Nordstrom and AG Adriano Goldschmied have agreed to pay more than $4 million to settle a proposed class-action lawsuit claiming the companies sold jeans featuring foreign components that were labeled as “made in the U.S.A.”
The offer—which also agrees to provide a $20 voucher or a pair of free AG pants to anyone who purchased jeans falsely marketed with a made-in-the-U.S.A. label over a four-year period—was filed in a federal court in California on Monday, Law360 reported.
The proposed settlement is in response to a suit filed in June 2014 by David Paz, accusing AG of mislabeling its “Protégé” style as American-made. Paz claimed he was tricked into buying the jeans at a Nordstrom department store in San Diego in May 2014, thinking he was supporting U.S. jobs, but later discovered that components such as the fabric, thread, buttons and rivets were made overseas.
While the jeans were cut and sewn in Los Angeles, California’s then-labeling law mandated that no product could be marked as Made in the U.S.A. when any part of it had been completely—or considerably—made elsewhere.
The state has since relaxed its legislation to align more closely with the Federal Trade Commission’s (FTC) standard—which says that for a product to be labeled American-made, “all or virtually all” of its components must be made stateside and final assembly has to be done domestically—but Nordstrom and AG aren’t off the hook.
Paz has asked the court to grant the proposal preliminary approval.
Earlier this year, a consumer moved for partial summary judgement in a similar class-action lawsuit against Macy’s and Citizens of Humanity.