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Mattel and Fisher Price Agree to Landmark Settlement of Consumer Product Lawsuits

by Melinda Giftos, posted Tuesday, October 20, 2009

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In 2007, Mattel and Fisher-Price introduced over 2 million defective toys into the consumer marketplace which were manufactured in China and contained illegal levels of lead. Because lead can cause irreversible brain damage, the toy companies ended up recalling  more than 21 million toys. This week, Mattel and Fisher-Price have agreed to settle the 22 resulting class action lawsuits filed against them, which would compensate millions of families who purchased the defective toys. If approved by the court, this landmark settlement could exceed $50 million. This comes on the heels of Mattel paying $12 million to 39 states to end investigations into lead content in toys and a $2.3 million civil penalty imposed by the federal government for exceeding legal lead paint limits.
 
It was the influx and subsequent recall of these defective toys that prompted significant governmental and consumer demands for higher safety standards. In fact, this recall prompted the U.S.'s implementation of the Consumer Product Safety Improvement Act of 2008, a dramatic piece of legislation which has awakened the Consumer Product Safety Commission and has required many businesses to implement dramatic new safety standards, which include lower limits of lead and phthalates, third party testing, warning labels and packaging standards which improve the efficiency of recalls. Ironically, the government has recently exempted Mattel from the third party testing requirement and allowed Mattel to conduct its own internal testing.
 
The Consumer Product Safety Act is still under development and affects a significant number of consumer products, particularly children's products.