The CPSC (release) has imposed a $1.1 million civil penalty on Mega Brands America, formerly Rose Art, to settle allegations that the firm "failed to provide the government with timely information about dangers to children with Magnetix magnetic building sets, as required under federal law." This penalty for a serious violation is based on pre-2008 law. The CPSC's release shows that had the threat of civil penalties been greater (neither the CPSC's enforcement stance nor the maximum penalty deterred Rose Art/Mega Brands), thereby causing the company to comply with the notification elements of the law, perhaps one death and as many as 25 dangerous intestinal surgeries of small children might have been avoided.

CPSC learned through the subpoena that at the time Rose Art filed its “initial report” in December 2005, it had received over 1,100 consumer complaints that magnets had fallen out of plastic pieces from dozens of different Magnetix models. Additionally, the subpoena revealed that Rose Art had received at least one report of an injury due to magnet ingestion, prior to the toddler’s death in Washington state.