It has recently been reported that President Donald Trump is looking for ways to defend American-made products by certifying legitimate U.S. goods and aggressively going after imported products unfairly sporting the “Made in America” label, the White House said on July 18, 2017. President Trump announced that his administration would crack down on “predatory online sales of foreign goods” that are hurting U.S. retailers. According to a senior official, the United States loses about $300 billion a year to theft of intellectual property ranging from semiconductors to jeans. In March of this year, the President signed an executive order that gave customs officials more authority to stop pirated and counterfeit items.

This space has addressed the issues, both regulatory and litigation, relating to “Made in America” claims (see herehere, and here). Based on the Administration’s comments,  the White House plans to work with the private sector on the new certification and verification system rather than create new regulations or spend taxpayer money. Continue Reading The Turn of the “Made in America” Claim Enforcement

“…Clowns to the right of me, jokers to the left, here I am…”

-Stealers Wheel (1972)

Legal actions regarding “Made in the USA” claims, whether prosecuted by the Federal Trade Commission (FTC) or through various state unfair trade practices acts, often settle early in the proceedings.  For example, in 2014, the FTC issued 16 “closing letters” wherein the target company agreed to revise its “Made in the USA”  claim to clarify that its products, even those assembled in the United States, included imported components. In 2015, the FTC issued 28 such “closing letters”; and in 2016, to date, the FTC has issued 18.

Earlier this month, Chemence, Inc., the Ohio maker of Kwikfix, Hammer-Tite and Flash Glue, entered into a settlement with the FTC.  Chemence was the third glue company that has resolved its claims issues with the FTC since 2015.   Toagosei America, Inc., makers of the Crazy Glue brand, and Gorilla Glue both previously reached agreement with the FTC, with FTC issuing closing letters after both companies agreed to make clear that their products included some imported materials.

Chemence’s path to resolution with the FTC was different.  Continue Reading Stuck in the Middle with the FTC

We blog frequently about new regulatory developments coming from CPSC or FDA and about enforcement actions brought by those federal agencies as well as state counterparts and private plaintiffs.  But we don’t very often discuss actions involving the Federal Trade Commission (FTC) and its enforcement of the FTC Act’s broad prohibition on unfair or deceptive acts or practices, which incorporates false advertising for consumer products such as food, cosmetics, OTC drugs, medical devices, and goods overseen by the CPSC.  We thought it was worth a quick reminder that this area can be fraught with booby traps for the uninitiated advertiser.

The FTC Act is the primary federal law enforcement tool for preventing false advertising that has the capacity to deceive consumers. Continue Reading Reminder – Truthful Advertising Is Not Optional

Made in the USA LabelingCalifornia, the beacon of individualism and often marching to its own set of rules, has joined the rest of the country as Gov. Jerry Brown has signed SB 633 which revises California’s take on what constitutes “Made in USA”.

Up until this week, existing California law prohibited the sale or offering for sale in the state of any merchandise in which the words, “Made in U.S.A.,” “Made in America,” “U.S.A.,” or similar words appeared on the label when the merchandise or any article, unit, or part thereof, has been entirely or substantially made, manufactured, or produced outside of the United States.  (Read our previous post on the California, the FTC and Made in the USA Claims here.) An epidemic of consumer class actions had been launched in the past several years claiming that this law was violated by California manufacturers and retailers even though the products met Federal and other state requirements for the proper use of “Made in USA labeling. Continue Reading California Joins rest of Country in “Made in USA” Rules

Two months ago, our colleague Dan Herling cautioned on this blog about making unsubstantiated “Made in the USA” claims on consumer products.  He compared the Federal Trade Commission’s standard to California’s more stringent standard under Business & Professions Code 17200.  Interestingly, just last week, the FTC announced that it has entered into proposed consent order with the company E.K. Ekcessories, Inc. over the firm’s claims that many of its products are “Made in the U.S.A.”  Companies should take note of this consent order as it is the first settlement announced by the FTC concerning “Made in the USA” claims since 2009 when the FTC entered into an agreement with a manufacturer of magnifiers and other portable vision aids over similar allegations.

The FTC alleged in its draft complaint that E.K. Ekcessories made misrepresentations regarding  its products, including outdoor equipment, bottle holders, dog collars and leashes, and cell phone accessories about their manufacture and production in the U.S.  These representations included (1) “For 28 years E.K. Ekcessories has been producing superior quality made accessories in our 60,000 sq. ft. facility in Logan, Utah;” (2) “our source of pride and satisfaction abounds from true ‘Made in USA’ product;” and (3) “Truly Made in the USA.”  The FTC claimed that, in fact, the company imported many products and components from overseas.

Continue Reading FTC Brings Enforcement Action over “Made in USA” Claims

Demi Lovato’s hit song “Made in the USA” recounts how her love for her boyfriend is both amazing and patriotic.  If they had fallen in love in Paris or Acapulco, however, she may be facing an enforcement action by the FTC or a lawsuit in California under Business & Professions Code 17200 for false advertising.

In 1997, the FTC developed a standard that products advertised as “Made in the USA” must be “all or virtually all” made in the US.  All or virtually all significant parts and processing that go into the product must be of US origin.  The FDA could also take action on a product under its domain based on misleading claims that misbrand products under the Food Drug & Cosmetic Act.

As we have come to expect, California has a more stringent standard than the FTC.  In California, a “Made in the USA” claim is not permitted if the “merchandise or any article, unit, or part thereof has been entirely or substantially made, manufactured, or produced outside the US.”

Enforcement actions be the FTC have included:

Continue Reading California, the FTC, & Made in the USA Claims