United States v. Midwest Fireworks Manufacturing Co.

Midwest Fireworks Manufacturing Company, Inc. (Midwest) (defendant) imported fireworks. The Consumer Products Safety Commission (CPSC) (plaintiff) collected and tested samples of Midwest’s fireworks. CPSC compliance officers evaluated the test results and determined that 79 of Midwest’s products were hazardous and violated federal law. The CPSC sent Midwest letters notifying it of the violations and asking Midwest to submit a proposed corrective plan. Midwest did not cooperate, and the CPSC filed a lawsuit to force Midwest to destroy or export the hazardous fireworks. At a hearing in the lawsuit, the CPSC sought to introduce evidence of its sample-collection reports, laboratory-test reports, compliance-officer evaluations, and letters to Midwest. The CPSC routinely created its sample-collection and laboratory-test reports whether litigation was anticipated or not. In addition, CPSC technicians involved in the Midwest investigation testified that they performed thousands of similar tests each year. Although the CPSC’s proposed exhibits contained out-of-court hearsay statements, the trial court admitted them under the business-records and public-records exceptions to the rule prohibiting hearsay. The trial court then issued a permanent injunction requiring Midwest to destroy or export all the hazardous fireworks. Midwest appealed the order, arguing that the trial court should have excluded the hearsay statements in the CPSC’s reports and letters.