How the Consumer Product Safety Commission targeted Leachco and lost
Raymond Donovan, Secretary of Labor for President Reagan, was accused of defrauding New York City back when he headed up a construction firm. He was forced to resign from the Reagan administration but was later acquitted of the fraud charges. Afterward, he famously asked, “Which office do I go to to get my reputation back?”
Leachco, a small family business in Ada, Oklahoma, is wondering the same thing now that an administrative law judge (ALJ) has dismissed claims brought by the Consumer Product Safety Commission.
First, some background. In January 2022, the Consumer Product Safety Commission published a statement on its website and announced that Leachco’s infant lounger, the Podster, was a “hazard.” The Commission also warned people not to use it. A month later, the Commission sued Leachco, alleging that the Podster presented a “substantial product hazard” because it supposedly had a “defect” that created a “substantial risk of injury to the public.”
These allegations are specious. The Podster is just a simple lounger designed for awake infants, under parental supervision, to lie snugly on their backs at an inclined angle. It doesn’t have any wiring that might catch fire, it doesn’t bounce or jostle babies, and it doesn’t have any hidden flaws. In essence, it’s a very well-designed lounger for infants.
Nonetheless, the Commission claimed that Podster was defective because the because it believes parents might allow infants to sleep in it despite Leachco’s warnings to the contrary. But as the ALJ observed, between 1,000 and 3,500 infants tragically die in their sleep each year—even in products, like cribs and bassinets, that the Commission itself promotes for a “safe-sleep environment.” Sadly, these deaths almost always occur when adults misuse safe products. But that doesn’t make the products defective.
And in Leachco’s case, there is no evidence of an injury following proper use of the Podster. While the Commission claimed that three infant deaths were “associated” with the Podster, the ALJ judiciously described this allegation as “questionable.” Indeed, the Commission presented, at best, conflicting evidence about the context of each death. It was undisputed that each incident followed adult misuse (for example, leaving an infant unattended with a bottle in his mouth).
Ultimately, therefore, the ALJ concluded that the Commission had failed to show that the Podster has a defect and, “even if a defect might be found to exist in some technical sense, the Commission has also failed to demonstrate that such defect creates or has created a substantial risk of injury to the public.”
Pacific Legal Foundation represented Leachco before the ALJ, and we’re thrilled with the ALJ’s decision. But the Commission’s press release—declaring the Podster a “hazard”—is still on the Commission’s website. Where does Leachco go to get its reputation back?
That question leads to another significant problem with the Commission’s case. Not only was the Commission’s case against Leachco bereft of evidence, but it was also allowed to prosecute the case in its own home “court.” The trial was conducted at the Commission’s offices in Bethesda, Maryland—not in federal court before a jury. The ALJ applied the Commission’s procedural and evidentiary rules—not those used in federal court. And, worst of all, the Commission’s enforcement lawyers get to appeal their loss to the Commission itself.
Leachco now faces an appellate “court” made up of the CPSC’s Commissioners—the very group of people who voted to initiate the lawsuit against Leachco in the first place. This in-house process violates the ancient legal principle that a party can’t be a judge in its own case. And the Commission’s review of its own case makes a mockery of the principle of neutrality.
Further, the Commissioners wield significant authority as heads of a powerful executive branch agency. Yet the head of the Executive Branch, the president, cannot fire any Commissioner except for “neglect of duty or malfeasance in office but for no other cause.” This may not seem like a big deal, but as the Supreme Court has explained, the president’s power to remove powerful officials helps to ensure that those officials remain accountable for their actions. This is especially important because the Commissioners are powerful but unelected. To ensure democratic accountability, the president—elected by and accountable to the people—must have the unrestricted authority to remove the CPSC’s Commissioners at will.
Leachco, while defending itself in the Commission’s in-house tribunal, separately challenged the Commissioners’ removal protection in federal court. And it recently asked the U.S. Supreme Court to hear the issue.
Leachco’s plight shows the dangers of unelected officials who have the power to target small companies without being held accountable. Leachco hopes that the Supreme Court will accept its case for review and hold that the Commissioners’ removal protections render them unaccountable to the people.
