Jore Corporation

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IN THE MATTER OF JORE CORPORATION CONSENT ORDER, ETC., INREGARD TO ALLEGED VIOLATIONS OF SEC. 5 OF THE FEDERAL TRADE COMMISSION ACT Docket C-4004; File No. 0023237 Complaint, March 15, 2001--Decision, March 15, 2001 This consent order addresses claims on certain packaging and labeling for products marketed by Respondent Jore Corporation -- including power tool accessories -- that such products are all or virtually all made in the United States. The order, among other things, prohibits the respondent from misrepresenting the extent to which any product is made in the United States, while permitting the respondent to represent that such products are made in the United States as long as all, or virtually all, of the components of the products are of United States origin, and all, or virtually all, of the labor in manufacturing them is performed in the United States. Participants For the Commission: Laura D. Koss, Walter C. Gross, Elaine D. Kolish, and Keith B. Anderson.

For the Respondent: William Outman, Baker & McKenzie. COMPLAINT The Federal Trade Commission, having reason to believe that Jore Corporation ("respondent") has 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 Jore Corporation is a Montana corporation with its principal office or place of business at 45000 Highway 93 South, Ronan, Montana 59864.

2. Respondent has manufactured, advertised, labeled, offered for sale, sold, and distributed products to the public, including power tool accessories.

VOLUME 131 Complaint 3. The acts and practices of respondent alleged in this complaint have been in or affecting commerce, as "commerce" is defined in Section 4 of the Federal Trade Commission Act. 4. Respondent has disseminated or has caused to be disseminated packaging for certain of its products, including but not necessarily limited to the attached Exhibits A through C. The packaging contains the following statements or depictions: A. Craftsman Speed-Lok, 7/16" Hex Shank Wood Boring Bit (2”), Exhibit A “Made in USA”

B. Craftsman Speed-Lok, 7/16" Hex Shank Wood Boring Bit (1”), Exhibit B “Made in USA”

C. Stanley/JoreTech Fast Change Power Drilling and Driving Set, Exhibit C “Made in USA” in immediate conjunction with American flag (on front and two side panels) In small print on back of package, “Made in USA with Domestic and Global Components”

5. Through the means described in Paragraph 4, notwithstanding the inconspicuous statement “Made in USA with Domestic and Global Components,” respondent has represented, expressly or by implication, that certain of its power tool accessories are made in the United States, i.e., that all, or virtually all, of the component parts of such power tool accessories are made in the United States, and that all, or virtually all, of the labor in manufacturing such power tool accessories is performed in the United States. VOLUME 131 Complaint 6. In truth and in fact, a significant portion of the components of certain of respondent’s power tool accessories is, or has been, of foreign origin. Therefore, the representation set forth in Paragraph 5 was, and is, false or misleading. 7. Respondent has disseminated or has caused to be disseminated packaging for certain of its products, including but not necessarily limited to the attached Exhibits D and E. The packaging contain the following statements:

A. Stanley/JoreTech 4" Hex Shank Wood Boring Bit (5/8"), Exhibit D “Made in USA with Domestic and Global Components” B. Stanley/JoreTech 4" Hex Shank Wood Boring Bit (7/8"), Exhibit E “Made in USA with Domestic and Global Components” 8. Through the means described in Paragraph 7, respondent has represented, expressly or by implication, that certain of its power tool accessories are made in the United States with domestic and imported components.

9. In truth and in fact, these products do not contain domestic components. Therefore, the representation set forth in Paragraph 8 was, and is, false or misleading.

10. The acts and practices of respondent 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 fifteenth day of March, 2001, has issued this complaint against respondent. we 1/2-in Wood ‘oral’ Boring Bit Use with the \ Speed-Lok™ Quick Connector or chuck directly into any 1/2-in.

drill chuck.

WARNING:

Always wear eye protection which complies with current ANSI Standard Z87.1 Always disconnect power source before using tool on electrical boxes, fittings or any workplace which may conduct electricity. Do not use on any power impact wrench. Bits could break, throwing fragments in all directions.

Before using on a power tool, read and understand machine owners manual, observing all instructions. FAILURE TO HEED ALL INSTRUCTIONS CAN RESULT IN SERIOUS BODILY INJURY OR DEATH.

Speed-Lok™ and Speed-Shank™ ARE TRADEMARKS OWNED BY JORE CORPORATION MADE IN U.S.A. Sold by Sears, Roebuck and Co., Hoffman Estates, iL 60179 1/2000 DOM 26254 .

60550669 926254 CRAFTSMAN CT Aggressive Angled Cutting Edge Hardened Steel Quick Connector Exhibit A CRAFTSMAN Speed-Lok"

its 1-in Wood Speed- ‘aaa’ Boring Bit Use with the Speed-Lok™ . Quick Connector or chuck directly ” into any 1/2-in.

drill chuck.

a ‘sont Separatety) Speed-Lok™ Quick Connector for easy one handed bit changes Speed- s Shank™ os ° Ag, drill bit slippage WARNING:

Always wear eye protection which complies with current ANSI Standard Z87.1 Always disconnect power source before using tool on electrical boxes, fittings or any workplace which may conduct electricity. Do not use on any power impact wrench. Bits could break, throwing fragments in all directions.

Before using on a power tool, read and understand machine owners manual, observing all instructions. FAILURE TO HEED ALL INSTRUCTIONS CAN RESULT IN SERIOUS BODILY INJURY OR DEATH.

Speed-Lok™ and Speed-Shank™ ARE TRADEMARKS OWNED BY JORE CORPORATION MADE IN U.S.A. Sold by Sears, Roebuck and Co., Hoffman Estates, 1& 60179 1/2000 it DOM26258 60550673 w CRAFTSMAN CT Aggressive Angled Cutting Edge Hardened Steel Quick Connector Exhibit B ee ae ety Exhibit Cl ast Change Power Drilling Contractor Grade” ' and Driving Set ESJuego de cambio rapido para taladro o destornillador electrico Fa st C h an g e emblem de percage et de vissage motorisé ivec connecteur a remplacement rapide Powe r D ri | | i n g f and Driving Set Juego de cambio rapido para taladro o destornillador electrico Ensemble de percage et de vissage motorisé avec connecteur a remplacement rapide a fh ? L457 1 L487 lil yw ft 7 MADEINU.S A.

HECHOENEUA FABRIQUE AUXE U Bus 116.564.332.764 F 8 9643;

13:64. 732, 1564.14 € The System Exhibit C2 Aovancro Process Control Screw Guide i C High- Torque Handle Contractor Drill and Driver Made in the USA with domestic and global components 1999 Jore Corporation MADE INU.S.A. = — y ees: taba V ith Rit HECHO EW EU.A. Stanley is the registered Fasniaué aux Travaillez en sécurité. Portez Sos lof lufettes de sécurité lorsque vous utilisez des outils. STS 14 L487 iit] ¢ ft ALE DRILLS rast Change Angled cutting edge digs into wood while the super sharp spurs cuta clean, smooth hole in all types of wood products.

k 1:4 Fast Shank ac es directly into the Fast C Connector to eliminate re-chuc ng. (cannectar sold sepé with toots by wearing He Glbe Coe ees cf Yq 60550505, 44ST SN \ Exhibit D L457 1 MOE) lit PAST Change LAST CNEL — FITS ALL DRILLS Angled cutting edge digs into wood while the super shar spurs cut a clean, smooth hole in all types of wood products ic Shank sores direct nto the Fast Change Crown yw sal senarately) Coneector to eliminate 60550509 rs V% S457 Sin Exhibit E VOLUME 131 Decision and Order DECISION AND ORDER The Federal Trade Commission having initiated an investigation of certain acts and practices of the respondent named in the caption hereof, and the respondent having been furnished thereafter with a copy of a draft complaint which the Bureau of Consumer Protection proposed to present to the Commission for its consideration and which, if issued by the Commission, would charge respondent with violations of the Federal Trade Commission Act; and The respondent, its attorney, and counsel for the Commission having thereafter executed an agreement containing a consent order, and admission by the respondent of all the jurisdictional facts set forth in the draft complaint, a statement that the signing of said agreement is for settlement purposes only and does not constitute an admission by respondent that the law has been violated as alleged in such complaint, or that the facts as alleged in such complaint, other than jurisdictional facts, are true, and waivers and other provisions as required by the Commission’s Rules; and The Commission having thereafter considered the matter and having determined that it had reason to believe that the respondent violated the said Act, and that a complaint should issue stating its charges in that respect, and having thereupon accepted the executed consent agreement and placed such agreement on the public record for a period of thirty (30) days, now in further conformity with the procedure prescribed in Section 2.34 of its Rules, the Commission hereby issues its complaint, makes the following jurisdictional findings, and enters the following order: 1. Respondent Jore Corporation is a Montana corporation with its principal office or place of business at 45000 Highway 93 South, Ronan, Montana 59864.

2. The Federal Trade Commission has jurisdiction of the subject matter of this proceeding and of the respondent, and the proceeding is in the public interest.

VOLUME 131 Decision and Order ORDER I.

IT IS ORDERED that respondent, Jore Corporation, a corporation, its successors and assigns, and its officers, agents, representatives, and employees, directly or through any corporation, subsidiary, division, or other device, in connection with the manufacturing, labeling, advertising, promotion, offering for sale, sale, or distribution of any product, in or affecting commerce, as "commerce" is defined in section 4 of the Federal Trade Commission Act, 15 U.S.C. § 44, shall not misrepresent, in any manner, directly or by implication, the extent to which any such product is made in the United States.

PROVIDED, however, that a representation that any such product is made in the United States will not be in violation of this Order so long as all, or virtually all, of the component parts of the product are made in the United States and all, or virtually all, of the labor in manufacturing the product is performed in the United States. PROVIDED FURTHER, that nothing in the order shall prohibit respondent from depleting the inventory of any product bearing a marking or labeling otherwise prohibited by this order and existing on the date this order is signed, in the normal course of business, provided that no such existing inventory is shipped later than January 31, 2001.

Il.

IT IS FURTHER ORDERED that respondent Jore Corporation, and its successors and assigns, shall, for five (5) years after the last date of dissemination of any representation covered by this order, maintain and upon request make available to the Federal Trade Commission for inspection and copying:

A. All labeling, packaging, advertisements and promotional materials containing the representation; VOLUME 131 Decision and Order B. All materials that were relied upon in disseminating the representation; and C. All tests, reports, studies, surveys, demonstrations, or other evidence in their possession or control that contradict, qualify, or call into question the representation, or the basis relied upon for the representation, including complaints and other communications with consumers or with governmental or consumer protection organizations.

Ill.

IT IS FURTHER ORDERED that respondent Jore Corporation, and its successors and assigns, shall deliver a copy of this order to all current and future officers, directors, and to all current and future employees, agents, and representatives having responsibilities with respect to the subject matter of this order, and shall secure from each such person a signed and dated statement acknowledging receipt of the order. Respondent shall deliver this order to current personnel within thirty (30) days after the date of service of this order, and to future personnel within thirty (30) days after the person assumes such position or responsibilities.

IV.

IT IS FURTHER ORDERED that respondent Jore Corporation, and its successors and assigns, shall notify the Commission at least thirty (30) days prior to any change in the corporation that may affect compliance obligations arising under this order, including but not limited to a dissolution, assignment, sale, merger, or other action that would result in the emergence of a successor corporation; the creation or dissolution of a subsidiary, parent, or affiliate that engages in any acts or practices subject to this order; the proposed filing of a bankruptcy petition; or a change in the corporate name or address. Provided, however, that, with respect to any proposed change in the corporation about which respondent learns less than thirty (30) days prior to the date such action is to take place, respondent shall notify the Commission as soon as is practicable after obtaining such knowledge. All notices required by this Part VOLUME 131 Decision and Order shall be sent by certified mail to the Associate Director, Division of Enforcement, Bureau of Consumer Protection, Federal Trade Commission, 600 Pennsylvania Avenue, N.W., Washington, D.C. 20580.

V.

IT IS FURTHER ORDERED that respondent Jore Corporation, and its successors and assigns, shall, within sixty (60) days after the date of service of this order, and at such other times as the Federal Trade Commission may require, file with the Commission a report, in writing, setting forth in detail the manner and form in which it has complied with this order.

Vi.

This order will terminate on March 15, 2021, or twenty (20) years from the most recent date that the United States or the Federal Trade Commission files a complaint (with or without an accompanying consent decree) in federal court alleging any violation of the order, whichever comes later; provided, however, that the filing of such a complaint will not affect the duration of this order if such complaint is filed after the order has terminated pursuant to this Part. 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 Part 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 direction of the Commission.

VOLUME 131 Analysis Analysis of Proposed Consent Order to Aid Public Comment Issued when the Commission tentatively approved a proposed consent order on January 22,2001 The Federal Trade Commission has accepted an agreement, subject to final approval, to a proposed consent order from respondent Jore Corporation.

The proposed consent order has been placed on the public record for thirty (30) days for reception 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 and take other appropriate action or make final the agreement’s proposed order.

This matter concerns U.S. origin claims contained on packaging for certain Jore Corporation products, including power tool accessories. The Commission’s complaint charges that respondents misrepresented on this packaging that the products were all or virtually all made in the United States. In truth and in fact, these products were actually made with significant foreign content and/or processing.

The proposed consent order contains a provision that is designed to remedy the charges and to prevent the respondent from engaging in similar acts and practices in the future. Part I of the proposed order prohibits Jore Corporation from misrepresenting the extent to which any product is made in the United States. The proposed order would allow Jore Corporation to represent that such products are made in the United States as long as all, or virtually all, of the components of the products are of U.S. origin, and all, or virtually all, of the labor in manufacturing them is performed in the United States. Part II of the proposed order requires respondent to maintain materials relied upon in disseminating any representation covered by the order. Part III of the proposed order requires Jore Corporation to distribute copies of the order to certain company VOLUME 131 Analysis officials and employees. Part IV of the proposed order requires Jore Corporation to notify the Commission of any change in the corporation that may affect compliance obligations under the order. Part V of the proposed order requires Jore Corporation to file one or more compliance reports. Part VI of the proposed order is a provision whereby the order, absent certain circumstances, terminates twenty years from the date of issuance. The purpose of this analysis is to facilitate public comment on the proposed consent order. It is not intended to constitute an official interpretation of the agreement and proposed order or to modify in any way their terms.

VOLUME 131 Complaint