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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I've been using Craftsman tools for years. Needless to say, my older ratchets and wrenches were made of much more stronger metal and would take a beating. The junk Sears is selling now are junk chinese imports. This year alone, I had to exchange 3 ratchets and 6 ratchet wrenches, who can't take the tork and the bearings fall apart. Don't be fooled by Sears claim of "Made in America", it's self evident their tools are now imported, and are next to junk.
If the tools still wrk as well as they always have and Sears will replace them as they guarantee, then what difference does it matter where they are made.
As long as the quality of the material is still the same, country of manufacture should be of no concern. It would be similar to comparing Japanese made autos to US made autos. It is about quality of the product.
Get over the fact that things aren't all made in the USA anymore. If they were, then most people who buy the products would not be able to afford them.
Saying they are "America's Most Trusted Brand" doesn't say they're made in America. Did Sears say they were? Volvos aren't made in America but they are a well trusted brand too.
why is "America's most trusted" interpreted as "made in America"?
As has been said, nothing is made in America anymore. For some reason it is cheaper to have items made in a country where people live in small houses without running water or electricity for people who prefer to pay a low price for a product.
All of my tools are Craftsman - power, mechanics, garden. Not, however, because I think they are "Made in the USA". But why would I or anyone buy anything else from Sears when most items can be purchased from other outlets at much lower prices. For examplde, a 55 inch tv at Sears for nearly $900, I can get at Walmart for more than $300 less!!!!!!!!!!
Same as almost every other top brand.
This is just another lawyer/law firm trying to make millions while the people they recruit for the lawsuit get pennies.
There is a real need for tort reform which we will never see as long as lawyers keep getting elected into the house and senate.
plus these lawsuits do not help. How is this going to create american jobs?
Stop blaming the stores. We have to take the blame for buying the cheaper product in the first place. If they want to compete then they have to do the same thing.
The other thing to think about if they are made over seas they probably sell them in more markets, so there would be a volume discount working as well.
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Australia just did, and it's doing fine. Mature countries know when to walk away from a fight.
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