United States: Adhesive Company Hopes Made-in-USA Ruling Won't Stick

J-B Weld to seek appeal of NAD's discontinuation recommendation

Guilt Trip

If you've ever used glue from your desk drawer to fix a broken bowl or Hummel figurine, only to watch the mended object come apart under the slightest pressure, you clearly didn't visit the J-B Weld website first.

These people are attached to glue (sorry about that).

Or, to be precise, these people are really, really into epoxies and silicone sealants. They have an adhesive solution for almost everything that's coming apart, including rotten wood (how does that even work?).

Lies That Bind?

Recently, one of J-B Weld's competitors took aim at this haven for adhesive fanatics over its advertising claims. Illinois Tool Works (ITW) is a sprawling Fortune 500 manufacturer that produces everything from ... Well, never mind. It just produces everything (go check out the list of its subsidiaries here). ITW manufactures its own set of adhesive products that compete with J-B Weld's. ITW took exception to J-B Weld's claims on its packaging and online that its products have "always been made in the USA."

As many rivals do, ITW headed for the National Advertising Division (NAD).

Homeland Harmony

The NAD, in its own words, "attempts to harmonize its efforts with those of the regulatory world." In this case, harmony demands contemplation of that inimitable phrase wielded by the Federal Trade Commission (FTC) in "made in the USA" disputes: "all or virtually all."

You can get a primer here, but for now let's just crib the FTC's own explanation: "'All or virtually all' means that all significant parts and processing that go into the product must be of U.S. origin. That is, the product should contain no – or negligible – foreign content.

So, did the challenge stick? (Again, sorry.)

The Takeaway

The issue raised by ITW involves the sourcing of the "tubes, caps [and] syringes" used by J-B Weld to contain its sticky elixirs (not, we assume, the standard cardboard and plastic blister packaging that holds the tubes of glue themselves).

The NAD wrote that "the FTC's guidance is silent on the question of whether the specific components at issue ... should be considered part of the product's packaging or part of the product itself."

Given that silence, the NAD's conclusions are interesting.

First, it found that consumers would likely believe that the made-in-the-USA claims on the J-B Weld packages would extend to the tubes and other containers that delivered the product.

Moreover – manufacturers, take note – the NAD held that the tubes, caps and syringes were integral to the value of the product, and were not merely a device to deliver the goods. "These components are integral to the consumer's ability to use the products properly," the NAD wrote, "to prevent the glue from drying out between uses, [to] allow precise application of the product, [to] prevent different constituents from mixing prior to application, and [for] other purposes." Therefore, their point of manufacture was worth investigating.

Another interesting tidbit: When J-B Weld answered the inquiry, it provided the NAD with consumer price breakdowns for its various products and did not provide its manufacturing costs. The point seems to have been to differentiate the pricing of the actual adhesive goop from the suspect tubing that housed it. The NAD rejected this approach, noting that the FTC's Enforcement Policy Statement (which explains compliance with the "all or virtually all" standard) considers the breakdown of a product's U.S. manufacturing costs, and not the final price paid by the customer. Because J-B Weld didn't provide any information on manufacturing costs, the NAD found that it failed to support its made-in-the-USA claims.

The NAD ruled that J-B Weld should discontinue its made-in-the-USA claims. J-B Weld declined to do so and is advancing its defense to the National Advertising Review Board.

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