Third Circuit Affirms Lanham Act Liability for False “Made in USA” Claims

On December 10, 2025, the Third Circuit affirmed a New Jersey district court’s finding that Albion Engineering Co. violated the Lanham Act by making false and misleading “Made in the USA” claims in connection with certain caulking guns, as well as the entry of a permanent injunction and an award of disgorgement.

Competitor Newborn Bros. Co., Inc. filed suit in 2012, alleging that Albion partially manufactured certain caulking guns overseas while making US-origin claims.  Albion printed statements such as “USA Manufacturer and Designer” and “Made in USA” on some imported products and advertised that all of its products were “designed and manufactured in the USA” and “Made in America.”  Newborn, however, also made potentially problematic US-origin representations in connection with its own imported caulking guns.

After 30 days of trial testimony spanning seven years, the district court held Albion liable for false advertising under the Lanham Act, entered a permanent injunction, and awarded Newborn more than $2 million in disgorgement, reducing the award under the unclean hands doctrine based on Newborn’s own conduct.  Both parties appealed.  The Third Circuit affirmed the district court’s rulings in all respects.

False Advertising and Permanent Injunction

Albion challenged several aspects of the false advertising holding, arguing that Newborn failed to present consumer survey evidence demonstrating deception and lacked evidence that any deception was material.  The Third Circuit rejected these arguments, holding that testimony and expert evidence may establish deception and materiality without a consumer survey.  The court also affirmed the finding that Newborn suffered injury in the form of diverted sales.

Albion additionally challenged the permanent injunction, which ordered Albion to send letters to recent distributors, request returns of mislabeled products, display notice of the litigation, and provide detailed country-of-origin information until it receives Customs and Border Patrol (CBP) guidance.  Even if Albion’s current practices are compliant with the Lanham Act, the district court’s conclusion that old products and marketing materials was sufficient to warrant a permanent injunction, the panel held.

The Third Circuit likewise upheld the district court’s mandate regarding country-of-origin disclosures. Albion had previously sought CBP guidance on an adjacent issue and was informed that the country of origin would not be the United States, but it did not seek a subsequent clarifying ruling.  “On this record, we cannot conclude that the District Court abused its discretion,” the panel stated.

Unclean Hands

Newborn, on the other hand, principally challenged the district court’s application of the unclean hands doctrine, which decreased the disgorgement award.  The lower court focused on Newborn’s use of a “Newborn U.S.A.” trademark on caulking-gun advertisements without reference to its US warehouse facilities to justify its application.  Newborn also used a logo incorporating its name within an outline of the United States and listed US-based offices and warehouses without disclosing that its caulking guns were manufactured overseas.

While these practices may not necessarily have caused consumer confusion or injury, they are sufficiently similar to Albion’s violations and “transgress[ed] equitable standards of conduct,” the court held.  Accordingly, the panel found that the reduction of Newborn’s recovery fell within the district court’s discretion.

The court also rejected Newborn’s challenge to Albion’s expert witness, who testified that repeat purchasers of Albion products would be aware of their overseas origin.  The panel held that this opinion fell within the expertise of the economist, who held a Ph.D.

The case is Newborn Bros. Co., Inc. v. Albion Engineering Co., Nos. 24-1548 & 24-3046 (3rd Cir.), filed Nov. 4, 2024.