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From Antitrust Law Daily, October 19, 2016

Glue maker settles FTC charges over ‘Made in USA’ claims

By Linda O’Brien, J.D., LL.M.

A Georgia-based specialty chemical company has agreed to pay a $220,000 judgment and refrain from making misleading unqualified claims that its strong, fast-acting glues are made in the United States to settle FTC charges that its acts and practices violated Section 5 of the FTC Act, the Commission announced today (FTC v. Chemence, Inc., Dkt. No. 1:16-cv-228, FTC File No. 152-3261).

Chemence, Inc. advertises and distributes consumer products, including cyanoacrylate glues. Cyanoacrylates are strong, fact-acting adhesives, also known as "power glues" or super glues," with industrial, medical, and household uses.

The FTC’s complaint, filed in in the federal district court in Cleveland, alleges that Chemence deceived consumers by making unqualified "made in the USA" or "proudly made in the USA" claims for its cyanoacrylate glue products. While the company’s claims allegedly implied that the products were all, or virtually all, made in the United States, approximately 55 percent of the costs of the chemical inputs to Chemence’s glues were attributable to imported chemicals that are essential to the glues’ function, according to the FTC. The complaint also alleged that Chemence assisted others in deceiving consumers by distributing its Made-in-USA marketing materials to private-label sellers and third-party websites and storefronts that promoted its glue products.

Under the terms of the stipulated final order, the company is prohibited from making unqualified "Made in USA" claims for any product unless it can show that the product’s final assembly or processing – and all significant processing – take place in the United States, and that all or virtually all ingredients or components of the product are made and sourced in the United States. Chemence also is prohibited from providing others with the means to make deceptive Made-in-USA claims about its products.

However, the order allows Chemence to make qualified "Made in USA" claims as long as they include a clear and conspicuous disclosure about the extent to which the product contains foreign parts, ingredients, and/or processing.

Attorneys: Julia S. Ensor for the FTC. Helen Mac Murray (MacMurray, Petersen & Shuster LLP) for Chemence, Inc.

Companies: Chemence, Inc.

MainStory: TopStory Advertising ConsumerProtection FederalTradeCommissionNews

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