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Kering, LVMH Questioned Over Potentially Misleading Product Labels

In an era of heightened calls for transparency, two luxury powerhouses find themselves in the media glare thanks to accusations that their products don’t have the lofty provenances their price tags would suggest.

First up, Kering. Upscale boutique and Kering wholesale customer Selima Optique has filed a lawsuit against the owner of the Gucci, YSL and Alexander McQueen brands, claiming the fashion conglomerate manufacturers its eyewear in China despite the “Made in Italy” labeling.

The class action lawsuit asserts that only final assembly and packaging of the eyewear takes place in Italy, while all other production takes place in China. According to Vision Monday, the complaint reads: “Defendants are deceiving their wholesale clients, who are at risk of losing their goodwill and trust from retail customers, by selling them misrepresented products.”

Selima was prompted to question the products when an order the store received included product with “Made in China” on one temple and “Made in Italy” on the other.

A Kering spokesperson told the publication that its luxury products are all made in Italy and labeled correctly according to the law. Ultimately, the company says it was a mix up at the warehouse where the goods were received. “U.S. frames need to be stamped ‘Made In.’ What happened in this case was that an allotment of Puma frames received by the warehouse had been previously been stamped ‘Made in China.’ Another 21 pairs of other various luxury brands of glasses were stamped ‘Made in China’ when they’d already been stamped ‘Made in Italy.’ So Selima received one pair stamped with both. When Kering realized that happened, it apologized for the mistake and for all the clients involved, offered to exchange the product and send the new certificates to customers that the luxury frames were made in Italy. All the customers accepted the exchange except for Selima,” the company said.

Also in the hot seat is LVMH after The Guardian reported that Louis Vuitton pricey pumps are made in Transylvania, an area in Romania—not Italy. Rumors first surfaced that the luxury house was assembling all but the soles of its shoes in its subsidiary Somarest there in 2014 but it wasn’t until recently that the Guardian got a look inside.

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The publication contacted Somarest directly with no luck but continued by tracking employees via social media where it was able to gather clues.

The Guardian says Louis Vuitton first set up shop in the town of Cisnadie in 2002 in pursuit of low labor costs, which would protect its margins. The paper estimates the factory produces 100,000 pairs a year. A spokesperson for the factory explained that the components all originate in France.

By all accounts, the workers create the goods by hand, as advertised—though not in Venice, as company lore goes. And the company’s labeling is in compliance with the European parliament’s “made in” laws, which state that products must carry the label of the country in which the “last, substantial, economically justified processing” took place.