With the holiday season in full swing, marketers are tirelessly seeking ways to convince you that their product is the perfect gift for everyone on your holiday list. Although the bearded man of the hour at this time of the year is, of course, Santa Claus, many sellers try to ensure a competitive advantage by invoking the spirit of another hirsute man: Uncle Sam. But if you’re thinking about abandoning a red and green color scheme this year for red, white, and blue and plastering your products with “Made in the USA” or “American Made,” some recent California litigation reminds us that sellers should be careful when they feel the patriotic spirit overtaking the holiday spirit.
As we have noted several times previously on this blog, “Made in the USA” claims are tricky animals that can come back and sneak up on you like a whack from the stick-bearing Krampus (the nasty European sidekick to Santa Claus best known for walloping children with bundles of birch branches). The Federal Trade Commission (“FTC”) has been active in this area, bringing a number of cases over the years to enforce its standard that to be able to make an unqualified “Made in USA” or “Our products are American made” claim, without any limits or qualifications, a product must be “all or virtually all” made in the U.S., i.e., all significant parts that go into the product must be of U.S. origin and all processing must take place in the U.S. The FTC guidance in this area has made it clear, however, that truthful qualified “Made in USA” claims, such as “Made in USA of foreign and domestic parts” or “Assembled in USA of parts from China” are permitted.