FTC Settles With Amazon, Sears, Macy’s Over Mislabeled Bamboo Clothing
Last week, the Federal Trade Commission (FTC) reached an agreement with four large retailers over charges that textiles the companies promoted as environmentally friendly “bamboo” were actually rayon. Sears, Amazon, Macy’s and Max Studio (Leon Max) agreed to pay a total of $1.26 million in fines.
The saga started in 2009, when the FTC warned consumers about four manufacturers that claimed they manufactured textiles out of bamboo using a “green” process. The reality, however, was that those companies used a more harmful technique standard for rayon manufacture that incorporated “harsh” chemicals and released hazardous air pollutants. One year later, the FTC sent letters to 78 companies with a warning that they were in danger of breaking the law if they sold rayon-based textiles but advertised them as “bamboo.” According to the FTC, any plant source--including bamboo--with cellulose can be churned into textiles, but the process is hardly eco-friendly and therefore technically it is rayon and must be labeled as such. Under the U.S. Textile Products Identification Act, even if a rayon-based textile contains bamboo, its manufacturing process is hardly green and therefore the label “rayon” must be on that item.
So are those bamboo socks of yours environmentally responsible?
The answer, of course, lies in the supply chain and how those “bamboo” products were manufactured. In the FTC’s view, many textiles containing bamboo are actually rayon--and even if bamboo was the plant sourced for its cellulose, the process is so caustic that no trace of the original bamboo plant is in the finished rayon product. The FTC alleged that despite repeatedly sending letters to the four retailers since early 2010, the companies still promoted clothing and other textile products as “bamboo.” Amazon appears to be the worst violator, with the company labeling products as “100% Organic Bamboo” and “100% Knit Bamboo.” The FTC, however, tagged Sears Holdings (which operates Sears and Kmart) with the highest fine, in part for its labeling of linens as “pure fiber” bamboo. Therein lies the reason for the fines--customers did not receive the kind of product they expected when they purchased items from crib sheets to football tees.
In addition to the fines, which the FTC based on the amount of products sold, each company is required to ensure that all labels and any ads promoting such products are accurate. The settlement, however, allows the company to score “good faith” guarantees that the products were not mislabeled before they were sold. The upshot for these companies is that any misleading claims by suppliers are not an excuse--no matter how tangled a supply chain may be, retailers must substantiate such manufacturing claims.
None of the companies mentioned the settlement in their online press rooms; Sears Holdings only acknowledged the incident to Bloomberg Business Week with a statement that the company was cooperating with the investigation.
Image credit: Wikipedia (fir0002)