15 U.S.C. § 1264 — Penalties; exceptions

Page 1371 TITLE 15—COMMERCE AND TRADE § 1264 the Commission’’ for ‘‘Secretary or officers or employ- ees of the Department’’. Subsec. (i). Pub. L. 110–314, § 204(b)(4)(H), substituted ‘‘Commission’’ for ‘‘Consumer Product Safety Commis- sion’’. 1986—Subsec. (k). Pub. L. 99–339 added subsec. (k). 1981—Subsec. (j). Pub. L. 97–35 added subsec. (j). 1978—Subsec. (i). Pub. L. 95–631 added subsec. (i). 1966—Subsec. (a). Pub. L. 89–756, §§ 2(f)(1), 3(b), sub- stituted ‘‘misbranded hazardous substance or banned hazardous substance’’ for ‘‘misbranded package of a hazardous substance’’. Subsec. (b). Pub. L. 89–756, §§ 2(f)(2), 3(b), substituted ‘‘being a misbranded hazardous substance or banned hazardous substance’’ for ‘‘being in a misbranded pack- age’’. Subsec. (c). Pub. L. 89–756, §§ 2(f)(1), 3(b), substituted ‘‘misbranded hazardous substance or banned hazardous substance’’ for ‘‘misbranded package of a hazardous substance’’. Subsec. (f). Pub. L. 89–756, § 2(f)(2), substituted ‘‘being a misbranded hazardous substance’’ for ‘‘being in a mis- branded package’’. Subsec. (g). Pub. L. 89–756, §§ 2(f)(1), 3(b), substituted ‘‘misbranded hazardous substance or banned hazardous substance’’ for ‘‘misbranded package of a hazardous substance’’. Statutory Notes and Related Subsidiaries EFFECTIVE DATE OF 1986 AMENDMENT Amendment by Pub. L. 99–339 effective 24 months after June 19, 1986, see section 109(d)(3) of Pub. L. 99–339, set out as a note under section 1261 of this title. EFFECTIVE DATE OF 1981 AMENDMENT Amendment by Pub. L. 97–35 effective Aug. 13, 1981, see section 1215 of Pub. L. 97–35, set out as a note under section 2052 of this title. § 1264. Penalties; exceptions (a) Criminal penalties Any person who violates any of the provisions of section 1263 of this title shall be guilty of a misdemeanor and shall on conviction thereof be subject to a fine of not more than $500 or to im- prisonment for not more than ninety days, or both; but for offenses committed with intent to defraud or mislead, or for second and subsequent offenses, the penalty shall be imprisonment for not more than 5 years, a fine determined under section 3571 of title 18, or both. (b) Exceptions No person shall be subject to the penalties of subsection (a) of this section, (1) for having vio- lated section 1263(c) of this title, if the receipt, delivery, or proffered delivery of the hazardous substance was made in good faith, unless he re- fuses to furnish on request of an officer or em- ployee duly designated by the Commission, the name and address of the person from whom he purchased or received such hazardous substance, and copies of all documents, if any there be, per- taining to the delivery of the hazardous sub- stance to him; or (2) for having violated section 1263(a) of this title, if he established a guarantee or undertaking signed by, and containing the name and address of, the person residing in the United States from whom he received in good faith the hazardous substance, to the effect that the hazardous substance is not a misbranded hazardous substance or a banned hazardous sub- stance within the meaning of those terms in this chapter; or (3) for having violated subsection (a) or (c) of section 1263 of this title with respect to any hazardous substance shipped or delivered for shipment for export to any foreign country, in a package marked for export on the outside of the shipping container and labeled in accordance with the specifications of the foreign purchaser and in accordance with the laws of the foreign country, but if such hazardous substance is sold or offered for sale in domestic commerce or if the Commission determines that exportation of such substance presents an unreasonable risk of injury to persons residing within the United States, this clause shall not apply. (c) Civil penalties (1) Any person who knowingly violates section 1263 of this title shall be subject to a civil pen- alty not to exceed $100,000 for each such viola- tion. Subject to paragraph (2), a violation of subsections (a), (b), (c), (d), (f), (g), (i), (j), and (k) of section 1263 of this title shall constitute a separate offense with respect to each substance involved, except that the maximum civil pen- alty shall not exceed $15,000,000 for any related series of violations. A violation of section 1263(e) of this title shall constitute a separate violation with respect to each failure or refusal to allow or perform an act required by section 1263(e) of this title; and, if such violation is a continuing one, each day of such violation shall constitute a separate offense, except that the maximum civil penalty shall not exceed $15,000,000 for any related series of violations. (2) The second sentence of paragraph (1) of this subsection shall not apply to violations of sub- section (a) or (c) of section 1263 of this title— (A) if the person who violated such sub- section is not the manufacturer, importer, or private labeler or a distributor of the sub- stances involved; and (B) if such person did not have either (i) ac- tual knowledge that such person’s distribution or sale of the substance violated such sub- section, or (ii) notice from the Commission that such distribution or sale would be a viola- tion of such subsection. (3) In determining the amount of any penalty to be sought upon commencing an action seek- ing to assess a penalty for a violation of section 1263 of this title, the Commission shall consider the nature, circumstances, extent, and gravity of the violation, including the nature of the sub- stance, the severity of the risk of injury, the oc- currence or absence of injury, the amount of the substance distributed, the appropriateness of such penalty in relation to the size of the busi- ness of the person charged, including how to mitigate undue adverse economic impacts on small businesses, and such other factors as ap- propriate. (4) Any civil penalty under this subsection may be compromised by the Commission. In de- termining the amount of such penalty or wheth- er it should be remitted or mitigated, and in what amount, the Commission shall consider the appropriateness of such penalty to the size of the business of the persons charged, including how to mitigate undue adverse economic im- pacts on small businesses, the nature, cir- cumstances, extent, and gravity of the viola- Page 1372 TITLE 15—COMMERCE AND TRADE § 1264 1 So in original. The comma probably should not appear. tion, including,1 the nature of the substance in- volved, the severity of the risk of injury, the oc- currence or absence of injury, and the amount of the substance distributed, and such other fac- tors as appropriate. The amount of such penalty when finally determined, or the amount agreed on compromise, may be deducted from any sums owing by the United States to the person charged. (5) As used in the first sentence of paragraph (1), the term ‘‘knowingly’’ means (A) having ac- tual knowledge, or (B) the presumed having of knowledge deemed to be possessed by a reason- able person who acts in the circumstances, in- cluding knowledge obtainable upon the exercise of due care to ascertain the truth of representa- tions. (6)(A) The maximum penalty amounts author- ized in paragraph (1) shall be adjusted for infla- tion as provided in this paragraph. (B) Not later than December 1, 2011, and De- cember 1 of each fifth calendar year thereafter, the Commission shall prescribe and publish in the Federal Register a schedule of maximum au- thorized penalties that shall apply for violations that occur after January 1 of the year imme- diately following such publication. (C) The schedule of maximum authorized pen- alties shall be prescribed by increasing each of the amounts referred to in paragraph (1) by the cost-of-living adjustment for the preceding five years. Any increase determined under the pre- ceding sentence shall be rounded to— (i) in the case of penalties greater than $1,000 but less than or equal to $10,000, the nearest multiple of $1,000; (ii) in the case of penalties greater than $10,000 but less than or equal to $100,000, the nearest multiple of $5,000; (iii) in the case of penalties greater than $100,000 but less than or equal to $200,000, the nearest multiple of $10,000; and (iv) in the case of penalties greater than $200,000, the nearest multiple of $25,000. (D) For purposes of this subsection: (i) The term ‘‘Consumer Price Index’’ means the Consumer Price Index for all-urban con- sumers published by the Department of Labor. (ii) The term ‘‘cost-of-living adjustment for the preceding five years’’ means the percent- age by which— (I) the Consumer Price Index for the month of June of the calendar year pre- ceding the adjustment; exceeds (II) the Consumer Price Index for the month of June preceding the date on which the maximum authorized penalty was last adjusted. (d) Civil action for injunction In the case of an attorney general of a State alleging a violation that affects or may affect such State or its residents, such attorney gen- eral may bring a civil action for an injunction to enforce any requirement of this chapter relat- ing to misbranded or banned hazardous sub- stances. The procedural requirements of section 2073 of this title shall apply to any such action. (Pub. L. 86–613, § 5, July 12, 1960, 74 Stat. 376; Pub. L. 89–756, §§ 2(g), 3(c), Nov. 3, 1966, 80 Stat. 1304, 1305; Pub. L. 95–631, § 7(b), Nov. 10, 1978, 92 Stat. 3745; Pub. L. 101–608, title I, §§ 115(b), 118(a), Nov. 16, 1990, 104 Stat. 3119, 3121; Pub. L. 110–314, title II, §§ 204(b)(4)(B), (H), 217(a)(2), (b)(1)(B), (c)(3), Aug. 14, 2008, 122 Stat. 3041, 3042, 3058, 3059, 3060.) Editorial Notes AMENDMENTS 2008—Subsec. (a). Pub. L. 110–314, § 217(c)(3), sub- stituted ‘‘5 years, a fine determined under section 3571 of title 18, or both.’’ for ‘‘one year, or a fine of not more than $3,000, or both such imprisonment and fine.’’ Subsec. (b). Pub. L. 110–314, § 204(b)(4)(B), (H), sub- stituted ‘‘Commission’’ for ‘‘Secretary’’ in cl. (1) and ‘‘Commission’’ for ‘‘Consumer Product Safety Commis- sion’’ in cl. (3). Subsec. (c)(1). Pub. L. 110–314, § 217(a)(2)(A), (B), sub- stituted ‘‘$100,000’’ for ‘‘$5,000’’ and substituted ‘‘$15,000,000’’ for ‘‘$1,250,000’’ in two places. Subsec. (c)(3). Pub. L. 110–314, § 217(b)(1)(B)(i), inserted ‘‘the nature, circumstances, extent, and gravity of the violation, including’’ after ‘‘shall consider’’, sub- stituted ‘‘substance distributed,’’ for ‘‘substance dis- tributed, and’’, and inserted ‘‘, including how to miti- gate undue adverse economic impacts on small busi- nesses, and such other factors as appropriate’’ before period at end. Subsec. (c)(4). Pub. L. 110–314, § 217(b)(1)(B)(ii)(II), in- serted ‘‘, and such other factors as appropriate’’ after ‘‘substance distributed’’. Pub. L. 110–314, § 217(b)(1)(B)(ii)(I), which directed in- sertion of ‘‘, including how to mitigate undue adverse economic impacts on small businesses, the nature, cir- cumstances, extent, and gravity of the violation, in- cluding’’ after ‘‘person charged’’, was executed by mak- ing the insertion after ‘‘persons charged’’ to reflect the probable intent of Congress. Subsec. (c)(6)(B). Pub. L. 110–314, § 217(a)(2)(C), which directed substitution of ‘‘December 1, 2011,’’ for ‘‘De- cember 1, 1994,’’ in par. (6)(B) of subsec. (c)(1), was exe- cuted by making the substitution in subsec. (c)(6)(B) to reflect the probable intent of Congress. 1990—Subsec. (c). Pub. L. 101–608, § 115(b), added sub- sec. (c). Subsec. (d). Pub. L. 101–608, § 118(a), added subsec. (d). 1978—Subsec. (b)(3). Pub. L. 95–631 substituted ‘‘with respect to’’ for ‘‘in respect of’’ and made cl. (3) inappli- cable when the Consumer Product Safety Commission determines that exportation of the substance presents an unreasonable risk of injury to persons residing with- in the United States. 1966—Subsec. (b). Pub. L. 89–756 substituted ‘‘a mis- branded hazardous substance or a banned hazardous substance within the meaning of those terms’’ for ‘‘in misbranded packages within the meaning of that term’’. Statutory Notes and Related Subsidiaries EFFECTIVE DATE OF 2008 AMENDMENT Amendment by section 217(a)(2) of Pub. L. 110–314 ef- fective on the date that is the earlier of the date on which final regulations are issued under section 217(b)(2) of Pub. L. 110–314, set out as a note under sec- tion 2069 of this title, or 1 year after Aug. 14, 2008, see section 217(a)(4) of Pub. L. 110–314, set out as a note under section 1194 of this title. CIVIL PENALTY CRITERIA The Consumer Product Safety Commission to issue a final regulation providing its interpretation of penalty factors described in subsec. (c)(3) of this section no later than 1 year after Aug. 14, 2008, see section 217(b)(2) of Pub. L. 110–314, set out as a note under section 2069 of this title. Page 1373 TITLE 15—COMMERCE AND TRADE § 1266 § 1265. Seizures (a) Grounds and jurisdiction Any misbranded hazardous substance or banned hazardous substance when introduced into or while in interstate commerce or while held for sale (whether or not the first sale) after shipment in interstate commerce, or which may not, under the provisions of section 1263(f) of this title, be introduced into interstate com- merce, or which has been manufactured in viola- tion of section 1263(g) of this title, shall be liable to be proceeded against while in interstate com- merce or at any time thereafter, on libel of in- formation and condemned in any district court in the United States within the jurisdiction of which the hazardous substance is found: Pro- vided, That this section shall not apply to a haz- ardous substance intended for export to any for- eign country if it (1) is in a package branded in accordance with the specifications of the foreign purchaser, (2) is labeled in accordance with the laws of the foreign country, and (3) is labeled on the outside of the shipping package to show that it is intended for export, and (4) is so exported. (b) Procedure; multiplicity of pending pro- ceedings Such hazardous substance shall be liable to seizure by process pursuant to the libel, and the procedure in cases under this section shall con- form, as nearly as may be, to the procedure in admiralty; except that on demand of either party any issue of fact joined in any such case shall be tried by jury. When libel for condemna- tion proceedings under this section, involving the same claimant and the same issues of mis- branding, are pending in two or more jurisdic- tions, such pending proceedings, upon applica- tion of the United States or the claimant sea- sonably made to the court of one such jurisdic- tion, shall be consolidated for trial by order of such court, and tried in (1) any district selected by the applicant where one of such proceedings is pending; or (2) a district agreed upon by stipu- lation between the parties. If no order for con- solidation is so made within a reasonable time, the United States or the claimant may apply to the court of one such jurisdiction, and such court (after giving the other party, the claim- ant, or the United States attorney for such dis- trict, reasonable notice and opportunity to be heard) shall by order, unless good cause to the contrary is shown, specify a district of reason- able proximity to the claimant’s principal place of business, in which all such pending pro- ceedings shall be consolidated for trial and tried. Such order of consolidation shall not apply so as to require the removal of any case the date for trial of which has been fixed. The court granting such order shall give prompt no- tification thereof to the other courts having ju- risdiction of the cases covered thereby. (c) Disposition of goods after decree of con- demnation Any hazardous substance condemned under this section shall, after entry of the decree, be disposed of by destruction or sale as the court may, in accordance with the provisions of this section, direct and the proceeds thereof, if sold, less the legal costs and charges, shall be paid into the Treasury of the United States; but such hazardous substance shall not be sold under such decree contrary to the provisions of this chapter or the laws of the jurisdiction in which sold: Provided, That, after entry of the decree and upon the payment of the costs of such pro- ceedings and the execution of a good and suffi- cient bond conditioned that such hazardous sub- stance shall not be sold or disposed of contrary to the provisions of this chapter or the laws of any State or territory in which sold, the court may by order direct that such hazardous sub- stance be delivered to the owner thereof to be destroyed or brought into compliance with the provisions of this chapter under the supervision of an officer or employee duly designated by the Commission, and the expense of such super- vision shall be paid by the person obtaining re- lease of the hazardous substance under bond. (d) Costs and fees When a decree of condemnation is entered against the hazardous substance, court costs and fees, and storage and other proper expenses, shall be awarded against the person, if any, in- tervening as claimant of the hazardous sub- stance. (e) Removal of case for trial In the case of removal for trial of any case as provided by subsection (b)— (1) the clerk of the court from which re- moval is made shall promptly transmit to the court in which the case is to be tried all rec- ords in the case necessary in order that such court may exercise jurisdiction; (2) the court to which such case is removed shall have the powers and be subject to the du- ties, for purposes of such case, which the court from which removal was made would have had, or to which such court would have been sub- ject, if such case had not been removed. (Pub. L. 86–613, § 6, July 12, 1960, 74 Stat. 376; Pub. L. 89–756, §§ 2(h), 3(d), Nov. 3, 1966, 80 Stat. 1304, 1305; Pub. L. 110–314, title II, § 204(b)(4)(B), Aug. 14, 2008, 122 Stat. 3041.) Editorial Notes AMENDMENTS 2008—Subsec. (c). Pub. L. 110–314 substituted ‘‘Com- mission’’ for ‘‘Secretary’’. 1966—Subsec. (a). Pub. L. 89–756 substituted ‘‘Any misbranded hazardous substance or banned hazardous substance’’ for ‘‘Any hazardous substance that is in a misbranded package’’. § 1266. Hearing before report of criminal viola- tion Before any violation of this chapter is re- ported by the Commission to any United States attorney for institution of a criminal pro- ceeding, the person against whom such pro- ceeding is contemplated shall be given appro- priate notice and an opportunity to present his views, either orally or in writing, with regard to such contemplated proceeding. (Pub. L. 86–613, § 7, July 12, 1960, 74 Stat. 377; Pub. L. 110–314, title II, § 204(b)(4)(B), Aug. 14, 2008, 122 Stat. 3041.)