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.