Federated to Pay Fine to Settle Sleepwear Claims

Federated Department Stores Inc., operator of Bloomingdale’s and Macy’s, agreed to pay a $850,000 fine to settle government allegations that it knowingly sold flammable clothing as children’s sleepwear. The U.S. Consumer Product Safety Commission accused Federated of failing to meet federal safety standards when the company sold about 600,000 loose-fitting, untreated cotton garments that were marketed as children’s sleepwear or robes. “They were selling items that looked like sleepwear but were really ordinary garments along with sleepwear so that consumers couldn’t tell the difference,” said Russ Rader, a spokesman for the commission. The $850,000 civil penalty was the largest ever imposed by the commission on a retailer for safety violations, Rader said. Federated denied the allegations and argued that the garments in question were sold as playwear, which is held to less stringent flammability standards. The Cincinnati-based company said it chose to settle the case to avoid the costs and uncertainties of litigation. Company officials were not available to comment. Federated said it will initiate a program to better educate consumers about the differences between sleepwear and playwear. Shares of Federated fell 24 cents to close at $41.41 on the NYSE.