Amid leadership changes and uncertainty, Fiscal Year 2025 saw just two penalty settlements between the U.S. Consumer Product Safety Commission (CPSC or the Commission) and companies the agency regulates. Less than halfway in, FY26 has already met that mark. On March 11, 2026, the sole remaining Commissioner and Acting Chairman, Peter Feldman, on behalf of the Commission, provisionally accepted an $11.5 million civil penalty settlement agreement with Shimano, Inc. and Shimano North America Holding, Inc. (collectively, Shimano).
The settlement agreement resolves CPSC staff’s allegations that Shimano failed to timely report a safety issue with certain bicycle cranksets that the company voluntarily recalled on September 21, 2023. In a LinkedIn post announcing the civil penalty settlement, Feldman remarked that “[f]or too long, the Commission’s civil penalty decisions lacked that coherence” but “[n]ot any longer.” Feldman indicated that this settlement — and the January settlement with Clorox, also for alleged late reporting — “underscores the civil penalty standard this Commission is working to restore.”
CPSC Staff Charges
According to CPSC staff’s allegations in the settlement agreement, the Shimano 11-Speed Bonded Hollowtech II Bicycle Cranksets (models: Ultegra FC-6800 and FC-R8000 and Dura-Ace FC-9000, FC-R9100, and FC-R9100P, collectively “Shimano cranksets”) contain a defect that could create a substantial product hazard or created an unreasonable risk of serious injury or death to consumers because the “recalled bonded crank parts can separate and break, posing a crash hazard to consumers.” CPSC staff alleges that between 2013 and 2022, Shimano received thousands of warranty claims relating to the Shimano cranksets and dozens of reports of consumers globally sustaining personal injuries while using the Shimano cranksets, including bone fractures, joint displacement, and lacerations, due to falls from bicycles, contact with the broken Shimano cranksets, and impact with the ground.
Also during that time, Shimano allegedly “made nine overall manufacturing and design changes that resulted in over twenty-five individual changes” to the Shimano cranksets to mitigate the potential for the Shimano cranksets to separate and break. Staff alleges that, despite having information that reasonably supported the conclusion that 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.
Shimano’s Response
Shimano contends that it “has a longstanding history of proactively working with the CPSC and remains committed to doing so.” Shimano states that the agreement with CPSC does not constitute an admission that the cranksets contained a defect that could create a substantial product hazard or created an unreasonable risk of serious injury or death, nor does entering the agreement constitute an admission that Shimano violated the Consumer Product Safety Act (CPSA) or any other law.
The Settlement Agreement
As part of the settlement agreement, Shimano has agreed to: pay a $11.5 million late-reporting civil penalty; maintain a compliance program “designed to ensure compliance with the [Consumer Product Safety Act] with respect to any Shimano consumer product imported, manufactured, distributed or sold in the United States;” and submit an annual report detailing its compliance program, internal controls, and an internal audit of the effectiveness of its compliance policies, procedures, systems, and training. The Shimano agreement also requires that Shimano’s compliance program have a procedure for tracking and reviewing claims whether those claims originate from “inside or outside the United States.”
Key Takeaways
This second penalty settlement in as many months serves as a reminder that CPSC continues to actively enforce Section 15 reporting requirements. Additionally, Acting Chairman Feldman has signaled that, under his leadership, the size of the penalties CPSC will seek in enforcement actions will be consciously tied to the agency’s perception of the significance of the alleged violation. Feldman wrote that, under his leadership, “the Commission’s civil penalty decisions will be guided by a simple principle: similar violations should produce comparable penalties, and the most egregious violations should face the strongest penalties.”
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