Sears accused of misleading public on Craftsman line
A lawsuit says the company wrongly claimed its tools were made in America. A California judge refuses to certify class-action status, but plaintiffs say they will appeal.
That issue is at the forefront of a claim that the company snookered consumers into believing that its famous Craftsman tools were made in the U.S. Sears has beaten back the lawsuit for now, but the battle appears to be far from over.
A California judge rejected an effort late last month to certify the suit as a class action. In his 42-page decision, Los Angeles County Superior Court Judge Anthony Mohr argued that there were "serious problems" with the case and that it would be a "nightmare" to manage because there are 40 million potential class members, according to the National Law Journal.
Sears, which registered the Craftsman trademark in 1921, cheered the decision. But Barbara Hart, the attorney representing the plaintiffs, said the ruling will be appealed. In an interview with MSN Money, Hart said that her clients will seek certification under a narrower class definition.
"We are pleased with the court's ruling but as the matter is still pending, we decline to comment further," Sears spokesman Larry Costello wrote in an email.
Costello declined to say how many Craftsman tools were made in the U.S. and Hart, who filed suit against the retailer in 2004, isn't sure either. After the suit was filed, Sears took Craftsman tools off the shelves and blacked out the words "Made in America," she said.
Sears will not share records about where its Craftsman tools are made, but Hart said the company utilizes more than 130 Chinese manufacturers for the Craftsman line.
Craftsman has been one of the few bright spots for Sears in recent years as the retailer has struggled to compete against larger rivals such as Wal-Mart (WMT) and Target (TGT). The stock has slumped more than 20% in the past year. Sears not a bargain for investors, trading at more than double its average 52-week price target of $17.83.
According to a recent report in the New York Times, the "Made in the USA" label has grown in popularity because it is a "signifier of old-school craftsmanship." It's also hard to find in today's global economy. The U.S. trade deficit with China alone is about $232 billion.
--Jonathan Berr is long Target. Follow him on Twitter@jdberr.
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Union made is the same as saying substandard. If I see a union label or unionized workers I will not buy that companies products. Detroit is the end result of socialism and their Marxist unions.
I laugh at the idiots that buy anything union. The get substandard products that cost 3 times as much. Fools...
Just wondering, anyone that will no longer buy tools at Sears, where will you buy them? Home Depot has Husky, mostly made in China now. Lowes has Kobalt, mostly made in Taiwan and China now. Then we have the best tools out there: Snap-On, this would be my choice.. Most are made in the USA, but a few items are made in Canada, UK, and in China. The one's now made outside the US are at least labeled as Blue Point. So if you want a USA made tool go with Snap-On.
craftsman tools have been made overseas for 15 years, anyone who is shocked by this has had their head in the sand since nafta was signed.
double edge sword, making things here, everyone complains about the loss of jobs, but, the average american consumer shops by price. period. we are unwilling to pay more.
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There was no specific news catalyst behind today's slide, which had the markings of broad-based profit-taking. Seven of ten sectors settled with losses of 1.0% or more while only two groups ... More
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