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How a “Made in USA” Class Action Lawsuit Works
The class action deceptive marketing lawyers at The Lyon Firm are investigating new claims of falsely representing products made abroad as Made in USA. These are common misrepresentations, and many lawsuits have been filed by plaintiffs who claim companies make the majority of a product outside the United States and label it as made domestically.
What the FTC’s “Made in USA” Standard Requires
The global supply chain has complicated labeling matters for consumers, and it is frequently unclear where a product is produced, assembled, and packaged. According to the standard guidelines set by the Federal Trade Commission (FTC), Made in USA is meant to describe an instance where “all or virtually all” of the product has been made domestically in America. That means that the vast majority of raw materials, designing, processing, and labor must be of domestic origin in order to label a product as such.
Can the product use Canadian raw materials? Can it be sent from China in a raw form, then molded and processed? The law says they cannot if they want to be labeled as a domestic product. But there are other gray areas, and it has even been argued that the word “made” is too ambiguous to be able to define what it denotes in these cases. There are several moving parts in the global supply chain and that is why it is more common to go to a shop and see the majority of products are labeled as made abroad.
FTC Rules on Domestic Origin Claims
Any deviation from FTC requirements—such as using imported materials or outsourcing final assembly—can make a label misleading. Businesses that violate these rules risk lawsuits, fines, and mandatory changes to their labeling and advertising practices.
The FTC has tried its best to be clear and concise with these legal questions. Essentially, to be labeled “Made in USA,” a product’s last “substantial transformation” must occur in the United States. That is to say, a product’s final form and most critical processing steps should occur in the U.S.
Due to trade complexities, the FTC sometimes updates its “Complying with the Made in USA Standard.” The FTC last made updates to add the Made in USA Labeling Rule, which codified the “all or virtually all” standard for product labels in 2021. This is all clearly spelled out for business practices, and negligent corporations may be subject to civil penalties if they make false “Made in the USA” claims on labels or in marketing materials.
The last updated FTC requirements note the following:
- The product’s final assembly or processing must occur in the USA;
- All significant processing that goes into the product must occur in the USA; and
- All or virtually all ingredients or components of the product must be made and sourced in the USA.
What You Need to Prove in a False Advertising Claim
Made in USA lawsuits have been filed against several companies that allegedly falsely labeled their products as being produced in the United States. Consumers do not have time to scrutinize and research every item they purchase and have to rely on the companies’ good faith to fairly and honestly label their products. The law now stipulates that companies should err on the side of caution and not test the waters with potentially false claims in promotional materials and product labels.
Companies should be aware of federal and state consumer laws, and they have a duty make sure their claims remain accurate. It has been common practice for American companies to outsource and move some or all of their production, assembling and packaging outside of the country. These kinds of changes must be reflected in marketing materials and labeling.
There can be significant confusion in these matters, but typically a reasonable consumer should be able to understand at first glance where a product is produced. And if a product includes both foreign and domestic parts, that should be noted, and the companies must be able to show clearly that the “domestic” parts are made in the USA.
If you believe you have been misled into believing that you purchased a product made in the USA, but it was made or assembled elsewhere, you may have a valid claim. Contact our attorneys for a free case review.
Why You Need a False Advertising Attorney
When companies place profits before transparency, and engage in deceptive marketing, they may be held liable in false advertising class action lawsuits. Practices like mislabeling products, or otherwise violating consumer protection laws, are unacceptable betrayals of trust. You can help hold these companies accountable.
The Lyon Firm is a highly-rated product liability and consumer safety law firm headquartered in Cincinnati, Ohio. We represent plaintiffs nationwide in individual claims and consumer safety class action lawsuits.
If you need consumer protection representation, contact our offices today at (513) 381-2333 for a free, confidential, no-obligation consultation.
Under FTC regulations, ‘Made in USA’ means all or virtually all of the product has been made in the United States, including its components, processing, and labor.
The label “Made in USA” carries weight. It suggests quality, craftsmanship, and support for domestic jobs. But when companies falsely use this label on products that are partly or entirely made overseas, it’s more than just misleading — it’s a violation of federal law and consumer trust. These deceptive marketing practices can result in serious penalties, lawsuits, and compensation for affected consumers.
Legal Options for Consumers
Consumers who have purchased a product based on a false “Made in USA” claim may be able to take legal action. This can include filing individual consumer fraud claims, joining class action lawsuits, or supporting FTC enforcement measures. An experienced consumer protection attorney can review the case, gather evidence, and determine the best path forward. Depending on the circumstances, victims may recover financial compensation, have products relabeled, or receive other forms of restitution.
Possible Compensation in False Advertising Cases
Compensation in these lawsuits can include full refunds for affected purchases, statutory damages under state or federal consumer protection laws, reimbursement of attorney’s fees, and in severe cases, punitive damages designed to deter future misconduct. The type and amount of compensation will depend on the specifics of the case and the strength of the evidence.
How to Identify a Potentially False “Made in USA” Claim
Before filing a complaint or joining a class action, consumers can take several steps to evaluate whether a product’s label may be misleading:
- Check the label carefully. Look for qualifications. A label that says “Assembled in USA from domestic and foreign components” is conditional and may be legally compliant. An unqualified “Made in USA” on a product with significant foreign components may not be.
- Research the manufacturer’s supply chain. Many large companies publish annual reports, sustainability disclosures, or supplier lists that reveal where materials are sourced. A gap between these disclosures and the product label can indicate a potential violation.
- Search the FTC’s enforcement actions. The FTC publishes records of its enforcement actions online. If a company has been previously investigated or penalized for origin-claim violations, that history is relevant.
- File a consumer complaint. The FTC accepts consumer complaints at reportfraud.ftc.gov. While the FTC does not resolve individual disputes, patterns of complaints can trigger investigations.
- Consult a consumer protection attorney. If you believe you were misled, a lawyer can review your purchase history, evaluate the label in question, and advise whether a class action or individual claim is appropriate. Most consultations at The Lyon Firm are free and confidential.
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Understanding State-Level “Made in USA” Laws
While the FTC sets the federal baseline, individual states have enacted consumer protection statutes that go even further. If you purchased a falsely labeled product, your state’s laws may provide additional legal remedies — sometimes more powerful than federal options alone.
California leads the country in domestic-origin enforcement. Under California Business & Professions Code, any product sold in California carrying a “Made in USA” label must have all articles, units, or parts manufactured in the United States. This is a stricter standard than the FTC’s “all or virtually all” threshold and has been the basis for numerous class action suits filed in California courts.
New York and Illinois also have broad consumer fraud statutes — the New York General Business Law and the Illinois Consumer Fraud and Deceptive Business Practices Act — which allow individuals to bring private lawsuits for deceptive acts in commerce. False country-of-origin claims fall squarely within these statutes.
Texas and Florida similarly allow private rights of action under their deceptive trade practice laws, making them favorable jurisdictions for consumer class actions involving mislabeled products.
False Advertising Lawsuit FAQs
Any product labeled or advertised as “Made in USA” that is not “all or virtually all” made in the United States may qualify as false advertising under FTC standards.
Businesses retain the option to use conditional Made in USA labeling when their products fall short of the rigorous “all or virtually all” requirement. These modified statements explicitly acknowledge the extent of foreign components or manufacturing.
Examples of conditional labeling include:
- “Contains 60% domestic content”
- “Assembled in USA using both domestic and foreign components”
- “Sofa constructed in USA with leather sourced from Italy and frame from Mexico”
The distinction between conditional and unconditional origin claims has gained importance amid recent litigation. Well-known companies such as Goya Foods, PepsiCo, and McCormick are defending themselves against lawsuits alleging they used absolute Made in USA claims despite incorporating essential materials from abroad.
An entire product range cannot carry blanket “Made in USA” labeling unless every individual item satisfies the complete standard. This requirement for accuracy has become increasingly critical as class action suits against prominent consumer brands regarding origin representations show an upward trend.
Not necessarily. Many consumer protection laws focus on whether the claim could mislead a reasonable consumer, regardless of intent.
Saying something is “American Quality” or using U.S. imagery make origin claims without directly saying “Made in USA”. References to American business locations or factory locations can also create legally binding origin claims. These claims, therefore, must meet the FTC’s “all or virtually all” standard.
The overall impression seems to matter more than the exact wording of a brand marketing scheme. The FTC states that “Implying a false Made in USA claim is just as illegal as making a false claim flat-out.”
American flags, U.S. maps, and patriotic imagery can make implied origin claims under FTC guidelines. However, some courts have decided patriotic symbols are too ambiguous to be considered “literally false” under the Lanham Act. They say while symbols suggest products are American-made, nobody can verify this objectively as true or false.
Class actions are typically filed when the amount of money in dispute for a single plaintiff would not justify the expense of litigating the case, but where the amount of damages of the entire class of plaintiffs would justify the cost of litigation. Basically, it’s more cost-effective to get justice for many at once instead of individually, saving everyone massive amounts of time and effort.
Moreover, without class actions, large corporate defendants would be able to cause harm over a large group of individuals without any risk of penalty. These collective cases provide safety in numbers.
- The Federal Trade Commission (FTC) settled with Williams Sonoma for $3.17 million for falsely labeling products as “Made in USA.” The FTC sued Williams-Sonoma for falsely advertising several product lines under its Goldtouch, Rejuvenation, Pottery Barn Teen and Pottery Barn Kids brands.
- PepsiCo was recently hit with a class action, alleging the company’s Pure Leaf tea was falsely labeled as “Brewed in USA,” despite containing foreign-sourced tea leaves. The plaintiff argues that the labeling misleads consumers into believing the products are made entirely domestically. This goes to show that even the world’s largest companies push the boundaries on FTC regulations.
- Kubota paid $2 million to settle a civil case for allegedly falsely labeling tractor replacement parts as “Made in USA.” The parts were allegedly made entirely overseas.
- Nordic Ware was sued for deceptive marketing after their advertising materials for their aluminum bakeware included images of the American flag, allegedly misleading consumers who prefer to buy American-made goods. The aluminum used in the Nordic Ware bakeware is sourced from Canada, and the raw material for aluminum, bauxite, is primarily imported from countries like Australia, Guinea, India, Brazil and Jamaica.
- Reynolds Wrap was named as a defendant in a deceptive labeling lawsuit alleging that their labels suggested the products were made domestically.
- The Federal Trade Commission sent refunds to more than 10,000 customers who bought Pyrex measuring cups that manufacturer Instant Brands falsely labeled.
Look for FTC-compliant labeling, check the brand’s manufacturing disclosures, and research supply chain statements in annual reports. If a label says “Made in USA” without qualification, the FTC requires all or virtually all components to be domestic.
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Taking the first step doesn’t have to be complicated. In just a few minutes, you can share the basics of your case, and our team will guide you from there:
- It begins with a few simple questions about your situation.
- From there, a member of our legal team reviews your case.
- Together, we’ll chart the path forward, helping you take the next step toward resolution.
