COMOTO Hit with A Nearly $2 Million Fine by CARB

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COMOTO the parent company to RevZilla, Cycle Gear, J&P Cycles has just settled a dispute with the California Air Resources Board (CARB) for the alleged selling of non-exempted add-on or modified motorcycle parts in California.

In total, COMOTO will pay $1,937,500 to resolve the alleged violations, in a mixture of fines to CARB and payments for environmental projects that benefit the community.

“We take the sale of uncertified parts seriously as it can lead to significantly higher emissions that impact the health of California residents,” said CARB Executive Officer Richard Corey. “It is also unfair to the vast majority of manufacturers who comply with clean air requirements.”

According to CARB, it found that RevZilla and Cycle Gear advertised, sold, and offered for sale, roughly 7,750 motorcycle parts that did not have legal exemptions to California’s anti-tampering laws for emission controls.

CARB also seems to have taken issue with the defense from COMOTO that the parts were sold for “race use” and therefore exempt from anti-tampering laws.

Interestingly enough though, in the settlement agreement, COMOTO agreed that its subsidiaries will begin prominently labeling the offending items with various phrases like, “FOR CLOSED COURSE COMPETITION USE ONLY. NOT INTENDED FOR STREET USE” or “LEGAL IN CALIFORNIA ONLY FOR RACING VEHICLES WHICH MAY NEVER BE USED, OR REGISTERED OR LICENSED FOR USE, UPON A HIGHWAY”.

Also per the settlement agreement between CARB and COMOTO, the motorcycle retailer will pay $250 per offending sale, which is a sizable discount from the statutory maximum, which is $500 a pop for offenses taking place before 2017, and $37,500 per instance for offenses taking place in 2017 and beyond.

For reference, the acts at the center of CARB/COMOTO the settlement agreement took place between October 2015 and December 2018. Assuming an even distribution of sales over time, CARB’s penalty to COMOTO could have been worth up to $180 million.

CARB says that COMOTO received leniency because it was the company’s first time offending the CARB statutes on non-exempted add-on or modified motorcycle parts in California.

Going forward, half of COMOTO’s nearly $2 million settlement agreement payment will benefit two Supplemental Environmental Projects: $615,598 will be paid to the Coachella Valley Mitigation Project Extension 2018 – 2023; and $353,151 to the Placer County Community Based Supplemental Environmental Project – ­­Phase 2.

The remaining $968,750 will be deposited into the California Air Pollution Control Fund.

Source: CARB