1. Product Recalls: Before, During and After Cynthia A. Boeh, VP & GC MiSUMi USA, Inc.

2. Why? Safety Reputation Finances Who should learn about recalls? Every in-house attorney Recalls have no boundaries and cross all industries – drugs, cars, machines, food, consumer products…..

3. Recent Recalls Takata – air bags exploding and shooting shrapnel in over 10.5 million vehicles Teavana – glass pitchers pose laceration or burn hazard Frozen Yellow-Fin Tuna – salmonella contamination Cost Plus World Market – bistro chair legs may unexpectedly bend DuPont – 1000’s of trees killed by Imprelis herbicide, up to $19K a tree, plus cost to remove dead trees ++

4. 3 Phases of Recall 4 1.Prepare 2.Investigate, analyze and determine action 3.Recover, regroup

5. Prepare…prepare…prepare Create (and continually update) recall / crises plan Ensure buy in from the top Train employees Governing agency/agencies – establish relationships – FDA, FAA, OSHA, CPSC, EPA, European Commission Appoint an executive to be spokesperson Appoint point person in charge of daily activities in case of recall Assign a team Conduct a mock emergency 5

6. Analyze Situation How serious is the situation? Death, injury, property damage How widespread is the problem? # of products involved How big of geographic area? Did we know about it ahead of time? INVESTIGATE Did we do enough at the time the first claims started coming in? When does the board need to be notified? Can products be found/traced to users? Re-evaluate as more information is gathered Get field team together

7. Regulatory Regulatory obligation to report? – CPSC has very regimented requirements See 16 CFR 1115.13 et sec and www.cpsc.govwww.cpsc.gov -Medical Devices – FDA - 21 CFR 803 -Motor Vehicle Industry related – NHTSA - 49 CFR Parts 573, 574, 576, 579 Report voluntarily? 7

8. Recall Guidance Regulatory agencies provide guidance – CPSC: Consumer Product Safety Commission http://www.cpsc.gov/en/Business--Manufacturing/Recall- Guidance/ http://www.cpsc.gov/en/Business--Manufacturing/Recall- Guidance/ – FDA: Federal Drug Administration http://www.fda.gov/Safety/Recalls/IndustryGuidance/ucm129334.htm http://www.fda.gov/ForConsumers/ConsumerUpdates/ucm049070.htm http://www.fda.gov/Safety/Recalls/IndustryGuidance/ucm129334.htm http://www.fda.gov/ForConsumers/ConsumerUpdates/ucm049070.htm – ISO: International Organization for Standardization 10393:2013 – OECD: Organisation for Economic Co-operation and Development http://globalrecalls.oecd.org/ http://globalrecalls.oecd.org/ 8

9. Corrective Action Warning Fix on fail Recall – What is product population? – Need product to be returned? – If only a part of entire product, provide replacement part for self fix? Require 3 rd party? – PR messaging important 9

10. Steps of a Recall Notice: to regulatory bodies, distributors, consumers, etc. Recovering the product: Tracing product: serial number, bar code, batch numbers Tracing the owners: sales records, warranty cards, distributor sales, GPS How product to be returned/tracked: prepaid shipping? Replacing the product or providing refund: may provide owner with option(s) Reintroduction of product? How? Reward key individuals who made the recall a success Audit the recall – revise plan by including what went well and learning how to rectify the things that went wrong

11. Top 10 Tips to Remember 1.Be prepared 2.NEVER lie 3.Take charge of message immediately (media strategy) 4.Have a delegated team (include experts?) 5.Have one spokesperson (Senior Executive) 6.Decide if a corrective action/recall is necessary 7.Keep employees in the loop (suppliers/distributors) 8.Encourage reporting of potential pitfalls, mistakes 9.Own up to fault & do the right thing 10.Discuss and implement lessons learned 11

12. Other issues to consider… Recall insurance? Bringing in others (ex. suppliers, manufacturers of components) Dealing with insurance When/if to bring back product in question 12

13. Thank you. Cynthia Adamson Boeh Vice President and General Counsel Misumi USA