Costco Agrees to $3.85 Million Civil Penalty, Compliance Program for Failure to Report Defective Trash Cans

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U.S. Consumer Product Safety Commission

Oct 05, 2018, 10:54 ET

WASHINGTON, Oct. 5, 2018 /PRNewswire/ -- https://www.cpsc.gov/Newsroom/News-Releases/2019/costco-agrees-to-385-million-civil-penalty-compliance-program-for-failure-to-report

The U.S. Consumer Product Safety Commission (CPSC) announced that Costco Wholesale, Corp. (Costco), of Issaquah, Wash., has agreed to pay a $3.85 million civil penalty.

The settlement resolves CPSC staff's charges that Costco knowingly failed to report to CPSC, as required by law, that the EKO Sensible Eco Living Trash Cans (EKO Trash Cans) contained a defect or created an unreasonable risk of serious injury.

CPSC staff charged that the black plastic protective collar in the opening on the back of the EKO Trash Can receptacle can become dislodged and expose a sharp edge, posing a laceration hazard to consumers. Costco received 92 complaints about the EKO Trash Cans, including 60 complaints from consumers who received injuries, some serious, but did not notify the CPSC immediately of the defect or risk.

On July 17, 2015, CPSC announced a recall with the manufacturer of 367,000 EKO Trash Cans. Costco sold the EKO Trash Cans nationwide between December 2013 and May 2015, for about $50.

In addition to paying the $3.85 million civil penalty, Costco has agreed to maintain a compliance program designed to achieve compliance with the Consumer Product Safety Act and a system of internal controls and procedures to ensure that Costco discloses information to the Commission in accordance with applicable law.

Costco's settlement of this matter does not constitute an admission of CPSC staff's charges.

The penalty agreement has been accepted provisionally by the Commission by a 4 to 0 vote.

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The U.S. Consumer Product Safety Commission is charged with protecting the public from unreasonable risks of injury or death associated with the use of thousands of types of consumer products under the agency's jurisdiction. Deaths, injuries, and property damage from consumer product incidents cost the nation more than $1 trillion annually. CPSC is committed to protecting consumers and families from products that pose a fire, electrical, chemical or mechanical hazard. CPSC's work to ensure the safety of consumer products - such as toys, cribs, power tools, cigarette lighters and household chemicals – contributed to a decline in the rate of deaths and injuries associated with consumer products over the past 40 years.

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SOURCE U.S. Consumer Product Safety Commission