William-Sonoma Settles FTC 'Made in USA' Claims for $1 Million
Williams-Sonoma will pay the Federal Trade Commission $1 million as part of a settlement with the agency involving “Made in USA” claims, the FTC said in a March 30 news release. The company also agreed to stop making claims “that all of its Goldtouch Bakeware products, its Rejuvenation-branded products, and Pottery Barn Teen and Pottery Barn Kids-branded upholstered furniture products are all or virtually all made in the” U.S. The settlement consent order, which was approved 5-0 by the FTC, doesn't include an admission of guilt by the company.
The FTC previously looked into Williams-Sonoma after receiving reports in 2018 that Williams-Sonoma incorrectly claimed in information on Pottery Barn Teen organic mattress pads that those products were “Crafted in America from local and imported materials.” The FTC then closed the investigation the same year, after Williams-Sonoma corrected the information and agreed “to comply with the FTC’s requirement that it undertake a larger review of its country-of-origin verification process.”
The FTC alleged that the company has since “made misleading claims that all Goldtouch Bakeware, Rejuvenation-branded products, and Pottery Barn Teen and Pottery Barn Kids-branded upholstered furniture products, including raw materials and subcontinental, were all or virtually all made in the United States.” Those claims were included in marketing materials on the company website and in emails, it said. The company didn't comment.
The consent order will prohibit the company from “making unqualified U.S.-origin claims for any product, unless it can show that the product’s final assembly or processing -- and all significant processing -- takes place in the United States, and that all or virtually all components of the product are made and sourced in the United States,” the FTC said. “Under the order, any qualified Made in USA claims must include a clear and conspicuous disclosure about the extent to which the product contains foreign parts, components, and/or processing. To claim that a product is assembled in the United States, Williams-Sonoma must ensure that it is last substantially transformed in the United States, its principal assembly takes place in the United States, and United States assembly operations are substantial.”
The FTC will post the consent order in the Federal Register shortly and will allow 30 days for public comments, it said. The FTC said in 2018 it hoped to eventually pursue monetary penalties in a “Made in USA” case as an example for other companies (see 1811280042). That followed some complaints over the FTC's use of settlements that don't include an admission of guilt or a financial penalty.
The Alliance for American Manufacturing said the “announcement is big news, because it’s the first time that the FTC has issued a financial penalty against a company for false 'Made in USA' claims.”