Maybe “a rose by any other name would smell as sweet,” but deceptively describing rayon clothing as bamboo isn’t so sweet – and violates the FTC’s Textile Rules. In addition to civil penalties totaling $1.3 million, settlements with Bed Bath & Beyond, Nordstrom, J.C. Penney Company, and Backcountry.com suggest another important point for industry members: Don’t ignore warnings about deceptive ads and misleading labels.
Why does this issue matter to consumers? First, under the Textile Rules, shoppers have the right to know what the products they buy are made of. Furthermore, while textiles described as “bamboo” often are promoted as environmentally friendly, the process for manufacturing rayon – even when it’s made from bamboo – can involve the use of harsh chemicals.
The FTC just announced the four settlements, but the story goes back to 2009. That’s when the FTC brought a series of cases against other companies selling rayon textiles falsely labeled and advertised as bamboo. In addition, we published a business alert advising companies that if a textile isn’t made directly of bamboo fiber, don’t call it bamboo. (In fact, there is virtually no bamboo fiber in the marketplace, so the chances are small that a product really is made directly of bamboo fiber.)
We followed up in January 2010 with letters to more than 70 businesses – including Bed Bath & Beyond, Nordstrom, J.C. Penney, and Backcountry.com – warning them about mislabeling rayon textiles as bamboo. Some companies that received those warnings didn’t change their tune, resulting in settlements in 2013 with Amazon, Macy’s, Sears and its Kmart and Kmart.com subsidiaries, and Leon Max, Inc. (Max Studio). Because a word of warning hadn’t been enough, those cases included civil penalties totaling $1.26 million. That’s also when the FTC issued an Enforcement Policy Statement regarding the advertising and sale of those and other textiles.
Law enforcement actions, a business alert, warning letters, more cases – but the four latest matters suggest that some companies still didn’t get the message:
- Bed Bath & Beyond. The complaint alleges the company (sometimes through its buybuy BABY subsidiary) mislabeled dozens of textiles as bamboo, including “Aden + Anais Bamboo 3-Pack Muslin Swaddles” and “Bamboo Blend Napkins.”
- Nordstrom. According to the complaint, the company sold mislabeled products online and in its stores, including a “Gypsy 05 Bamboo Racerback Hi-Lo Dress” and “Degree Six Clothing – The Bamboo Long Sleeve Tee.”
- J.C. Penney. The lawsuit charges that the company deceptively promoted products as bamboo, including “Muk Luks 4-pk Men’s Bamboo Socks.” The FTC also says the company falsely claimed bamboo gave the products anti-microbial properties.
- Backcountry.com. The complaint alleges that the online retailer deceptively marketed products as bamboo, like men’s “Bridgedale Bamboo Crew Sock,” sometimes with anti-microbial claims the FTC says were misleading.
Civil penalties in the cases – $500,000 from Bed Bath & Beyond, $360,000 from Nordstrom, $290,000 from J.C. Penney, and $150,000 from Backcountry.com – are based on product sales and how long the violations went on.
Textile manufacturers and retailers can take five material messages from the FTC actions.
1. Don’t call it “bamboo” if the textile isn’t made directly of bamboo fiber. Exercise caution before advertising or labeling a textile product as bamboo. There is virtually no actual bamboo fiber out there, so be highly skeptical if suppliers tell you their textile products are “bamboo.” What’s more, be careful not to convey expressly or by implication an environmental claim you can’t support with sound science.
2. Look beyond the label. It’s important that your required fiber content disclosures are accurate, but your compliance obligations don’t end there. Some companies seem to think that if they modify their content disclosures to accurately read “rayon,” they’re free to use the word “bamboo” in product titles and descriptions. That’s a mistake. If it’s not made directly of bamboo fiber, don’t call it bamboo. Not anywhere, not any way.
3. Consult the FTC Enforcement Policy Statement. We think the 2013 Policy Statement offers a commonsense approach to global supply chain issues. To what extent can your company implement the procedures outlined in the Statement?
4. Don’t say you haven’t been warned. The four companies that settled law enforcement actions today all received warning letters in 2010. Those letters used a procedure outlined in Section 5(m)(1)(B) of the FTC Act for putting businesses on notice that certain practices are unfair or deceptive – in this instance, failing to use proper fiber names in labeling and advertising textile products. Under that portion of the law, future violations committed “with actual knowledge” that a practice is unfair or deceptive can result in civil penalties. Bed Bath & Beyond, Nordstrom, J.C. Penney, and Backcountry.com may have initially taken the warning to heart, but it didn’t seem to stick. At some point, false claims crept back into their labels and ads. But this time around, violations resulted in civil penalties. If your company received one of those bamboo warning letters in 2010, it’s especially important to build compliance into the fabric of your operations.
5. Scrutinize your stock for potentially misleading bamboo claims. The FTC is sending letters to other retailers, asking them to check their inventories to ensure proper labeling and advertising of rayon textile products. As holiday shoppers make their lists and check them twice, retailers should consider a little checking of their own.
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