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The U.S. Department of Justice announced a settlement with XYZ Corporation over allegations that the company’s popular line of children’s toys contained a defect that could cause serious injury. The agreement, reached after a year‑long investigation, requires XYZ to pay $25 million to affected families and to implement a comprehensive safety review of all its products. “This settlement is a major victory for American children and parents,” Associate Attorney General Stanley Woodward Jr. said in a statement released Monday.

Under the terms of the deal, XYZ will recall all units produced between 2018 and 2023 and will provide free replacement parts to any child who has suffered an injury. The company also agreed to submit its safety testing protocols to an independent third‑party auditor for the next five years. The DOJ’s action follows a series of complaints from parents and consumer advocacy groups who reported that the toys’ small parts could become lodged in a child’s airway or cause choking.

The settlement is expected to bring closure to the families involved and to reinforce consumer confidence in the toy industry. It also signals the government’s continued focus on product safety, particularly for items marketed to children. The DOJ will monitor XYZ’s compliance with the safety measures and may pursue additional enforcement actions if the company fails to meet its obligations.