‘Responsible Corporate Officer’ Doctrine Extended To CEO In Product Recall

Regulators are increasingly using the “responsible corporate officer” doctrine to hold high-ranking executives personally liable for alleged legal violations of the company, including in a recent case wherein the doctrine was used in an administrative action. The Consumer Product Safety Commission required a recall of a Maxfield & Oberton product, and in fighting the recall the company went bankrupt. After the company dissolved, the Commission added the firm’s former CEO Craig Zucker to the suit, meaning he could potentially be held personally responsible for $57 million in recall costs. The Commission confirmed to the New York Times that it was the first time they’ve used the doctrine in an administrative case. Business groups, including the National Association of Manufacturers and the National Retail Federation, have urged that Zucker be dropped from the suit.