U.S. Department of Justice: Electrolux Agrees to Pay $750,000 Civil Penalty for Delay in Reporting

Electrolux settled allegations that it knowingly failed to report immediately to CPSC a safety hazard associated with certain wall ovens
May 19, 2014
Release Number:

WASHINGTON, D.C. –The Justice Department’s Civil Division announced today that Electrolux Home Products Inc. (Electrolux), of Charlotte, North Carolina, has agreed to pay a civil penalty of $750,000 to settle allegations that it knowingly failed to report immediately to the U.S. Consumer Product Safety Commission (CPSC) a safety hazard associated with certain wall ovens sold to consumers.  Electrolux has also agreed to establish and maintain a compliance program with internal recordkeeping and monitoring systems to keep track of information about product safety hazards.

 
“Manufacturers and distributors of consumer products are required to report product defects and hazards to the Consumer Product Safety Commission immediately and there are penalties for those who fail to do so,” said Stuart F. Delery, Assistant Attorney General for the Justice Department’s Civil Division.  “We will continue to work with our partners at the CPSC to ensure that they can act promptly to protect consumers from injuries.”        

 
In a complaint filed on behalf of the CPSC in U.S. District Court for the Southern District of Georgia, the United States alleged that Electrolux became aware of incidents in which gas could build up in the oven during broiling and escape and ignite, causing burn and fire hazards to consumers.  Electrolux imported and distributed approximately 7,800 of the Kenmore ovens that were sold by Sears and other stores throughout the United States.

 
“CPSC will vigorously enforce the immediate reporting requirement found in the Consumer Product Safety Act,” said CPSC Acting Chairman Bob Adler.  “The federal reporting rules are aimed at protecting the safety of the American public.  Delay in reporting of product defects and hazards by manufacturers, distributors or retailers can result in civil penalties and other measures designed to ensure consumer safety.”

 
Under the Consumer Product Safety Act (CPSA), manufacturers, distributors, and retailers are required to report product hazards to the CPSC.  A knowing violation of the CPSA subjects a firm to civil penalties.  The United States alleged that between February 2006 and November 2007, Electrolux knew of 22 consumer reports of flames shooting out of the oven when the broiler was on.  The incidents resulted in consumer injuries ranging from singed hair to facial burns.  The United States alleged that Electrolux failed to immediately report hazards with the oven, despite the fact that Frigidaire Canada, Electrolux’s sister company, identified the defective and hazardous nature of the ovens in January 2005 and implemented a design change to fix the defect in March 2006. 

 
“Public safety is a paramount concern,” said United States Attorney, Southern District of Georgia Edward J. Tarver.  “The United States Attorney’s Office must and will continue to work together with the CPSC to protect consumers.”

During the relevant time period, Electrolux’s principal place of business was in Augusta, Georgia.  A recall of the ovens was announced in 2008.  In agreeing to settle this matter, Electrolux has not admitted that it knowingly violated the CPSA.

 
The matter is being handled by the Department of Justice’s Consumer Protection Branch and the U.S. Attorney’s Office for the Southern District of Georgia, on behalf of the Consumer Product Safety Commission.