On May 9, 2014, the Federal Trade Commission (the “FTC”) announced that American Apparel, Inc. (“American Apparel”) agreed to settle FTC charges that American Apparel falsely claimed it was compliant with the U.S.-European Union Safe Harbor (the “US-EU Safe Harbor Framework”). 

The FTC’s complaint alleged that American Apparel, a clothing manufacturer and retailer with more than 200 stores worldwide, falsely represented that it was a “current” participant in the US-EU Safe Harbor Framework on its website when it was not a “current” participant from June 2013 until December 2013 as it had allowed its certification to lapse during that time. 

In the May 9 announcement, the FTC elaborates that American Apparel’s conduct violated Section 5 of the FTC Act, but it “does not necessarily mean that the company committed any substantive violations of the privacy principles of the Safe Harbor frameworks.” The proposed consent order, among other requirements, prohibits American Apparel from making misrepresentations about its membership in any privacy or security program sponsored by the government or any other self-regulatory or standard-setting organization.