Dive Brief:
- Williams-Sonoma recently agreed to a nearly $3.2 million civil penalty with the Federal Trade Commission for violating a “Made in USA” order. According to the FTC, the home retailer advertised that some products it sold under its various banners were made in the USA but they were actually made in China or other countries.
- The FTC sued Williams-Sonoma in 2020, accusing the company of similar misleading claims of products made in the United States. The retailer paid $1 million to settle that case.
- In addition to the fine, the federal settlement requires Williams-Sonoma to submit annual compliance reports. It also reinforces the FTC’s prior orders on what claims the company can make about the manufacturing origin of its products. Williams-Sonoma did not immediately respond to Retail Dive’s request for comment on the case.
Dive Insight:
The FTC said Friday that Williams-Sonoma’s fine is the largest ever levied in a Made in USA case.
Despite settling the 2020 case – which began in 2018 – the FTC said it learned the retailer was again engaging in similar tactics by marketing Pottery Barn Teen mattress pads as “Crafted in America from domestic and imported materials.” But the mattress pads were made in China.
The nonprofit watchdog organization Truth in Advertising championed both the 2018 and most recent case against Williams-Sonoma. The organization filed an FTC complaint last summer based on a consumer tip regarding the Pottery Barn Teen-branded mattress pad. A consumer realized it was being marketed as USA-made. But it was labeled – and later verified, according to the watchdog organization – to be made in China.
The FTC then began investigating six other Williams-Sonoma products advertised as Made in USA “and found those claims were also deceptive in violation of the 2020 order,” the agency said. The FTC found that products under the California-based retailer’s Goldtouch, Rejuvenation, Pottery Barn Teen and Pottery Barn Kids brands were not made in the USA as advertised.
“Williams-Sonoma’s deception misled consumers and harmed honest American businesses,” FTC Chair Lina Khan said in a statement. “Today’s record-setting civil penalty makes clear that firms committing Made-in-USA fraud will not get a free pass.”
Under the reinforced requirements for Williams-Sonoma, the company must show that a U.S.-origin product’s final assembly or processing takes place in the U.S. and that all or most or all of its ingredients or components are made and sourced in U.S. The company must also include “a clear and conspicuous disclosure about the extent to which the product contains foreign parts, ingredients or components, or processing.”
“Williams-Sonoma was put on notice several years ago that it was deceiving consumers with misleading Made in USA marketing,” Truth In Advertising’s Executive Director Bonnie Patten said in a statement. “We hope this recent action will send a strong message that there’s a price to pay for such deception.”
