New Balance ‘Made in the USA’ Labels May Be Fraudulent

Many consumers pay attention to where they products they purchase are made and many prefer to buy items that are made domestically.

New Balance, a popular athletic shoe company, claims that their shoes that carry the New Balance ‘Made in the USA’ label are in fact made domestically. But this may not be completely accurate.

The Wall Street Journal reports that 25% of New Balance’s shoes are made completely in one of New Balance’s five New England factories. This is an anomaly at a time when 98 percent of the shoes sold in the United States are imported.

According to the New Balance website, they state, “We’re proud to be the only major company to make or assemble more than 4 million pairs of athletic footwear per year in the USA, which represents a limited portion of our sales. Where the domestic value is at least 70%, we label our shoes Made in the USA.”

This means that a shoe that has 30 percent of its materials made outside of the USA may still be labeled with the New Balance ‘Made in the USA’ label. For example, the outer soles are imported from China.

The Federal Trade Commission (FTC) states that a product has to be “all or virtually all” made in the United States to qualify for this kind of labeling.

This would mean that for a product to carry the New Balance ‘Made in the USA’ label, much more than 70% of it should be made domestically.

In the 1990s, the FTC brought an enforcement action against the shoe company for this claim.

Because of this, a legal battle has ensued over the past couple of decades. Eventually the FTC dropped its action against New Balance ‘Made in the USA’ labels, but continued to restate the “all or virtually all” standard.

In California, however, the standards have been even stricter. Until just recently, California prohibited the phrase “Made in the USA” for any product that “any article, unit, or part thereof” — no matter how small — has been “made, manufactured, or produced outside of the United States.”

Now, it is closer to the federal standard. Under the FTC standard, “all or virtually all” means that “all significant parts and processing that go into the product must be of U.S. origin,” or “the product should contain no — or negligible — foreign content.”

This previous standard for labeling has gotten some companies into trouble in California. If a company marketed a product with a “Made in the USA” label with some imported parts, the product would not pass California’s previous labeling laws and could be subject to litigation.

However, even elsewhere, companies must adhere to the “all or virtually all” standard set up by the FTC. New Balance ‘Made in the USA’ labels state that only 70% of the product’s value is American made, however, the FTC believes this is not good enough.

Richard Holober, executive director of the Consumer Federation of California says, “We look at the New Balance shoe case as clear proof that the federal law is not being enforced.”

New Balance claims they are not misleading customers because they clearly state that only 70% of the parts of their New Balance ‘Made in the USA’ products are domestically manufactured. Matthew LeBretton, a spokesperson for New Balance, claims that the company has never been sued in California.

Class action lawyers are currently investigating New Balance for allegedly manufacturing, distributing, marketing and selling products that were labeled as “Made in the USA” or “Made in USA” in violation of applicable California and federal laws.

If you believe that you have been misled by New Balance or if you have purchased New Balance shoes believing that they were manufactured in the United States, you may have a right to compensation.

Join a Free New Balance ‘Made in the USA’ Class Action Lawsuit Investigation

If you purchased one or more New Balance shoes in California in the past two years based, in part, on a “Made in the USA” label, you may be able to seek compensation by joining a class action lawsuit investigation.

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