FTC Fines Major Retailers $1.3M for Misleading Environmental Claims

Retailers Bed Bath & Beyond, Nordstrom, JC Penney and Backcountry.com have been fined $1.3 million by the Federal Trade Commission for misleading environmental claims.

Under the court order settling the FTC’s charges, the four companies are barred from labeling and advertising rayon textiles as made of bamboo and will pay the following civil penalties: Bed Bath & Beyond will pay $500,000, Nordstrom will pay $360,000, JC Penney will pay $290,000, and Backcountry.com will pay $150,000.

The FTC says the retailers violated the FTC Act and the agency’s Textile Rules.

“It’s misleading to call bamboo that has been chemically processed into rayon simply ‘bamboo,’” said Jessica Rich, director of the Bureau of Consumer Protection. “It’s important for [consumers] to know that textiles marketed as environmentally friendly alternatives may not be as ‘green’ as they were led to believe.”

The complaints allege the four companies broke the law by continuing to misrepresent or mislabel rayon products as “bamboo” despite receiving warning letters from the FTC in 2010.

The FTC says its publication, How to Avoid Bamboozling Your Customers, provides useful information on how to correctly label and advertise textiles that are rayon made from bamboo and cautions sellers that it is highly unlikely they are selling actual bamboo fiber products.

The FTC has also announced it is sending letters to other retailers to help protect consumers from deceptive “bamboo” claims by urging retailers to check their own inventories and ensure proper labeling and advertising of rayon textile products.

In 2013, Amazon, Leon Max, Macy’s and Sears – and Sears’ Kmart subsidiaries – agreed to pay $1.26 million in penalties to settle FTC charges the retailers misled customers by selling rayon fabrics labeled as made from bamboo fiber.