Made In the U.S.A.?

Shareholder, Shawn Collins authored the client alert, “Made in the U.S.A?” which takes a high-level look at the Federal Trade Commission’s, “all or virtually all” standard for determining if a companies’ MUSA claim is false or misleading, and compare and contrast it with the California standard, which is the most burdensome for companies to comply with.

Key Takeaways: When promoting the patriotic credentials of your company, you should adhere to the following principles to remain compliant with both the FTC and California standards:

• Unqualified Claims Require Final Assembly or Processing in the U.S.A. The “all or virtually all” analysis is irrelevant if you cannot prove that final assembly or processing of the product occurred in the United States. 
• Scrutinize Your Manufacturing Process. Assuming the product is put together or otherwise completed in the United States, companies should pay close attention to (1) the portion of a product’s total manufacturing costs that are attributable to U.S. parts or processing; and (2) how far removed from the finished product any foreign content is. Companies should look back far enough in their manufacturing process to be reasonably sure that any significant foreign content has been included in their assessment of foreign costs.
• Earlier Is Better. Foreign content incorporated early in the manufacturing process often will be less
  significant to consumers than content that is a direct part of the finished product or the parts or
  components produced by the immediate supplier
• Ask Questions of Your Suppliers. Companies should ask their suppliers for specific information about the percentage of U.S. content before they make a U.S.A. origin claim. If given in good faith, companies can rely on information provided by their suppliers about the domestic content in the parts or components that they produce.
• Qualified Claims Still Require Significant U.S. Content. Avoid qualified claims unless the product has a significant amount of U.S. content or U.S. processing.
• Beware of Implied Claims. U.S. symbols (e.g., a map of the U.S. or an American flag) or geographic
  references (e.g., U.S. factory locations or headquarters) on a product label could potentially create the
  impression that your product was assembled or produced in the U.S.A.

Read the full client alert below.