Pennsylvania-based hat company settles with FTC regarding deceptive “Made in USA” claims.

American Made Matters

Screenshot of their “American Made Matters” logo from their website: http://www.americanmadematters.com

 

According to a Federal Trade Commission (FTC) press release on January 23, 2018, Pennsylvania-based Bollman Hat Company (wholly-owned subsidiary of SaveAnAmericanJob, LLC) settled with the FTC regarding the use of their “American Made Matters” certification and marketing materials.

The FTC complaint initially claimed the Bollman Hat Company deceived consumers with “Made in USA” claims for their hats and other products. In addition to the “Made in USA” claims, the hats were marketed with other taglines such as “American Matters,” “Choose American,” and “Made in USA since 1868.”

However, the FTC found that 70 percent or more of their hat styles are imported as finished products. The complaint alleged the remaining styles contained significant amounts of imported content. Claiming “Made in USA” is a high standard that is not met by most manufacturers. In order to avoid FTC issues, some manufacturers qualify their “Made in USA” claims with additional language such as – “Made in USA from domestic and foreign components” or “Assembled in the USA”.

Also according to the FTC complaint, the Bollman Hat Company used an “American Made Matters” seal on their products, and also licensed that “American Made Matters” seal to any company that claimed they had a US based manufacturing factory. The Bollman Hat Company also charged a $99 per year licensing fee and also required manufacturers to certify that at least 50% of the cost of their products was incurred in the US with final assembly or substantial transformation in the US.

As part of their settlement with the FTC, Bollman and subsidiaries are no longer able to make US origin claims for their products unless they can show final assembly or processing takes place in the US. Under the FTC order, any qualified Made in USA claims must include a clear and conspicuous disclosure about the extent to which the product contains foreign parts, ingredients, and/or processing.

For the past year, the FTC has increased prosecution of deceptive “Made in USA” claims as the Bollman case is the third case in the past year.

There will be a public comment period through February 23, 2018 before the FTC order becomes final.

If you have any questions regarding whether your manufactured good is “Made in USA” , deceptive claims, any other “Made in the USA” issue; or wish to file comments with the FTC, contact David Hsu at 832.896.6288 or by email at dhsu@givensjohnston.com.

Consultations are free and all calls and emails are confidential.

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