The U.S. Consumer Product Safety Commission Tuesday said that toys and toddler products maker RC2 Corp. (RCRC) has agreed to pay a civil penalty of $1.25 million for allegedly violating the federal lead paint ban. The penalty settlement has been provisionally accepted by the commission.
The U.S. Consumer Product Safety Commission, or CPSC, said that in 1978, a federal ban was in place prohibiting toys and other children's articles with more than 0.06% lead by weight in paints or surface coatings. Following the Consumer Product Safety Improvement Act of 2008, the regulatory limit was reduced to 0.009% on August 14, 2009.
The CPSC alleged that RC2 failed to take adequate action to ensure its toys complied with the lead paint ban. The failure created a risk of lead poisoning and adverse health effects on children.
The penalty settlement resolves allegations that RC2 and one of its wholly-owned subsidiaries, Learning Curve Brands Inc., knowingly imported and sold various Thomas & Friends Wooden Railway toys with paint or other surface coatings that contained lead levels above legal limits.
The settlement with the company also resolves other potential matters, including allegations that RC2 imported up to 1.5 million units of non-compliant Thomas & Friends toys between January 2005 and June 2007, and distributed them to its retail customers for sale in the U.S. The toys were recalled in June 2007. RC2 also imported up to 200,000 units of five additional non-compliant toys from this product line between March 2003 and April 2007, supplying them to its retail customers for sale to U.S. consumers. In September 2007, the company expanded the original June 2007 recall to include these additional units.
In May 2007, RC2 reported that more than two dozen styles of vehicles, buildings and other train set components from the Thomas & Friends product line were determined to have paints with lead levels above the then-applicable limit of 0.06%. Later, in August and September 2007, RC2 reported that five additional toys from this product line were determined to have exceeded this limit.
In agreeing to the settlement, RC2 denied that it knowingly violated federal law, as alleged by the commission.
Commenting on the settlement, CPSC Chairman Inez Tenenbaum stated, "The highly publicized recall of Thomas & Friends (TM) Wooden Railway toys was a catalyst for Congressional action aimed at strengthening CPSC and making the lead-in-paint limits under federal law even stricter."
The CPSC also stated that it is still interested in receiving incident or injury reports that are either directly related to this product recall or involve a different hazard with the same product.
RCRC is currently trading at $14.899, up $0.099, or 0.67%, on the Nasdaq.
For comments and feedback contact: editorial@rttnews.com
June 12, 2026 17:14 ET Major central bank action was the focus this week in economic news. The European Central Bank became the first major central bank to move in response to the rising inflationary pressures in the backdrop of the conflict in the Middle East. In North America, the U.S. inflation and trade data as well as Canada’s central bank decision gained attention. The Chinese trade data was the main news in Asia.