Fix the CPSIA Erratabase Before It Harms Commerce, Consumers

By March 10, 2011Regulations

The Consumer Product Safety Commission is scheduled to take its product safety complaint database online Friday, doing a real disservice to consumers who want accurate information and to companies that will have their reputations harmed by false, inaccurate and even malign reports about their products.

CPSC promotes its database

The National Association of Manufacturers this week filed a petition for reconsideration of the final rule implementing the database under the Consumer Product Safety Improvement Act (CPSIA). The NAM also requested an extension of the CPSC’s “soft launch” for three months to prevent the database from going “live” before fixing a number of administrative and policy challenges yet to be resolved. (NAM letter.)

We’ve seen many claims that the test phase of the database produced few of the false complaints that the manufacturers and others have been so concerned about. The advocates for the regulatory state at OMB Watch, for example, reported:

Manufacturers and business associations like the National Association of Manufacturers have targeted the database for fear that inaccurate data will be reported by consumers and, as a result, profits could be hurt. In CPSC’s testing of the site during the soft launch, however, “of the 900 complaints that were logged, four were determined to be inaccurate,” according to a March 3 BNA article (subscription required).

Curse you, business owners, for caring about profits!

This isn’t the full story, but even if it were, that’s four wrong complaints that could harm a company or product’s reputation. Multiply the number of complaints tens of thousands of times once the database starts operating, and the 0.44 percent inaccuracy rate starts to look seriously damaging. (We can also speculate about the trial lawyers and “consumer activists” holding back submissions during the trial run, waiting for the database to get up and running before salting it with inflammatory reports.)

Worse, NAM and its members have identified six serious problems with the database that would make it a font of bad information, the erratabase we write about. Consider this one:

Manufacturers, importers or private labelers have indicated that they have received reports of harm identifying an incident as involving their product that did not in fact involve their product, so were materially inaccurate, and advised CPSC of this fact. They have not received return affirmative confirmation that CPSC staff will not post such false claims in the database. CPSC staffers have indicated they may not possess the resources to adequately scrub the database to avoid posting upon such notification. This is contrary to the express direction of Congress that materially inaccurate information with the potential for irreparable reputational harm be vetted prior to posting.

Rep. Mike Pompeo (R-KS) won passage of an amendment in H.R. 1, the continuing resolution, to block funding for the database until Congress had conducted a thorough review. (See Shopfloor, “CPSC Erratabase and the Interests of Trial Lawyers.“) The amendment has brought Pompeo the expected obloquy from the left, and Sen. Jay Rockefeller (D-WV), chairman of the Senate Commerce Committee, issued a news release denouncing it. From Rockefeller’s news release, “Rockefeller Says Budget Should Not Defund Consumer Safety Priorities“:

In these tough economic times, it’s important that we cut costs and provide the greatest value for the taxpayers’ dollar,” Chairman Rockefeller said. “But I cannot support efforts to defund a consumer safety priority. The CPSC’s product safety database would serve as an early warning system for unsafe products and has the potential to save lives.”

But Senator, a database full of inaccurate information, false and inflammatory complaints, and ambiguous allegations does not help consumer safety. It diminishes it.

Senators and House members should also recognize that the CPSC ignored clear statutory language and legislative history when the commission expanded the definition of the “reporters” able to file complaints. As the NAM’s letter states:

The Commission’s decision in the final rule to define the term “consumer” very broadly appears contrary to the intent of Congress, and will result in the potential for multiple reports of harm involving the identical incident. This will result in public confusion about the potential extent of any possible harm and will result in the inclusion of reports based on second-hand information without the possibility of verification. Experience with paper-based reporting demonstrates that often multiple products are erroneously cited as related to reported injuries without an actual causative connection. This results in misidentification and duplication of reports, which must be avoided in the Database.

Right now, it’s a bad database that will misinform consumers and damage business and commerce. The project can be salvaged if the CPSC recognizes the critical errors and provides additional time to fix the database and reporting process. If consumer safety is a real priority, the CPSC will grant the extension.

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