Williams-Sonoma, Inc. will pay a record civil penalty of $3.175 million for violating a Federal Trade Commission (FTC) order to truthfully disclose whether products it sells are actually made in the United States. A Department of Justice complaint, based on a referral from the FTC, charges that the retailer listed multiple products as being “Made in USA” when they in fact were made in China and other countries.
“Williams-Sonoma’s deception misled consumers and harmed honest American businesses,” said Lina Khan, Chair of the FTC in a statement. “Today’s record-setting civil penalty makes clear that firms committing Made-in-USA fraud will not get a free pass.”
In addition to the fine, Williams-Sonoma will need to submit annual compliance certifications, and the FTC has placed restrictions on claims the retailer can make about its products:
- Restriction on unqualified claims: Williams-Sonoma will be prohibited from making unqualified U.S.-origin claims for any product, unless it can show that the product’s final assembly or processing — and all significant processing — takes place in the U.S., and that all or virtually all ingredients or components of the product are made and sourced in the U.S.;
- Requirement for qualified claims: The company is required to include in any qualified Made in USA claims a clear and conspicuous disclosure about the extent to which the product contains foreign parts, ingredients or components, or processing.; and
- Requirement for assembly claims: The company must also ensure, when claiming a product is assembled in the U.S., that it is last substantially transformed in the U.S., its principal assembly takes place in the U.S. and U.S. assembly operations are substantial.
The FTC had sued Williams-Sonoma in 2020, charging that the company advertised multiple products under its Goldtouch, Rejuvenation, Pottery Barn Teen and Pottery Barn Kids brands as being all, or virtually all, made in the U.S. when they were not. Williams-Sonoma agreed to an FTC order requiring it to stop making deceptive claims and follow Made in USA requirements.
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The current complaint came to the FTC’s attention around mattress pads marketed under the PBTeen brand as “Crafted in America from domestic and imported materials,” when it was actually made in China. The FTC investigated six other products and found they also were deceptive and violated the FTC’s order.
