Notice2022-14822
Vornado Air, LLC
Primary source
Metadata and text below are from the Federal Register, a public-domain U.S. government work. Always verify the official published version before relying on it for any legal matter.
Published
July 12, 2022
Issuing agencies
Consumer Product Safety Commission
Full Text
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<title>Federal Register, Volume 87 Issue 132 (Tuesday, July 12, 2022)</title>
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[Federal Register Volume 87, Number 132 (Tuesday, July 12, 2022)]
[Notices]
[Pages 41294-41297]
From the Federal Register Online via the Government Publishing Office [<a href="http://www.gpo.gov">www.gpo.gov</a>]
[FR Doc No: 2022-14822]
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CONSUMER PRODUCT SAFETY COMMISSION
[CPSC Docket No. 22-C0002]
Vornado Air, LLC
AGENCY: Consumer Product Safety Commission.
ACTION: Notice.
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The Commission publishes in the Federal Register any settlement
that it provisionally accepts under the Consumer Product Safety Act.
Published below is a provisionally accepted Settlement Agreement with
Vornado Air, LLC, containing a civil penalty in the amount of seven
million, five hundred thousand dollars ($7,500,000), subject to the
terms and conditions of the Settlement Agreement.\1\
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\1\ The Commission voted (4-0-1) to provisionally accept the
proposed Settlement Agreement and Order pertaining to Vornado Air,
LLC. Chair Hoehn-Saric, Commissioners Baiocco, Trumka and Boyle
voted to provisionally accept the Settlement Agreement and Order.
Commissioner Feldman voted to take other action. Chair Hoehn-Saric,
Commissioners Feldman and Trumka issued respective statements with
their votes which can be found here: Commissioners [verbar] <a href="http://CPSC.gov">CPSC.gov</a>
DATES: Any interested person may ask the Commission not to accept this
agreement or otherwise comment on its contents by filing a written
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request with the Office of the Secretary by July 27, 2022.
ADDRESSES: Persons wishing to comment on this Settlement Agreement
should send written comments to Comment 22-C0002, Office of the
Secretary, Consumer Product Safety Commission, 4330 East West Highway,
Bethesda, MD 20814; telephone: (240) 863-8938 (mobile), (301) 504-7479
(office); email: <a href="/cdn-cgi/l/email-protection#87e4f7f4e4aae8f4c7e4f7f4e4a9e0e8f1"><span class="__cf_email__" data-cfemail="6c0f1c1f0f41031f2c0f1c1f0f420b031a">[email protected]</span></a>.
FOR FURTHER INFORMATION CONTACT: Caitlin O'Donnell, Trial Attorney,
Division of Enforcement and Litigation, Office of Compliance and Field
Operations, Consumer Product Safety Commission, 4330 East West Highway,
Bethesda, Maryland 20814-4408; <a href="/cdn-cgi/l/email-protection#cdaea2a9a2a3a3a8a1a18daebdbeaee3aaa2bb"><span class="__cf_email__" data-cfemail="1b78747f7475757e77775b786b6878357c746d">[email protected]</span></a>.
SUPPLEMENTARY INFORMATION: The text of the Agreement and Order appears
below.
Dated: July 7, 2022.
Alberta E. Mills,
Secretary.
United States of America Consumer Product Safety Commission, CPSC
Docket No. 22-C0002
In the Matter of: Vornado Air, LLC
Settlement Agreement
1. In accordance with the Consumer Product Safety Act (``CPSA''),
15 U.S.C. Sec. Sec. 2051-2089, and 16 C.F.R. Sec. 1118.20, Vornado
Air, LLC (``Vornado'' or ``the Firm''), and the United States Consumer
Product Safety Commission (``Commission''), through its staff, hereby
enter into this Settlement Agreement (``Agreement''). The Agreement and
the incorporated attached Order resolve staff's charges set forth
below.
The Parties
2. The Commission is an independent federal regulatory agency,
established pursuant to, and responsible for, the enforcement of the
CPSA, 15 U.S.C. Sec. Sec. 2051-2089. By executing the Agreement, staff
is acting on behalf of the Commission, pursuant to 16 C.F.R. Sec.
1118.20(b). The Commission issues the Order under the provisions of the
CPSA.
3. Vornado is a privately held company, organized and existing
under the laws of the state of Delaware, with its principal place of
business in Andover, Kansas.
Staff Charges
4. Between 2009 and 2015, Vornado manufactured, distributed, and
offered for sale approximately 350,000 VH101 Personal Vortex Heaters
(``Subject Products'').
5. The Subject Products are ``consumer products'' that were
``distribut[ed] in commerce,'' as those terms are defined or used in
sections 3(a)(5) and (8) of the CPSA, 15 U.S.C. Sec. 2052(a)(5), (8).
Vornado is a ``manufacturer'' and ``distributor'' of the Subject
Products, as such terms are defined in sections 3(a)(7) and (11) of the
CPSA, 15 U.S.C. Sec. 2052(a)(7), (11).
Violation of CPSA Section 19(a)(4)
6. The Subject Products contain a defect which could create a
substantial product hazard and create an unreasonable risk of serious
injury or death because they can overheat when in use, posing fire and
burn hazards.
7. Vornado received and investigated multiple reports of
overheating and fire involving the Subject Products. Despite possessing
information that reasonably supported the conclusion that the Subject
Products contained a defect that could create a substantial product
hazard or created an unreasonable risk of serious injury or death,
Vornado did not immediately report to the Commission.
8. In December 2017, Vornado received notice of a potential claim
alleging that an elderly man succumbed to injuries sustained in a fire
involving a Vornado space heater that was suspected to be one of the
Subject Products.
9. In January 2018, Vornado filed an Initial Report with the
Commission under 15 U.S.C. Sec. 2064(b). In that report, the Firm
stated that it had not yet confirmed that the heater involved in the
fatal fire was a unit of the Subject Products.
[[Page 41295]]
10. In February 2018, Vornado filed a Full Report with the
Commission under 15 U.S.C. Sec. 2064(b) concerning the Subject
Products.
11. Vornado and the Commission jointly announced a Fast Track
recall of the Subject Products on April 4, 2018. The press release
announcing the recall stated that the Subject Products can overheat
while in use, posing fire and burn hazards, and that 15 fire incidents
had been reported.
12. On August 22, 2018, after the Firm confirmed that one of the
Subject Products was, in fact, involved in the fatal fire, the recall
was re-announced. The press release included a description of the
December 2017 fatal fire incident as well as an updated total of 19
fire incidents.
Failure to Timely Report
13. Despite having information reasonably supporting the conclusion
that the Subject Products contained a defect or created an unreasonable
risk of serious injury or death, Vornado did not notify the Commission
immediately of such defect or risk, as required by sections 15(b)(3)
and (4) of the CPSA, 15 U.S.C. Sec. 2064(b)(3), (4), in violation of
section 19(a)(4) of the CPSA, 15 U.S.C. Sec. 2068(a)(4).
14. Because the information in Vornado's possession about the
Subject Products constituted actual and presumed knowledge, Vornado
knowingly violated section 19(a)(4) of the CPSA, 15 U.S.C. Sec.
2068(a)(4), as the term ``knowingly'' is defined in section 20(d) of
the CPSA, 15 U.S.C. Sec. 2069(d).
15. Pursuant to section 20 of the CPSA, 15 U.S.C. Sec. 2069,
Vornado is subject to civil penalties for its knowing violation of
section 19(a)(4) of the CPSA, 15 U.S.C. Sec. 2068(a)(4).
Response of Vornado
16. Vornado's settlement of this matter does not constitute an
admission of the staff's charges as set forth in paragraphs 4 through
15 above, and Vornado denies staff's allegations that it failed to
notify the Commission in a timely matter in accordance with section
15(b) of the CPSA and that there was any ``knowing'' violation of the
CPSA as that term is defined in 15 U.S.C. Sec. 2069(d).
17. At all relevant times, Vornado had a product safety compliance
program, which included pre-market third-party laboratory testing of
the Subject Products to applicable safety standards and rigorous
quality assurance measures. Vornado took reasonable measures to monitor
field reports and evaluate returned units of the Subject Products.
18. Vornado notified the Commission under section 15(b) and
conducted a voluntary recall of the Subject Products under the Fast
Track program prior to confirming product identification or causation
of the reported fire that resulted in a fatality.
19. Vornado enters into this Agreement to settle this matter
without the delay and unnecessary expense of litigation. Vornado does
not admit that it violated the CPSA or any other law, and Vornado's
willingness to enter into this Agreement and Order does not constitute,
nor is it evidence of, an admission by Vornado of liability or
violation of any law.
Agreement of the Parties
20. Under the CPSA, the Commission has jurisdiction over the matter
involving the Subject Products and over Vornado.
21. The parties enter into the Agreement for settlement purposes
only. The Agreement does not constitute an admission by Vornado or a
determination by the Commission that Vornado violated the CPSA's
reporting requirements.
22. In settlement of staff's charges, and to avoid the cost,
distraction, delay, uncertainty, and inconvenience of protracted
litigation or other proceedings, Vornado shall pay a civil penalty in
the amount of seven million five hundred thousand dollars ($7,500,000)
within thirty (30) calendar days after receiving service of the
Commission's final Order accepting the Agreement. All payments to be
made under the Agreement shall constitute debts owing to the United
States and shall be made by electronic wire transfer to the United
States via <a href="http://www.pay.gov">http://www.pay.gov</a>, for allocation to, and credit against,
the payment obligations of Vornado under this Agreement. Failure to
make such payment by the date specified in the Commission's final Order
shall constitute Default.
23. All unpaid amounts, if any, due and owing under the Agreement,
shall constitute a debt due and immediately owing by Vornado to the
United States, and interest shall accrue and be paid by Vornado at the
federal legal rate of interest set forth at 28 U.S.C. Sec. 1961(a) and
(b) from the date of Default, until all amounts due have been paid in
full (hereinafter ``Default Payment Amount'' and ``Default Interest
Balance''). Vornado shall consent to a Consent Judgment in the amount
of the Default Payment Amount and Default Interest Balance, and the
United States, at its sole option, may collect the entire Default
Payment Amount and Default Interest Balance, or exercise any other
rights granted by law or in equity, including, but not limited to,
referring such matters for private collection, and Vornado agrees not
to contest, and hereby waives and discharges any defenses to, any
collection action undertaken by the United States, or its agents or
contractors, pursuant to this paragraph. Vornado shall pay the United
States all reasonable costs of collection and enforcement under this
paragraph, respectively, including reasonable attorney's fees and
expenses.
24. After staff receives this Agreement executed on behalf of
Vornado, staff shall promptly submit the Agreement to the Commission
for provisional acceptance. Promptly following provisional acceptance
of the Agreement by the Commission, the Agreement shall be placed on
the public record and published in the Federal Register, in accordance
with the procedures set forth in 16 C.F.R. Sec. 1118.20(e). If the
Commission does not receive any written request not to accept the
Agreement within fifteen (15) calendar days, the Agreement shall be
deemed finally accepted on the 16th calendar day after the date the
Agreement is published in the Federal Register, in accordance with 16
C.F.R. Sec. 1118.20(f).
25. This Agreement is conditioned upon, and subject to, the
Commission's final acceptance, as set forth above, and it is subject to
the provisions of 16 C.F.R. Sec. 1118.20(h). Upon the later of: (i)
the Commission's final acceptance of this Agreement and service of the
accepted Agreement upon Vornado, and (ii) the date of issuance of the
final Order, this Agreement shall be in full force and effect, and
shall be binding upon the parties.
26. Effective upon the later of: (1) the Commission's final
acceptance of the Agreement and service of the accepted Agreement upon
Vornado, and (2) the date of issuance of the final Order, for good and
valuable consideration, Vornado hereby expressly and irrevocably waives
and agrees not to assert any past, present, or future rights to the
following, in connection with the matter described in this Agreement:
(i) an administrative or judicial hearing;
(ii) judicial review or other challenge or contest of the
Commission's actions;
(iii) a determination by the Commission of whether Vornado failed
to comply with the CPSA and the underlying regulations;
(iv) a statement of findings of fact and conclusions of law; and
(v) any claims under the Equal Access to Justice Act.
[[Page 41296]]
27. Vornado shall maintain a compliance program and a system of
internal controls and procedures designed to ensure compliance with the
CPSA with respect to any consumer product imported, manufactured,
distributed, or sold by Vornado, and which shall contain the following
elements:
(i) written standards, policies, and procedures, including those
designed to ensure that information that may relate to or impact CPSA
compliance is conveyed effectively to personnel responsible for CPSA
compliance, whether or not an injury has been reported;
(ii) procedures for reviewing claims and reports for safety
concerns and for implementing corrective and preventive actions when
compliance deficiencies or violations are identified;
(iii) procedures requiring that information required to be
disclosed by Vornado to the Commission is recorded, processed, and
reported in accordance with applicable law;
(iv) procedures requiring that all reporting made to the Commission
is timely, truthful, complete, accurate, and in accordance with
applicable law;
(v) procedures requiring that prompt disclosure is made to
Vornado's senior management of any significant deficiencies or material
weaknesses in the design or operation of such compliance program or
internal controls that affect adversely, in any material respect,
Vornado's ability to record, process, and report to the Commission in
accordance with applicable law;
(vi) mechanisms to effectively communicate to all applicable
Vornado employees, through training programs or other means,
compliance-related company policies and procedures to prevent
violations of the CPSA;
(vii) a mechanism for confidential employee reporting of
compliance-related questions or concerns to either a compliance officer
or to another senior manager with authority to act as necessary;
(viii) Vornado's senior management responsibility for CPSA
compliance; and
(ix) retention of all CPSA compliance-related records for at least
five (5) years, and availability of such records to CPSC staff upon
request.
28. The Firm shall submit a report under CPSA section 16(b), sworn
to under penalty of perjury:
(i) describing in detail its compliance program and internal
controls and the actions the Firm has taken to comply with each
subparagraph of paragraph 27;
(ii) affirming that during the reporting period the Firm has
reviewed its compliance program and internal controls, including the
actions referenced in subparagraph (a) of this paragraph, for
effectiveness, and that it complies with each subparagraph of paragraph
27, or describing in detail any non-compliance with any such
subparagraph; and
(iii) identifying any changes or modifications made during the
reporting period to the Firm's compliance program or internal controls
to ensure compliance with the terms of the CPSA and, in particular, the
requirements of CPSA section 15 related to timely reporting.
Such reports shall be submitted annually to the Director, Office of
Compliance, Division of Enforcement and Litigation, for a period of
three (3) years beginning 12 months after the Commission's Final Order
of Acceptance of the Agreement. The first report shall be submitted 30
days after the close of the first 12-month reporting period, and
successive reports shall be due annually on the same date thereafter.
Without limitation, the Firm acknowledges and agrees that failure to
make such timely and accurate reports as required by this Agreement and
Order may constitute a violation of section 19(a)(3) of the CPSA.
29. Notwithstanding and in addition to the above, upon request of
staff, Vornado shall promptly provide to CPSC written documentation
identifying any material changes or improvements to the Firm's
compliance program or internal controls and the effective date of those
changes or improvements. Vornado shall cooperate fully and truthfully
with staff and shall make available all non-privileged information and
materials, and any personnel deemed necessary by staff, to evaluate
Vornado's compliance with the terms of the Agreement.
30. The parties acknowledge and agree that the Commission may
publicize the terms of the Agreement and the Order.
31. Vornado represents that the Agreement:
(i) is entered into freely and voluntarily, without any degree of
duress or compulsion whatsoever;
(ii) has been duly authorized; and
(iii) constitutes the valid and binding obligation of Vornado,
enforceable against Vornado in accordance with its terms. The
individuals signing the Agreement on behalf of Vornado represent and
warrant that they are duly authorized by Vornado to execute the
Agreement.
32. The signatories represent that they are authorized to execute
this Agreement.
33. The Agreement is governed by the laws of the United States.
34. The Agreement and the Order shall apply to, and be binding
upon, Vornado and each of its successors, transferees, and assigns; and
a violation of the Agreement or Order may subject Vornado, and each of
its successors, transferees, and assigns, to appropriate legal action.
35. The Agreement and the Order constitute the complete agreement
between the parties on the subject matter contained therein.
36. The Agreement may be used in interpreting the Order.
Understandings, agreements, representations, or interpretations apart
from those contained in the Agreement and the Order may not be used to
vary or contradict their terms. For purposes of construction, the
Agreement shall be deemed to have been drafted by both of the parties
and shall not, therefore, be construed against any party, for that
reason, in any subsequent dispute.
37. The Agreement may not be waived, amended, modified, or
otherwise altered, except as in accordance with the provisions of 16
CFR 1118.20(h). The Agreement may be executed in counterparts.
38. If any provision of the Agreement or the Order is held to be
illegal, invalid, or unenforceable under present or future laws
effective during the terms of the Agreement and the Order, such
provision shall be fully severable. The balance of the Agreement and
the Order shall remain in full force and effect, unless the Commission
and Vornado agree in writing that severing the provision materially
affects the purpose of the Agreement and the Order.
Vornado Air, LLC
Dated: 5/24/2022.
By: /s/----------------------------------------------------------------
Randy Brillhart,
Vornado Air, LLC Chief Executive Officer.
Dated: 5/24/2022.
By: /s/----------------------------------------------------------------
Michelle Gillice,
Counsel to Vornado Air, LLC.
U.S. Consumer Product Safety Commission
Dated: 5/25/2022.
By: /s/----------------------------------------------------------------
Caitlin O'Donnell,
Trial Attorney, Office of Compliance and Field Operations.
[[Page 41297]]
United States of America Consumer Product Safety Commission, CPSC
Docket No.: 22-C0002
In the Matter of: Vornado Air, LLC
Order
Upon consideration of the Settlement Agreement entered into between
Vornado Air, LLC (``Vornado''), and the U.S. Consumer Product Safety
Commission (``Commission''), and the Commission having jurisdiction
over the subject matter and over Vornado, and it appearing that the
Settlement Agreement and the Order are in the public interest, it is:
Ordered that the Settlement Agreement be, and is, hereby, accepted;
and it is
Further ordered that Vornado shall comply with all terms of the
Settlement Agreement including payment of a civil penalty in the amount
of seven million five hundred thousand dollars ($7,500,000), within
thirty (30) days after service of the Commission's final Order
accepting the Settlement Agreement. The payment shall be made by
electronic wire transfer to the Commission via: <a href="http://www.pay.gov">http://www.pay.gov</a>.
Upon the failure of Vornado to make the foregoing payment when due,
interest on the unpaid amount shall accrue and be paid by Vornado at
the federal legal rate of interest set forth at 28 U.S.C. Sec. 1961(a)
and (b). If Vornado fails to make such payment or to comply in full
with any other provision of the Settlement Agreement, such conduct will
be considered a violation of the Settlement Agreement and Order, and
the Commission reserves the right to pursue additional enforcement
actions against the Firm.
Provisionally accepted and provisional Order issued on the --5th
day of July, 2022.
By Order of the Commission:
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Alberta Mills, Secretary U.S. Consumer Product Safety Commission.
[FR Doc. 2022-14822 Filed 7-11-22; 8:45 am]
BILLING CODE 6355-01-P
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