San Francisco-based luxury home goods giant, Williams-Sonoma, is facing a record $3.18 million fine for falsely advertising some of its products as "Made in USA," according to a federal court filing on Monday. This marks the second time the company has been penalized for such violations, with the Federal Trade Commission (FTC) accusing it of breaching a 2020 order related to the same issue.
The FTC alleges that Williams-Sonoma, the parent company of brands such as Pottery Barn and West Elm, labeled six products as American-made without disclosing that they were either processed outside of the U.S. or contained foreign components. One such item, mattress pads sold under the Pottery Barn Teen brand, were found to be made entirely in China, the filing claims.
"Williams-Sonoma's deception misled consumers and harmed honest American businesses. Today's record-setting civil penalty makes clear that firms committing Made-in-USA fraud will not get a free pass," FTC Chair Lina Khan said in a statement.
The company, which ranked No. 1,469 on Forbes' 2023 list of the world's largest companies, had a total of $8.67 billion in sales last year. It's worth noting that the demand for American-made goods has remained strong, with a Morning Consult survey published in June 2023 finding that nearly two-thirds of U.S. consumers said they routinely sought out "Made in America" products.
The FTC's proposed fine of $3.18 million is the largest ever proposed for such violations, topping the $2 million it fined tractor maker Kubota North America in January for falsely labeling as domestically made replacement parts for its agricultural equipment.
Williams-Sonoma admitted to the allegations made in the complaint, according to Reuters. However, the company did not respond to requests for comment on the FTC's filing. The case is now awaiting a response from a federal judge.
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