Chemence, Inc.

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IN THE MATTER OF CHEMENCE, INC., AND JAMES COOKE CONSENT ORDER, ETC. IN REGARD TO ALLEGED VIOLATIONS OF SECTION 5 OF THE FEDERAL TRADE COMMISSION ACT Docket No. C-4738; File No. X160032 Complaint, February 9, 2021 – Decision, February 9, 2021 This consent order addresses Chemence, Inc.’s advertising, labeling, sale, and distribution of cyanoacrylate “superglue” products as made in the United States. The complaint alleges that Respondents engaged in deceptive acts or practices in violation of Section 5(a) of the Federal Trade Commission Act by representing that the cyanoacrylate “superglue” products they manufactured and supplied to trade customers were all or virtually all made in the United States and violated a 2016 federal court order in the process. The consent order prohibits Respondents from making any country-of-origin claim about a product or service unless the claim is true, not misleading, and Respondents have a reasonable basis substantiating the representation. Participants For the Commission: Julia Solomon Ensor and Adrienne J. Lighten. For the Respondents: Robert Wilson, Wilson & Wilson Co., L.P.A. COMPLAINT The Federal Trade Commission, having reason to believe that Chemence, Inc., a corporation, and James Cooke, individually and as an officer of Chemence, Inc., (collectively, “Respondents”) have violated the provisions of the Federal Trade Commission Act, and it appearing to the Commission that this proceeding is in the public interest, alleges: 1. Respondent Chemence, Inc. (“Chemence”) is an Ohio corporation with its principal office or principal place of business at 185 Bluegrass Valley Parkway, Alpharetta, GA 30005.

2. Chemence advertises, labels, offers for sale, and distributes products to consumers, including, but not limited to, cyanoacrylate glue products (“cyanoacrylates”). Cyanoacrylates are strong, fast-acting adhesives, also known as “power glues” or “superglues,” with industrial, medical, and household uses. Chemence advertises these products in stores and on its website, www.chemence-us.com, and offers for sale, sells, and distributes them directly to the public throughout the United States.

3. Chemence provides third parties with marketing materials so third parties can market and sell products under its own brand names.

CHEMENCE, INC. 475 Complaint 4. Chemence also manufactures private-labeled products sold under retailer brand names, and provides those retailers with labeling and promotional materials for use in the marketing and sale of private-labeled products.

5. Respondent James Cooke (“Cooke”) is the president of Chemence. Individually or in concert with others, he controlled or had the authority to control, or participated in the acts and practices of Chemence, including the acts and practices alleged in this complaint. Since at least 2014, he has communicated with the Federal Trade Commission on Chemence’s behalf regarding the acts and practices alleged in this complaint. In 2017, he personally signed the Report described infra ¶¶13-17, in which he designated himself the Federal Trade Commission’s primary point of contact regarding the acts and practices alleged in this complaint, and expressly assumed liability for Chemence’s compliance with the 2016 Order described infra ¶ 8. His principal office or place of business is the same as that of Chemence. 6. The acts and practices of Respondents alleged in this complaint have been in or affecting commerce, as “commerce” is defined in Section 4 of the Federal Trade Commission Act.

2016 Action and Order 7. On February 1, 2016, the Federal Trade Commission (“FTC”) filed the complaint in the Northern District of Ohio attached as Exhibit A alleging that Chemence violated Section 5(a) of the Federal Trade Commission Act, 15 U.S.C. § 45(a), by deceptively representing that its cyanoacrylates, including the materials used to make such products, were all or virtually all made in the United States. In fact, the complaint alleged, a significant proportion (approximately 55%) of the cost of the chemical inputs to Chemence’s cyanoacrylates is attributable to imported chemicals, and these imported chemicals are essential to the function of Chemence’s glue products. The complaint further alleged that Chemence provided the means and instrumentalities to third-party retailers to commit deceptive acts and practices by providing such retailers with deceptive marketing materials for use in the marketing and sale of private-labeled products.

8. On October 13, 2016, the Northern District of Ohio entered the Stipulated Order for Permanent Injunction and Monetary Judgment attached as Exhibit B (the “2016 Order”), resolving all matters then in dispute between Chemence and the FTC. 9. In addition to monetary relief and compliance-monitoring provisions, the 2016 Order contained two injunctive relief provisions.

10. Part I of the 2016 Order permanently enjoins Chemence from representing, expressly or by implication, that a product or service is of U.S. origin unless: (1) the final assembly or processing of the product occurs in the United States, all significant processing that goes into the product occurs in the United States, and all or virtually all ingredients or components of the product are made and sourced in the United States; or (2) a clear and conspicuous qualification appears immediately adjacent to the representation that accurately conveys the extent to which the product contains foreign parts, ingredients, and/or processing. VOLUME 171 Complaint 11. Part II of the 2016 Order permanently enjoins Chemence from providing others with the “means and instrumentalities” to make any representation prohibited by Part I. The 2016 Order defines “means and instrumentalities” as any information, including but not limited to, any advertising, labeling, promotional, sales training, or purported substantiation materials, for use by trade customers in the marketing of any product or service. 12. Part V.A. of the 2016 Order requires Chemence to submit a compliance report one year after entry of the Order.

2017 Compliance Report 13. On October 17, 2017, Chemence submitted the required one-year compliance report, attached as Exhibit C (the “2017 Report”).

14. The 2017 Report describes Chemence’s efforts to comply with each provision of the 2016 Order. In addition to these efforts, the 2017 Report states, “To assure future compliance with the Order, Chemence has instructed members of its respective staffs having responsibility for the requirements of the Order and of their responsibility to ensure compliance with the Order . . . Chemence is confident that those instructions are sufficient to ensure compliance with the Order.” See Exhibit C, p.2.

15. The 2017 Report further includes a declaration under penalty of perjury that, as of October 13, 2017, “Chemence has changed the labeling on all of Chemence’s cyanoacrylate glue/superglue adhesive products sold, distributed or offered for sale or distribution, by or on behalf of Chemence to consumers to read ‘Made in USA with US and globally sourced materials.’” Id. at 3-4.

16. As Chemence’s President, Cooke personally signed the 2017 Report, declaring it true and correct under penalty of perjury. Id. at 6.

17. The 2017 Report also includes Cooke’s executed Acknowledgement by Declaration of Receipt of the 2016 Order. Id. at 31.

Private-Labeled Products 18. Since entry of the 2016 Order, Respondents continued to manufacture privatelabeled products sold under retailer brand names, and provide those trade customers with labeling and promotional materials for use in the marketing and sale of private-labeled products. 19. In numerous instances since entry of the 2016 Order and through at least March 2020, despite the statement described in Paragraph 15, Respondents supplied such trade customers with pre-labeled and pre-packaged cyanoacrylates containing unqualified “Made in USA” claims on promotional materials or labels. Examples include, but are not limited to, the promotional materials and labels depicted in attached Exhibit D. CHEMENCE, INC. 477 Complaint 20. In numerous instances, including, but not limited to, the promotional materials and labels shown in Exhibit D, Respondents represented the private-labeled cyanoacrylates it supplied to trade customers were all or virtually all made in the United States. 21. In fact, significant proportions of the chemical inputs, and overall costs, to manufacture Respondents’ cyanoacrylates are attributable to foreign materials. In numerous instances, foreign materials accounted for more than 80% of materials costs and more than 50% of overall manufacturing costs for these products.

22. Therefore, Respondents’ claims that their private-labeled cyanoacrylates are all or virtually all made in the United States deceive consumers. 23. Respondents’ claims also violate Part I of the 2016 Order because Respondents represented their cyanoacrylates were of U.S.-origin, with no qualification, despite the fact that they contain significant ingredients sourced outside the United States. 24. Respondents further violated Part II of the 2016 Order because they provided labeling and promotional materials containing representations prohibited by Part I to third-party trade customers for use in the marketing of private-labeled cyanoacrylates. 25. Despite knowing or consciously avoiding knowing that Chemence’s privatelabeled cyanoacrylates are labeled “Made in USA” without qualification, in the 2017 Compliance Report, Cooke nonetheless declared under penalty of perjury that Chemence had “changed the labeling on all of Chemence’s cyanoacrylate glue/superglue adhesive products sold, distributed or offered for sale or distribution by or on behalf of Chemence customers to read ‘Made in USA with US and globally sourced materials.’” 26. Entry of an administrative order against Respondents will make civil penalties for future violations available to the Commission pursuant to Section 5(l) of the FTC Act, 15 U.S.C. § 45(l), as modified by Section 4 of the Federal Civil Penalties Inflation Adjustment Act of 1990, 28 U.S.C. § 2461, and Section 1.98(c) of the FTC’s Rules of Practice, 16 C.F.R. § 1.98(c), which directs that a Respondent who violates an order of the Commission after it has become final, and while such order is in effect, “shall forfeit and pay to the United States a civil penalty of not more than [$43,280] for each violation.”

27. Therefore, an administrative action is in the public interest. COUNT I False or Misleading Representation 28. In connection with the advertising, promotion, offering for sale, or sale of cyanoacrylates, Respondents have represented, directly or indirectly, expressly or by implication, that such cyanoacrylates, including the raw materials used to make such products, are all or virtually all made in the United States.

VOLUME 171 Complaint 29. In fact, a significant proportion of the costs of the materials used and a significant proportion of the overall costs to make Respondents’ cyanoacrylates are attributable to imported materials. Therefore, the representation set forth in Paragraph 28 is false or misleading. COUNT II Means and Instrumentalities 30. Respondents have distributed the promotional materials described in Paragraphs 19 and 20 to trade customers for use in the marketing and sale of Respondents’ products, including private-labeled products. In so doing, Respondents have provided the means and instrumentalities to these third-party retailers for the commission of deceptive acts or practices. VIOLATION OF SECTION 5 31. The acts and practices of Respondents as alleged in this complaint constitute unfair or deceptive acts or practices in or affecting commerce in violation of Section 5(a) of the Federal Trade Commission Act.

THEREFORE, the Federal Trade Commission this ninth day of February, 2021, has issued this Complaint against Respondents.

By the Commission.

CHEMENCE, INC. 479 Complaint Exhibit A Case: 1:16-cv-00228 Doc #1 Filed: 02/01/16 Lof?. PagelD# 1 UNITED STATES DISTRICT COURT NORTHERN DISTRICT OF OHIO FEDERAL TRADE COMMISSION, Case No. 1:16-cv-228 Plaintiff, COMPLAINT FOR PERMANENT INJUNCTION AND OTHER ¥. EQUITABLE RELIEF CHEMENCE., INC., an Ohio corporation, Defendant.

Plaintiff, the Federal Trade Commission (“FTC’), for its Complaint alleges: 1. The FTC brings this action under Section 13(b) of the Federal Trade Commission Act (FTC Act’), 15 U.S.C. § 53(b), to obtain temporary, preliminary, and permanent injunctive relief, rescission or reformation of contracts. restitution, the refund of monies paid, disgorgement of ill-gotten momes, and other equitable relief for Defendant's acts or practices i violation of Section 3(a) of the FTC Act, 15 U.S.C. § 45(a).

Exhibit A p. Lof7 VOLUME 171 Complaint CHEMENCE, INC.

Complaint Case: 1:16-cv-00228 Doc #1 Filed: 02/01/16 Sof 7. PagelD #3 COMMERCE Ee At all times material to this Complaint, Defendant has mamtained a substantial course of trade in or affecting commerce, as “commerce” is defined in Section 4 of the FTC Act. 15 U.S.C. § 44.

DEFENDANT'S BUSINESS ACTIVITIES &. Defendant advertises, labels. offers for sale, and distributes products to consumers, including, but not limited to, cyanoacrylate glues. Cyanoacrylates are strong, fast-acting adhesives, also known as “power glues” or “supergiues,” with industrial, medical, and household uses. Defendant advertises these products in stores and on its website, www_chemence-us.com, and offers for sale, sells, and distributes them directly to the public throughout the United States.

9 Defendant provides third parties with marketing materials so third parties can market and sell Defendant’s own products.

10. Defendant manufactures rebranded, private-labeled products sold under retailer brand names, and provides those retailers with marketing materials for use in the marketing and sale of rebranded, private-labeled products.

11. To induce consumers to purchase cyanoacrylate glues, Defendant has dissenunated, or has caused to be disseminated, advertisements, packaging, and promotional materials for its products. These materials contain the following statements, among others: Exhibit A p. 3 of 7 VOLUME 171 Complaint CHEMENCE, INC.

Complaint Case: 1:16-cv-00228 Doc #1 Filed: 02/01/16 Sof 7. PagelD #5 VIOLATIONS OF THE FIC ACT 15. = Section 5(a) of the FTC Act, 15 U.S.C. § 45(a), prohibits “unfair or deceptive acts Of practices in or affecting commerce.”

16. Misrepresentations or deceptive omissions of maternal fact constitute deceptive acts or practices prohibited by Section 5(a) of the FTC Act. Count I (False or Misleading Representation) 17. =‘ Through the means described in Paragraphs 11 and 12. Defendant has represented, directly of indirectly, expressly or by implication, that its cyanoacrylate glue products, including the materials used to make such products, are all or virtually all made m the United States.

18. In truth and in fact, Defendant's cyanoacrylate glue products, including the materials used to make such products, are not all or virtually all made in the United States. 19. = Therefore, the making of the representation as set forth in Paragraph 17 of this Complaint constitutes a deceptive act or practice, in or affecting commerce in violation of Section 5(a) of the FTC Act.

Count I (Means and Instrumentalities) 20. As described in Paragraph 10, Defendant has distributed the promotional materials described in Paragraphs 11 and 12 to third-party retailers for use in the marketing and sale of Defendant's products, including rebranded products. 21 ~—s Inso dog, Defendant has provided the means and instrumentalities to these third-party retailers for the commission of deceptive acts or practices. Exhibit A p. 5 of 7 VOLUME 171 Complaint

VOLUME 171 Complaint Exhibit B CHEMENCE, INC.

Complaint Case: 1:16-cv-00228-PAG Doc #:53 Filed: 10/13/16 2 of 14. PagelD #: 572 FINDINGS 1. This Court has jurisdiction over this matter.

2. The Complaint charges that Defendant participated in deceptive acts or practices im violation of Section 5 ofthe FTC Act, 15 U.S.C. § 45, in the manufacturing, labeling, advertising, promotion, offering for sale, sale, or distribution of cyanoacrylate glue as “Made in the US.A” or “Proudly Made in the USA.”

3. Defendant neither adnuts nor denies any of the allegations in the Complamt, except as specifically stated im this Order. Onby for purposes of this action, Defendant admits the facts necessary to establish jurisdiction.

4. Defendant waives any claim that it may have under the Equal Access to Justice Act, 28 U.S.C. § 2412, concerning the prosecution of this action through the date of this Order, and agrees to bear its own costs and attorney fees.

5. Defendant waives all rights to appeal or otherwise challenge or contest the validity of this Order.

DEFINITIONS For the purpose of this Order, the following definitions apply: A “Clear(ly) and conspicuous(ly)" means that a required disclosure is difficult to miss (ie., easily noticeable) and easily understandable by ordinary consumers, including in all of the following ways:

1. In any communication that is solely visual of solely audible, the disclosure mmst be made through the same means through which the communication is presented. Tn any communication made through both visual and audible means, such as a bot Exhibit B p.2 of 14 VOLUME 171 Complaint CHEMENCE, INC.

Complaint Case: 1:16-cv-00228-PAG Doc #:53 Filed: 10/ 13/16 40f14. PagelD # 574 B. “Made in the United States” shall mean any representation, express or unplied, that a Product or Service, or a specified component thereof, is of U_S.-origin, including, but not limited to, a representation that such Product or Service is “made,” “produced” in the United States, or any other U.S.-onigin c Cc. “Product or Service” means any good or service o ORDER “manufactired.” “built,” or lain fered by Defendant.

I. PROHIBITION AGAINST MISREPRESENTATIONS IT IS FURTHER ORDERED that Defendant, and Defendant's officers, agents, employees, and attorneys, and all other persons in active concert or participation with any of them, who receive actual notice of this Order, whether acting directly or indirectly, in connection with the manufacturing, labeling, advertising, promotion, offering for sale, sale, or distribution of cyanoacrylate glue or any other Product or Service are permanently restrained and enjoined from misrepresenting, expressly or by implication, that a Product or Service is Made in the United States, unless:

1. The final assembly of processing of the product occurs in the United States, all significant processing that goes into the product occurs in the United States, and all or virtually all ingredients or components of the product are made and sourced in the United States; or ba Aclear and conspicuous qualification appears immediately adjacent to the representation that accurately conveys the extent to which the product contains foreign parts, ingredients, and/or processing.

Exhibit B p. 4 of 14 VOLUME 171 Complaint CHEMENCE, INC.

Complaint Case: 1:16-cv-00228-PAG Doc #:53 Filed: 10/13/16 Gof14. PagelD #: 576 subsequent civil litigation by or on behalf of the Commission, including in a proceeding to enforce its rights to any payment or monetary judgment pursuant to this Order, such as a nondischarzeability complaint in amy bankruptcy case.

E. The facts alleged in the Complaint establish all elements necessary to sustain an action by the Commission pursuant to Section 523(a)(2)(A) of the Bankruptcy Code, 11 U.S.C. § 523(a)(2)(A), and this Order will have collateral estoppel effect for such purposes. F. Defendant acknowledges that its Taxpayer Identification Numbers (Employer Identification Numbers), which Defendant must subnut to the Commission, may be used for collecting and reporting on any delinquent amount arising out of this Order, in accordance with 31 U.S.C. §7701.

G. All money paid to the Commussion pursuant to this Order may be deposited into a fund adnunistered by the Commission or its designee to be used for equitable relief, including consumer redress and any attendant expenses for the administration of any redress fund. Ifa representative of the Commission decides that direct redress to consumers is wholly or partially impracticable or money remains after redress is completed, the Commission may apply any remaining money for such other equitable relief (including consumer information remedies) as it determines to be reasonably related to Defendant's practices alleged in the Complaint. Any money not used for such equitable relief is to be deposited to the US. Treasury as disgorgement. Defendant has no nght to challenge amy actions the Commission or its representatives may take pursuant to this Subsection.

Exhibit B p. Gof 14 VOLUME 171 Complaint CHEMENCE, INC.

Complaint Case: 1:16-cv-00228-PAG Doc #:53 Filed: 10/13/16 8 of 14. PagelD #: 578 (c) describe the activities of each business, including the goods and services offered, the means of advertising, marketing, and sales; (d) describe in detail whether and how Defendant is in compliance with each Section of this Order; and (e) provide a copy of each Order Acknowledgment obtained pursuant to this Order, unless previously submitted to the Commussion.

B. For 20 years after entry of this Order, Defendant must submit a compliance notice, sworn under penalty of perjury, within 14 days of any change in the following: (a) any designated point of contact; or (b) the structure of Defendant any entity that Defendant has any ownership interest in or controls directhy or indirectly that may affect compliance cbligations arising under this Order, including: creation, merger, sale, or dissolution of the entity or any subsidiary, parent, or affiliate that engages in any acts or practices subject to this Order. Cc. Defendant must submit to the Commission notice of the filing of any bankruptcy petition, insolvency proceeding, or sumilar proceeding by or agaist Defendant within 14 days of its filing. D. Any submission to the Commission required by this Order to be sworn under penalty of perjury must be true and accurate and comply with 28 U_S.C_ § 1746, suchas by concluding: “T declare under penalty of perjury under the laws of the United States of America that the foregoing is true and correct. Executed on: “and supplying the date, signatory’s full name, title (if applicable), and sizmature.

E. Unless otherwise directed by a Commussion representative in writing, all submissions to the Commission pursuant to this Order must be emailed to DEbriefiaiftc.gov or sent by overnight courier (not the U.S. Postal Service) to: Associate Director for Enforcement, Bureau of Consumer Protection, Federal Trade Commussion, 600 Pennsylvania Avenue WW, Washington, Exhibit B p. § of 14 VOLUME 171 Complaint CHEMENCE, INC.

Complaint Case: 1:16-cv-00228-PAG Doc #: 53 Filed: 10/13/16 10 of 14. PagelD + 580 oust be sworn under penalty of perjury: appear for depositions; and produce documents for inspection and copying. The Commission is also authorized to obtam discovery, without further leave of court, using any of the procedures prescribed by Federal Rules of Civil Procedure 29, 30 (including telephonic depositions), 31, 33, 34, 36, 45, and 69. B. For matters concerning this Order, the Commission is authorized to communicate directly with Defendant. Defendant must permit representatives of the Commission to interview any employee or other person affiliated with Defendant who has agreed to such an interview, The person interviewed may have counsel present.

Cc. The Commission may use all other lawful means, melnding posing, through its Tepresentatives a3 constuners, suppliers, or other individuals or entities, to Defendant or any individual or entity affiliated with Defendant, without the necessity of identification or prior notice. Nothing im this Order limits the Commission’s lawful use of compulsory process, pursuant to Sections 9 and 20 of the FTC Act, 15 U.S.C. §§ 49, 57b-1. VILL RETENTION OF JURISDICTION IT IS FURTHER ORDERED that this Court retains jurisdiction of this matter for purposes of construction, modification, and enforcement of this Order. SO ORDERED this _ 13th day of _October 2016.

‘sf Patricia A. Gaughan PATRICIA A. GAUGHAN UNITED STATES DISTRICT JUDGE Exhibit B p- 10 of 14 VOLUME 171 Complaint

VOLUME 171 Complaint CHEMENCE, INC.

Complaint Case: 1:16-cv-00228-PAG Doc # 53 Filed: 10/13/16 14 0f14. PagelD = 534 UNITE] FOR TH D STATES DISTRICT COURT E NORTH i"

RN DISTRICT OF OHIO FEDERAL TRADE COMMISSION Plaintiff, ¥.

CHEMENCE, INC., an Ohio corporation, Defendant.

Case No. 1:16-cv-228-PAG ACKNOWLEDGMENT BY DECLARATION OF RECEIPT OF ORDER BY NON PARTY L Permanent Injunction and Monetary Judgment, in FTC v. Chemence, Inc., on 20.

Iwas not a Defendant in that court case. My title or relationship with Defendant Chemence, Inc. is , received a copy of the Stipulated Order for I declare under penalty of perjury under the laws of the United States of America that the foregoing is true and correct.

Executed on Signed:

pat Exhibit B p- 14 of 14 VOLUME 171 Complaint Exhibit C CHEMENCE, INC.

Complaint UNITED STATES DISTRICT COURT NORTHERN DISTRICT OF OHIO FEDERAL TRADE COMMISSION, Case No.: 1:16-cv-228 ) ) ) ) v. ) ) CHEMENCE, INC. ) ) ) Defendant.

Defendant Chemence, Inc. (“Chemence™) hereby submits the following compliance report pursuant to the Stipulated Order for Permanent Injunction and Monetary Judgment (the “Order”) on or about one year after entry of the Order, which was entered in this case on October 13, 2016. As required by Section V. COMPLIANCE REPORTING A.(q) of the Order, this report describes in detail whether and how Chemence is in compliance with each Section of this Order.

DETAILED DESCRIPTION OF CHEMENCE'S COMPLIANCE EFFORTS As required by the Order, this section describes in detail "whether and how Defendant is in compliance with each Section of this Order." Specifically, the actions Chemence has taken and is taking to comply with each Section of the Order are described below. To assure future compliance with the Order, Chamence has instructed members of its respective staffs having responsibility for the requirements of the Order and of their responsibility to ensure compliance with the Order. The specific contents of those instructions reflect confidential legal advice and are protected from disclosure pursuant to the attorney-client privilege and the work product doctrine. Because the Order principally restricts decaptive acts or practices in violation of Section 5 of the FTC Act, 15 U.S.C. § 45, in the manufacturing, labeling, advertising, promotion, offering for sale, sale, or distribution of cyanoacrylate glue as “Made in the USA,” which is already subject to the supervision and control of ils respective key personnel in the ordinary course of Chemence's business, Chemence is confident that those instructions are sufficient to ensure compliance with the Order. Nonetheless, where Chemence believes that additional measures are prudent to further compliance with specific provisions of the Order, they are further described below.

1. PROHIBITION AGAINST MISREPRESENTATIONS Exhibit C p. 2 of 33 VOLUME 171 Complaint CHEMENCE, INC.

Complaint sold, distributed or offered for sale or distribution, by or on behalf of Chemence to consumers to read “Made in USA with US and globally sourced materials.” In addition, customers are not permitted to unilaterally change any advertising, labeling, promotional, sales training, or substantiation materials provided to them by Charnenca. Furthermore, any advertising, labeling, promotional, sales training, or substantiation materials desired to be used by customers, which wes not provided to them by Chemence, must be approved by Chemence in advance of use, Since the date of the Order, Chemence has not approved any customer initiated material changes for use and is in compliance with this Section.

Ill. MONETARY JUDGMENT Section It! required Chamence to pay the FTC Two Hundred Twenty Thousand Dollars ($220,000) as equitable monetary relief. Chemence complied with this requirement by timely paying the FTC Hundred Twenty Thousand Dollars ($220,000) on or about October 20, 2016. The rest of Section III does not impose any other relevant compliance obligations on Chemence. IV. ORDER ACKNOWLEDGMENTS Section IV imposes certain obligations on Chemence to obtain acknowledgments of receipt of the Order and deliver a copy to all principals, officers, directors, and LLC managers and members; (2) all employees, agents, and representatives who participate in conduct related to the subject matter of the Order; and (3) any business entity resulting from any change in structure as set forth in the Section titled Compliance Reporting. Delivery must occur within 7 days of entry of this Order for current personnel. For all others, delivery must occur before they assume their responsibilities. From each individual or entity to which Chemence delivered a copy of this Order, Chemence must obtain, within 30 days, a signed and dated acknowledgment of receipt of this Order. Chemence has complied with this Section by delivering the Order to and recaiving Acknowledgements from the following individuals:

Hugh V. Cooke — Chief Executive Officar and Director;

James Cooke — President and Director;

Michael Pornykala - Global Marketing Director; and Jason Schmidt — Controller.

V. COMPLIANCE REPORTING Section V imposes certain obligations on Chemence to make timely submissions to the Commission one year after entry of the Order by submitting this Compliance Report. Chemence must do the following:

A (a) identify the primary physical, postal, and email address and telephone number, as designated points of contact, which representatives of the Commission may use to communicate with Defendant;

James Cooke — President 185 Bluegrass Valley Parkway, Alpharetta, GA 30005 Exhibit C p. 4 of 33 VOLUME 171 Complaint CHEMENCE, INC.

Complaint There have been no such proceedings since the date of the Order. D. — Any submission to the Commission required by this Order to be sworn under penalty of perjury must be true and accurate and comply with 28 U.S.C. § 1746, Such oath has been stated hereinafter.

E. All submissions to the Commission pursuant to this Order must be emailed to DEbrief@ ftc.gov_with the subject line beginning: FTC v. Chemence, Inc. This Compliance Report was emailed to [email protected] with such subject line. VI. RECORDKEEPING Section V1. imposes obligations on Chemence to create certain records for 20 years after entry of the Order, and retain each such record for 5 years. Chernence must create and retain the following records:

A. —__ Accounting records showing the revenues from all goods or services sold; These accounting records have been and will be created and retained for the specified periods.

B. Personnel records showing, for each person providing services, whether as an employee or otherwise, that person's: name; addresses; telephone numbers; job title or position; dates of service; and (if applicable) the reason for termination; These personnel records have bean and will be created and retained for the specified periods. C. All records necessary to demonstrate full compliance with each provision of this Order, including all submissions to the Commission;

These compliance records have been and will be created and retained for the specified periods. D. — A copy of each unique advertisement or other marketing material; Unique advertisement and marketing materials have been and will be retained for the E. _ All materials that were relied upon in disseminating the representation; All materials that were relied upon in disseminating the representation have been and will be retained for the specified periods.

F. _ All tests, reports, studies, surveys, demonstrations, or other evidence in its possession or control that contradict, qualify, or call into question the representation, or the besis relied upon Exhibit C p. 6 of 33 VOLUME 171 Complaint CHEMENCE, INC. 507 Complaint Chemence, Inc. Product Labeling Schedule Labeling:

Revised = “Made In USA with US and globally sourced materials" or “blank” for no country of origin marking Exhibit C p. 8 of 33 VOLUME 171 Complaint 1-040-554-0016 1-040-554-0048 1-040-640-0002 1-040-647-0001 1-040-661-0002 10431407 10431412 10432004 10432016 104320374 10432106 10432109 10432121 10432412 10433020 10433055 10433056 10439058 10433087 10433078 10433086 10434004 10434081 10434436 10435001 10435023 10438011 10437015 10438008 1-45-0038 1-45-0047 1-45-0048 14045-0070 1-50-0060 1-050-0061 1-050-0075 1-050-0076 1050-0079 14050-0116 1050-0123 1-050-554-0004 1-050-704-0001 1060-0001 15974 1-999-0001 1-898-0068 1-899-0084 1-999-0109 1-998-0132 1-999-0141 1-999-0159 201418 24550015 24550045 27022437 CHEMENCE, INC.

Complaint Exhibit C p. 10 of 33 VOLUME 171 Complaint 504 036 SIGEL REVISED 507 003 PR1500 507 003 SIS 507 012 FNAOW 507 020 BNGL102C 507 204 PREOO 509 015 EC100 509 015 C1500 509 015 C2500 509 015 EC300 509 015 EC40 509 015 ECS 509 015 ECS00 509 015 PR100 509 015 PR1500 509 015 PR4000 509 015 PRS 509 015 PRS:

509 015 PREOO 509 015 SF20 509 015 SFS5 509 015 SI1500 509 015 Si3Z00 509 079 ECS 509 204 LOS 509 512 ACI2 503 514 PRS 509 516 AC4S 509 530 AC45P 509 534 AC45S 509 534 ACTO 509 541 SIGEL 509 583 AC45A 509 612 CAVAC 509 654 EC100 510 516 ACIOF 510 586 SI100 510 637 ACIOP 511 554 5235FR 511 580 FMO003 515 514 AC308 515 516 AC45 515 524 AC12P 530 224 19987 530 259 21203 530 625 24163 530 685 19965 530 701 24206P 534 020 BNG102C 534 020 BNGL102C 534 020 FMAA01BA 534 020 GEL10a §34 020 GEL10G8A 534 020 GEL10aC 534 020 GFGL200F CHEMENCE, INC.

Complaint Exhibit C p. 12 of 33 S11 VOLUME 171 Complaint CHEMENCE, INC. 513 Complaint 547 027 ECGEL 547 029 TLA2 SA7 029 TLT1 547 570 AVM 547 600 Si40 547 613 TL42 547 613 TL71 548 015 EC100 550 524 AC1IP 550 524 AC68B 550 524 $1500 550 524 SI200 550 524 SIS 550 530 AC11 550 530 S11500 550 530 S200 550 530 SIS 550 569 CAACDB 554 570 08752 554 612 CA/AC 563 012 5320 563 012 5325 563 012 5345 563 012 5350 563 020 5300 563 020 5305 563 020 5310 563 020 5315 563 020 5340 563 514 5365 563 514 5370 563 514 5380 571 026 EC2500 574 524 ACIIP 576 186 Si100 576 186 S!1500 S76 186 SIS 576 637 ACSBA 585 077 PR100 585 077 TL42 585 077 TL43 585 079 EC100 585 079 ECS00 585 079 PR100 585 079 PR4000 585 079 PREOO 585 079 SI100A 585 079 Si40 585 079 SI600 585 079 SIGEL 585 516 ACSB 585 554 EC100 585 554 S11500 585 585 ACI2 585 555 ACT7 Exhibit C p- 14 of 33 VOLUME 171 Complaint 890 050 KT622 $90 050 KT712 590 050 KT722 590 050 KT902 590 056 KBO14 590 056 KBO614 590 056 KB444 580 086 KB4501 590 056 KBA714 590 056 KB8514 590 100 KP0637 590 1000 KTE22 590 2000 KBO14 580 2000 KBO614 590 2000 KB084 590 2000 KBE04 590 222 KB4501 580 250 KROSS 590 250 KS455 590 250 KS675 590 250 KSS25 590 250 KT422 890 250 KT432 590 250 KT712 590 250 KT772 590 300 KBOS4 1590 900 KB544 590 900 KG155 590 300 KG1a5 590 3343DV 590 3350DF 590 3987DS 590 454 KBz24 590 516 KP100 590 524 KP1137 $90 530 KBA714 590 534 KP1137 590 553 KP4527-A 590 KAPS-50 590 KBG514-454 590 KBLTL-10 '§90 KBLTL-250 590 KBLTL-50 590 KBTL-S 590 KCSTS:50 580 KFSGM-50 580 KG155-300 590 KGP 100-28 S90 KGP5-454 590 KHAMT 590 KHAMT-t 580 KHDTL-250 590 KHDTL-50 590 KHTPS-50 590 KHTRC-1000 REVISED REVISED REVISED REVISED REVISED REVISED REVISED REVISED REVISED REVISED REVISED REVISED REVISED REVISED REVISED REVISED REVISED REVISED REVISED REVISED REVISED REVISED REVISED REVISED REVISED REVISED REVISED REVISED REVISED REVISED REVISED REVISED REVISED REVISED REVISED REVISED REVISED REVISED REVISED REVISED REVISED REVISED REVISED REVISED REVISED CHEMENCE, INC.

Complaint Exhibit C p- 16 of 33 VOLUME 171 Complaint 607 001 SI1500 607 001 SIS 607 173 DYNKOO46 607 173 DYNKO047 607 173 SI1500 607 173 SIZ00 607 173 SIS 607 173 Si600 607 186 AC1IP 607 186 ACB 607 186 DYNKO048 607 186 SI1500 607 186 Si300 607 186 SIS 607 186 Si600 607 520 AC11 607 635 DYNKO045S 609 0016 60-9600-2961-7 610 692 281222 610 692 290439 610 692 3517CT 610 692 73517 1610 710 281223 610 710 290441 610 710 3519C 612 233 20050 612 233 20150 619.001 54640 619 003 54641 619.015 54643 623 586 PRS 623 637 ACTIP 624 004 1500 624 555 SP661 624 636 1435 624 640 1310 624 640 1320 624 640 1410 1624 640 2005 624 705 1241 624 705 1242 624 705 1243 624 706 1001 624 706 1005 624 706 1260 624 706 1300 624 706 1330 624 706 1430 624 706 2002 1624 707 1524 624 708 1431 624 708 1432 624 708 1484 624 708 1490 CHEMENCE, INC.

Complaint Exhibit C p. 18 of 33 VOLUME 171 Complaint 635 753 15271 635 753 15481 635 753 31601 635 753 33097 635 753 33260 635 753 33612 635 754 32299 635 004 Si40 636 036 S100 637 036 Si40 642 001 9158 642 001 FN300 642 001 FNSOONNBR 642 001 NNOSO 642 020 FNS 642 036 FNS 1642 036 FNSCNG 1642 036 FNSLGND 642 512 NNOS1BK 642 514 9157 642 514 NNOGE 1643 560 760022 1645 001 0015 646 514 SFS 1646 514 SI1100 646 514 SI300 646 514 SIS 1646 516 ACTI 646 522 SFS 646 522 S11100 646 522 SI300 G46 522 SIS 646 524 ACB 1646 524 PKCAFIN 646 524 SFS 646 524 S11100 G46 524 S300 646 524 SIS 647 O11 PS67 647 015 PRIS500 647 015 PR4000 647 015 PR600 647 017 GM15 1647 017 GM1B8 647 017 PS67 647 017 RTOS 647 017 AT20 647 O17 TLA2 647 O17 TL71 647 071 ATOS 1647 071 AT20G 647 071 ATBO 647 O71 TL22 647 O71 TLA2 647 O71 TLE2 CHEMENCE, INC.

Complaint Exhibit C p. 20 of 33 VOLUME 171 Complaint 665 031-H2 665 031-K1 665 031-R1 665 031-WCt 665 O32 665 O32-H2 665 032-K1 665 032-R1 665 032-WC1 665 033 665 033-R1 665 034-H2 665 036 665 040 665 040-H2 665 040-K1 665 040-R1 665 040-WCt 665 041 665 041-H2 665 041-K1 665 041-R1 665 041-WCt 665 042 665 042-K1 665 042-R1 665 042-WC1 665 046 685 060 665 060-H2 665 060-WCt 665 061 665 061-H2 665 062 665 062-H2 665 080 665 080-H2 665 080-WC1 665 081 665 081-H2 665 062 665 100 665 100-R1 665 101 665 101-He 665 101-K1 665 120 665 120-K1 665 120-R1 665 121 665 130 665 130-H2 665 210 665 210-WCt 665 211 CHEMENCE, INC.

Complaint Exhibit C p- 22 of 33 VOLUME 171 Complaint CHEMENCE, INC. 523 Complaint 70-0066-6826-6 701 00158 701 01732 704 64240 707 31160 709 700805 1841156 8810061 910213 8910255 8910260 a910270 8g10273 8810264 ag10293 8910294 8910305 8810308 8910308 8910308035572 8910343 8910354 ag10371 ag10371Z as10374 8910401 8910450 8910451 8910453 8910454 8910463 8910471 8820080 8s20061 as200e2 8820081 Exhibit C p. 24 of 33 VOLUME 171 Complaint 006615 OD6E21 DD6643 006657 OD6670 DD6673 Dpesa7 GL3at1 |JS1000GPI00 JS1000UP100 JS1000SP100 |JS1-999-0052 |JS1-999-0053 |J81-999-0054 |J$1-99-0200 |JS22980CT01 JS44100CFX JS44100ESCL JS44100FPM |JS4533-2-250 }JS48200KM CHEMENCE, INC.

Complaint Exhibit C p. 26 of 33 VOLUME 171 Complaint JS700JSS01GE JS700JSS01RK |JS700JSS01RKE \JS700JSS028 JS700JSSO2BE JS7O0JSS02G JS700JSSO2GE JS700JSSO2RK JS700JSSO2RKE JS700JSS03B JS700JSSOSBE JS700JSSOSG JS700JSSOSGE JS700JSSOSRK JS700JSSOSAKE JS700JSS04B JS700JSSO4BE JS700JSSO4G JS700JSSO4GE JS700JSSO4AK JS700JSSO4AKE |JSSLBIXPX JSBLK1GALBT JSCGPSBJEHW JSCL3S0 JSDAYTSVC SDIEMSVC SORVXI64 JSESCLNILT JSFEEDCTRL JSICIGAL JSJCSSGAL SMT OO0CLNMO1K JSM1OOOCLNMG2C JSM1000CLNMO3M JSMtOOOCLNMO4Y SMT OOOKAPIOTK SMT OOOKAPW2C JSM1000KAPHO3M SMT OO0KAPIOSR USM 1O00KAPIO4Y SMT OOOKGPIONK SSM O00KGPW2C USM 000KGPIOQM JSM1000KGPIO4Y }JSMtO00SPIO1K JSM1O00SPI01-K JSMtO00SPI02C JSM1000SPI02-C JSM1000SPIO3M USMTO00SPIOSY JSM1000SPI04-Y |JSPM24100 JSPROX344 JSPROX364 CHEMENCE, INC.

Complaint Exhibit C p. 28 of 33 VOLUME 171 Complaint

VOLUME 171 Complaint CHEMENCE, INC. 531 Complaint Case: 1:16-Cv-00228-PAG Doc #:53 Filed; 10/19/16 14 of 14. PagelD #: 584 UNITED STATES DISTRICT COURT FOR THE NORTHERN DISTRICT OF OHIO Canc No, |; }6-cv-228-PAG ACKNOWLEDGMENT BY DECLARATION OF RECEIPT OF ORDER BY NON PARTY FEDERAL TRADE COMMISSION Plainciff, v.

CHEMENCE, INC., an Ohio corporation, Defendant.

L, Michael Pomykale, feceived a copy of the Stipulated Order for Permanent Injunction and Monetary Judgment, in FTC v. Chemence, Inc.,on October 13 , 2016.

T was not a Defendant in that court case, My title or relationship with Defendant Chemence, Inc. is _Global Marketing Director .

I declare under penalty of perjury under the laws of the United States of America that the foregoing is true and correct, Executedon Oct. l7, 2036 Signet: x Exhibit C p- 32 of 33 VOLUME 171 Complaint Bonds in seconds ta:

metal, vinyl, rubber, aluminum, plastics, wood, cork, leather, and much mare, CHEMENCE, INC.

Complaint Exhibit D — eS Parté S62 QUICKER & STRONGER.

Sets in seconds, An improved cyancatrylate adhesive that effectively bonds most surfaces, including: metal, vinyl, aluminum, rubder, most Plastics. wood, cardboard, cork, paper, leather and mech more. wasTaUCTIONS:

1. Unscrew nozzle with cap on it.

2. Point he away from face.

3. Pierce metal tebe with potnt on exter cap.

00 NOT SQUEEZE TUBE WHILE PUNCTURING.

‘Aner puncture Is made, replace nozzle on tude.

4. Use sparingly (anty 1 drop per square Inch) on 1 suttace only. Press parts together for 15 seconds.

5. Clean tip and replace cap Do nol use for reattaching rear view mirror to windshield. Use Master's Real View mlsror adhesive Wot recommended tor ending glass or for polyethylene er polyprepyiene, DANGER: Contains Cyansacrylate. Bonds skin and eyes In seconds. Skin contect through clothing may cause Berns May cause afiergis stim reaction. Vapors irritating to eyes, ase and throat.

KEEP OUT OF REACH OF CHILDREN PRECAUTIONS FOR USE: Avoid contact with skin and eyas.

tn case of eye coniast, Mesh with water for 15 minutes; call a physician. For skin contact, wash with water. For ingestion, G2 nol induce vomiting: call a physician. It spilled on stothing, immediately tush with large quantities of water.

Oo nol remove boaced clothing: contact a physician.

MADE IN USA, master {ian AUSTEN CORONATION + MEME, TH BTN SUPER GLUE CARD Revinon 0 on Pete Comes Radius: 02"

Maveriak bane Gort Sit WV Varnishe Heheant baxes costing for heat sea “Trecherwens: 2 ris Meet AE cates c a”

DN ee oes ae Co DIE CUT SIZE a ARTIST Exhibit D p-1lof6 VOLUME 171 Complaint STICK FAST”

INSTANT CA ADHESIVE MADE IN USA = ee iib8 ] r ar \ i e) me I a act p — L > Ww a st be . | oe H wie 4 *! al . ’ meat treat s 7 4 =, f ——, :

30314700016 8 J VOLUME 171 Complaint SAATI 201 Fairview Si. Extension Fountain Inn, SC 29644 Tel; 800-431-2200 Fax. 664-662-0089 Hours: Monday - Fiday 8:30am = 5 00pm EST ww-saali.com Ernall! [email protected] 24-hour Emergency Telephone @ infotrac iv US): 1-800-535-5053.

Imerrational, +1-352-323-3500 Tradernark of The SAATI Grou FOR INDUSTRIAL USE ONLY CHEMENCE, INC.

Complaint —SAATI ULTRAFIX CA - MV 1 Pan Cyanoacrylate Spray- Activated Frame Adhesive GHS CLASSIFICATIONS Skin Iritation, Categery 3 Bye lrrtation, Category 2A Flammable Liquids, Calegary 4 HAZARD STATEMENTS.

227 | Combustible liquid H316, Causes mild skin iitation, H319 , Causes serious eye irritation.

PRECAUTIONARY STATEMENTS P210 Keep away from least, hot surfaces, Sparks, open flames and other ignition sources, No smoking, P280 Wear protective gloves/protective clothing/leye protectioniface protection P264: Wash skin thoroughly after handling. P370+P378: In case of fire: Use water spray, alcohol resistant foam, dry chemical or carbon DIRECTIONS FOR USE: To obtain optimal adhesion, degrease the frame. dioxide to extinguish. P332+P313 \ If skin HIRST AID EYES: Fluef witli water. seek medical Streieh the fabric over ths (rame providing good contact between the Iwo. si attention. ‘Squeeze a thin bead of adhesive onta fabric around the frame penmeter and gr Oe advice/attention, SKIN: Soak lp warm seapy water. spread evenly Lightly spray the applied adhesive with Ultratix CA Activator : INGESTION: Ingestion pci due te A (aerosol) or Ulirafix CA Activator P (pump style), which sets in less than EYES: Rinse caullously with watet for polymerization. 30 seconds Release tension and remove the screen from the stetchng several Minutes, Remove contac! lenses, if " tond easy to do. Continue rinsing.

INHALATION; |! breathed in, move person system. presen : into fresh air, Ifnot breathing, give artificlal P3374P315 : IT eye irtitalian persists: Gel : medical advice/atiention. P403 : Store ina (espiration. Consulta physician, well-ventilated place, PS01: Dispose of cantents/container in adderdance to EIRE RESPONSE federa/state/looal requiations, Use water spray, slcohol-resistent foam, dry chemical Or CalDon dioxide.

Wear self contained breathing apparatue for fire fighting if Necessary, SPILL RESPONSE Ventilats area of spill Flood area With water lu polyrrierize, Absorb with sand / eart) and Uisapose in accordance Witty local, state, and federal regulailons, WARNING STORAGE AND HANDLING Matefia should be stofed al of below 22€.

setsvanac nti [IU EA SCAS03300L0216 XXKXXXKAKKKK MADE IN THE USA 02/26/2020 Exhibit D p. 5 of 6 VOLUME 171 Decision and Order DECISION The Federal Trade Commission (“Commission”) initiated an investigation of certain acts and practices of the Respondents named in the caption. The Commission’s Bureau of Consumer Protection (“BCP”) prepared and furnished to Respondents a draft Complaint. BCP proposed to present the draft Complaint to the Commission for its consideration. If issued by the Commission, the draft Complaint would charge the Respondents with violations of the Federal Trade Commission Act.

Respondents and BCP thereafter executed an Agreement Containing Consent Order (“Consent Agreement”). The Consent Agreement includes: 1) statements by Respondents that they neither admit nor deny any of the allegations in the Complaint, except as specifically stated in this Decision and Order, and that only for purposes of this action, they admit the facts necessary to establish jurisdiction; and 2) waivers and other provisions as required by the Commission’s Rules.

The Commission considered the matter and determined that it had reason to believe that Respondents have violated the Federal Trade Commission Act, and that a Complaint should issue stating its charges in that respect. The Commission accepted the executed Consent Agreement and placed it on the public record for a period of 30 days for the receipt and consideration of public comments. The Commission duly considered any comments received from interested persons pursuant to Section 2.34 of its Rules, 16 C.F.R. § 2.34. Now, in further conformity with the procedure prescribed in Rule 2.34, the Commission issues its Complaint, makes the following Findings, and issues the following Order: CHEMENCE, INC. 539 Decision and Order Findings 1. The Respondents are:

a. Respondent Chemence, Inc., an Ohio corporation with its principal office or principal place of business at 185 Bluegrass Valley Parkway, Alpharetta, GA 30005.

b. Respondent James Cooke, an officer of the Corporate Respondent, Chemence, Inc. Individually or in concert with others, he controlled or had the authority to control, or participated in the acts and practices of Chemence, Inc. His principal office or place of business is the same as that of Chemence, Inc.

2. The Commission has jurisdiction over the subject matter of this proceeding and over the Respondents, and the proceeding is in the public interest. ORDER Definitions For purposes of this Order, the following definitions apply: A. “Clear(ly) and conspicuous(ly)” means that a required disclosure is difficult to miss (i.e., easily noticeable) and easily understandable by ordinary consumers, including in all of the following ways:

1. In any communication that is solely visual or solely audible, the disclosure must be made through the same means through which the communication is presented. In any communication made through both visual and audible means, such as a television advertisement, the disclosure must be presented simultaneously in both the visual and audible portions of the communication even if the representation requiring the disclosure (“triggering representation”) is made through only one means. 2. A visual disclosure, by its size, contrast, location, the length of time it appears, and other characteristics, must stand out from any accompanying text or other visual elements so that it is easily noticed, read, and understood.

3. An audible disclosure, including by telephone or streaming video, must be delivered in a volume, speed, and cadence sufficient for ordinary consumers to easily hear and understand it.

4. In any communication using an interactive electronic medium, such as the Internet or software, the disclosure must be unavoidable. VOLUME 171 Decision and Order 5. On a product label, the disclosure must be presented on the principal display panel.

6. The disclosure must use diction and syntax understandable to ordinary consumers and must appear in each language in which the triggering representation appears.

7. The disclosure must comply with these requirements in each medium through which it is received, including all electronic devices and face-to­ face communications.

8. The disclosure must not be contradicted or mitigated by, or inconsistent with, anything else in the communication.

9. When the representation or sales practice targets a specific audience, such as children, the elderly, or the terminally ill, “ordinary consumers” includes reasonable members of that group.

B. “Made in the United States” means any representation, express or implied, that a product or service, or a specified component thereof, is of U.S.-origin, including, but not limited to, a representation that such product or service is “made,” “manufactured,” “built,” “produced,” or “crafted” in the United States or in America, or any other U.S.-origin claim.

C. “Respondents” means the Corporate Respondent and the Individual Respondent, individually, collectively, or in any combination.

1. “Corporate Respondent” means Chemence, Inc., and its successors and assigns.

2. “Individual Respondent” means James Cooke.

Provisions I.

Prohibited Misrepresentations Regarding U.S.-Origin Claims IT IS ORDERED that Respondents, and Respondents’ officers, agents, employees, and attorneys, and all other persons in active concert or participation with any of them, who receive actual notice of this Order, whether acting directly or indirectly, in connection with the manufacturing, labeling, advertising, promotion, offering for sale, sale, or distribution of any cyanoacrylate glue product, or any other product or service, must not make any representation, expressly or by implication, that a product is Made in the United States unless: A. The final assembly or processing of the product occurs in the United States, all significant processing that goes into the product occurs in the United States, and CHEMENCE, INC. 541 Decision and Order all or virtually all ingredients or components of the product are made and sourced in the United States; or B. A Clear and Conspicuous qualification appears immediately adjacent to the representation that accurately conveys the extent to which the product contains foreign parts, ingredients or components, and/or processing; or C. For a claim that a product is assembled in the United States, the product is last substantially transformed in the United States, the product’s principal assembly takes place in the United States, and United States assembly operations are substantial.

II.

Prohibited Misleading and Unsubstantiated Country-of-Origin Representations IT IS FURTHER ORDERED that Respondents, and Respondents’ officers, agents, employees, and attorneys, and all other persons in active concert or participation with any of them, who receive actual notice of this Order, whether acting directly or indirectly, in connection with the manufacturing, labeling, advertising, promotion, offering for sale, sale, or distribution of any cyanoacrylate glue product, or any other product or service, must not make any representation, expressly or by implication, regarding the country of origin of any product or service unless the representation is non-misleading, including that, at the time such representation is made, Respondents possess and rely upon a reasonable basis for the representation.

III.

Means and Instrumentalities IT IS FURTHER ORDERED that Respondents, and Respondents’ officers, agents, employees, and attorneys, and all other persons in active concert or participation with any of them, who receive actual notice of this Order, whether acting directly or indirectly, in connection with the manufacturing, labeling, advertising, promotion, offering for sale, sale, or distribution of any cyanoacrylate glue product, or any other product or service, must not provide to others the means and instrumentalities with which to make any representation prohibited by Provision I or II above. For the purposes of this Provision, “means and instrumentalities” means any information, including, but not necessarily limited to, any advertising, labeling, promotional, sales training, or purported substantiation materials, for use by trade customers in the marketing of any product or service.

VOLUME 171 Decision and Order IV.

Monetary Relief IT IS FURTHER ORDERED that:

A. Respondents must pay to the Commission $1,200,000, which Respondents stipulate their undersigned counsel holds in escrow for no purpose other than payment to the Commission.

B. Such payment must be made within 8 days of the effective date of this Order by electronic fund transfer in accordance with instructions provided by a representative of the Commission.

V.

Additional Monetary Provisions IT IS FURTHER ORDERED that:

A. Respondents relinquish dominion and all legal and equitable right, title, and interest in all assets transferred pursuant to this Order and may not seek the return of any assets.

B. The facts alleged in the Complaint will be taken as true, without further proof, in any subsequent civil litigation by or on behalf of the Commission to enforce its rights to any payment pursuant to this Order, such as a nondischargeability complaint in any bankruptcy case.

C. The facts alleged in the Complaint establish all elements necessary to sustain an action by or on behalf of the Commission pursuant to Section 523(a)(2)(A) of the Bankruptcy Code, 11 U.S.C. § 523(a)(2)(A), and this Order will have collateral estoppel effect for such purposes.

D. All money paid to the Commission pursuant to this Order may be deposited into a fund administered by the Commission or its designee to be used for relief, including consumer redress and any attendant expenses for the administration of any redress fund. If a representative of the Commission decides that direct redress to consumers is wholly or partially impracticable or money remains after redress is completed, the Commission may apply any remaining money for such other relief (including consumer information remedies) as it determines to be reasonably related to Respondents’ practices alleged in the Complaint. Any money not used is to be deposited to the U.S. Treasury. Respondents have no right to challenge any activities pursuant to this Provision. E. In the event of default on any obligation to make payment under this Order, interest, computed as if pursuant to 28 U.S.C. § 1961(a), shall accrue from the date of default to the date of payment. In the event such default continues for 10 CHEMENCE, INC. 543 Decision and Order days beyond the date that payment is due, the entire amount will immediately become due and payable.

F. Each day of nonpayment is a violation through continuing failure to obey or neglect to obey a final order of the Commission and thus will be deemed a separate offense and violation for which a civil penalty shall accrue. G. Respondents acknowledge that their Taxpayer Identification Numbers (Social Security or Employer Identification Numbers) may be used for collecting and reporting on any delinquent amount arising out of this Order, in accordance with 31 U.S.C. § 7701.

VI.

Customer Information IT IS FURTHER ORDERED that Respondents must directly or indirectly provide sufficient customer information, including sufficient identification of all resellers, to enable the Commission to efficiently administer consumer redress. If a representative of the Commission requests in writing any information related to redress, Respondents must provide it, in the form prescribed by the Commission representative, within 14 days. VII.

Notice to Customers IT IS FURTHER ORDERED that Respondents must notify customers as follows: A. Respondents must identify all third-party trade customers who purchased pre­ labeled or pre-packaged cyanoacrylate glue products from Corporate Respondent with unqualified representations that the products were Made in the United States on or after October 13, 2016 (“Eligible Customers”).

1. Such Eligible Customers, and their contact information, must be identified to the extent such information is in Respondents’ possession, custody, or control;

2. Eligible Customers include those identified at any time, including after Respondents’ execution of the Agreement through the eligibility period, which runs for 1 year after the issuance date of the Order. B. Respondents must notify all identified Eligible Customers by mailing or emailing each a notice in the form shown in Attachment A. The communication containing the notification letter may contain a copy of this Order, but no other document or enclosure.

VOLUME 171 Decision and Order C. Respondents must notify all Eligible Customers within 30 days after the issuance date of this Order and any Eligible Customers identified thereafter within 30 days of their identification.

D. Respondents must report on their notification program under penalty of perjury: 1. Respondents must submit a report within 60 days of entry of this Order and at the conclusion of the program summarizing its compliance to date. 2. If a representative of the Commission requests any information regarding the program, including any of the underlying customer data, Respondents must submit it within 10 days of the request.

3. Failure to provide required notices or any requested information will be treated as a continuing failure to obey this Order.

VIII.

Acknowledgments of the Order IT IS FURTHER ORDERED that Respondents obtain acknowledgments of receipt of this Order:

A. Each Respondent, within 10 days after the effective date of this Order, must submit to the Commission an acknowledgment of receipt of this Order sworn under penalty of perjury.

B. Individual Respondent, for any business that such Respondent, individually or collectively with Corporate Respondent, is the majority owner or controls directly or indirectly, and Corporate Respondent must deliver a copy of this Order to: (1) all principals, officers, directors, and LLC managers and members; (2) all employees having managerial responsibilities for conduct related to the subject matter of the Order and all agents and representatives who participate in conduct related to the subject matter of the Order; and (3) any business entity resulting from any change in structure as set forth in the Provision titled Compliance Reports and Notices. Delivery must occur within 10 days after the effective date of this Order for current personnel. For all others, delivery must occur before they assume their responsibilities.

C. From each individual or entity to which a Respondent delivered a copy of this Order, that Respondent must obtain, within 30 days, a signed and dated acknowledgment of receipt of this Order.

CHEMENCE, INC. 545 Decision and Order IX.

Compliance Reports and Notices IT IS FURTHER ORDERED that Respondents make timely submissions to the Commission:

A. One year after the issuance date of this Order, each Respondent must submit a compliance report, sworn under penalty of perjury, in which: 1. Each Respondent must: (a) identify the primary physical, postal, and email address and telephone number, as designated points of contact, which representatives of the Commission may use to communicate with Respondent; (b) identify all of that Respondent’s businesses by all of their names, telephone numbers, and physical, postal, email, and Internet addresses; (c) describe the activities of each business, including the goods and services offered, the means of advertising, marketing, and sales, and the involvement of any other Respondent (which Individual Respondent must describe if he knows or should know due to his own involvement); (d) describe in detail whether and how that Respondent is in compliance with each Provision of this Order, including a discussion of all of the changes the Respondent made to comply with the Order; and (e) provide a copy of each Acknowledgment of the Order obtained pursuant to this Order, unless previously submitted to the Commission.

2. Additionally, Individual Respondent must: (a) identify all his telephone numbers and all his physical, postal, email and Internet addresses, including all residences; (b) identify all his business activities, including any business for which such Respondent performs services, whether as an employee or otherwise, and any entity in which such Respondent has any ownership interest; and (c) describe in detail such Respondent’s involvement in each such business activity, including title, role, responsibilities, participation, authority, control, and any ownership. B. Each Respondent must submit a compliance notice, sworn under penalty of perjury, within 14 days of any change in the following: 1. Each Respondent must submit notice of any change in: (a) any designated point of contact; or (b) the structure of Corporate Respondent or any entity that Respondent has any ownership interest in or controls directly or indirectly that may affect compliance obligations arising under this Order, including: creation, merger, sale, or dissolution of the entity or any subsidiary, parent, or affiliate that engages in any acts or practices subject to this Order.

VOLUME 171 Decision and Order 2. Additionally, Individual Respondent must submit notice of any change in: (a) name, including alias or fictitious name, or residence address; or (b) title or role in any business activity, including (i) any business for which such Respondent performs services, whether as an employee or otherwise, and (ii) any entity in which such Respondent has any ownership interest and over which Respondents have direct or indirect control. For each such business activity, also identify its name, physical address, and any Internet address.

C. Each Respondent must submit notice of the filing of any bankruptcy petition, insolvency proceeding, or similar proceeding by or against such Respondent within 14 days of its filing.

D. Any submission to the Commission required by this Order to be sworn under penalty of perjury must be true and accurate and comply with 28 U.S.C. § 1746, such as by concluding: “I declare under penalty of perjury under the laws of the United States of America that the foregoing is true and correct. Executed on: _____” and supplying the date, signatory’s full name, title (if applicable), and signature.

E. Unless otherwise directed by a Commission representative in writing, all submissions to the Commission pursuant to this Order must be emailed to [email protected] or sent by overnight courier (not the U.S. Postal Service) to: Associate Director for Enforcement, Bureau of Consumer Protection, Federal Trade Commission, 600 Pennsylvania Avenue NW, Washington, DC 20580. The subject line must begin: In re Chemence, Inc., X160032. X.

Recordkeeping IT IS FURTHER ORDERED that Respondents must create certain records and retain each such record for 5 years. Specifically, Corporate Respondent and Individual Respondent, for any business that such Respondent, individually or collectively with Corporate Respondent, is a majority owner or controls directly or indirectly, must create and retain the following records: A. Accounting records showing the revenues from all goods or services sold, the costs incurred in generating those revenues, and resulting net profit or loss; B. Personnel records showing, for each person providing services in relation to any aspect of the Order, whether as an employee or otherwise, that person’s: name; addresses; telephone numbers; job title or position; dates of service; and (if applicable) the reason for termination;

C. Records of all customer complaints and refund requests concerning the subject matter of this Order, whether received directly or indirectly, such as through a third party, and any response;

CHEMENCE, INC. 547 Decision and Order D. All records necessary to demonstrate full compliance with each provision of this Order, including all submissions to the Commission;

E. A copy of each unique advertisement, label, or other marketing material making a representation subject to this Order; and F. For 5 years from the date of the last dissemination of any representation covered by this Order, all materials that were relied upon in making the representation. XI.

Compliance Monitoring IT IS FURTHER ORDERED that, for the purpose of monitoring Respondents’ compliance with this Order:

A. Within 10 days of receipt of a written request from a representative of the Commission, each Respondent must: submit additional compliance reports or other requested information, which must be sworn under penalty of perjury, and produce records for inspection and copying.

B. For matters concerning this Order, representatives of the Commission are authorized to communicate directly with each Respondent. Respondents must permit representatives of the Commission to interview anyone affiliated with any Respondent who has agreed to such an interview. The interviewee may have counsel present.

C. The Commission may use all other lawful means, including posing through its representatives as consumers, suppliers, or other individuals or entities, to Respondents or any individual or entity affiliated with Respondents, without the necessity of identification or prior notice. Nothing in this Order limits the Commission’s lawful use of compulsory process, pursuant to Sections 9 and 20 of the FTC Act, 15 U.S.C. §§ 49, 57b-1.

D. Upon written request from a representative of the Commission, any consumer reporting agency must furnish consumer reports concerning Individual Respondent, pursuant to Section 604(2) of the Fair Credit Reporting Act, 15 U.S.C. § 1681b(a)(2).

XII.

Order Effective Dates IT IS FURTHER ORDERED that this Order is final and effective upon the date of its publication on the Commission’s website (ftc.gov) as a final order. This Order will terminate 20 years from the date of its issuance (which date may be stated at the end of this Order, near the Commission’s seal), or 20 years from the most recent date that the United States or the Commission files a complaint (with or without an accompanying settlement) in federal court VOLUME 171 Decision and Order alleging any violation of this Order, whichever comes later; provided, however, that the filing of such a complaint will not affect the duration of:

A. Any Provision in this Order that terminates in less than 20 years; B. This Order’s application to any Respondent that is not named as a defendant in such complaint; and C. This Order if such complaint is filed after the Order has terminated pursuant to this Provision.

Provided, further, that if such complaint is dismissed or a federal court rules that the Respondent did not violate any provision of the Order, and the dismissal or ruling is either not appealed or upheld on appeal, then the Order will terminate according to this Provision as though the complaint had never been filed, except that the Order will not terminate between the date such complaint is filed and the later of the deadline for appealing such dismissal or ruling and the date such dismissal or ruling is upheld on appeal.

By the Commission.

ATTACHMENT A: NOTICE TO CUSTOMERS The notification email or letter must be in the following form, from an authorized Chemence, Inc. address or email address, appearing on Chemence, Inc.’s letterhead if in letter form, and containing a Chemence, Inc. signature line with the sender’s full contact information: Subject: Settlement of FTC deceptive advertising case Dear <Name of customer>:

Our records show that you bought cyanoacrylate glue products from Chemence, Inc. that we provided to you in packages or with labels making “Made in USA” claims. We’re writing to tell you that the Federal Trade Commission, the nation’s consumer protection agency, has sued us for deceptive or false advertising. According to the FTC, we made misleading claims that our glues were all or virtually all made in the United States. To settle the FTC’s lawsuit, we’re contacting our customers to tell them that our cyanoacrylate glue products contain significant imported ingredients and therefore should have been labeled with qualified claims – for example, “Made in USA with Globally Sourced Materials.”

CHEMENCE, INC. 549 Concurring Statement If you have questions about this lawsuit, visit [get short URL]. For more information about “Made in USA” advertising, visit [get short URL]. Sincerely, [signature] [Chemence, Inc. signature block] STATEMENT OF COMMISSIONER ROHIT CHOPRA Summary • Made in USA fraud harms both consumers and honest competitors. Yet for decades, FTC Commissioners pursued a no-money, no-fault settlement strategy to tackle this problem, ignoring Congressional authority to penalize bad actors. • Over the last two years, the Commission has begun to turn the page on its checkered record, obtaining significant judgments for Made in USA fraud and initiating a rulemaking to trigger damages and penalties.

• Today’s action against Chemence and a top executive is another step forward in protecting the Made in USA brand and restoring the Commission’s law enforcement credibility.

For markets to function fairly, the Federal Trade Commission must be a credible watchdog, ensuring that companies have an incentive to follow the law and adhere to the agency's rules and orders. Corporate defendants that blatantly lie about their products have been able to convince Commissioners that their conduct caused no harm, allowing them to extract settlements with virtually no consequences whatsoever. Robert Pitofsky, who served as a Commissioner and later as the agency’s Chairman, described these no-money, no-fault orders as “scandalously weak.”1 Longstanding FTC policies recognize that blatant deception harms consumers and diverts sales from honest competitors.2 But, over the years, Commissioners quietly adopted a permissive 1 See Irving Scher et al., Part II – FTC Improvement Act, 45 ANTITRUST L.J. 96, 117 (1976). 2 For example, the Commission’s Policy Statement on Deception notes that “[t]he prohibitions of Section 5 are intended to prevent injury to competitors as well as to consumers.” FTC Policy Statement on Deception, 103 F.T.C. 174, 175 (1984) (appended to Cliffdale Assocs., Inc., 103 F.T.C. 110 (1984)), https://www.ftc.gov/public­ statements/1983/10/ftc-policy-statement-deception.

VOLUME 171 Concurring Statement approach toward corporate fraud, while bringing down the hammer on small, fly-by-night operations. Going hard on small businesses can give the appearance of active enforcement, even as more established companies face few consequences for their wrongdoing. However, there are promising signs that this is changing. One of the best examples of our moving away from lax enforcement is our Made in USA fraud program. Today, the Commission is announcing another action against an established corporate actor, showing we are turning the page on our permissive policy of the past.

FTC’s Flawed Made in USA Enforcement Strategy Consumers prefer goods that are produced domestically, and they are even willing to pay more for them.3 This gives bad actors an incentive to unlawfully parade their products with the “Made in USA” brand. Government enforcement can ensure that this strategy does not pay off. However, for decades, there was bipartisan consensus at the Federal Trade Commission that Made in USA fraud should not be penalized. Even in egregious cases, most matters were resolved with no-money, no-fault settlements, and many violators received nothing more than closing letters. In 1994, Congress authorized the Commission to do more – granting the agency new authority to trigger penalties and damages for Made in USA fraud – but past Commissioners declined to even propose implementing this new authority, allowing it to languish for a quarter century.4 This lack of deterrence contributed to brazen Made in USA fraud, as seen in some of the Commission’s recent cases. In 2018, for example, the FTC sued Patriot Puck, which branded its product as “The Only American Made Hockey Puck.” In fact, according to the Commission’s lawsuit, these pucks were made in China.5 That same year, the FTC sued a seller of military bags 3 See, e.g., Kong, Xinyao and Rao, Anita (June 8, 2020). “Do Made in USA Claims Matter?,” University of Chicago, Becker Friedman Institute for Economics Working Paper No. 2019-138, Available at SSRN: https://papers.ssrn.com/sole/papers.cfm?abstract id=3468543. 4 See generally Statement of Commissioner Rohit Chopra Regarding Activating Civil Penalties for Made in USA Fraud (Apr. 17, 2019), https://www ftc.gov/public-statements/2019/04/statement-commissioner-rohit-chopra­ regarding-activating-civil-penalties. In fact, under pressure from interest groups in the 1990s, Commissioners tried to weaken the Made in USA standard in light of globalized supply chains. Request for Public Comment on Proposed Guides for the use of U.S. Origin Claims, 62 Fed. Reg. 25020 (May 7, 1997), https://www.govinfo.gov/content/pkg/FR-1997-05-07/pdf/97-11814.pdf. See also Bruce Ingersoll, FTC May Ease Its Guidelines For the ‘Made in USA’ Label, WALL STREET J. (May 6, 1997), https://www.wsj.com/articles/SB862863598530948000. This effort was widely opposed, and it failed. See Matthew Bales, Jr., Implications and Effects of the FTC’s Decision to Retain the “All or Virtually All” Standard, 30 U. MIAMI INTER-AM. L. REV. 727 (1999).

5 Press Release, Fed. Trade Commu, FTC Approves Final Consents Settling Charges that Hockey Puck Seller, Companies Selling Recreational and Outdoor Equipment Made False ‘Made in USA’ Claims (Apr. 17, 2020), https://www.ftc.gov/news-events/press-releases/2019/04/ftc-approves-final-consents-settling-charges-hockey-puck­ seller; Statement of Commissioner Rohit Chopra In the Matter of Nectar Sleep, Sandpiper/PiperGear USA, and Patriot Puck (Sep. 12, 2018), https://www ftc.gov/public-statements/2018/09/statement-commissioner-chopra (hereinafter Dissenting Statement on No-Consequences Made in USA Settlements). CHEMENCE, INC. 551 Concurring Statement and other gear, charging the firm with inserting fraudulent Made in USA labels into imported products, and marketing these products on military bases.6 These practices harmed both consumers and honest competitors.7 Even firms that the FTC warned were seemingly undeterred. In 2017, the FTC required ispring Water Systems to stop mislabeling its products. Last year, ispring violated this order.8 In 2018, the FTC warned Williams-Sonoma to stop falsely marketing products as Made in USA;9 earlier this year, they were charged with doing it anyway. 10 The fact that these repeat offenders were caught is a testament to our staff’s vigilance, but offenders’ willingness to break the law twice demonstrates the flaws of the strategy pursued by past Commissions. Recently, we have seen how that strategy is changing. ispring was ordered to pay a civil penalty, and the company admitted that it broke the law. Williams-Sonoma was required to pay $1 million to resolve the Commission’s allegations – a small sum, perhaps, for Williams- Sonoma, but a record for the FTC’s Made in USA enforcement program. And in July, the Commission finally proposed codifying the Made in USA standard into a rule.11 This rule would help to end the agency’s reliance on no-money settlements, allowing the Commission to seek civil penalties, damages, and other sanctions for Made in USA violations.12 Turning the Page Today’s action against Chemence and its top executive marks another turning point for the FTC’s enforcement strategy. Chemence is an established player in the adhesives and sealants 6 Id.

7 In fact, one competitor formally complained to the FTC that it lost out on a valuable Army and Air Force exchange listing based on Sandpiper’s deception. See Advantus, Corp. (Comment #5) at 3–4, https://www.ftc.gov/system/files/documents/public comments/2018/10/00005-155955.pdf. 8 Press Release, Fed. Trade Commu, Marketer of Water Filtration Systems to Pay $110,000 Civil Penalty for Deceptive Made-in-USA Advertisements in Violation of 2017 Order (Apr. 12, 2019), https://www ftc.gov/news­ events/press-releases/2019/04/marketer-water-filtration-systems-pay-110000-civil-penalty. 9 Closing letter to Danielle M. Hohos, Esq., Deputy General Counsel for Williams-Sonoma, Inc. (June 13, 2018), https://www.ftc.gov/system/files/documents/closing letters/nid/musa williams-sonoma closing letter.pdf. 10 Press Release, Fed. Trade Commu, Williams-Sonoma, Inc. Settles with FTC, Agrees to Stop Making Overly Broad and Misleading ‘Made in USA’ Claims about Houseware and Furniture Products (Mar. 30, 2020), https://www.ftc.gov/news-events/press-releases/2020/03/williams-sonoma-inc-settles-ftc-agrees-stop-making­ overly-broad.

11 Press Release, Fed. Trade Commu, FTC Issues Staff Report on Made in USA Workshop, Seeks Comment on Related Proposed Rulemaking for Labeling Rule (June 22, 2020), https://www ftc.gov/news-events/press­ releases/2020/06/ftc-issues-staff-report-on-made-in-usa-workshop. 12 Of course, not every Made in USA violation requires a lawsuit, or justifies a large judgment. But seeking and accepting no money and no meaningful consequences undermines our credibility. VOLUME 171 Concurring Statement business. The order announced today imposes real consequences – a major difference from the Commission’s past Made in USA settlements.

First, the proposed order requires Chemence to forfeit $1.2 million in revenue stemming from the company’s failures. This is another record judgment for the FTC’s Made in USA enforcement program, and it represents a sea change from the era of no-money settlements. It is encouraging to see the FTC reducing its reliance on no-money orders, both here and in other program areas.

Second, this order reminds businesses that FTC orders are not suggestions.13 The FTC’s complaint highlights false compliance reports filed by Chemence, and charges the company’s president personally for his involvement in the alleged violations.14 This stands in stark contrast to other actions against repeat offenders, where the FTC granted broad releases to executives who oversaw egregious violations. The approach in this matter is far more effective.15 Third, the proposed order requires Chemence to notify consumers of this action. Notice confers benefits in cases like this. It helps to erase any competitive advantage a firm realized through deception, and it accords consumers the dignity of knowing what happened. I have long argued we should seek notice in Made in USA and other matters,16 and I am pleased to see this provision incorporated into this enforcement action.

Our new approach is a critical step forward for protecting the Made in USA brand, and it is a model for other FTC enforcement areas. There is more work to do, including finalizing a Made in USA fraud rule, but we are clearly moving in the right direction. While it is tempting for any government agency to think that the status quo is working well, we do our best work when we engage in self-critical analysis and strive for continuous improvement. I congratulate all of the agency’s staff who fought for this outcome, as well as the many stakeholders who have worked with us to turn the page on the policy inherited from our predecessor Commissioners.17 These efforts to reboot the Made in USA enforcement program represent real progress.

13 Memorandum from Commissioner Chopra to FTC Staff Regarding Repeat Offenders (May 14, 2018), https://www.ftc.gov/public-statements/2018/05/commissioners-memorandum-2018-01-repeat-offenders. 14 Compl. ¶¶ 13-16, In the Matter of Chemence, Inc. et al., Docket No. X160032. 15 In addition, by filing this case administratively, the Commission has triggered civil penalties for future violations, even if in the absence of a final Made in USA fraud rule. 16 Dissenting Statement on No-Consequences Made in USA Settlements, supra note 4, https://www.ftc.gov/system/files/documents/public statements/1407380/rchopra musa statement-sept 12.pdf. 17 See, e.g., Press Release, Truth in Advertising, Inc. (TINA.org), Ad Watchdog TINA.org Petitions FTC for Made in USA Rule (Aug. 22, 2019), https://www.truthinadvertising.org/made-in-usa-press-release/; Consumer Reports (Comment #6), https://www ftc.gov/policy/public-comments/2018/10/12/comment-00006-0; Alliance for American Manufacturing (Comment #5), https://www ftc.gov/policy/public-comments/2018/10/12/comment-00005-0. CHEMENCE, INC. 553 Analysis to Aid Public Comment ANALYSIS OF CONSENT ORDER TO AID PUBLIC COMMENT The Federal Trade Commission (“FTC” or “Commission”) has accepted, subject to final approval, an agreement containing a consent order from Chemence, Inc. and James Cooke (“Respondents”).

The proposed consent order has been placed on the public record for thirty (30) days for receipt of comments by interested persons. Comments received during this period will become part of the public record. After thirty (30) days, the Commission will again review the agreement and the comments received, and will decide whether it should withdraw from the agreement or make final the agreement’s proposed order. This matter involves Respondents’ advertising, labeling, sale, and distribution of cyanoacrylate “superglue” products as made in the United States. According to the FTC’s complaint, Respondents represented that the cyanoacrylate “superglue” products they manufactured and supplied to trade customers were all or virtually all made in the United States. In fact, significant proportions of the chemical inputs, and overall costs, to manufacture Respondents’ cyanoacrylate “superglues” are attributable to foreign materials. In numerous instances, foreign materials accounted for more than 80% of materials costs and more than 50% of overall manufacturing costs for these products. The complaint also alleges that, by distributing promotional materials containing misrepresentations regarding the U.S. origin of their products, Respondents provided trade customers the means and instrumentalities to commit deceptive acts or practices. Based on the foregoing, the complaint alleges that Respondents engaged in deceptive acts or practices in violation of Section 5(a) of the FTC Act, and violated a 2016 federal court order in the process.

The proposed consent order contains provisions designed to prevent Respondents from engaging in similar acts and practices in the future. Consistent with the FTC’s Enforcement Policy Statement on U.S. Origin Claims, Part I prohibits Respondents from making U.S.-origin claims for their products unless either: (1) the final assembly or processing of the product occurs in the United States, all significant processing that goes into the product occurs in the United States, and all or virtually all ingredients or components of the product are made and sourced in the United States; (2) a clear and conspicuous qualification appears immediately adjacent to the representation that accurately conveys the extent to which the product contains foreign parts, ingredients or components, and/or processing; or (3) for a claim that a product is assembled in the United States, the product is last substantially transformed in the United States, the product’s principal assembly takes place in the United States, and United States assembly operations are substantial.

Part II prohibits Respondents from making any country-of-origin claim about a product or service unless the claim is true, not misleading, and Respondents have a reasonable basis substantiating the representation.

Part III prohibits Respondents from providing third parties with the means and instrumentalities to make the claims prohibited in Parts I or II. VOLUME 171 Analysis to Aid Public Comment Parts IV through VI are monetary provisions. Part IV imposes a judgment of $1,200,000. Part V includes additional monetary provisions relating to collections. Part VI requires Respondents to provide sufficient customer information to enable the Commission to administer consumer redress, if appropriate.

Part VII is a notice provision requiring Respondents to identify and notify certain thirdparty trade customers of the FTC’s action within 30 days after the issuance of the order, or within 30 days of the customer’s identification, if identified later. Respondents are also required to submit reports regarding their notification program. Parts VIII through XI are reporting and compliance provisions. Part VIII requires Respondents to acknowledge receipt of the order, to provide a copy of the order to certain current and future principals, officers, directors, and employees, and to obtain an acknowledgement from each such person that they have received a copy of the order. Part IX requires Respondents to file a compliance report within one year after the order becomes final and to notify the Commission within 14 days of certain changes that would affect compliance with the order. Part X requires Respondents to maintain certain records, including records necessary to demonstrate compliance with the order. Part XI requires Respondents to submit additional compliance reports when requested by the Commission and to permit the Commission or its representatives to interview Respondents’ personnel. Finally, Part XII is a “sunset” provision terminating the order after twenty (20) years, with certain exceptions.

The purpose of this analysis is to aid public comment on the proposed order. It is not intended to constitute an official interpretation of the proposed order or to modify its terms in any way.

STEVES DISTRIBUTING, LLC 555 Complaint