WASHINGTON — An Illinois firm agreed to pay a $1.25 million settlement for importing and selling Thomas & Friends children's toys that contained lead levels above legal limits and risked sickening children.

In agreeing to the penalty settlement, RC2 denied it knowingly violated federal law as alleged by the Consumer Product Safety Commission.

The commission, which provisionally accepted the settlement, charged that RC2 of Oak Brook, Ill., and one of its subsidiaries, Learning Curve Brands, knowingly imported and sold Thomas & Friends Wooden Railway toys that had "paints or other surface coatings" containing lead levels above .06 percent by weight. The toys were imported from China.

That level violated a 1978 lead paint ban on toys.

"This failure created a risk of lead poisoning and adverse health effects to children," the commission said in a statement.

From May through September 2007, RC2 reported more than two dozen styles of vehicles, buildings and other train set components were found to contain lead levels that violated the 1978 ban.

That amounted to some 1.7 million units sold that were later recalled between June and September of that year, according to the CPSC.

RC2 sells infant, toddler and preschool products under its Learning Curve brands, including Lamaze, The First Years and licensed properties such as Thomas & Friends, Bob the Builder and Winnie the Pooh.