Every time investors turn around, things get worse at Mattel (NYSE: MAT). The Wall Street Journal (subscription required) reports that the federal Consumer Product Safety Commission requires companies to "report all claims of potentially hazardous product defects within 24 hours." Mattel apparently has not been doing that. The company took several months to review data on the nearly 18 million play sets that it recalled last month.
The CPSC says that it has had about enough of Mattel's behavior. The commissions chairperson calls Mattel's approach "fallacious and wrongheaded."
Although the commission is fairly small and cannot handle all of the cases that it should, it is astonishing that Mattel would makes its position with consumers worse by adopting a stance that might be viewed as irresponsible.
Over the last three months, Mattel shares are down well over 20%. A public confrontation with the federal government is the last thing that the company's stockholders need.
Douglas A. McIntyre is a partner at 24/7 Wall St.
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