Stamina Products, Inc., a Corporation, 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 16 CFR 1118.20(e). Published below is a provisionally-accepted Settlement Agreement with Stamina Products, Inc., a corporation, containing a civil penalty of $105,000.

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 February 1, 2008.

ADDRESSES:

Persons wishing to comment on this Settlement Agreement should send written comments to the Comment 08-0002, Office of the Secretary, Consumer Product Safety Commission, 4330 East West Highway, Room 502, Bethesda, Maryland 20814-4408.

FOR FURTHER INFORMATION CONTACT:

Dennis C. Kacoyanis; Trial Attorney, Office of Compliance and Field Operations, Consumer Product Safety Commission, 4330 East West Highway, Bethesda, Maryland 20814-4408; telephone (301) 504-7587.

SUPPLEMENTARY INFORMATION:

The text of the Agreement and Order appears below.

In the Matter of Stamina Products, Inc., a corporation.

I. Settlement Agreement and Order

1. This Settlement Agreement is made by and between the staff (“the staff”) of the U.S. Consumer Product Safety Commission (“the Commission”) and Stamina Products, Inc. (“Stamina”), a corporation, in accordance with the Commission's Procedures for Investigations, Inspections, and Inquiries under the Consumer Product Safety Act (“CPSA”), 16 CFR 1118.20. This Settlement Agreement and the incorporated attached Order settle the staff's allegations set forth below.

II. The Parties

2. The Commission is an independent federal regulatory agency responsible for the enforcement of the CPSA, 15 U.S.C. 2051-2084.

3. Stamina is a corporation organized and existing under the laws of the State of Missouri, with its principal corporate office located in Springfield, MO. At all times relevant, Stamina imported and/or distributed exercise equipment and sporting and recreational products.

II. Allegations of the Staff

4. Between August 2000 and March 2006, Stamina imported for sale nationwide approximately 668,000 In-Motion Trampolines (“trampolines”), Model Numbers 35-1625, 35-1625A-LC, 35-1625AW, and 36-1625AW-LC.

5. The trampolines are ``consumer products'' and, at the times relevant herein, Stamina was a ``manufacturer'' of those consumer products, which were ``distributed in commerce,'' as those terms are defined in sections 3(a)(1), (4), (11), and (12) of the CPSA, 15 U.S.C. 2052(a)(1), (4), (11), and (12).

6. The trampolines are defective because the trampoline's folding/unfolding instructions did not adequately warn consumers of the hazards resulting from use of the product.

7. On or about April 11, 2002, Stamina received a report from a consumer who alleged that while folding/unfolding the trampoline, it popped up and hit her in the mouth knocking a veneer off her tooth.

8. On or about January 2, 2004, Stamina received another report from a consumer who alleged chin lacerations requiring nine sutures when the trampoline sprang back during the folding/unfolding process.

9. From September 2004 through June 2005, Stamina received seven additional complaints from consumers who alleged that the trampoline sprang back during the folding/unfolding process. In six of these complaints, consumers alleged serious injuries consisting of facial lacerations requiring sutures, bruises, headaches, neck pain, broken facial bones, loss of mouth sensation, and blurred vision.

10. All but one of the injuries described in paragraphs 7-9, above constitute `serious' injuries as that term is defined in 16 CFR 1115.6(c).

11. Although Stamina obtained sufficient information to reasonably support the conclusion that the trampolines contained a defect which could create a substantial product hazard or created an unreasonable risk of serious injury or death, Stamina failed to immediately inform the Commission of such defect or risk as required by sections 15(b)(2) and (3) of the CPSA, 15 U.S.C. 2064(b)(2) and (3).

12. By failing to furnish information in a timely manner as required by section 15(b) of the CPSA, 15 U.S.C. 2064(b), Stamina 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).

13. Pursuant to section 20 of the CPSA, 15 U.S.C. 2069, Stamina is subject to civil penalties for its failure to make a timely report under section 15(b) of the CPSA, 15 U.S.C. 2064(b).

III. Stamina's Response

14. Stamina denies the staff's allegations set forth in paragraphs 4 through 13 above.

15. Stamina denies that the trampoline product contained a defect which could create a substantial product hazard, or created an unreasonable risk of serious injury or death, and denies that it violated the reporting requirements of section 15(b) of the CPSA, 15 U.S.C. 2064(b).

16. Stamina reported to the Commission on July 11, 2005.

17. The trampoline's folding/unfolding instructions adequately warned consumers of the hazards that could result from misuse or misassembly of the product.

18. The trampoline product contained assembly and disassembly instructions that Stamina contends, if followed, would have prevented the alleged incidents identified in paragraphs 7 through 9.

19. Stamina contends the incidents identified in paragraphs 7 through 9 were the result of consumer misuse or misassembly.

20. Stamina denies the alleged injuries were ‘serious’ injuries as that term is defined in 16 CFR 1115.6(c).

IV. Agreement of the Parties

21. The Commission has jurisdiction over this matter and over Stamina under the Consumer Product Safety Act, 15 U.S.C. 2051-2084.

22. In settlement of the staff's allegations, Stamina agrees to pay a civil penalty in the amount of $105,000.00 as set forth in the attached incorporated Order.

23. The parties enter this Settlement Agreement for settlement purposes only. Neither the Settlement Agreement nor the Order constitute an admission by Stamina or a determination by the Commission that Stamina violated the CPSA's reporting requirements or that the trampoline contained a defect.

24. Upon provisional acceptance of this Settlement Agreement by the Commission, the Commission shall place this Agreement and Order on the public record and shall publish it 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 Settlement Agreement and Order within 15 calendar days, the Agreement shall be deemed finally accepted on the 16th calendar day after the date it is published in the Federal Register in accordance with 16 CFR 1118.20(f).

25. This Settlement Agreement and Order resolves the alleged violations of the CPSA set forth in paragraphs 4 through 12, above.

26. Upon final acceptance of this Settlement Agreement by the Commission and issuance of the Final Order, Stamina knowingly, voluntarily, and completely waives any rights it may have in this matter to the following: (i) An administrative or judicial hearing; (ii) judicial review or other challenge or contest of the validity of the Commission's actions, (iii) a determination by the Commission as to whether Stamina failed to comply with the CPSA and the underlying regulations; (iv) a statement of findings of fact or conclusions of law; and (v) any claims under the Equal Access to Justice Act.

27. The Commission may publicize the terms of the Settlement Agreement and Order.

28. This Settlement Agreement and Order shall apply to, and be binding upon Stamina and each of its successors and assigns.

29. The Commission's Order in this matter is issued under the provisions of the CPSA, 15 U.S.C. 2051-2084, and a violation of this Order may subject those referenced in paragraph 24 to appropriate legal action.

30. This Settlement Agreement may be used in interpreting the Order. Agreements, understandings, representations, or interpretations made outside of this Settlement Agreement and Order may not be used to vary or contradict its terms.

31. This Settlement Agreement and Order shall not be waived, changed, amended, modified, or otherwise altered without written agreement thereto executed by the party against whom such amendment, modification, alteration or waiver is sought to be enforced, and approval by the Commission.

32. If after the effective date hereof, any provision of this Settlement Agreement and Order is held to be illegal, invalid, or unenforceable under present or future laws effective during the terms of the Settlement Agreement and Order, such provisions shall be fully severable. The rest of the Settlement Agreement and Order shall remain in full effect, unless the Commission and Stamina jointly determine that severing the provision materially changes the purpose of the Settlement Agreement Order

Stamina Products, Inc.

Dated: November 29, 2007

Kevin Gerschefske,

Vice-President & Secretary,

Stamina Products, Inc.,

2040 N. Alliance,

Springfield, MO 65803.

Dated: November 30, 2007

Randall E. Hindricks, Esquire,

Brandon J.B. Boulware, Esquire,

Rouse, Hendricks, German May, P.C.,

Attorneys for Stamina Products, Inc.,

1010 Walnut, Suite 400,

Kansas City, MO 64106.

Consumer Product Safety Commission

John Gibson Mullan,

Assistant Executive Director,

Office of Compliance and Field Operations,

Consumer Product Safety Commission,

4330 East West Highway,

Bethesda, MD 20814.

Ronald G. Yelenik,

Acting Director,

Legal Division,

Office of Compliance and Field Operations.

Dated: November 30, 2007

Dennis C. Kacoyanis,

Trial Attorney,

Office of Compliance and Field Operations.

In the Matter of Stamina Products, Inc., a corporation

Order

Upon consideration of the Settlement Agreement entered into between Stamina Products, Inc. (“Stamina”) and the staff of the Consumer Product Safety Commission (“the Commission”); and the Commission having jurisdiction over the subject matter and Stamina; and it appearing that the Settlement Agreement is in the public interest, it is

Ordered that the Settlement Agreement be, and hereby, is accepted; and it is

Further ordered that Stamina shall pay a civil penalty of one hundred five-thousand dollars ($105,000.00) to the order of the United States Treasury within twenty (20) calendar days of service of the Final Order of the Commission upon Stamina. Upon the failure of Stamina to make full payment in the prescribed time, interest on the outstanding balance shall accrue and be paid of the Federal legal rate of interest under the provisions of 28 U.S.C. 1961(a) and (b).

Provisionally accepted and provisional Order issued on the 11th day of January, 2008.

By order of the Commission.

Todd A. Stevenson, Secretary,

Consumer Product Safety Commission.