Lithium-ion battery firm Lithionics Battery and the Florida, US-based firm’s general manager, Steven Tartaglia, have been ordered to pay a civil penalty for allegedly falsifying claims its product was “Made in USA”.
Lithionics Battery was found to have improperly labelled and advertised batteries, battery modules and battery management systems as “Made in USA,” even though key components of the products— including the lithium-ion cells that powered the batteries— were imported.
Improper labelling violates the Federal Trade Commissions (FTC) “Made in USA” rule.
Under the Made in USA Labeling Rule, marketers are prohibited from labeling products as “Made in USA” unless the final assembly or processing, and all significant processing that goes into the products occur in the US; and unless all or virtually all ingredients or components of the products are made and sourced in the US. The rule also requires all “Made in USA” labels appearing in mail order catalogues to be truthful and non misleading.
The complaint was filed in the U.S. District Court for the Middle District of Florida.
Lithionics Battery was ordered to pay $105,319.56 in civil penalties as part of a settlement to resolve allegations that it violated the FTC’s Labeling Rule and the FTC Act in connection with marketing its battery products, announced the United States Department of Justice and the FTC.
This is the first action under the FTC’s new “Made in USA” rule.
Principal deputy assistant attorney general Brian M. Boynton, head of the Justice Department’s Civil Division, said in a statement: “The Department of Justice will not tolerate companies who deceive customers by falsely claiming that their products were made in the United States.
“The department is committed to protecting consumers from the deceptive practices of companies who hope to gain an unfair advantage through dishonesty.”
Director Sam Levine of the FTC’s Bureau of Consumer Protection, said in a statement: “As our country works to onshore production of lithium-ion batteries, it’s critical that honest businesses have a chance to compete, and that consumers can buy American.
“Falsely labelling batteries as made in the United States is against the law, and the FTC is using its new Made in USA rule to make sure this misconduct comes with a price.”
The stipulated order also requires Lithionics to notify affected customers and to submit compliance reports to the FTC for over a decade.
Lithionics Battery had not replied to BEST’s request for a comment at the time of publication.
