Kubota Hit With $2 Million Penalty for False 'Made in USA' Labels on Replacement Tractor Parts

Texas company Kubota North America was ordered Jan. 25 to pay $2 million for falsely labeling replacement parts for tractors, mowers, utility vehicles, and construction and agricultural equipment as having been made in the U.S. The U.S. District Court for the Northern District of Texas entered a stipulated judgment against the company, which included the penalty and compliance reporting and record-keeping requirements for the next 20 years (U.S. v. Kubota North America Corp., N.D. Tex. # 3:24-00159).

The FTC brought the case Jan. 22, alleging that Kubota labeled thousands of its replacement parts as "Made in the USA" when the goods were "wholly imported." The complaint said Kubota engaged in this conduct over the past three years "despite being sued by the FTC previously for the same violations."

Kubota said in an email that it "cooperated fully with the U.S. government throughout this investigation and is voluntarily addressing the FTC's concerns." The company added that it "has implemented policies and process improvements, including regular reviews of our supplier information, regarding the accuracy of such labels on all Kubota Genuine Parts. All parts in this matter sold to customers since 2021 were produced by approved Kubota suppliers, and Kubota continues to stand behind these parts as 'Kubota Genuine Parts.'"

Kubota said it "regrets that this matter has occurred."

The judgment ordered Kubota to submit a compliance report in one year describing each of its business activities and explaining "in detail whether and how" it's in compliance with the order. For the next 20 years, the company must notify the FTC of any changes to its point of contact or the structure of the company or of any entity that has ownership in the company directly or indirectly that could affect compliance obligations.

Kubota also was ordered to create certain records for the next 20 years, including accounting records "showing the revenues from all goods or services sold," personnel records, all consumer complaints and refund requests, and all records needed to show full compliance with the order.

Additionally, the company must submit "additional compliance reports or other requested information" and "produce documents for inspection and copying."