Hunton Retail Law Resource

On October 19, 2016, Chemence, Inc., the manufacturer of products such as Hammer Tite, Krylex Glues and Kwik Fix, agreed to resolve an FTC challenge of the company’s “Made in USA” and “Proudly Made in USA” claims. The settlement  requires Chemence to pay $220,000 and substantiate any future “Made in USA” claims.

Earlier this year, the FTC filed suit against Chemence, alleging that its country of origin claims deceived consumers into thinking its products were all, or virtually all, made in the United States. According to the FTC’s complaint, approximately 55 percent of the costs of the chemicals put in Chemence’s glues were attributable to imported essential chemicals. The FTC also alleged that Chemence distributed its deceptive “Made in USA” representations to private-label and third-party sellers.

Under the stipulated final order, Chemence may only use unqualified “Made in USA” claims for a product or service if its final assembly or processing, as well as all major processing, is completed in the United States and if all, or virtually all, ingredients or components of the product or service are domestically made and sourced. Chemence may make a qualified “Made in USA” claim only if a “clear and conspicuous qualification appears immediately adjacent to the representation that accurately conveys the extent to which the product contains foreign parts, ingredients, and/or processing.”

The case was part of a larger package of investigations by the FTC against glue manufacturers, and continues the agency’s effort to crack down on companies making misleading country of origin claims.