Letter Opposing S. 2663, the "CPSC Reform Act"

Monday, March 3, 2008 - 7:00pm

March 4, 2008


The U.S. Chamber of Commerce, the world's largest business federation representing more than three million businesses and organizations of every size, sector, and region, strongly opposes the current version of S. 2663, the "CPSC Reform Act," which is being considered by the Senate this week. Enactment of S. 2663, in its current form, will create an unmanageable and conflict-ridden environment that would ultimately undermine and prevent the CPSC (Consumer Product Safety Commission) from fulfilling its mandate. These changes are unjustified on either legal or public policy grounds.

It is important to note that the Chamber supports increasing the resources available to the CPSC to accomplish its very valuable statutory purposes. The CPSC has been grossly underfunded throughout its existence and S. 2663 contains provisions designed to help rectify that situation. Nevertheless, the bill is deeply flawed.

First, Section 20 of S. 2663 would create a situation potentially rife with conflict between state attorneys general and the CPSC by authorizing state attorneys general to bring actions on behalf of their own states against companies they believe violated federal consumer protection statutes enforced by the CPSC. While state attorneys general have an interest in enforcing consumer protection laws enacted by their respective states, effectively deputizing them to enforce federal law in the manner contemplated by S. 2663 is inappropriate. Personal injury lawyer supporters of this controversial provision argue that it is not harmful because it only authorizes state attorneys general to pursue injunctive relief, not money damages. What they fail to point out is that these lawyers may still get potentially huge contingency fee windfalls regardless of whether injunctions or monetary damages are at stake. Section 20 would inevitably lead to conflicts between the CPSC and states attorneys general in seeking the best course of action to remedy violations.

Second, the legislation turns the presumption on its head that the opinions and decisions of the CPSC should take precedence in its mission to provide national standards for consumer products through Section 17, which limits the preemptive authority of the CPSC. This section would lead to a continual battle for supremacy between the CPSC, state attorneys general, and members of the plaintiffs trial bar.

Third, S. 2663 would create a new right that will allow millions of employees of consumer product manufacturers, distributors and retailers, as well as related federal employees, to prevent a pending disciplinary action or termination by claiming knowledge of a product safety violation. Congress has established no record providing the evidence necessary to show there is a need for such an extraordinary provision. This provision would allow a disgruntled employee a powerful incentive to report preliminary, erroneous or unsubstantiated information as an alleged product safety violation in order to insulate themselves from disciplinary action for reasons entirely unrelated to product safety.

Fourth, the bill's requirement for the CPSC to create a public database without any safeguards or assurances that the information posted is true and accurate will lead to consumer confusion and give rise to lawsuits based on a rumor repeated through the echo chamber of the Internet. The legislation would give CPSC staff only 15 days to ensure that the information they have received is accurate. Should they make a mistake and post something in the database that is in error, it would cause tremendous harm to a company who may have done nothing wrong.

As currently drafted, S. 2663 is flawed and will ultimately serve to only increase litigation and cause companies to work in a less voluntary fashion with the CPSC—a result that would lead to decreased product and consumer safety. Accordingly, the Chamber strongly urges you to oppose S. 2663 in its current form. The Chamber may consider votes on, or in relation to, this issue in our annual How They Voted scorecard.

R. Bruce Josten