Selling to consumers is generally a beneficial enterprise for all involved, but occasionally businesses will need to recall products, for a myriad of reasons. When that happens, different sets of rules apply depending on the type of product that is impacted. If your product falls under the U.S. Consumer Product Safety Commission’s (CPSC) jurisdiction, one set of rules applies. A different set of rules applies to recalls involving Food and Drug Administration (FDA) regulated food products. Below is a simple guide to the key elements and differences of the recall process in each of these regimes.
CPSC (consumer products)
FDA (food products)
|When a product fails to comply with the law, including a specific consumer product safety rule.
When you learn that a product has a defect that creates a substantial risk of injury to the public.
When you obtain information that your product creates an unreasonable risk of serious injury or death.
|When the food product or its label/labeling violates FDA law, it is adulterated (e.g., contains a foodborne pathogen like Salmonella) or misbranded (e.g., it contains an undeclared allergen).
|You are permitted to investigate for up to 10 working days if you think you may have one of the triggers above, but if you know you have a reportable event, you have to report then.
|FDA does not establish a finite period of time in which one must conduct an investigation and reach a determination. That being said, if the public health is at risk it is the manufacturer’s/distributor’s responsibility to act as quickly as possible.
When you have to contact the agency
|When you “obtain information” of a potential substantial product hazard—one of the triggers above—you must report “immediately,” although the investigation period may apply.
|Reporting to FDA is only required when you have reached a determination that you have a “Class I” recall—a reasonable probability that the article of food is adulterated or misbranded and the use of or exposure to such article will cause serious adverse health consequences or death to humans or animals.
When you can recall products
|Technically, you can recall products at any time, but silent recalls—recalls without publicizing them—are discouraged. And the reporting obligation always applies.
Responsible businesses typically work with the CPSC. Often, a report will be filed first, then the CPSC will determine whether an issue violates the law or creates an unreasonable risk of injury or death or a substantial product hazard. If the issue is worthy of recall, you will be asked to submit a corrective action plan, which would include items such as a draft joint press release and a recall-and-repair, recall-and-replace, or recall-and-refund plan.
|Manufacturers and/or distributors may voluntarily initiate a recall at any time to fulfill their responsibility to protect the public health. Recalls may also be initiated after notification of a problem from FDA or a state agency, in response to a formal request by FDA, or as ordered by FDA (only in Class I recall situations).
Potential penalties for product recalls
|Civil penalties for violation of the CPSC’s laws and regulations can be assessed for $100,000 for each violation, and up to $15,150,000 for a related series of violations.
|Failure to comply with a mandatory FDA recall order, which FDA can only issue in Class I recall situations, can result in civil penalties—up to $50,000 for an individual and $250,000 for any other entity; capped at $500,000 for all violations adjudicated in a single proceeding; all costs associated with the recall. There are no statutory violations or penalties per se for not conducting a “voluntary” recall (whether Class I, II, or III).
FDA has also been known to issue press releases if a company fails to recall product the Agency otherwise believes should be recalled.
Companies that are more familiar with the FDA’s sphere or the CPSC’s sphere may think that the processes translate easily, but that is not always the case, as shown by the chart above. Indeed, the chart is a primer on the key differences: more complicated product issues (whether food or consumer) will often trigger more complicated processes.