December 9, 2015 / 3:37 PM / 2 years ago

Bed Bath, Nordstrom, others settle U.S. false labeling charges

A woman checks her phone outside the entrance of a J.C. Penney store in New York August 14, 2013. REUTERS/Brendan McDermid

(Reuters) - Four U.S. retailers agreed to pay $1.3 million of fines to settle U.S. civil charges that they deceived consumers by falsely labeling and advertising textile products as containing bamboo, when they were actually made from rayon.

Bed Bath & Beyond Inc (BBBY.O) will pay $500,000, Nordstrom Inc (JWN.N) will pay $360,000, J.C. Penney Co (JCP.N) will pay $290,000 and outdoor gear maker Backcountry.com LLC will pay $150,000 to settle, the Federal Trade Commission said on Wednesday. None of the retailers admitted wrongdoing.

The FTC accused the retailers of advertising rayon products such as dresses, socks, t-shirts, bath rugs, napkins and pillow shams as containing bamboo, despite having received warning letters from the agency in 2010 against doing that.

Unlike rayon, bamboo is often promoted as environmentally friendly because it grows quickly and has little or no need for pesticides, the FTC has said.

In addition, some consumers will pay more for products they consider good for the environment.

“It’s misleading to call bamboo that has been chemically processed into rayon simply ‘bamboo,'” Jessica Rich, director of the FTC’s consumer protection bureau, said in a statement.

“With consumers in the midst of their holiday shopping, it’s important for them to know that textiles marketed as environmentally friendly alternatives may not be as ‘green’ as they were led to believe,” she added.

The retailers were accused of violating the federal Textile Fiber Products Identification Act and related FTC rules.

Backcountry.com is controlled by private equity firm TSG Consumer Partners.

Other retailers also received the FTC warning letter.

In Jan. 2013, Amazon.com Inc (AMZN.O), Macy’s Inc (M.N), Sears Holdings Corp (SHLD.O) and women’s clothing retailer Leon Max Inc agreed to pay a combined $1.26 million to settle similar FTC claims.

Reporting by Jonathan Stempel in New York; Editing by Meredith Mazzilli

0 : 0
  • narrow-browser-and-phone
  • medium-browser-and-portrait-tablet
  • landscape-tablet
  • medium-wide-browser
  • wide-browser-and-larger
  • medium-browser-and-landscape-tablet
  • medium-wide-browser-and-larger
  • above-phone
  • portrait-tablet-and-above
  • above-portrait-tablet
  • landscape-tablet-and-above
  • landscape-tablet-and-medium-wide-browser
  • portrait-tablet-and-below
  • landscape-tablet-and-below