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.

By Jonathan Berr Dec 7, 2012 3:47PM
Sears store in Milford, Connecticut -- Spencer Platt/Getty ImagesSears Holdings (SHLD) says its Craftsman line is America's most trusted tool brand. But are those tools even made in America?

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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794Comments
Dec 8, 2012 11:47AM
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If we would all be less apathetic about our lives, we would not buy ANYTHING that's made in China unless it's just not available elsewhere. Until that incredible China trade imbalance is brought way down, anything, from almost any other country, is a better choice. If people would do what I'm suggesting, it would also fix the WalMart problem. Walmart would lighten up on exploiting their workers AND quickly revise their buying protocol. Think about it. 100 people "against" makes little to no difference. 1,000,000 people "against" cause corporations and government to PAY ATTENTION.  Thanks for reading.
Dec 8, 2012 11:12AM
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Not sure about the Craftsman tools being made in he USA, but almost all lawsuits are!
Dec 8, 2012 11:06AM
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you know it's one thing to buy a cheap made product and know it is a throw away, but when they are charging 1000% markup! they wonder why this country is in trouble! we as buyers need to stop letting our government help these company's grow! we should allow any american company that can bring back a manufactured item to be made here again-free taxes for 5 years! why can't we help them help us?
Dec 8, 2012 11:05AM
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every time I brake or lost one of my old craftsman tools pre 70 s I cry because it can never be replaced with a tool made today .
Dec 8, 2012 10:57AM
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Consumers are Kings when it comes to improving our standard of living. Buying legitimate "MADE IN AMERICA" products keeps our capital on our shores and grows OUR economy. We can't buy on price alone and succeed. It is abhorrent  that Sears had abused the "MADE IN AMERICA" label. A class action designation would serve them right.
Dec 8, 2012 10:57AM
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The few manufacturing jobs that remain in the good ole U.S.A. are held by illegal, alien, immigrants that could give a rats ....about this country.  Why, because they "love" their country and allot of Americans don't love this country, that's why the rich ship their manufacturing jobs to other countries.
Dec 8, 2012 10:56AM
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  Just another p o s  lawyer feeding off the public?  The only thing that will happen is lawyers will make tons of money and the tools will double in price;  Hello already, joe public just does not get it, a big shell game;  all these law suits ever do is make our products more complicated and expensive!!!!!

 I wonder how many tools the carpet bagger (attorney) has ever bought?  If you want to rip off the public, make things complicated/ confusing and take the longest route possible to settle a case ( they get paid by the hour or pro bono and then rip off the serttement);  The first thing taught in lawyer school, is make a case that could be settled in 2 days, drag out for 2 yrs.!!!!!!!!!!!!!! 

Dec 8, 2012 10:45AM
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I have a product I would love to produce in the USA but with all the rules and regulations required for something that has no negative impact on anything, it's impossible. The time and cost is prohibitive. Close to 5 years and several million $ or overseas, 90 days and no hassle. By the way, all components are already approved for other products. This product will be Worldwide representing thousands of jobs.
Dec 8, 2012 10:27AM
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sears for years had commercials and adversment that always said made in america

100% satisfaction guarantee..

and there craftsman line was always stamped made in usa

i have plenty of there older tools with the made in usa..

starting 7 years ago or so, i noticed made in china stamped on the tools

but yet on the package it says american made,, then went to assembled in america

funny thing is the tools are cheaper can see with your eyes in the castings

and they charge the same for what they pay pennies on the dollar to make

 

i blame all this on giving companies tax breaks to send there companies overseas

bush

 

 

 

Dec 8, 2012 10:26AM
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At one time I was a diehard craftsman buyer of hand and power tools.  These days if you have a ratchet fail, they replace it with a "refurbished" one that works worse than the one you took in.  My son had a craftsman tape measure that broke.  They don't carry them any longer so they replaced it with a crappy Stanley, and now they are out of the warranty cycle on the craftsman item.

 

I had a shovel that the handle broke on.  Took it back and they wanted to replace it with their garbage Companion line that has a limited warranty and you have to have a receipt to return.  After a 15 minute argument with the sales clerk who claimed I had no choice, "Sears only has to replace the item and it can be with their choice of products", I got the store manager involved.  Argued with him for another 10 minutes before they finally gave in and replaced it with another Craftsman shovel.  Never use to have to do this.  It was always just replace it an move on.

 

This is just another example of why Sears is failing.  They used to be the place where you could believe their word on warranties.  Today, their product sucks all around.  I rarely even enter a Sears store now days.  They went to hell when K-mart took them over.

 

My tool purchases today are at Lowes.  I know theirs is Chinese mostly also but at least they are honoring their warranties (at least for now).

Dec 8, 2012 10:21AM
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Most people who bash union jobs are not smart enough  to hold union jobs. Most are to lazy to even to get a job. The union don't want these uneducated idiots. When your union you have  to perform.
Dec 8, 2012 10:14AM
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Sarah Michelle Gellar was made in America,,Nothing could be finer....
Dec 8, 2012 10:03AM
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Just a few months back, my son and I were discussing Craftsman tools. We both felt that the quality had declined over time, and the great warranty was not being supported as in the past. Now, I see why SEARS is in a steep decline to oblivion.
Dec 8, 2012 10:01AM
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Sears was the place to buy stuff thirty years ago and more.This is a new era and they can not compete.I do not buy from Sears, but if they are going to make it, probably need to make things in China.If they are misrepresenting where the tools are made then they need to be punished.You can buy tools made in America at Farm/Fleet,just as good and cheaper.Let us not buy anything from Sears and let them die gracefully.
Dec 8, 2012 9:57AM
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Buy a product made in China, and you can help pay for China's national health care. 
Dec 8, 2012 9:52AM
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impose high tariffs,on all imports.give incentives to mfg in usa  !!!!
Dec 8, 2012 9:50AM
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Does that include our so-called American government, which has lied to the American people.

 

This government has failed and the American people want more - free money, free phones, free health care

 

Nothing will change until the American people change - no more freebies, no more dependency on the government.

 

It is time to start again - an independent and truly free United States of America!

 

Dec 8, 2012 9:49AM
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Up to this minutes I've always thought they were made in the USA.  Just lost one more customer Sears.  Now for the deception I sure as hell hope you fail.  Somewhere in all this I hope the CEO is reading the comments and thinking "I just f*^ked up"
Dec 8, 2012 9:46AM
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Once upon a time, unions were needed.  Not anymore, all they do is drive company's out of America because of their hourly wage they want.
Dec 8, 2012 9:41AM
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I work in a small-scale custom manufacturing facility. Our standards are the highest in the industry, but few care. Much of my work is due to lack of planning Contractors  with deadlines who can't wait for products to ship from China. Most seem like they would prefer to sell Chinese junk and cover the many flaws with a warranty(Sears.) Our market edge is to fill orders faster than they can ship and keep margins low low low. That means no benefits, no health, dental, vacations or retirement. Welcome to American manufacturing in the private sector.
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