A novelty glass company that sells drinkware with bullets embedded in the side has to pay a competitor more than $3.1 million in damages after falsely promoting its products as being American-made, according to a jury decision in a Wisconsin federal court earlier this month.

BenShot started making “bulletproof” drinkware, like this shot glass, in 2015 at its Wisconsin facility. The company sued a competitor for making false Made-in-the-USA claims and was recently awarded more than $3.1 million in damages by a jury.

Lucky Shot USA marketed its bullet-embedded glasses as being “Made in the USA,” but the indented glasses are made in China, with the bullet glued into the glass in the United States later, according to the lawsuit.

Competitor BenShot sued Lucky Shot for violating the Lanham Act and Wisconsin unfair competition laws. BenShot was launched by a father-and-son team in 2015 on the grounds of an abandoned Thomas Edison furniture factory in Wisconsin – and the company makes shot glasses and other drinkware with bullets and additional items embedded in the side.

“We’re proud of what we do, and we’re proud of where we do it,” said co-founder Ben Wolfgram. “It would be a lot cheaper – and easier – to have our glassware made in China, but that’s not what we’re about, and it’s not what our customers want.”

Back in 2017, Wolfgram said he first learned that Lucky Shot USA and several other companies owned and operated by Douglas Ingalls were advertising similarly designed bullet glassware as being “Made in the USA,” even though most of the components were made in China.

Ingalls and Lucky Shot didn’t respond to a request for comment.

During the litigation, BenShot also discovered deceptive emails from Lucky Shot that asked for photos of the glasses being made without showing the faces of workers or “writing in Chinese” – moves designed to make customers more likely to think the products were made in the U.S., Wolfgram said.

The case between the two bullet-glass companies went through several years of litigation. When Lucky Shot moved to dismiss the case, the court relied heavily on the Federal Trade Commission’s Enforcement Policy Statement on U.S. Origin Claims to deny the motion.

On Oct. 17, a jury agreed that Lucky Shot USA had violated the federal Lanham Act “by falsely designating the geographic origin of the bullet glassware products” and that the false designation caused damages to BenShot.

“We’re fighting back against deceptive marketing and false ‘Made in USA’ claims,” Wolfgram said. “If a company makes their product overseas, that’s their choice. But, to make it overseas and then lie to their customers – active military, veterans, law enforcement officers – is completely unacceptable.”

In April, the FTC started enforcing new rules related to claims that a product is American-made.

The FTC says that protecting consumers and honest businesses from deceptive Made-in-USA claims is a key priority – something companies in the promo products industry and other markets should heed. In August, for example, the FTC fined a company for falsely claiming PPE products were Made in the USA.

The jury decision against Lucky Shot is a good reminder that the FTC’s labeling rules have a broad application, and marketers can be held liable for false and deceptive claims in private litigation as well as through FTC enforcement.