Provisional Acceptance of a Settlement Agreement and Order

CONSUMER PRODUCT SAFETY COMMISSION

[CPSC Docket No. 95-C0014]

Provisional Acceptance of a Settlement Agreement and Order

In the matter of Terri Treat, Individually and as the sole

proprietor of Clouds d/b/a, Cotton Cloud Futon corporation.

AGENCY: Consumer Product Safety Commission.

ACTION: Provisional acceptance of a settlement agreement under the

Consumer Product Safety Act.

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SUMMARY: It is the policy of the Commission to publish settlements

which it provisionally accepts under the Consumer Product Safety Act in

the Federal Register in accordance with the terms of 16 CFR 1605.13.

Published below is a provisionally-accepted Settlement Agreement with

Cotton Cloud Futon corporation.

DATES: Any interested person may ask the Commission not to accept this

agreement or otherwise comment on its contents by filing a written

request with the Office of the Secretary by August 16, 1995.

ADDRESSES: Persons wishing to comment on this Settlement Agreement

should sent written comments to the Comment 95-C0014, Office of the

Secretary, Consumer Product Safety Commission, Washington, DC 20207.

FOR FURTHER INFORMATION CONTACT:

Dennis C. Kacoyanis, Trial Attorney, Office of Compliance and

Enforcement, Consumer Product Safety Commission, Washington, DC 20207;

telephone (301) 504-0626.

SUPPLEMENTARY INFORMATION: The text of the Agreement and Order appears

below.

Dated: July 26, 1995.

Sadye E. Dunn,

Secretary.

In the matter of Terri Treat, individually and as the sole

proprietor of Clouds, DBA, Cotton Cloud Futon Corporation.

[CPSC Docket No. 95-C0014]

Complaint; Nature of Proceedings

Pursuant to the provisions of the Flammable Fabrics Act, as

amended, (15 U.S.C. 1191 et seq.; hereinafter the ``FFA''); the

Federal Trade Commission Act, as amended, (15 U.S.C. 41 et seq.;

hereinafter, the ``FTCA''); and the Standard for the Flammability of

Mattresses and Mattress Pads (FF 4-72, as amended), 16 CFR part 1632

(hereinafter, the ``Mattress Standard''), the Consumer Product

Safety Commission having reason to believe that Terri Treat,

individually and as the sole proprietor of Clouds DBA, Cotton Cloud

Futon Corporation hereinafter, ``Respondent''), 1916 N.E. Broadway,

Portland, OR 97232, has violated the provisions of said Acts; and

further, it appearing to the Commission that a proceeding by it in

respect those violations would be in the public interest, therefore,

it hereby issues its Complaint stating its charges as follows:

1. Respondent Terri Treat is the sole proprietor of Clouds DBA,

Cotton Cloud Futon Corporation, 1916 N.E. Broadway, Portland, OR

97005; and in that capacity, is responsible for the acts, practices,

and policies of Clouds DBA, Cotton Cloud Futon Corporation.

2. Respondent is now and has been engaged in the manufacturing

for sale, sale, and offering for sale, in commerce, and has

introduced, delivered for introduction, transported and caused to be

transported in commerce, and has sold or delivered after sale or

shipment in commerce, as the term ``commerce'' is defined in section

2(b) of the FFA, 15 U.S.C. 1191(b), futon mattresses described as

follows: (a) All cotton, (b) cotton-foam core, (c) poly-cotton, (d)

poly-cotton foam core, (e) wool-cotton, (f) wool-cotton foam core,

(g) wool-poly/cotton, (h) wool-poly/cotton foam core, (i) infant,

(j) artland feather bed, and (k) 100% recycled dacron.

3. Each futon mattress identified in paragraph 3 of the

complaint is intended or promoted for sleeping upon.

4. Each futon mattress identified in paragraph 3 of the

complaint is, therefore:

(a) A ``mattress'' within the meaning of Sec. 1632.1(a) of the

Mattress Standard (FF 4-72, as amended), 1632.1(a); and

(b) An ``interior furnishing'' and a ``product'' as these terms

are defined in sections 2 (e) and (h) of the FFA, as amended, 15

U.S.C. 1191 (e) and (h).

[[Page 39155]]

5. Respondent is subject to, and has failed to comply with, the

Mattress Standard in that:

(a) Respondent failed to do prototype testing of the ticking

substitution procedure required by Sec. 1632.3 or 1632.6 of the

Mattress Standard, 16 CFR 1632.3 or 1632.6.

(b) Respondent failed to maintain the manufacturing or test

specifications or test records, ticking substitution specifications

or test records, or other records required by Sec. 1632.31 (c)(1) or

(c)(5) and (c)(6), 16 CFR 1632.31 (c)(1) or (c)(5) and (c)(6).

6. The acts by Respondent set forth in paragraph 5 of the

complaint are unlawful and constitute an unfair method of

competition and an unfair and deceptive practice in commerce under

the FTCA, in violation of section 3(a) of the FFA, 15 U.S.C.

1192(a), for which a cease and desist order may be issued against

Respondent pursuant to section 5(b) of the FFA, 15 U.S.C. 1194(b),

and section 5 of the FTCA, 15 U.S.C. 45.

Relief Sought

7. The staff seeks issuance of a cease and desist order against

Respondent pursuant to section 5(b) of the FFA, 15 U.S.C. 1194(b),

and section 5 of the FTCA, 15 U.S.C. 45.

Wherefore, the premises considered, the Commission hereby issues

this Complaint on the ________ day of ____________, 1995.

By direction of the Commission:

Dated:____________

David Schmeltzer,

Assistant Executive Director, Office of Compliance and Enforcement.

In the matter of Terri Treat, individually and as sole

proprietor of Clouds, DBA, Cotton Cloud Futon Corporation.

[CPSC Docket No. 95-C0014]

Consent Order Agreement

Terri Treat, individually, and as the sole proprietor of Clouds,

DBA, Cotton Cloud Futon Corporation (hereinafter, ``Respondent''),

enters into this Consent Order Agreement (hereinafter,

``Agreement'') with the staff of the Consumer Product Safety

Commission (hereinafter, ``Commission'') pursuant to the procedures

for Consent Order Agreements contained in Sec. 1605.13 of the

Commission's Procedures for Investigations, Inspections, and

Inquiries under the Flammable Fabrics Act (FFA), 16 CFR 1605.13.

This Agreement and Order are for the sole purpose of settling

allegations of the staff (1) that Respondent violated section 3(a)

of the Flammable Fabrics Act (FFA), as amended, 15 U.S.C. 1192(a)

and the Standard for the Flammability of Mattresses and Mattress

Pads, as amended, 16 CFR part 1632 (FF 4-72) (hereinafter, the

``Mattress Standard''), as more fully set forth in the Complaint

accompanying this Agreement; and (2) that Respondent knowingly

violated section 3(a) of the FFA, as amended, 15 U.S.C. 1192(a) and

the Mattress Standard.

Respondent and the Staff Agree

1. The Consumer Product Safety Commission has jurisdiction in

this matter under the following Acts: Consumer Product Safety Act

(15 U.S.C. 2051 et seq.), Flammable Fabrics Act (15 U.S.C. 1191 et

seq.), and the Federal Trade Commission Act (15 U.S.C. 41 et seq.).

2. Respondent Terri Treat is the sole proprietor of Clouds DBA,

Cotton Cloud Futon Corporation, 1916 N.E. Broadway, Portland, OR

97005; and in that capacity is responsible for the acts, practices,

and policies of Clouds DBA, Cotton Cloud Futon Corporation.

3. Respondent is now and has been engaged in one or more of the

following: the manufacture for sale, the sale, or the offering for

sale, in commerce, or the importation, delivery for introduction,

transportation in commerce, or the sale or delivery after sale or

shipment in commerce, of a product, fabric, or related material

which is subject to the requirements of the Flammable Fabrics Act,

as amended, 15 U.S.C. 1191 et seq., and the Standard for the

Flammability of Mattresses and Mattress Pads (FF 4-72), as amended,

16 CFR part 1632.

4. Respondent denies the allegations of paragraphs 1 through 6

of the Complaint that Respondent violated section 3(a) of the FFA,

as amended, 15 U.S.C. 1192(a); and the Mattress Standard.

5. Respondent denies that she knowingly violated section 3(a) of

the FFA, as amended, 15 U.S.C. 1192(a); and the Mattress Standard.

6. This Agreement is entered into for the purposes of settlement

only and does not constitute a determination by the Commission that

Respondent (a) violated or (b) knowingly violated the FFA and the

Mattress Standard.

7. Respondent agrees to pay in settlement of the staff's

allegations a civil penalty as set forth in the incorporated Order.

8. This Agreement does not constitute an admission by Respondent

that a civil penalty is appropriate.

9. This Agreement becomes effective only upon its final

acceptance by the Commission and service of the incorporated Order

upon Respondent.

10. Upon final acceptance of this Consent Order Agreement by the

Commission and issuance of the Final Order, Respondent knowingly,

voluntarily, and completely waives any rights she may have in this

matter (1) to an administrative or judicial hearing, (2) to judicial

review or other challenge or contest of the validity of the

Commission's actions, (3) to a determination by the Commission as to

whether Respondent failed to comply with the Flammable Fabrics Act

as aforesaid, (4) to a statement of findings of fact and conclusions

of law, and (5) to any claims under the Equal Access to Justice Act.

11. Violation of the provisions of the Order may subject

Respondent to a civil and/or criminal penalty for each such

violation, as prescribed by law.

12. For purposes of section 6(b) of the CPSA, 15 U.S.C. 2055(b),

this matter shall be treated as if a complaint had issued; and the

Commission may publicize the terms of the Consent Order Agreement.

13. Agreements, understandings, representations, or

interpretations made outside the Consent Order Agreement may not be

used to vary or to contradict its terms.

14. Upon acceptance of this Agreement, the Commission shall

issue the following Order incorporated herein by reference.

Dated: June 26, 1995.

Respondent Terri Treat

Terri Treat, individually and as sole proprietor of Clouds, DBA,

Cotton Cloud Futon Corporation

Commission Staff

David Schmeltzer,

Assistant Executive Director, Office of Compliance.

Eric L. Stone,

Acting Director, Division of Administrative Litigation, Office of

Compliance.

Dated: July 5, 1995.

Dennis C. Kacoyanis,

Trial Attorney, Division of Administrative Litigation, Office of

Compliance.

[CPSC Docket No. 95-C0014]

In the matter of Terri Treat, individually and as sole

proprietor of Clouds, DBA, Cotton Cloud Futon Corporation.

Order

Upon consideration of the Consent Order Agreement entered into

between Respondent Terri Treat, individually and as sole proprietor

of Clouds, DBA, Cotton Cloud Futon Corporation and the staff of the

Consumer Product Safety Commission; and the Commission having

jurisdiction over the subject matter and Respondent Terri Treat,

individually and as sole proprietor of Clouds, DBA, Cotton Cloud

Futon Corporation; and it appearing that the Consent Order Agreement

is in the public interest,

I

It is ordered that the Consent Order Agreement be and hereby is

accepted.

II

It is further ordered that Respondent, and her successors and

assigns, agents, representatives, and employees of the Respondent,

directly or through any corporation, subsidiary, division, or other

business entity, or through any agency, device or instrumentality,

do forthwith cease and desist from selling or offering for sale, in

commerce, or manufacturing for sale, in commerce, or importing into

the United States or introducing, delivering for introduction,

transporting or causing to be transported, in commerce, or selling

or delivering after sale or shipment in commerce, any product,

fabric or related material which is subject to and fails to conform

to the Standard for the Flammability of Mattresses and Mattress Pads

(FF 4-72), as amended, 16 CFR part 1632.

III

It is further ordered that Respondent conduct prototype testing

for each mattress design, prior to production, in accordance with

applicable provisions of the Standard for the Flammability of

Mattresses and Mattress Pads (FF 4-72), as amended, 16 CFR part

1632.

IV

It is further ordered that Respondent prepare and maintain

written records of the prototype testing specified in paragraph III

of

[[Page 39156]]

this Order for each mattress design, including photographs of the

tested mattresses, in accordance with applicable provisions of the

Standard for the Flammability of Mattresses and Mattress Pads (FF 4-

72), as amended, 16 CFR part 1632.

V

It is further ordered that Respondent prepare and maintain a

written record of the manufacturing specifications of each mattress

prototype in accordance with applicable provisions of the Standard

for the Flammability of Mattresses and Mattress Pads (FF 4-72), as

amended, 16 CFR part 1632.

VI

It is further ordered that Respondent conduct prototype testing

or, if appropriate, obtain supplier certification to support any

substitution of materials after prototype testing, in accordance

with all applicable provisions of the Standard for the Flammability

of Mattresses and Mattress Pads (FF 4-72), as amended, 16 CFR part

1632.

VII

It is further ordered that Respondents prepare and maintain a

written record of the manufacturing specifications of any new

ticking or tape edge material substituted for those used in the

original prototype testing, in accordance with applicable provisions

of the Standard for the Flammability of Mattresses and Mattress Pads

(FF 4-72), as amended, 16 CFR part 1632.

VIII

It is further ordered that Respondent prepare and maintain a

written record of the manufacturing specifications of any new foam

core material substituted for those used in the original prototype

testing, in accordance with applicable provisions of the Standard

for the Flammability of Mattresses and Mattress Pads (FF 4-72), as

amended, 16 CFR part 1632.

IX

It is further ordered that Respondent prepare and maintain all

other records required by the Standard for the Flammability of

Mattresses and Mattress Pads (FF 4-72), as amended, 16 CFR part

1632, including:

(a) Records to support any determination that a particular

material other than ticking or tape edge did not influence ignition

resistance;

(b) Ticking certification test results or a certification from

the ticking supplier; and

(c) Records describing the disposition of all failing and

rejected prototype mattresses.

X

It is further ordered that upon final acceptance of the Consent

Order Agreement by the Commission, Respondent Terri Treat pay to the

Commission a civil penalty in the amount of Ten Thousand And 00/100

Dollars ($10,000.00) in two payments of Five Thousand And 00/100

Dollars ($5,000.00) each. The first payment of Five Thousand And 00/

100 Dollars ($5,000.00) shall be due on July 1, 1995 or within

twenty (20) days after service of the Final Order of the Commission

accepting this Consent Order Agreement (hereinafter, the

``anniversary date''), whichever is later. The second payment of

Five Thousand And 00/100 Dollars ($5,000.00) shall be paid on July

1, 1996 or within one year of the anniversary date. Upon failure by

Respondent to make payment or upon the making of a late payment by

Respondent, the entire amount of the civil penalty shall be due and

payable, and interest on the outstanding balance shall accrue and be

paid at the federal legal rate of interest under the provisions of

28 U.S.C. 1961 (a) and (b).

XI

It is further ordered that Respondent shall within ninety (90)

days after service upon her of this Order, file with the Commission

a report, in writing, setting forth in detail the manner and form in

which she has complied with this Order.

XII

It is further ordered that for a period of three (3) years from

the date this Order becomes final pursuant to 16 CFR 1605.13(e),

Respondent notify the Commission at least thirty (30) days prior to

any proposed change in the way Respondent does business which may

affect her compliance obligations arising out of this Order.

By direction of the Commission, this Consent Order Agreement is

provisionally accepted pursuant to 16 CFR 1605.13, and shall be

placed on the public record, and the Commission shall announce the

provisional acceptance of the Consent Order Agreement in the

Commission's Public Calendar and in the Federal Register.

So ordered by the Commission, this 26th day of July, 1995.

Sadye E. Dunn,

Secretary, Consumer Product Safety Commission.

[FR Doc. 95-18750 Filed 7-31-95; 8:45 am]

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