United We Ball

The Buckyballs Case: Federal Overreach in the Name of Public Safety

What even are Buckyballs?

What was the problem with Buckyballs?

What exactly happened to Buckyballs?

What were both sides of the argument against Craig Zucker?

How did the lawsuit against Craig Zucker end?

Are there similar cases to the Buckyballs situation?

In conclusion

Buckyballs have come to rerepresent much more than a hands-on pastime. In fact, they became the center of an unprecedented complaint filed by the Consumer Product Safety Commission (CPSC) against the product’s founder, Craig Zucker.

The ensuing litigation and related cases have created critical questions about the accountability of corporate officers for the misuse of a product, the role of labeling in our relationship to potentially dangerous products, and the limits that federal agencies should work within regarding corporate responsibility.

What even are Buckyballs?

Buckyballs are small, spherical, powerfully magnetic beads, named after an informal term for molecules of buckminsterfullerene, a type of fullerene. A fullerene is an allotrope of carbon, or basically where an element (in this case, carbon) exists in more than one form while remaining in the same physical state.

This particular buckyball has 60 carbon atoms and is, therefore, very strong. While the fullerene itself is not magnetic, the addition of neodymium, a rare earth metal five times stronger than a normal magnet, makes these balls a force to be reckoned with.

The nickname buckyballs is based on the carbon bonds’ resemblance to a soccer ball’s structure.

This also served as the name of a toy launched by Maxfield & Oberton Holdings LLC, co-founded by Craig Zucker. The sets contained up to 216 pieces of rare-earth spherical magnets.

Launched in 2009, and marketed as a stress reliever for adults, Buckyballs were a huge success and thriving trend until the CPSC ordered a recall.

What was the problem with Buckyballs?

While Buckyballs were marked by early success, there was an alarming frequency of ingestions and injuries by children, in one case resulting in the tragic death of a 19-month-old.

The CPSC estimates that between 2009 and 2011, approximately 1,700 children were hospitalized after ingesting Buckyballs or other similar magnets, often with severe bowel injuries.

Despite five warning labels, including clear labeling to “keep away from all children,” these cases persisted. This ultimately prompted the CPSC to order the first voluntary recall, citing “a defect in the design, packaging, warnings, and instructions, which pose a substantial risk of injury to the public.” They also argued that since all the warnings were on the external packaging, there was not an equal opportunity to notice them.

What exactly happened to Buckyballs?

At first, the CPSC was mainly just voicing concerns. Initially, the company complied with the commission, even collaborating in efforts to promote safe use of the product by its intended audience.

They even launched a website promoting safe use of the magnets.

Eventually, the commission decided these efforts were insufficient, and in a rare move, filed an administrative complaint against the company, seeking a mandatory recall.

The decision to file a complaint against Buckyballs was met with some disagreement, with Huffington Post citing CDC data to propose that dogs were more dangerous than the magnets they were trying to ban.

Unbeknownst to the company, the agency was also allegedly reaching out to stores to discourage them from selling Buckyballs, rather than “filing an injunction against the sale of Buckyballs while pursuing their case,” as former CPSC commissioner Nancy Nord writes was within their legal wheelhouse.

The CPSC claims the decisions to reach out to retailers and file the complaint were made after failing to create a voluntary recall plan with the company that the commission “found to be adequate.”

They also said that warnings and education “proved to be ineffective” and further prompted their decision to discourage retailers from selling the product.

Zucker said he interpreted this move, and the subsequent decline in sales, as the final sign of Buckyballs going out of business and ultimately dissolved the company.

In response, the commission filed a suit against Zucker personally.

This was the first time the CPSC “attempted to hold a former officer liable for the actions of a defunct corporation.”

What were both sides of the argument against Craig Zucker?

The CPSC’s perspective

A CPSC spokesperson denied the organization was pursuing a personal vendetta, instead saying “it was Zucker’s decision to dissolve the company.”

While the rerepresentative maintained that the founder took a different route than others in the face of a complaint, they do not confirm whether this action was in violation of an explicit policy, therefore warranting personal repercussions.

The agency cited the rarely used Park doctrine, which “permits responsible corporate officers to be held liable for the actions of the corporation, even in the absence of personal guilt on the part of the individual.”

However, the wording of the doctrine does not specify how responsibility is determined “in the absence of personal guilt.”

Though the packaging called the product a “desk toy you couldn’t put down,” the founder Craig Zucker has always claimed that it was ‘never a toy,’ or supplied to kid-oriented stores, and was ‘always advertised as an adult desktop gift item.’

The CPSC contradicts this claim, saying the magnets were initially marketed to kids and eventually rebranded as an adult desktop item.

The agency also claimed that the product’s age restriction of 13+ violated their mandatory standard of 14+.

Zucker’s Perspective

Zucker filed a lawsuit in response, claiming the lawsuit was an attack on “the bedrock principle” of limited liability for owners of corporations and “put every entrepreneur at risk.”

He also launched the irreverently named ad campaign titled “Save Our Balls/United We Ball,”  and appeared on CBS to argue that the balls have a “comparatively low rate of injury.”

Zucker maintained that the product was never intended for children, and the labeling complied with the standards of the time and was adjusted as soon as said standards changed.

He also defends the actions the company took to comply with the commission in promoting proper use of the product, saying they provided safety warning signs for retailers and made them sign an agreement to only market the product to adults.

Zucker maintains that the company followed labeling standards of the time until the CPSC changed its legal definition of a child from 13 to 14.

This contradicts the claims of the CPSC, who says the labeling of the product already violated their standard.

Zucker’s side also argued that the time frame for the CPSC’s figures for injuries related the aforementioned magnets no longer reflected reality, as they “had driven ten of the thirteen biggest companies out of the market.”

How did the lawsuit against Craig Zucker end?

The case ended with Zucker ordered to pay $375,000 after being threatened with up to $57 million in damages.

Despite paying for the recall, Zucker still denies that the toys were defective or hazardous.

He also continued down his entrepreneurial path, founding the rare-earth magnet company Speks, which fulfills the CPSC standards.

However, this situation seems to have set a precedent for further litigation against similar companies.

Are there similar cases to the Buckyballs situation?

There has been similar litigation against rare-earth magnet companies, such as Zen Magnets.

The CPSC sought a ban on the company’s products and others like it, citing an unreasonable risk of injury. Their main argument was that warning labels were insufficient as they simply don’t work.

This raised important questions as to why federal regulations are often so reliant on warning labels if they apparently simply don’t work in some cases.

An attorney judge in Colorado ruled in March 2016 that a CPSC mandatory recall of a certain class of magnets was unfounded, saying it could not prove that the product was dangerous when used as directed.

The CPSC filed an appeal, eventually holding a hearing before the entire commission, who eventually decided to effectively overrule the AJL’s decision.

In conclusion

The litigation against various rare-earth magnet toy companies, including Buckyballs, speaks to the limits to the actions federal agencies can take against individual corporate officers.

It also begs the question of how responsible those officers are for the misuse of their product when that product is clearly labeled with warnings and accurately advertised to an explicitly stated age group.

The CPSC’s decision to privately advise retailers not to carry Buckyballs was cited as due to not reaching a voluntary recall plan that the agency found sufficient. Considering the alternative courses of action the commission could have taken, the decision that arguably affected the corporation’s sales the most, was largely conducive to the company dissolving.

Though the closure of the company is not stated to have violated any stated guidelines, the commission interpreted this as non-compliance and further pursued justice through an unprecedented lawsuit against Craig Zucker himself. They have also defended this action with a rarely used doctrine with arguably contradictory wording.

While the danger of these rare-earth magnets to children is undeniable, them being banned despite being properly labeled creates uncertainty as to the purpose of labeling. The commission also stating that warning labels “simply don’t work” in a similar case against Zen Magnets intensifies this intensity further, as this argument could be made for many products commonly misused by children yet more accessible than Buckyballs.

The Buckyballs case is a powerful example of the delicate dance between protecting public safety while respecting the boundaries between government and corporate affairs.

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