The U.S. Consumer Product Safety Commission – CPSC – has announced that Hewlett-Packard Company of Palo Alto, Calif., will pay a civil penalty of $425,000 for its failure to immediately report lithium ion batteries that seriously injured consumers. In agreeing to the settlement, HP denied the allegations that the lithium-ion battery packs – or the notebook computers that use the packs – could create an unreasonable risk of serious injury or death. HP also denies that it violated the reporting requirements of the Consumer Product Safety Act.
The controversy is of interest to the auto industry since its use of lithium ion batteries in electrical vehicles and hybrids is growing at exponential rate, with millions of battery packs soon to be on U.S. roads. The National Highway Traffic Safety Administration closed its investigation of fires in Chevrolet Volt EVs last week. Nevertheless many consumers remain wary of the emerging technology and it remains to be seen if the Volt brand is damaged.
The HP settlement resolves allegations that HP knowingly violated federal law, after it knew that certain lithium-ion battery packs contained a defect or created an unreasonable risk of serious injury or death. The lithium-ion battery packs can overheat, posing a fire and burn hazard to consumers. The packs were shipped with new HP Notebook computers, sold as accessories or provided as spare parts for various HP models.
CPSC said that by September 2007, HP knew of about 22 incidents associated with the lithium-ion battery packs. At least two of these incidents resulted in injuries to consumers. HP also was aware that at least one consumer apparently went to the hospital.
CPSC also said that between March 2007 and April 2007, HP conducted a study, from which it obtained additional information about the lithium-ion battery packs. HP did not notify the Commission about the incidents or the study until July 25, 2008. By that time, CPSC alleges that the firm was aware of at least 31 incidents involving the lithium-ion battery packs.
In October 2008, HP and CPSC announced a recall of about 32,000 lithium-ion battery packs. HP sold notebook computers for between $700 and $3,000 that contained the lithium-ion battery packs, as did computer and electronics stores nationwide and various Web retailers. Lithium-ion battery packs that were sold separately for use with the notebook computers retailed for between $100 and $160.
Federal law requires manufacturers, distributors, and retailers to report to CPSC immediately (within 24 hours) after obtaining information reasonably supporting the conclusion that a product contains a defect which could create a substantial product hazard, creates an unreasonable risk of serious injury or death, or fails to comply with any consumer product safety rule or any other rule, regulation, standard, or ban enforced by CPSC.