The U.S. Department of Transportation (DOT) issued an emergency order to ban all Samsung Galaxy Note 7 smartphones on all flights in the U.S. Individuals are not allowed to transport the Note 7 on their person, in carry-on baggage, or in checked baggage, nor are the phones allowed to be air shipped. Transportation Secretary Anthony Foxx stated the safety of all those on an aircraft must take priority.
Initially, Samsung issued recalls on the original Galaxy Note 7 smartphone and its subsequent Note 7 replacement after accounts surfaced that both units reported catching fire. Last week Samsung announced it would permanently discontinue production of the Note 7.
Samsung is expected to take a $5.3 billion loss in its next few quarters from the cancellation of its Note 7. However, Samsung is more concerned about its long-term impact on its reputation and brand. For large corporations, brand equity can be its most valuable asset. However, Samsung has yet to release an explanation of why some of the Note 7 devices kept exploding. Honesty and transparency are needed to repair brand damage and to stop long-lasting repercussions on its other product lines.
END OF DAYS?
A recent consumer survey found 40% of current Samsung customers will not buy another smartphone from the company. On the day Samsung announced it would cease production of the Note 7, the company stock plummeted 8%, erasing about $17 billion off the company's market value. With the cost of product recalls and the significant increase in recalls from the Food and Drug Administration, Consumer Product Safety Commission, and the Department of Transportation, we'll keep watching for product liability issues.
STANDARDS IMPROVEMENT PROJECT
The Occupational Safety and Health Administration announced 18 proposed changes to the agency's recordkeeping, general industry, maritime, and construction standards. OSHA states that the changes will modernize OSHA standards, help employers understand their responsibilities, increase compliance and reduce compliance costs.
The proposed revisions would save employers an estimated $3.2 million per year. They are based on responses to a public Request for Information issued in 2012, as well as recommendations from the Advisory Committee on Construction Safety and Health, OSHA staff, and the Office of Management and Budget. OSHA is seeking public comments on the proposed rules. Comments are due Dec. 5, 2016.
MAKING OUR WAY AROUND THE COUNTRY
Governor Andrew Cuomo announced a "first-in-the-nation" regulation requiring banks, insurance companies, and other financial institutions to be regulated by the NY Department of Financial Services (DFS) to establish and maintain a cybersecurity program. Some of the requirements of the cybersecurity program include a written cybersecurity policy, designating a Chief Information Security Officer responsible for implementing, overseeing, and enforcing its program and policy, as well as cybersecurity policies for third-party service providers. DFS is the first state regulator to issue guidelines involving cybersecurity and could set an example for other state and federal regulators. Before final adoption, DFS is accepting public comments. Comments are due Nov. 12, 2016.
The U.S. Court of Appeals for the District of Columbia Circuit ruled the Consumer Financial Protection Bureau (CFPB) is unconstitutional but can continue to operate under the President's supervision. The DC Appellate Court threw out a $109 million penalty saying the CFPB structure gave too much power to the director with no oversight. The CFPB was created in the Dodd-Frank legislation in response to the financial crisis. House Financial Services Committee Chairman Rep. Jeb Hensarling (R-TX) is looking to repeal and replace Dodd-Frank. The CFPB stated that in the last five years it has recovered $11.7 billion that it returned to more than 27 million consumers.
The third and final Presidential debate takes place tonight at the University of Nevada in Las Vegas. Or, if you want to see history in the making, check out the Chicago Cubs taking on the LA Dodgers. Or just in case you haven't seen it, you can watch the new Star Wars Rogue One trailer. So excited.