Shihan Qu Battles Federal Regulators

Via The Westword

By Alan Prendergast

Published JANUARY 20, 2018

Shihan Qu thought he knew a thing or two about small, round magnets and their capacity to attract — not only each other, but artists, scientists and hobbyists, drawn by the magnets’ quirky behavior and simple elegance. What he hadn’t counted on, though, was their ability to attract trouble.

The first sign of trouble arrived on his doorstep six or seven years ago, in the form of a polite, official-looking fellow in a drab suit. Qu was in his early twenties then, a recent graduate of the University of Colorado and already a fledgling entrepreneur, operating his own online company, Zen Magnets, out of his home in Boulder. The man identified himself as a representative of the United States Consumer Product Safety Commission, a federal agency. He said he had a few questions.

Another business owner might have been more suspicious, mindful of the old canard: I’m from the government and I’m here to help you. But Qu figured he had nothing to hide. He invited the man inside. He showed him his office, his website and his magnets — BB-sized rare-earth balls, thirty times more powerful than the typical refrigerator magnet, sold for as little as twelve bucks for a set of 72, and used to make jewelry, complex geometric shapes, free-form sculptures and other kinds of magnet art, or simply for desktop fidgeting and messing around.

The man took notes. He volunteered little about the reasons for his surprise visit. At one point he mentioned that there were possible safety concerns; the CPSC had received reports about children swallowing high-powered magnets like those sold by Zen, with devastating results. Qu pointed out that he didn’t market his magnets as a toy and included a warning on his website: “Can cause serious problems if swallowed. Do not give to kids under the age of 12, and keep them away from pets.”

The man left. Qu set about adding to his website more explicit, stronger warnings about magnet ingestion. But the episode was only the first volley in what would become an all-out assault on small rare-earth magnets, or SREMs, by federal regulators and the Department of Justice. Over the next few months, Qu received voluminous paperwork from the CPSC, inquiring about his operations, his packaging and his suppliers. He received notifications that the agency was contemplating a new rule that would essentially ban the sale of high-powered magnet spheres. He was asked to agree to a “voluntary” recall of his product or face dire consequences.

Qu was a modest operator in a decidedly niche business. In its better years, Zen Magnets sold around 20,000 magnet sets of various sizes, grossing $600,000 in annual revenues — less than 5 percent of the market at its peak. As the pressure from the government increased, much bigger companies than Zen decided to throw in the towel. Most of his friends and advisors urged Qu to do the same.

“You’re up against the federal government,” Qu says. “Every expert tells you you’re not going to make it, don’t try to fight this. If it was just about corporate profits, I would have left the same time everybody else did. But at the time it just felt like — it was angering to me. If I don’t fight this, I’m going to regret it for the rest of my life.”

The full 5,800 word article is available at