New Jersey Judge Sends Country of Origin Marking Dispute Between Importers to Trial
A dispute over country of origin marking on hand tools imported from Taiwan heads to a trial by jury, after a New Jersey U.S. District Court judge recently declined to decide the case until more factual details are available. Newborn Bros., an importer of Taiwanese hand tools, alleges Albion Engineering engaged in unfair competition under the Lanham Act and New Jersey law by falsely advertising its products were made in the U.S. despite importing them from Taiwan. The judge held Newborn did not present sufficiently detailed proof of false marking and advertising, and left it for a jury to decide whether Albion’s allegedly false advertising cost Newborn sales.
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According to Newborn, Albion continued to represent that it makes its caulk guns and accessories in the U.S., despite having shifted production to Taiwan in 2001. For example, imported components of Albion’s caulk guns were stamped “Phila., PA. U.S.A.,” Newborn said. Caulk guns imported from Taiwan were marked “USA Manufacturer,” with CBP eventually directing Albion to add a "Made in Taiwan" label in close proximity to avoid consumer deception, it said. Albion’s owner’s guides, handbooks and website also made blanket statements that all of its products were made in the U.S., Newborn said.
Newborn moved for the judge in the case to find Albion engaged in unfair competition and order Albion to pay monetary damages in the form of disgorged profits. But the District Court found Newborn’s allegations lacked enough detail. For example, the phrase “USA Manufacturer” could be true in that Albion did manufacture in the U.S. at one time and still manufactures other products in the U.S. The issues are also complex in that Albion changed its product lines and labeling practices over time. “While the Court has little doubt that a jury will find one or more of Albion’s country of origin statements literally false, the full extent of Albion’s false labeling is unclear from the current record,” the judge said.
Newborn also needs to prove the false advertising actually diverted sales before it awards monetary damages, the District Court said. Though Newborn presented evidence to that effect, and a “reasonable juror could conclude that it lost sales because of Albion’s allegedly false statements,” that is a factual issue for a jury to decide, the court said.
(Newborn Bros., Inc. v. Albion Engineering Co., D.N.J. 12-2999, dated 12/20/16, unsealed 01/06/17, Judge Hillman)
Email ITTNews@warren-news.com for a copy of the opinion.