Kubota’s Made in USA Claims

Safe to say, the FTC does not think tractor maker Kubota’s deceptive made in the USA claims are sexy.

A quarter century after suing the company for allegedly falsely claiming that a line of lawn and garden tractors was made in the USA, the FTC last week obtained a $2 million civil penalty against Kubota for allegedly falsely labeling thousands of farm equipment replacement parts as “Made in USA.” The civil penalty is the largest the FTC has ever obtained for a violation of the Made in USA Labeling Rule.

Under the stipulated order, Kubota is also prohibited from making unqualified U.S.-origin claims, such as “Made in USA,” for any product unless it can show that the product’s final assembly or processing and all significant processing takes place in the United States and that all or virtually all components are made and sourced in the U.S.

“Since at least 2021, Kubota has labeled thousands of replacement parts as MUSA when, in fact, they were wholly imported,” the FTC said in its complaint, which was filed by the Department of Justice on behalf of the FTC.

In many instances, Kubota has incorrectly recorded “USA” as the origin of wholly-imported parts in its sales databases, leading its systems to generate MUSA labels for those products. … In other instances, Kubota has failed to update package designs that incorporated MUSA labels after shifting production of those products overseas.

The lawsuit continued:

Because of these systems failures, Kubota has sold millions of wholly-imported replacement parts with false MUSA labels.

To settle the FTC’s previous lawsuit, Kubota agreed to an order prohibiting the company from misrepresenting the extent to which any lawn or garden tractor is made in the USA. The order expired in 2019.

Regarding this latest go-around with the FTC, Kubota said in a statement that it has “cooperated fully” with the agency and is voluntarily addressing its concerns. Further, the company said it has put processes in place to improve the accuracy of country-of-origin information on product labels.

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The Made in USA Labeling Rule, which took effect in 2021, prohibits marketers from labeling products as made in the USA unless all of the following criteria is met:

• Final assembly or processing of the product occurs in the United States.
• All significant processing for the product occurs in the United States.
• All or virtually all of the product’s ingredients or components are made and sourced in the United States.

The rule, which was proposed in 2020 as a result of a TINA.org petition for rulemaking, applies to physical and digital made in the USA labels.

Find more of our coverage on made in the USA claims here.