The Federal Trade Commission (FTC) has finalized an order against apparel company Lions Not Sheep Products LLC and its owner, Sean Whalen, for falsely claiming that its imported apparel was Made in USA.
Lions Not Sheep Products and Whalen will pay $211,335 to settle the charges. First announced in May, the FTC’s complaint alleged that the company added phony Made in USA labels to clothing imported from China and other countries.
In addition to the monetary judgment, the FTC’s order requires Whalen and Utah-based Lions Not Sheep to stop making bogus Made in USA claims and “come clean” about foreign production.
Under the order, Whalen and Lions Not Sheep must stop claiming that products are made in the United States unless they can show that the product’s final assembly or processing, and all significant processing, takes place in the U.S., and that all or virtually all ingredients or components of the product are made and sourced in the country.
Also 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. In addition to claim that a product is assembled in the United States, Whalen and Lions Not Sheep must ensure that it is last substantially transformed in the country, its principal assembly takes place in the United States, and U.S. assembly operations are substantial.
Lions Not Sheep is an apparel company that sells T-shirts, sweatshirts, jackets and sweaters on its own website, as well as through Amazon and Etsy, according to the FTC. The company and Whalen heavily marketed it through social media channels, claiming that it would “show people it’s possible to live your life as a LION, Not a sheep,” and its Made in USA claims online and on product labels included “Made in the USA,” “Made in America,” “Are your products USA Made?” “100% AMERICAN MADE” and “BEST DAMN AMERICAN MADE GEAR ON THE PLANET,” the FTC said.
However, in most cases the products advertised using these claims consist of wholly imported shirts and hats with limited finishing work performed in the United States, the FTC charged. The complaint alleges that on Oct. 8, 2020, Whalen published a video of himself to his social media accounts, with the title MADE IN AMERICA! alongside a Chinese flag. In the video, Whalen said he could conceal the fact that his shirts are made in China by ripping out the origin tags and replacing them with tags stating that the merchandise was made in the United States.
According to the complaint, between May 10 and Oct. 21, 2021, Whalen and Lions Not Sheep removed tags disclosing that the merchandise was made in a foreign country and printed “Made in USA” at the neck of the shirts.
The FTC’s Made in USA Labeling Rule went into effect on Aug. 13, 2021. Companies that violate the Rule from that date forward may be subject to civil penalties. The Commission voted 5-0 to approve the final order in this case.