WASHINGTON (BRAIN) — Shimano has agreed to pay an $11.5 million penalty to the Consumer Product Safety Commission in a settlement of CPSC's charges that Shimano knowingly failed to immediately report issues with its Hollowtech II cranksets.
In 2023, Shimano announced a U.S. recall and a global inspection and replacement program for the bonded aluminum cranks, which can delaminate and fail. Shimano also reached a settlement in a class-action lawsuit filed on behalf of consumers. A court approved that settlement last month.
According to the CPSC, "(B)etween 2013 and 2022, Shimano received thousands of warranty claims relating to the bicycle cranksets and dozens of reports of consumers globally sustaining personal injuries while using the bicycle cranksets, including bone fractures, joint displacement, and lacerations, due to falls from bicycles, contact with the broken cranksets, and impact with the ground. During this time, Shimano, Inc. made nine overall manufacturing and design changes that resulted in over twenty-five individual changes to the bicycle cranksets to mitigate the potential for the cranksets to separate and break. Despite possessing information that reasonably supported the conclusion that the bicycle cranksets contained a defect which could create a substantial product hazard or created an unreasonable risk of serious injury or death, Shimano did not immediately report to the Commission."
According to the CPSC, in addition to the $11.5 million civil penalty, the settlement agreement requires Shimano to maintain internal controls and procedures designed to ensure compliance with the Consumer Product Safety Act (CPSA), including enhancements to its compliance program. Shimano has also agreed to submit annual reports regarding its compliance program, internal controls, and internal audits of the effectiveness of compliance policies, procedures, systems, and training.
The Commission has provisionally accepted the settlement agreement.
