Spilling the Tea on Made in the USA Claims
When it comes to marketing products in the United States, the “Made in the USA” label carries significant weight, (maybe more so now than in previous years and administrations). Made in the USA is often associated with patriotism, quality, and support for domestic jobs. These days with the unavoidable impact of potential tariffs on so many goods, companies that do make products in the USA may also see “Made in the USA” as a marketing opportunity.
USA origin claims have long been a focus of the Federal Trade Commission whose rules and regs surrounding “Made in the USA” claims are well established by the Enforcement Policy Statement on U.S.-Origin Claims and the Made in USA Labeling Rule. But what does “Made” in the USA mean?
What does “Made” Mean: All or Virtually All
To claim that a product is “Made in the USA,” it must be “all or virtually all” made in the United States. This includes the sourcing of all parts and processes. Any foreign element or content of the final product should be negligible. Further, a product claiming to be “Made in the USA” must have undergone its “final substantial transformation” in the USA – meaning that the last “significant change in the product's form, appearance, or nature” must occur in the USA. In order to determine if a product is in fact made in the USA, the FTC will look at the portion of manufacturing costs that are attributable to US parts and processing as well as how far removed any foreign content is from the finished product.
Not Quite Made in the USA
When a product doesn't meet the strict “Made in the USA” standard, advertisers may use qualified claims, such as “Made in the USA from Italian leather”. The claim still must be truthful in that the product's final assembly, processing, or finishing must have taken place in the USA. Advertisers may also (truthfully) say things like “designed in the United States,” as long as there is no implication that the whole product was made in the US. “Assembled in” is another common qualified claim which may be used so long as the principal assembly and the last substantial transformation of a product was in the United States.
Spilling the Tea
Here's a very recent example: In the April 2025 case of Banks v. R.C. Bigelow Inc., a jury in the Central District of California found that Bigelow's labeling of its tea products as “Manufactured in the USA 100% American Family Owned” to be misleading. While Bigelow's tea bags were manufactured in the United States, the tea leaves were grown and processed abroad in countries like China, India, and Sri Lanka. The Federal Trade Commission (FTC)'s Made in USA Labeling Rule requires that products labeled as “Made in USA” must be “all or virtually all” made domestically, including the sourcing of components, and contain negligible foreign content.
The court ruled that Bigelow's representation was “literally false” because the foreign processing transformed the tea leaves into consumable products. This misrepresentation led to a $2.36 million verdict in favor of the consumer class, emphasizing the importance of strict adherence to FTC guidelines to avoid misleading consumers and legal consequences.
Compliance Matters
Compliance has always mattered but in the current climate in might be tempting to use the “Made in the USA” moniker without really understanding the substantiation involved in making such a claim. Can you ensure that you can prove your product meets the “all or virtually all” standard? If you are making a qualified claim, is it truthful and clearly stated? These claims are going to get examined more closely so keep records of your sourcing, costs, assembly processes, and marketing substantiation data. Qualified claims are intended to help consumers understand exactly how a product is made. If you overstate such a claim you could be subject to legal and reputational risks.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
