FTC staff sent closing letters on May 6, 2021, to mattress seller GhostBed and beer canning equipment maker Alpha Brewing Operations, ending inquiries into whether they overstated how much of their products were made in the USA.
GhostBed
The FTC said that although some GhostBed products are imported or contain imported parts, the company ran Google ads and social media posts with unqualified USA origin claims. Some marketing may also have broken the Textile Products Identification Act, which requires origin disclosures in certain ads.
GhostBed’s fix included:
- Removing broad, unqualified USA origin claims from ads, including Google and Facebook ads and social media posts.
- Starting quarterly employee training and closer review of origin claims.
- Working with affiliates to correct claims and dropping partners that did not comply.
- Adding required origin information to mail-order ads.
The FTC said GhostBed may still promote its USA workers and its line of USA-origin mattresses and pillows. In 2020, Truth in Advertising had reported a GhostPillow sold as made in the USA whose tag said it was made in China.
Alpha Brewing Operations
The FTC was concerned that Alpha Brewing may have overstated how much of some of its beer canning lines were made in the USA. The company removed its unqualified USA origin claims and told its dealers and staff about the change.
The letter noted that a company may be able to make a truthful claim that a foreign-made product is “Designed” in the USA, as long as it does not suggest the product itself is of USA origin.
FAQ
Were the companies fined?
No. FTC staff closed both inquiries after the companies changed their claims.
When were the letters sent?
May 6, 2021.
Can a company say “Designed in USA”?
The FTC said it may, if the claim is true and does not suggest the product is USA-made.
Source & credit
Source: Frankfurt Kurnit Klein & Selz, 2021: “More On ‘Made in the USA’ from the FTC”.
Also: Truth in Advertising: “GhostBed’s Deceptive Made in USA Claims” (updated May 14, 2021).