Nectar’s parent company Resident Home has been found in violation of an earlier Federal Trade Commission (FTC) administrative order. Resident will pay $750,000 to the FTC to settle charges over alleged misrepresentations that its mattresses were constructed from 100% USA-made materials.
In 2018, the FTC filed a complaint against Resident, saying that the company’s claims that its mattresses were “assembled in the United States” were false and misleading. U.S.-origin claims must comply with key regulatory requirements set forth by the Federal Trade Commission (FTC).
An administrative order was imposed, which prohibited Resident from making further misrepresentations. The order also required Resident to provide a compliance report the following year.
In 2019, Resident’s co-founder, Ran Reske, attested under penalty of perjury that Resident “has never made US origin claims” and that Resident did “not create advertisements, marketing materials, or representations that their products are of a U.S. origin.”
The FTC alleges that Resident stated that their mattresses were “proudly made with 100% USA-made premium quality materials.” The FTC went on to say that “in numerous instances, Resident mattresses are wholly imported or incorporated significant imported materials, and in all instances, Resident mattresses are finished overseas.”
That means in addition to contradicting the 2019 report, the FTC found that Resident’s US-origin claims were false or misleading and constituted unfair or deceptive acts in violation of the FTCA.
Due to the violations, Resident will pay a $750,000 fine. Also, the FTC’s order forbids Resident from making any unsubstantiated product origin claims and from making any US-origin claims without a clear and conspicuous disclaimer.
The order also bars Resident from making any U.S.-origin claim without demonstrating that the products meet U.S. assembly standards and compels the company to file regular compliance reports with the FTC and to notify its customers of the FTC proceeding and of its misleading US-origin claims.
The FAM reached out to Reske for comment and did not receive a response.