Zen Magnets v. Consumer Product Safety, No. 19-1168 (10th Cir. 2020)Annotate this Case
Zen Magnets, LLC's small rare-earth magnets were shiny and smooth, resembling candies that commonly garnish cookies and desserts. The appearance sometimes leads young children to put the magnets in their mouths. Older children also sometimes put the magnets in their mouths to magnetize braces or mimic facial piercings. When put in children’s mouths, the magnets were sometimes swallowed, lodging in the digestive system and causing serious injury or death. The Consumer Product Safety Commission tried to address this danger through both rulemaking and adjudication. The Commission conducted two proceedings involving the making of small rare-earth magnets: (1) a rulemaking affecting all manufacturers of these magnets; and (2) an adjudication affecting only one manufacturer: Zen Magnets, LLC. For the adjudication, the Commission needed to provide Zen with a fair proceeding under the Fifth Amendment’s Due Process Clause. Zen contended the adjudication was unfair for two reasons: (1) the Commissioners conducted the adjudication after engaging in a rulemaking on closely related issues; and (2) three Commissioners participated in the adjudication after making public statements showing bias. The district court found: (1) the Commission had not denied due process by simultaneously conducting the adjudication after the related rulemaking; (2) two of the Commissioners had not shown bias through their public statements; but (3) one Commissioner did show bias through a public statement specifically about Zen. Both parties appealed: the Commission appealed the district court's decision as to the third Commissioner's statements; Zen cross-appealed, arguing a due process violation, and that the district court issued an advisory opinion on the merits. After its review, the Tenth Circuit concluded the Commissioners’ participation in the rulemaking and their statements did not result in a
denial of due process, so the district court's judgment as to Commissioners Robinson and Kaye were affirmed. The Court reversed, however, as to Commissioner Adler. The Court concluded it lacked jurisdiction to decide whether the district court rendered an advisory opinion.