Mattel seen facing safety probe

Report: Consumer Product Safety Commission says toymaker did not abide by its mandate for disclosing product safety risks within 24 hours.


The Consumer Product Safety Commission is investigating whether Mattel "knowingly" withheld information regarding potential safety risks associated with its toys that were involved in a major recall last month, according to a published report Tuesday.

The Wall Street Journal reported that the CPSC mandates that manufacturers must report all claims of potentially hazardous product defects within 24 hours, with few exceptions.

"It's a statute; it's clear," Julie Vallese, a CPSC spokeswoman told the paper..

According to the Journal, Mattel (Charts, Fortune 500) in at least three major cases since the late 1990s, including last month's recall of nearly 18 million playsets studded with potentially dangerous magnets, took months to gather information and report it to the agency.

Even though Mattel said that its highest priority is protecting children by pulling defective products off store shelves as soon as hazards emerge, the report said Mattel's timetable for reporting these hazards differs from that of the CPSC.

Mattel CEO Robert Eckerd said in an interview that the company discloses problems on its own timetable because it believes both the law and the commission's enforcement practices are unreasonable, the paper said.

What's more, the report said the toymaker maintains that it should be able to evaluate hazards internally before alerting any outsiders, regardless of what the law says.

Since 2001, the CPSC has twice fined the world's largest toymaker for "knowingly" withholding information regarding potentially hazardous problems with its products, the report said

Mattel settled those cases, denying any wrongdoing or that the recalled toys had any defects.

With this new CPSC probe of Mattel's latest recall, the paper said the agency is again investigating the timeliness of the company's disclosures.

Mattel's competitors include Hasbro Inc. (Charts) and JAKKS Pacific Inc. (ChartsTop of page

Most stock quote data provided by BATS. Market indices are shown in real time, except for the DJIA, which is delayed by two minutes. All times are ET. Disclaimer.

Morningstar: © 2014 Morningstar, Inc. All Rights Reserved.

Factset: FactSet Research Systems Inc. 2014. All rights reserved.

Chicago Mercantile Association: Certain market data is the property of Chicago Mercantile Exchange Inc. and its licensors. All rights reserved.

Dow Jones: The Dow Jones branded indices are proprietary to and are calculated, distributed and marketed by DJI Opco, a subsidiary of S&P Dow Jones Indices LLC and have been licensed for use to S&P Opco, LLC and CNN. Standard & Poor's and S&P are registered trademarks of Standard & Poor’s Financial Services LLC and Dow Jones is a registered trademark of Dow Jones Trademark Holdings LLC. All content of the Dow Jones branded indices © S&P Dow Jones Indices LLC 2014 and/or its affiliates.

Most stock quote data provided by BATS. Market indices are shown in real time, except for the DJIA, which is delayed by two minutes. All times are ET. Disclaimer.

Morningstar: © 2014 Morningstar, Inc. All Rights Reserved.

Factset: FactSet Research Systems Inc. 2014. All rights reserved.

Chicago Mercantile Association: Certain market data is the property of Chicago Mercantile Exchange Inc. and its licensors. All rights reserved.

Dow Jones: The Dow Jones branded indices are proprietary to and are calculated, distributed and marketed by DJI Opco, a subsidiary of S&P Dow Jones Indices LLC and have been licensed for use to S&P Opco, LLC and CNN. Standard & Poor's and S&P are registered trademarks of Standard & Poor’s Financial Services LLC and Dow Jones is a registered trademark of Dow Jones Trademark Holdings LLC. All content of the Dow Jones branded indices © S&P Dow Jones Indices LLC 2014 and/or its affiliates.