The End of the Maximum Civil Penalty Cap as We Know It? Bills Aim to Amend Civil Penalties Under the Consumer Product Safety Act

On January 25, Senator Peter Welch (D-VT) and original co-sponsors Senators Richard Blumenthal (D-CT), Edward Markey (D-MA), Brian Schatz (D-HI), and Ben Ray Luján (D-NM) introduced the Consumer Advocacy and Protection Act of 2024 (the CAP Act). The CAP Act would amend the Consumer Product Safety Act (CPSA) by striking certain provisions that limit the civil penalties that the U.S. Consumer Product Safety Commission (CPSC) can seek for violations of the CPSA and applicable regulations.

The CAP Act would:

• Increase the per-violation cap on civil penalties from $100,000 to $250,000.
• Remove the maximum civil penalty cap for related series of violations.
• Decrease the time between inflation adjustments to the maximum civil penalty cap for an individual violation from every five years to annually.

Notably, the CAP Act would allow the CPSC to adjust the maximum civil penalty cap for an individual violation without going through the notice-and-comment rulemaking process that is generally required under the Administrative Procedure Act (APA).

Concurrently, Representative Jan Schakowsky (D-IL) introduced the identical Consumer Advocacy and Protection Act (also called the CAP Act) in the House of Representatives.

In the accompanying press release, Senator Welch stated that the “CAP Act will help ensure corporations are held accountable when they violate consumer safety protections.” Senator Luján criticized current civil penalties as “little more than a slap on the wrist to major corporations.” This CAP Act follows multiple statements by CPSC Commissioners over the past few years calling for raising the penalty cap. See, e.g., Commissioner Mary T. Boyle Statement on BJ’s Agreement to Pay $9.0 Million Civil Penalty, CPSC (Sept. 29, 2023).

It remains to be seen whether the CAP Act will garner the bipartisan support necessary to successfully move through Congress.

For questions about compliance with the Consumer Product Safety Act, including timely reporting and recalls under Section 15(b) of the CPSA, or with other product safety matters, please reach out to the authors or any of their colleagues on Arnold & Porter’s Consumer Product Safety team.

© Arnold & Porter Kaye Scholer LLP 2024 All Rights Reserved. This blog post is intended to be a general summary of the law and does not constitute legal advice. You should consult with counsel to determine applicable legal requirements in a specific fact situation.