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Wal-Mart to Pay Penalty for Delay in Reporting Exercise Equipment Hazard
Apr 28, 2003
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The U.S. Consumer Product Safety Commission (CPSC) and the U.S. Department of Justice have announced that retailer Wal-Mart Stores Inc. of Bentonville, AR, U.S. has agreed to pay a civil penalty of U.S. $750,000. The penalty resolves a lawsuit filed in May 2001 by the Justice Department, on behalf of CPSC, in the U.S. District Court for the District of Maryland, in which the government charged Wal-Mart with failing to report safety hazards associated with home exercise equipment. After an initial investigation by CPSC, the case against Wal-Mart was referred to the Civil Division of the Justice Department, led by Assistant Attorney General Robert D. McCallum, and then filed in court with the assistance of the U.S. Attorney's Office in Baltimore, MD, U.S., led by U.S. Attorney Thomas M. DiBiagio. Commission and Justice Department attorneys cooperated in the litigation and settlement of the case. "This case demonstrates that retailers, like manufacturers, importers, and distributors, are required to report consumer product defects and injuries to the Consumer Product Safety Commission in a timely manner, and that there are penalties for those who fail to do so," said Hal Stratton, CPSC chairman. "Prompt and timely reporting by companies will allow us to act swiftly to protect consumers from injuries." The lawsuit and civil penalty settlement represent the first time a retailer has been sued and paid a penalty for failing to report a safety problem where the retailer was not also an importer or private labeler. Under the announced settlement, Wal-Mart also agreed to establish internal recordkeeping and monitoring systems to keep track of information about product safety hazards. Under the law administered and enforced by the CPSC, manufacturers, distributors, and retailers must immediately report product hazards to CPSC. CPSC and the Department of Justice charged that Wal-Mart failed to report hazards with Weider and Weslo brand exercise gliders, despite knowing of at least 29 consumers who were injured while trying out the gliders in Wal-Mart stores across the country. The injuries included fractured vertebrae, herniated discs, and a compression injury to a woman's spine. In November 2001, Icon Health & Fitness Inc., the manufacturer of the gliders, agreed to pay a $500,000 civil penalty for failing to inform the CPSC in a timely manner of 86 incidents and 68 injuries involving the same Weider and Weslo exercise equipment. The injuries were the result of a defect in the arm supporting the seat on the exercise gliders that can disconnect during use, causing the user to fall abruptly. That settlement also required Icon to establish internal recordkeeping and monitoring systems to keep track of information about product safety hazards. In April 1999, CPSC and Icon jointly announced a recall of the gliders, which include the Weider Shape Glider (Model WECR 4306), the Weider Power Glide (Model WECR 4406), and the Weslo Shape Trainer (Model WLCR 4356).

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