The point is that people kept doing stupid shit with the magnets despite having been extensively warned NOT to stupid shit.
One quote states: "The warnings were not effective."
So we should banning matches, because people still do stupid shit with matches.
The legal question is whether these magnets are inherently dangerous. They clearly are not, imho. Dynamite, gasoline...these are examples of inherently dangerous products.
But this company has small resources to fight the good fight, and more critically, no pro-magnet-toys lobby.