product Safety Commission reports of serious injuries to consumers, violation of section 19(a)(4) of the
(‘‘Commission’’), through its staff, PetSmart initiated an investigation and CPSA, 15 U.S.C. 2068(a)(4).
hereby enter into this Settlement evaluation of the defect and risk
Agreement (‘‘Agreement’’). The associated with the Fish Bowls. That Violation of CPSA Section 19(a)(13)
Agreement and the incorporated investigation, which concluded in July 17. PetSmart’s January 31, 2014 Full
attached Order resolve staff’s charges set 2013, identified deficiencies in the Report identified the Subject Products
forth below. thickness and distribution of the glass in as 10,211 Fish Bowls, sold between
the Fish Bowls. During its investigation, February 2013 and September 2013,
THE PARTIES PetSmart continued to receive reports of which posed a laceration hazard to
2. The Commission is an independent serious injury caused by the Fish Bowls. consumers. The Full Report did not
federal regulatory agency, established Firms may conduct a reasonably identify an additional 81,300 units of
pursuant to, and responsible for, the expeditious investigation, not normally Subject Products that were sold prior to
enforcement of the CPSA, 15 U.S.C. exceeding 10 days, to evaluate their February 2013 that posed the same
2051¥2089. By executing the reporting obligations. See 16 CFR hazard and had been the subject of
Agreement, staff is acting on behalf of 1115.14(d). PetSmart’s investigation incident and injury reports received by
the Commission, pursuant to 16 CFR took over two months to complete. PetSmart.
1118.20(b). The Commission issues the 10. PetSmart stopped sale of the Fish 18. By failing to identify the correct
Order under the provisions of the CPSA. Bowls in September 2013. At the time amount and distribution dates of the
3. PetSmart is a corporation, PetSmart stopped sale of the Fish Subject Products in PetSmart’s Full
organized and existing under the laws of Bowls, PetSmart had received at least 12 Report, PetSmart knowingly
the state of Delaware, with its principal reports of consumers being injured misrepresented the scope of consumer
place of business in Phoenix, AZ. during normal use of the Subject products subject to an action required
Products. under section 15 of the CPSA. As a
STAFF CHARGES 11. PetSmart did not file a Full Report result of PetSmart’s misrepresentation,
4. Between April 2009 and September with the Commission until January 31, the April 24, 2014 CPSC press release
2013, PetSmart imported and offered for 2014, pursuant to 15 U.S.C. 2064(b). announcing the recall inaccurately
sale in the United States, approximately PetSmart and the Commission jointly stated that ‘‘[a]bout 10,200’’ Fish Bowls
127,444 ‘‘Great Choice’’ or ‘‘Top Fin’’ announced a recall of 10,200 Fish Bowls were affected by the hazard posed by
brand 1.75 gallon, brandy snifter-style on April 24, 2014. the Fish Bowls. An expansion of the
glass fish bowls (‘‘Fish Bowls’’ or 12. PetSmart’s Full Report contained recall was announced on November 17,
‘‘Subject Products’’) . information on only 10,211 Fish Bowls 2015.
5. The Fish Bowls are a ‘‘consumer imported and sold between February 19. By knowingly misrepresenting the
product,’’ ‘‘distribut[ed] in commerce,’’ 2013 and September 2013. However, scope of consumer products subject to
as those terms are defined or used in information produced by PetSmart an action under section 15 of the CPSA,
sections 3(a)(5) and (8) of the CPSA, 15 during staff’s civil penalty investigation PetSmart knowingly violated section
U.S.C. 2052(a)(5) and (8). PetSmart is an revealed that PetSmart had actually sold 19(a)(13) of the CPSA, 15 U.S.C.
‘‘importer,’’ ‘‘manufacturer’’ and a total of 91,500 Fish Bowls between 2068(a)(13), as the term ‘‘knowingly’’ is
‘‘retailer’’ of the Fish Bowls, as such March 2010 and September 2013 that defined in section 20(d) of the CPSA, 15
terms are defined in sections 3(a)(11) posed the same laceration hazard. U.S.C. 2069(d).
and (13) of the CPSA, 15 U.S.C. PetSmart and the Commission jointly 20. Pursuant to section 20 of the
2052(a)(11) and (13). announced an expanded recall of 91,500 CPSA, 15 U.S.C. 2069, PetSmart is
Fish Bowls on November 17, 2015. subject to civil penalties for its knowing
Violation of CPSA Section 19(a)(4) 13. By the date of the expanded recall, violation of section 19(a)(13) of the
6. The Fish Bowls contain a defect PetSmart received at least 32 reports of CPSA, 15 U.S.C. 2068(a)(13).
which could create a substantial Fish Bowls cracking, breaking or
asabaliauskas on DSK3SPTVN1PROD with NOTICES
product hazard and create an shattering during normal use, including RESPONSE OF PETSMART
unreasonable risk of serious injury 18 reports of injury. PetSmart received 21. PetSmart’s settlement of this
because they can crack, shatter, or break at least six of these reports of injury matter does not constitute an admission
during normal use, posing a laceration after the first recall. of staff’s charges in paragraphs 4
hazard to consumers. 14. Despite having information that through 20 above.
7. Between August 2011 and January the Fish Bowls contained a defect and 22. Between November 2013 and
2014, PetSmart received at least 19 created an unreasonable risk of serious January 2014, PetSmart corresponded
incident reports of Fish Bowls cracking, injury, PetSmart did not notify the with CPSC staff regarding certain Fish
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![Federal Register / Vol. 81, No. 222 / Thursday, November 17, 2016 / Notices 81089
least five (5) years, and availability of 42. The Agreement and the Order UNITED STATES OF AMERICA
such records to staff upon reasonable shall apply to, and be binding upon, CONSUMER PRODUCT SAFETY
request. PetSmart and each of its successors, COMMISSION
36. PetSmart represents and agrees transferees, and assigns; and a violation In the Matter of: PETSMART, INC. CPSC
that it has designed and implemented of the Agreement or Order may subject Docket No.: 17–C0001
internal controls and procedures PetSmart, and each of its successors, ORDER
designed to ensure that, with respect to transferees, and assigns, to appropriate
all consumer products imported, Upon consideration of the Settlement
legal action.
manufactured, distributed or sold by Agreement entered into between
PetSmart: (i) information required to be 43. The Agreement and the Order PetSmart, Inc. (‘‘PetSmart’’), and the
disclosed by PetSmart to the constitute the complete agreement U.S. Consumer Product Safety
Commission is recorded, processed and between the parties on the subject Commission (‘‘Commission’’), and the
reported in accordance with applicable matter contained therein. Commission having jurisdiction over
law; (ii) all reporting made to the 44. The Agreement may be used in the subject matter and over PetSmart,
Commission is timely, truthful, interpreting the Order. Understandings, and it appearing that the Settlement
complete, accurate and in accordance agreements, representations, or Agreement and the Order are in the
with applicable law; and (iii) prompt interpretations apart from those public interest, it is:
disclosure is made to PetSmart’s contained in the Agreement and the ORDERED that the Settlement
management of any significant Order may not be used to vary or Agreement be, and is, hereby, accepted;
deficiencies or material weaknesses in contradict their terms. For purposes of and it is
the design or operation of such internal FURTHER ORDERED that PetSmart
construction, the Agreement shall be
controls that are reasonably likely to shall comply with the terms of the
deemed to have been drafted by both of Settlement Agreement and shall pay a
affect adversely, in any material respect, the parties and shall not, therefore, be
PetSmart’s ability to record, process and civil penalty in the amount of four
construed against any party, for that million, two hundred fifty thousand
report to the Commission in accordance reason, in any subsequent dispute.
with applicable law. dollars ($4,250,000), within thirty (30)
37. Upon reasonable request of staff, 45. The Agreement may not be days after service of the Commission’s
PetSmart shall provide written waived, amended, modified, or final Order accepting the Settlement
documentation of its internal controls otherwise altered, except as in Agreement. The payment shall be made
and procedures, including, but not accordance with the provisions of 16 by electronic wire transfer to the
limited to, the effective dates of the CFR 1118.20(h). The Agreement may be Commission via: http://www.pay.gov.
procedures and improvements thereto. executed in counterparts. Upon the failure of PetSmart to make
PetSmart shall cooperate fully and 46. If any provision of the Agreement the foregoing payment when due,
truthfully with staff and shall, upon or the Order is held to be illegal, interest on the unpaid amount shall
reasonable notice make available all invalid, or unenforceable under present accrue and be paid by PetSmart at the
non-privileged information and or future laws effective during the terms federal legal rate of interest set forth at
materials, and personnel with direct of the Agreement and the Order, such 28 U.S.C. 1961(a) and (b). If PetSmart
involvement in such procedures and provision shall be fully severable. The fails to make such payment or to comply
deemed necessary by staff to evaluate balance of the Agreement and the Order in full with any other provision of the
PetSmart’s compliance with the terms of Settlement Agreement, such conduct
shall remain in full force and effect,
the Agreement. will be considered a violation of the
unless the Commission and PetSmart
38. The parties acknowledge and Settlement Agreement and Order.
agree in writing that severing the
agree that the Commission may Provisionally accepted and provisional
provision materially affects the purpose
publicize the terms of the Agreement Order issued on the 14th day of November,
of the Agreement and the Order.
and the Order. 2016.
39. PetSmart represents that the PETSMART, INC.
BY ORDER OF THE COMMISSION:
Agreement: (i) is entered into freely and Dated: October 28, 2016 lllllllllllllllllllll
voluntarily, without any degree of By: lllllllllllllllllll Todd A. Stevenson, Secretary
duress or compulsion whatsoever; (ii) Michael J. Massey U.S. Consumer Product Safety Commission
has been duly authorized; and (iii) President and Chief Executive Officer [FR Doc. 2016–27644 Filed 11–16–16; 8:45 am]
constitutes the valid and binding PetSmart, Inc. BILLING CODE 6355–01–P
obligation of PetSmart, enforceable Dated: October 28, 2016
against PetSmart in accordance with its By: lllllllllllllllllll
terms. PetSmart will not directly or Jeffrey B. Margulies, Esq. DEPARTMENT OF ENERGY
indirectly receive any reimbursement, Norton Rose Fulbright US LLP
indemnification, insurance related Counsel to PetSmart, Inc. Federal Energy Regulatory
payment, or other payment in U.S. CONSUMER PRODUCT SAFETY Commission
connection with the civil penalty to be COMMISSION
paid by PetSmart pursuant to the [Project No. 14795–001]
Agreement and Order. The individuals Mary T. Boyle
General Counsel Shell Energy North America (US), L.P.;
asabaliauskas on DSK3SPTVN1PROD with NOTICES
signing the Agreement on behalf of Notice of Intent To File License
PetSmart represent and warrant that Mary B. Murphy
Assistant General Counsel Application, Filing of Pre-Application
they are duly authorized by PetSmart to Document, and Approving Use of the
execute the Agreement. Dated: October 27, 2016
Traditional Licensing Process
40. The signatories represent that they By: lllllllllllllllllll
are authorized to execute this Philip Z. Brown a. Type of Filing: Notice of Intent to
Agreement. Trial Attorney File License Application and Request to
41. The Agreement is governed by the Division of Compliance Use the Traditional Licensing Process.
laws of the United States. Office of the General Counsel b. Project No.: 14795–001.
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Document Created: 2016-11-17 02:59:42
Document Modified: 2016-11-17 02:59:42
| Category | Regulatory Information | |
| Collection | Federal Register | |
| sudoc Class | AE 2.7: GS 4.107: AE 2.106: | |
| Publisher | Office of the Federal Register, National Archives and Records Administration | |
| Section | Notices | |
| Action | Notice. | |
| 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 December 2, 2016. | |
| Contact | Philip Z. Brown, Trial Attorney, Division of Compliance, Office of the General Counsel, Consumer Product Safety Commission, 4330 East-West Highway, Bethesda, Maryland 20814- 4408; telephone (301) 504-7645. | |
| FR Citation | 81 FR 81086 |
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