Philips Lighting North America Agrees to Pay $2 Million Civil Penalty for Failure to Report Defective Lamps and Implement Compliance Program

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U.S. Consumer Product Safety Commission

Nov 24, 2015, 02:39 ET

WASHINGTON, Nov. 24, 2015 /PRNewswire-USNewswire/ -- http://www.cpsc.gov/en/Newsroom/News-Releases/2016/Philips-Lighting-North-America-Agrees-to-Pay-2-Million-Civil-Penalty/

The U.S. Consumer Product Safety Commission (CPSC) announced today that Philips Lighting North America Corp., of Somerset, N.J., has agreed to pay a $2 million civil penalty to the government. The penalty settles charges that the company knowingly failed to report to CPSC, as required by federal law, information about a defect and an unreasonable risk of serious injury with EnergySaver (a/k/a/ "Marathon" or "Marathon Classic") compact fluorescent lamps.

After numerous complaints about glass separating from the body of the lamps and striking people and objects, and attempting multiple design changes to fix the problem, Philips failed to report the matter to CPSC. The incidents resulted in 10 reports of lacerations and seven reports of property damage.

In addition to paying the $2 million civil penalty, Philips has agreed to implement and maintain a compliance program to ensure compliance with the Consumer Product Safety Act (CPSA) and a related system of internal controls and procedures.

The compliance program requires written standards and policies and written procedures to ensure that all information regarding the firm's compliance with the CPSA, including reports and complaints, whether an injury is referenced or not, is conveyed to the firm's responsible employees. The compliance program also must address:

confidential employee reporting of compliance concerns to a senior manager;
effective communication of compliance policies and procedures, including training;
senior management responsibility for, and board oversight of, compliance; and
requirements for record retention.

The lamps were recalled in August 2011, after Philips had manufactured about 1.86 million units. Grocery and home center stores, online retailers, and professional electrical distributors sold the lamps from March 2007 through July 2011 for between $11 and $24 each.

Philips does not admit to CPSC staff's charges.

The penalty agreement has been accepted provisionally by the Commission by a 4 to 1 vote.

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SOURCE U.S. Consumer Product Safety Commission