05/25/2001 - Updated 08:38 AM ET
By Jayne O'Donnell, USA TODAY
The government is suing Wal-Mart for failing to report dozens of serious injuries connected with defective exercise equipment it sold from 1996 to 1999.
The Justice Department and the Consumer Product Safety Commission are seeking up to $4.5 million in fines each from Wal-Mart and Icon Health & Fitness, maker of the equipment.
The case marks the first time the government has sued a retailer in federal court for failing to report product-related injuries.
The lawsuit, filed late Thursday, says Weider and Weslo exercise gliders had a defect that allowed the seat to collapse during use. Many of the injuries — which included fractured vertebrae, herniated discs and a spinal injury that left a woman 50% disabled — occurred in Wal-Mart stores.
"Wal-Mart believes we did what we were supposed to do," spokesman Bill Wertz says. "We had no reason to believe there was a risk of serious injury. The most serious injury we knew of was a tailbone fracture."
Justice and CPSC say Wal-Mart was the first to learn of a potential problem when an injury occurred at a store in 1996, but did not report it to CPSC as required by law. Icon recalled the gliders in 1999.
The government says Wal-Mart and its subsidiaries, Sam's East and Sam's West, knew of 46 incidents, including 41 injuries. CPSC says that 29 of the incidents occurred at Wal-Mart stores while consumers were trying the equipment and the incidents were reported to store personnel. CPSC also says that the insurance company that handled 36 claims involving glider incidents is owned by Wal-Mart.
"We were very willing to cooperate in working out better ways to track customer complaints, but CPSC was focused on a multimillion-dollar penalty we felt we did not deserve," Wertz says.
The government also says Icon, which says it is the world's largest manufacturer of fitness equipment, knew of 86 incidents, including 68 injuries, but did not report them to CPSC. Icon did make design changes to the gliders.
Icon President Gary Stevenson says the company, located in Logan, Utah, cooperated fully with CPSC and told the agency about all the incidents when asked. "We have always maintained a high priority on the safety of users who use our equipment," he says.
In several civil lawsuits, judges have given Wal-Mart financial penalties for not giving plaintiffs information about accidents on its property.
"I'm not at all surprised that they failed to follow government regulations in notifying CPSC of problems," says Lewis Laska, a Nashville plaintiff's attorney who runs the Wal-Mart Litigation Project for lawyers suing Wal-Mart.
Wal-Mart says it now has a "zero-tolerance" policy on judicial reprimands. It says it cut the number to 10 last year from 22 in 1999.
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