Tuesday, January 6, 2009

Consumer Safety Database a Problem for Trade Secrets?

Toxic Tort Litigation Blog writes about several problems with the pending database from the Consumer Product Safety Commission. While the post,
CPSC's New Database: An Opportunity for Abuse?, covers a lot of territory, the following points about trade secrets interested me:
The Consumer Product Safety Improvement Act of 2008 ("CPSIA") provides that the Consumer Product Safety Commission ("CPSC") will establish and maintain an Internet database on the safety of consumer products. The CPSIA Section 212 requires that the database be: (1) available to the public; (2) searchable; and (3) accessible on the CPSC's website. Reports of harm caused by consumer products may be reported by consumers; local, state or federal govenment agencies; health care professionals; child service providers; and public safety entities. Ideally, the database will encourage the sharing of information and direct communications among consumers, consumer advocacy groups and state attorneys general, who have been given an important new role under the CPSIA. For the first time, consumers will have direct instant access on the Agency's website to potentially important product safety information.

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Because the person making the report need not be identified to the manufacturer unless he or she explicitly consents, there may not be much the manufacturer can do, within the 10 day window provided before the report is posted, to determine whether the report is accurate. Certainly, this narrow window does not permit a manufacturer to obtain the product from a consumer, assuming the consumer can be identified, and inspect it. The manufacturer can request that proprietary or trade secret information not be posted on the database, but that request, if granted, will result only in the sensitive information being redacted, not in a delay in posting the report on the database. The statute permits a manufacturer to request that its own comments also be included in the database, but in the absence of a realistic time frame to perform an investigation of the underlying report, what would be an appropriate comment to make? Moreover, the manufacturer may be at a disadvantage if reporters call seeking comment after the consumer's report is posted by the Commission.
While it is not clear what impelled this legislation, I will presume that it may have to do with the rash of bad products from China. If so, I put it down as an another example of how crises make for bad legislation (TARP, anyone?).

Duane Morris has a page devoted to the law here and the Commission has a portal page here.

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