FTC: Made in USA Certifier Must Actually Certify (or Disclose Self-Certification)
Seller Beware: Consumer Protection Insights for Industry
As we have discussed in several posts (for example, here), the FTC has stringent standards for "Made in USA" claims. On July 22, 2014, the FTC reached a settlement with Made in the USA Brand, LLC, which charges companies to use its "Made in USA" certification mark and to be listed on its website as a company whose products are made in the United States.
Made in the USA Brand says that it uses the FTC's Enforcement Policy Statement for US Origin Claims as its accreditation standard to determine whether a company can license its certification mark and be listed on its website. According to the FTC's Complaint, however, Made in the USA Brand does not rely on an "independent or objective" evaluation to determine whether companies licensing the mark meet this standard. Instead, the Complaint says, Made in the USA Brand awards a license to any company that self-certifies that it meets the accreditation standard and pays the licensing fee. Moreover, the Complaint alleges that "in numerous instances, entities promoted on Respondent's website have sold products containing significant imported content," and Made in the USA Brand lacks "competent and reliable evidence" that any company on the website meets the FTC's standard.
Under the Proposed Consent Order, Made in the USA Brand may not claim that a company using its certification mark is in compliance with its accreditation standard unless: (1) an entity unaffiliated with the company has conducted an "Independent and Objective Evaluation" to confirm that the company's products meets the accreditation standard, or (2) Respondent's certification mark and other promotional materials "clearly and prominently disclose" that a company can meet the accreditation standard through self-certification. In addition, Made in the USA Brand may not make any country-of-origin claims about a product using the certification mark unless (1) the claim is true, not misleading, and substantiated by "competent and reliable evidence," or (2) the mark clearly and prominently discloses that the company can meet the accreditation standard based on self-certification.
Although the FTC took aim at the certifier in this case, marketers also need to make sure that all claims reasonably conveyed by a certification are truthful, not misleading, and substantiated. (See Section 260.6 of the FTC's Green Guides.) The FTC is accepting public comments on the proposed consent order until Friday, August 22, 2014.
© Arnold & Porter Kaye Scholer LLP 2014 All Rights Reserved. This blog post is intended to be a general summary of the law and does not constitute legal advice. You should consult with counsel to determine applicable legal requirements in a specific fact situation.