The Federal Trade Commission continues to actively investigate marketers for making false and misleading "Made in USA" claims. In what is potentially a sign of the FTC's frustration about the number of problems that it is still finding, FTC staff indicated in a recent closing letter that it is willing to help advertisers made better "Made in USA" claims. They wrote, "FTC staff is available to work with companies to craft qualified claims that serve the dual purpose of conveying non-deceptive information to consumers and highlighting work done in the United States." While I've always found FTC staff to be extremely helpful when I've called them with questions, it's great to see them proactively reaching out to industry to offer help in an area that marketers often find difficult to navigate.
Here, the FTC raised concerns about whether Daktronics, Inc. overstated the extent to which its LED signs -- which incorporate significant imported content -- are made in the United States. The FTC reminded the marketer that claims that a product is "made," "built, or "manufactured" in the United States mean that the product was "all or virtually all" made in the U.S. Citing its "Made in USA" Policy Statement, the FTC said that where a product does not that satisfy this standard,"any claim of U.S. origin should be adequately qualified to avoid consumer deception about the presence of foreign content."
The FTC also indicated that if Daktronics employs workers and performs certain processes in the United States, it is appropriate for the company to promote that, so long as the company's marketing does not "overstate the extent to which Daktronics products are made in the United States."
In deciding not to take action against Daktronics, the FTC noted that the company implemented a remedial action plan to avoid deceiving consumers, which included:
- Immediately withdrawing and replacing online ads identified by FTC staff;
- Reviewing all other online, hard copy, trade show, and on-product marketing materials and removing or modifying overly broad or unsubstantiated U.S.-origin claims;
- Providing training on how to make non-deceptive U.S.-origin claims to marketing groups, sales groups, product managers, human resources, technical writers, content creation groups, and demo groups; and
- Reviewing reseller claims for Daktronics products and providing replacement marketing materials to resellers as needed.
I'm sure this isn't the last we'll hear from the FTC on "Made in USA" issues!
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