Following a public comment period, the Federal Trade Commission has approved a final consent order settling charges that Gennex Media LLC and owner Akil Kurji made false, misleading, or unsupported advertising claims that their “Brandnex” products were all or virtually all made in the United States.
First announced in March 2021, the FTC’s complaint alleges that, since at least 2012, Gennex and Kurji have violated the FTC Act by claiming on their Brandnex website that the products they sell are made in the United States, when in fact in numerous instances they are wholly imported from China.
Gennex sells customizable promotional products such as wristbands, lanyards, temporary tattoos, and buttons. Gennex and Kurji also do business as Brandnex, BrandStrong, PMGOA, and Promotional Manufacturing Group of America.
Under the terms of the proposed order, Gennex and Kurji are prohibited from making unqualified U.S.-origin claims for any product, unless they can show that the product’s final assembly or processing—and all significant processing—takes place in the United States and that all or virtually all ingredients or components of the product are made and sourced in the United States. Under the order, any qualified Made in USA claims must include a clear and conspicuous disclosure about the extent to which the product contains foreign parts, ingredients or components, or processing. Finally, to claim that a product is assembled in the United States, Gennex and Kurji must ensure that it is last substantially transformed in the United States, its principal assembly takes place in the United States, and its U.S. assembly operations are substantial.
The order prohibits Gennex and Kurji from making any country-of-origin claim about a product or service unless the claim is not misleading and they have a reasonable basis that substantiates their claim. It also requires Gennex and Kurji to provide compliance reports.
The FTC’s Enforcement Policy Statement on U.S. Origin Claims provides further guidance on making non-deceptive “Made in USA” claims. The agency’s Made in USA page features cases, instructive closing letters, and the brochure Complying with the Made in USA Standard, which answers many of the questions companies ask.
The Commission voted 4-0 to approve the final order in this case.