The Federal Trade Commission recently closed three investigations into whether marketers made false claims about whether their products are made in the United States.
The FTC's Enforcement Policy Statement on U.S. Origin Claims says that a marketer should not make unqualified claims that its products are made in the United States, unless the marketer can substantiate that the products are "all or virtually all" made here. The FTC also recently promulgated a new Made in USA Labeling Rule, which codifies the standards set forth in the enforcement policy statement.
The FTC looked into whether marketing materials from KLOS Guitars may have overstated the extent to which certain of its guitars are made in the United States. The FTC said that while the company designs and assembles guitars in Utah, the company's guitars incorporate significant imported parts. In a December 15th closing letter, the FTC said that while it is appropriate for KLOS to promote the fact that it employs workers, including skilled luthiers, to design and assemble guitars in the United States, the company's marketing materials should not convey that the products are made here, unless the company can substantiate that claim. (FWIW, luthiers are people who make string instruments.)
The FTC also looked into whether marketing for Neaties hangers overstated the extent to which they made in the United States. According to the FTC, although most Neaties plastic hangers are made here, Neaties also offers several lines of imported hangers. The FTC expressed the concern that "product inserts and banners on the Neaties website and Amazon storefront stating 'Made in USA' or 'American Made' were overly broad." In its December 15th closing letter, the FTC emphasized to Neaties that "unless marketers specify which products are covered or directly link claims to particular products, consumers generally interpret U.S.-origin claims in marketing materials to cover all products advertised in those materials."
And, in a December 15th closing letter to Origin USA, the FTC told the company that it was concerned that Origin USA's marketing materials may have overstated the extent to which the company's metal doors and windows are made in the United States. Interestingly, the FTC didn't bring up -- at least in the closing letter -- any concerns about the company name itself.
The FTC continues to actively enforce its "Made in USA" standard, and these letters highlight two areas of continuing concern for the FTC. First, if you're going to talk about workers or processes based in the United States, you've got to ensure that you don't communicate a misleading claim that the product, as a whole, is made here. And, when making broad "Made in USA" claims, it's important to be clear about whether you're talking about all of your products -- or just specific items.
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