BY: Follow @lachlan
A government watchdog group filed a lawsuit against the Consumer Product Safety Commission (CPSC) on Tuesday to force the commission to release documents requested under the Freedom of Information Act.
Cause of Action requested documents six months ago pertaining to CPSC’s administrative actions against Craig Zucker, creator of the popular adult desk toy Buckyballs. It is now suing the agency to turn over those documents.
Cause of Action says CPSC’s refusal to respond to its request within the legally mandated 20 business days is indicative of the opacity of many of the administration’s regulatory actions.
Zucker has filed his own suit against the commission, attempting to obtain an injunction against its efforts to hold him personally liable for recalling Buckyballs, which CPSC says are a hazard to children.
Buckyballs, manufactured by Zucker’s former company Maxfield & Oberton, were popular magnetic steel balls marketed as adult desk toys. The company folded in 2012 after CPSC ordered a recall, claiming they could cause serious damage to internal organs if swallowed.
The commission’s critics, including former commissioner and CPSC chair Nancy Nord, say CPSC went overboard in trying to hold Zucker personally liable for the costs of recalling the product.
Nord called the campaign against Zucker “irrational” and “detrimental to creativity, innovation and entrepreneurship” in a Wall Street Journal column last year.
Cause of Action has assisted Zucker in his legal campaign to avoid the estimated $57 million cost of recalling Buckyballs from retailers nationwide. It filed a FOIA request in November seeking documents and internal communications pertaining to the Buckyballs case.
“Well past the statutory 20 day deadline, the CPSC has yet to produce any documents,” the group said in a statement on Tuesday.
“This administration was just pegged with the title the ‘most secretive’ administration in history and the CPSC’s refusal to produce documents is another example of that spirit of secrecy,” Cause of Action executive director Dan Epstein said in a statement.
The administration came under fire last week, which is recognized nationally as Sunshine Week, for its secrecy and disregard for laws promoting transparency.
According to CPSC’s “open government plan,” federal agencies “should provide citizens with information about what their government is doing so that government can be held accountable.”
Epstein says CPSC is not living up to that pledge.
“Americans have an interest in how federal agencies conduct oversight, and the CPSC’s consistent unresponsiveness to our inquiry is a disservice to the public,” Epstein said.
Cause of Action and Zucker are attempting to obtain the documents because it is not clear that CPSC has the legal authority to hold the businessman liable for the costs of a recall.
“The legal theory for this move is known as the ‘responsible corporate officer’ doctrine, which says corporate officers may be held criminally liable for law violations even absent knowledge of or participation in the illegal act,” Nord explained.
“Yet here we are not dealing with a criminal matter,” she noted. “We are dealing with a recall of a product that has not been proven to be defective and even now is legal to sell. It has never been suggested that Mr. Zucker, or Maxfield & Oberton, acted illegally.”
CPSC’s attempt to hold Zucker personally liable for recall costs, if upheld, will have significant implications for wide swaths of industry, observers note.
Corporate law firm Morrison and Foerster recently warned clients that such an outcome would carry “sobering implications.”
“Extension of this doctrine to the consumer products arena could add another powerful tool to the CPSC’s enforcement toolbox, allowing the CPSC to leverage the threat of personal liability against corporate officers,” the firm said in a May, 2013, memo.