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Sunday, May 17, 2015

JUDGE ORDERS COMPANY TO STOP SALE OF CERTAIN HIGH-POWERED MAGNETS

FROM:  U.S. JUSTICE DEPARTMENT 
Thursday, May 14, 2015
Judge Orders Injunction to Stop Sale of Dangerous Magnets

A federal judge today ordered a Colorado company to stop selling hazardous high-powered magnets that had been the subject of a product recall by their manufacturer as part of an agreement with the Consumer Product Safety Commission (CPSC), the Justice Department announced.  U.S. District Court Judge Christine M. Arguello of the District of Colorado found that Zen Magnets LLC and its owner, Shihan Qu, were violating the Consumer Product Safety Act by selling magnets that were purchased from a New Jersey company shortly before the magnets were recalled.

Last week, the department filed a complaint seeking injunctive relief and civil penalties against Zen Magnets and Qu.

The complaint alleged that Zen Magnets purchased 917,000 tiny, high-powered magnets from a New Jersey firm one week before that firm signed an agreement with the CPSC to recall the magnets.  Once the magnets were recalled, their sale by any party was prohibited.  Nonetheless, despite repeated warnings by the CPSC, Qu’s Denver-based company continued to sell the magnets.

The magnets are sold in sets and generally marketed as desk toys.  When swallowed by children or teens, the magnets clamp together and can cause serious internal injuries.

“The Department of Justice will continue to work with the Consumer Product Safety Commission to enforce our consumer protection laws and protect consumers from dangerous products,” said Principal Deputy Assistant Attorney General Benjamin C. Mizer of the Justice Department’s Civil Division.  “Efforts to evade the law and sell products that have already been recalled will not be tolerated.”

In issuing the preliminary injunction, Judge Arguello found a substantial likelihood that the defendants had violated the Consumer Product Safety Act and a cognizable danger of recurring violations in the future.  The ruling said that Zen Magnets “has essentially turned its pledge to continue to defy the CPSC into a marketing campaign” and has “openly vowed” not to stop selling the recalled magnets absent an injunction.  Thursday’s ruling followed a three-hour evidentiary hearing on Monday in Denver.

“Zen Magnets insisted on selling a dangerous product to the public, even after repeatedly being warned to stop by the Consumer Product Safety Commission,” said U.S. Attorney John Walsh of the District of Colorado.  “The magnets in this case can cause serious harm to people – particularly to children – if swallowed, by causing rips in the digestive system leading to grave infection.   Given the company’s refusal to stop selling the product, this office, working with the Consumer Product Safety Commission, did not hesitate to seek a court order to protect the public.   Today’s order is a victory for public safety, and for the safety of young children.”

Zen Magnets is separately challenging a rule issued by the CPSC that went into effect April 1, but was temporarily stayed until April 20.  The rule requires magnets or magnet sets to be large enough so that they cannot be swallowed or weak enough so they are unlikely to clamp together if ingested.

In issuing that rule, the CPSC noted the risk of injury that the rule addresses.  When a person ingests more than one magnet from a magnet set, there is potential for damage to intestinal tissue.  The magnets are attracted to each other in the digestive system, damaging the tissue that becomes trapped between the magnets.  In several incidents, surgery was required to remove magnets that children had swallowed.

The rule, which Zen Magnets is challenging before the 10th Circuit Court of Appeals, applies only prospectively.  The preliminary injunction issued by Judge Arguello applies to the 917,000 tiny magnets that Zen Magnets acquired in July 2014, shortly before the manufacturer agreed to recall the magnets, and all other magnets that were commingled with the recalled magnets.

The case is being handled by Trial Attorney Patrick Jasperse of the Civil Division’s Consumer Protection Branch and Assistant U.S. Attorney Jamie Mendelson of the District of Colorado.