15 U.S.C. § 1264 — Penalties; exceptions

(a) A person who violates section 1263 commits a misdemeanor. On conviction, the person may be fined up to $500, imprisoned up to 90 days, or both. If the offense was intended to defraud or mislead, or is a second or later offense, the person may be imprisoned up to 5 years, fined under 18 U.S.C. § 3571, or both. (b) A person is not subject to subsection (a) penalties: (1) for violating section 1263(c), if receipt, delivery, or offered delivery was in good faith, unless the person refuses a properly designated Commission officer or employee’s request for the supplier’s name and address and copies of any delivery documents; (2) for violating section 1263(a), if the person has a signed guarantee or undertaking naming and giving the address of the United States resident from whom the person received the substance in good faith, stating that it is not misbranded or banned as those terms are used in this chapter; or (3) for violating section 1263(a) or (c) involving a substance shipped or delivered for shipment for export to a foreign country, if the outside of the shipping container is marked for export and the substance is labeled as the foreign buyer specifies and as the foreign country’s laws require. This exception does not apply if the substance is sold or offered for sale in domestic commerce, or if the Commission determines that exporting it presents an unreasonable risk of injury to persons residing within the United States. (c)(1) A person who knowingly violates section 1263 may be assessed a civil penalty up to $100,000 for each violation. Subject to paragraph (2), each substance involved in a violation of section 1263(a), (b), (c), (d), (f), (g), (i), (j), or (k) counts as a separate offense, but related violations together may not exceed $15,000,000. Each failure or refusal involving a required act under section 1263(e) is a separate violation; for a continuing violation, each day is a separate offense, with the same $15,000,000 cap for a related series. (2) The paragraph (1) separate-substance rule does not apply to section 1263(a) or (c) violations if the violator is not the manufacturer, importer, private labeler, or distributor and lacked both actual knowledge that the sale or distribution violated the subsection and Commission notice that it would violate it. (3) When seeking a penalty, the Commission must consider the violation’s nature, circumstances, extent, and seriousness; the substance; injury risk and whether injury occurred; quantity distributed; whether the penalty fits the charged business’s size, including ways to reduce undue harm to small businesses; and other appropriate factors. (4) The Commission may compromise a civil penalty. When setting, remitting, or reducing it, the Commission must consider the business’s size, small-business impacts, and the violation’s nature, circumstances, extent, seriousness, substance, injury risk, injury, quantity distributed, and other appropriate factors. A final or compromised penalty may be deducted from money the United States owes the charged person. (5) “Knowingly” in paragraph (1) means actual knowledge or presumed knowledge that a reasonable person would have in the circumstances, including knowledge obtainable through due care to determine whether representations are true. (6)(A) The paragraph (1) maximums must be adjusted for inflation. (B) By December 1, 2011, and each fifth December 1 after that, the Commission must publish in the Federal Register a schedule of maximum penalties applying to violations after January 1 of the following year. (C) The schedule increases each paragraph (1) amount by the preceding five years’ cost-of-living adjustment and rounds it to the nearest $1,000 for penalties over $1,000 through $10,000, nearest $5,000 for penalties over $10,000 through $100,000, nearest $10,000 for penalties over $100,000 through $200,000, and nearest $25,000 for penalties over $200,000. (D) “Consumer Price Index” means the Department of Labor’s index for all urban consumers. The cost-of-living adjustment is the percentage by which the June index in the calendar year before adjustment exceeds the June index before the last adjustment. (d) A State attorney general alleging a violation affecting or possibly affecting the State or its residents may bring a civil injunction action to enforce this chapter’s requirements about misbranded or banned hazardous substances. Section 2073’s procedures apply. Other quoted terms are not defined in this section.