NAD Finds APEC Not Responsible for “Made in USA” Claims in Customer Reviews

New York, NY – Feb. 4, 2019 – The National Advertising Division determined that Advanced Purification Engineering Corporation (APEC) is not responsible for substantiating online customer reviews on third-party websites which state that its products were “Made in the USA.” APEC makes residential reverse osmosis (RO) drinking water filtration systems and its claims were challenged by Aquasana, Inc., a competing manufacturer of water filtration products.  NAD also found that APEC provided a reasonable basis for its claim made via search engine results that it is a “U.S. manufacturer.”

NAD is an investigative unit of the advertising industry’s system of self-regulation and is administered by the Council of Better Business Bureaus.

The challenged claims included:

• “Made in the USA.”
• “Built in the USA.”
• “Top rated U.S. Manufacturer.”

The challenger also identified the following claims which appeared in customer reviews posted on third-party retail websites:

• “#1 U.S. Manufacturer of Reverse Osmosis Water Systems.”
• “Great RO System!! I bought it to replace my older Watts RO Pure System purchased at Costco a few years ago … The APEC System is made in the USA, which is why I chose over other comparable systems on Amazon.”
• “The filter works great. I like that it’s USA made because I don’t trust the chemicals used in products coming out of China. Reverse osmosis is the best way to filter water also.”
• “Dragging around 5 gallon water bottles got to be tiresome I decided on a R.O. system. There were too many brands with too many features so I went with Amazon’s pick.  Also, the high review ratings and the made in USA claim confirmed my choice.”

APEC manufactures residential reverse osmosis (RO) drinking water filtration systems.  Aquasana argued that APEC’s claims that its systems were “Made in the USA” did not comply with FTC standards for making such claims.  APEC explained that, following an FTC inquiry, it removed all “Built in USA” or “Made in USA” claims from its advertising, updated claims on third-party sales platforms, and made diligent efforts to identify and correct improper claims made by third-party marketers. APEC also modified its advertising to convey the message that its products are designed and assembled in the USA.  Aquasana argued that APEC continued to benefit from customer reviews, posted on third-party retail websites, like Amazon which erroneously praise APEC’s products for being “made in the USA” and contended that APEC is responsible to correct the statements in those reviews or re-list its product so that the reviews are removed.

Aquasana also argued that search engine results which describe APEC as a “Top rated U.S. Manufacturer” and the “#1 U.S. Manufacturer of Reverse Osmosis Water Systems” convey the unsupported message that APEC’s products are purely of domestic origin.

NAD determined that APEC did not control the message conveyed by the product reviews at issue.  Therefore, NAD found that it is not responsible for the truthfulness of reviews including the “Made in USA” claims.  In reaching this decision, NAD examined whether APEC responded to the review by echoing positive statements made by the customer or by otherwise responding in a manner which validates any claims made by the customer.

NAD also observed that APEC has taken reasonable measures to prevent unsupported domestic origin claims from being made through customer reviews.  After the FTC inquiry, in addition to modifying claims on its own platforms, APEC took corrective action by changing the product description on Amazon.  Rather than describing the filtration systems as “built in the USA.” NAD observed that it now states that APEC’s RO systems are “designed and assembled” in the United States.

NAD also determined that the claims “Top rated U.S. manufacturer” and the “#1 U.S. Manufacturer of Reverse Osmosis Water Systems,” as they appear standing alone in search engine results, do not convey a message that all of APEC’s RO systems or any particular products are “made” in the United States, i.e., the products are “all or virtually all” of domestic origin consistent with the FTC’s standard.  Rather, NAD concluded that they convey a general message about APEC itself and that APEC is a U.S.-based manufacturer with a significant manufacturing presence in the United States. APEC is headquartered in California where it designs, engineers, and assembles RO water filtration systems, manufacturing its products and employing workers in the United States. Accordingly, NAD determined that APEC has a reasonable basis to describe itself as a “U.S. manufacturer” as it appears in search engine results.

In its advertiser’s statement, APEC thanked NAD for its thoughtful consideration of this inquiry.

Note: A recommendation by NAD to modify or discontinue a claim is not a finding of wrongdoing and an advertiser’s voluntary discontinuance or modification of claims should not be construed as an admission of impropriety. It is the policy of NAD not to endorse any company, product, or service. Decisions finding that advertising claims have been substantiated should not be construed as endorsements.