Toy Company Fights Against Federal Regulators’ War on Fun

Published January 15, 2016

Federal regulators are requesting a judge uphold a ban on toy magnets, arguing the entertainment products, marketed to adults for entertainment purposes, are unreasonably dangerous to the public.

In 2014, the Consumer Product Safety Commission (CPSC) issued regulations banning the importing or manufacturing of magnets or toy magnet sets deemed to be excessively strong, responding to 100 reported hospital visits between 2009 and 2011 involving young children eating toy magnets, which amounts to about five cases per one million children.

Targeting Toymakers

Zen Magnets, owned by Shihan Qu, is the only remaining American vendor of imported toy magnets, and it is the target of several lawsuits filed by the federal government.

CPSC is calling on United States Court of Appeals Judge Neil Gorsuch, who has been assigned to one of the most recent legal battles between CPSC and Zen Magnets, to maintain the ban on Zen Magnets’ toys.

Alden Abbott, a senior legal fellow at The Heritage Foundation, says CPSC regulators dislike being forced to justify their wishes.

“The CPSC, under their statutes, based on cost-benefit analysis, can issue a regulation saying a product has an unreasonable risk of injury related to its benefits [and] therefore should be withdrawn,” Abbott said. “Typically, what they like to do is go to the company and urge the company to do a recall, or they impose a number of safety warnings that can be released when the product is sold that make it less likely to be used in a hazardous way.”

Retail-iatory Actions  

Craig Zucker, the owner of Buckyballs, a company producing toys similar to Zen Magnets, tried to fight the CPSC ban. CPSC retaliated against Zucker by wiping out the retail market for toy magnets, Abbott says.

“The CPSC could have applied for an injunction in federal court,” Abbott said. “Instead, they asked retailers to voluntarily not sell the products. Most of the retailers agreed to stop carrying it. The due process problem is that the CPSC indirectly destroyed the market for Zucker, not by going to federal court to argue for an injunction, but by going directly to retailers.”

Ends Justifying the Means?

Nancy Nord, a former CPSC commissioner, says CPSC is hungry for more power and less accountability.

“[CPSC]chose not to go to court, because you would have to prove your case, and another set of eyes would be looking at it, and my sense is that the agency did not want to have to do that,” Nord said. “I was concerned that the agency made a decision that this is what they wanted to do and figured out what were the regulatory routes they were going to take to achieve those results. As a [former] commissioner, that bothers me a great deal.”

Tony Corvo ([email protected]) writes from Beavercreek, Ohio.