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From Products Liability Law Daily, October 29, 2014

Baja, One World Technologies agree to pay $4.3 million for failure to report defective mini-bikes and go-carts

By Pamela C. Maloney, J.D.

Baja Inc., and its corporate affiliate, One World Technologies Inc., of Anderson, S.C., agreed to pay a $4.3 million civil penalty pursuant to a settlement agreement that was accepted provisional by the Consumer Product Safety Commission. The agreement settles charges by CPSC staff that the firms knowingly failed to report to the agency immediately, as required by federal law, defects and an unreasonable risk of serious injury involving 11 models of mini-bikes and go-carts. In addition to agreeing to pay the $4.3 million civil penalty, Baja and One World have agreed to maintain a program designed to ensure compliance with the safety statutes and regulations enforced by the Commission (In the Matter of: One World Technologies, Inc., October 14, 2014)

Background. Baja had sold the vehicles nationwide from November 2004 through June 2010 for $200 to $2,000. In July 2010, Baja and CPSC announced the recall of 308,000 mini-bikes and go-carts because the gas cap on these products could leak or detach from the fuel tank, posing a fire and burn hazard to consumers. In addition, the throttle could stick due to an improperly positioned fuel line and throttle cable, posing a sudden acceleration hazard to consumers (CPSC Recall Notice, No. 10-304, July 15, 2010). The recall involved Baja Motorsports mini-bikes with model numbers beginning with HT65, MB165, WR65, MB196, DB30, WR90 and DR90 and go-carts with model numbers BB65, SD65, DN65 and TR65.

CPSC staff charges. According to the CPSC staff, Baja did not file its defect report with CPSC until June 2010. CPSC staff charged that by the time Baja filed the report, the company had received four reports of fires from leaking gas caps and burn injuries to consumers, including a serious burn injury to a child. Baja had also received two dozen consumer reports of stuck throttles. Although Baja had implemented design changes to remedy the throttle hazard, the firm did not notified consumers or CPSC of these changes.

Compliance program. The program Baja agreed to establish in order to ensure compliance with the safety statutes and regulations enforced by the Commission includes:

  • written standards and policies;

  • systematic procedures for reviewing and referring consumer and retailer incident reports for potential safety issues;

  • confidential employee reporting of compliance concerns to a senior manager;

  • effective communication of compliance policies and procedures, including training;

  • senior manager responsibility for compliance and accountability for violations;

  • oversight of compliance by the firm’s governing body; and

  • records retention requirements.

In agreeing to the settlement, Baja and One World did not admit to CPSC staff’s charges that its mini-bikes and go-carts contained a defect which could create a substantial product hazard or created an unreasonable risk of serious injury or death, or that the company failed to notify the Commission in a timely manner, in accordance with the reporting requirements of the Consumer Product Safety Act.

CPSC Docket No. 15-C0001.

Companies: Baja Inc.; One World Technologies, Inc.

MainStory: TopStory SettlementAgreementsNews CPSCNewsStory SportsandRecEquipmentNews

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