Today, just two days after July 4th, the FTC sent warning letters to several companies advertising products as Made in USA (and in one case, hand Made in Texas) despite information suggesting that the products were imported in whole or significant part. The claims at issue included “”handmaid in Austin, Texas", “#americanmadeus”, “#madeincali”, “manufactured in the USA”, “built in the USA” and “created by American workers, engineers and innovators.”

 The timing shouldn't come as a surprise. Just last year, the FTC sent similar warning letters to four companies just after the July 4th holiday. The products at issue this time around include drums, industrial laser machinery, coordinate measuring machines, and e-cigarettes. The press release announcing these warning letters made clear that consumers who pay a premium for U.S.-origin goods should get products that are actually all or virtually all made here, and companies that make that claim without the substantiation to back it up should expect to hear from the FTC.

These letters follow a March executive order directing the FTC to prioritize Made in USA enforcement, and an April press release announcing three settlements involving flag products, footwear, and electronic dartboards advertised as American made. Taken together, the emerging pattern confirms that the FTC continues to be actively focused on U.S. origin claims.

Noteworthy takeaways for anyone advertising U.S. origin

These warning letters should serve as a reminder that the FTC takes a broad view in terms of what constitutes an unqualified U.S. origin claim. Avoiding the word “made” won't necessarily mitigate risk. Here, claims that products were  “manufactured”, “built” and “created” domestically were called out as unqualified claims. Also, you don't need to refer to the USA, United States or America to run afoul of Section 5 or the Made in USA Labeling Rule. Claims like “Made in Texas” or “#madeincali” were treated as unqualified claims. Speaking of hashtags, it's notable that two of these letters provided warnings about claims within hashtags. Even if that's the only place where you discuss U.S. origin, it's still actionable. Additionally, focusing only on the process of making the product may not be good enough to qualify a U.S. origin claim. We all know that “assembled in the USA” is considered a qualified claim, but as noted above, the FTC considered “Manufactured in US-based facilities” unqualified. 

Zooming out a bit, these letters underscore that the FTC is still actively patrolling Made in USA claims right now. Today's announcement shouldn't be interpreted as a timely nod to our nation's birthday. It should be taken as a catalyst to double-check that substantiation file and make sure that any prior U.S. origin claims continue to be truthful today. If you wait until a warning letter arrives, you may be looking at a consent order in the near future.

And if you're hearing “everyone else in our product category is saying it and the FTC hasn't taken action", these warning letters should be good ammunition to demonstrate that such an excuse is not a good justification stepping too close to the line. Today's announcement involved two companies marketing laser machines and three companies selling e-cigarettes. Once the FTC discovers an unsubstantiated claim made by your competitor, you should expect them to review the marketing of most, if not all, companies in a product category, and to target all of them with warning letters or CIDs in one sweep. That matters for how you think about competitive risk internally. 

If your product touches U.S. origin claims in any way, whether on a label, in an ad, on a website, in a hashtag or in a sales deck, heed the FTC's warning. The "all or virtually all" standard can more complicated than many appreciate. We'll be monitoring for the consent orders that will inevitably follow, and if you need a gut check, we're here to help.