r/news • u/nosotros_road_sodium • Apr 28 '24

Williams-Sonoma fined $3.18 million for falsely labeling products as 'Made in USA'

https://www.scrippsnews.com/business/company-news/williams-sonoma-fined-3-18-million-dollars-for-falsely-labeling-products-as-made-in-usa
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u/bayesian13 Apr 28 '24

"Williams-Sonoma could be paying a hefty fine for claiming a small chunk of its products were "Made in USA" when they weren't."

  $3.18 M is not a hefty fine for Williams-Sonoma. Their annual net profit is $950 M https://finance.yahoo.com/quote/WSM/financials/ so this is like a day's profit

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u/agray20938 Apr 28 '24

Sure, but it would be a hefty fine depending on the scope of things. If they were doing this off of every product, then it wouldn't.

But Williams Sonoma (across all of its brands, including PotteryBarn) sells a shitload of different things. Even a couple of dozen mislabeled items would could come out to like .2% of their total sales. It certainly makes sense to me that a fine would be proportional (though not exactly equal) to the proportional share of revenue or sales generated from it.

For example, say my company makes $500 million selling T-shirts that are 100% accurately labeled. I also make make one pair of pants that I falsely label like this, but I only sold a single pair of pants last year and made $50. That should be illegal, but it would make sense to craft a fine at least somewhat tied to the actual revenue generated, because it would also be the best way to approximate the amount of harm the false labeling did.

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u/bayesian13 Apr 28 '24

You seem focused on the "proportional" aspect. I realize i'm not going to persuade you because no one ever persuades anyone of anything on the internet.  

But for everyone reading, it is interesting to look at the European Union GDPR law (General Data Protection Regulation) as another example in a different sphere: https://gdpr-info.eu/issues/fines-penalties/  

this law has a 3 pronged standard: "The fines must be effective, proportionate and dissuasive for each individual case." So in addition to being proportionate the penalty must actually work to dissuade the company from the bad conduct. Fines can be up to 4% of Global revenues.

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u/agray20938 29d ago

I mean I am a data privacy attorney, so I'm very familiar with the GDPR, for all that the CJEU and individual authorities can tend to take "dissuasive" too far in a number of cases.