HP Must Pay Civil Penalty Over Li-ion Battery Failure

The U.S. Consumer Product Safety Commission (CPSC) said on Monday that Hewlett-Packard has agreed to pay a civil penalty for failing to notify the Commission about faulty lithium-ion battery packs on time (PDF). HP will be required to pay a mere $425,000 by an undisclosed date, and willingly resolves staff allegations that HP knowingly failed to report the battery problem immediately to CPSC.

Up until October 2008, HP allegedly sold notebooks with defective lithium-ion battery packs. The company also sold the packs as an accessory and provided them as spare parts for various HP models. These packs reportedly overheated and in some cases caught fire, resulting in injuries to consumers, one of which was hospitalized. CPSC staff claim that HP knew of around 22 incidents by September 22, and was also aware of the hospitalized consumer.

CPSC staff also alleges that between March 2007 and April 2007, HP conducted a study and obtained additional information about the lithium-ion battery packs. The company didn't inform the Commission about the incidents or the study itself until July 25, 2008. By then, HP supposedly knew of at least 31 incidents regarding the faulty lithium-ion battery packs.

Finally in October 2008, HP and CPSC jointly announced a recall of about 32,000 lithium-ion battery packs, but the damage had already been done.

"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," the CPSC states.

Although agreeing to pay the penalty, HP denies allegations that the lithium-ion battery packs (or the notebooks with which the packs were used) 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.

Meanwhile, the CPSC is still open to receiving incident or injury reports that are either directly related to this specific product recall, or involve a different hazard with the same product. The CPSC also warns that under federal law, it is illegal to attempt to sell or resell this or any other recalled product.