The U.S. Attorney’s Office is seeking a permanent injunction against an Ohio company that sold COVID-19 personal protective equipment such as N95 masks to healthcare workers and first responders across the country as “Made in USA” even though most of the items were manufactured in China.
The complaint filed earlier this month stems from a referral by the Federal Trade Commission (FTC) about Adam J. Harmon and two companies he controls -Axis LED Group, LLC and ALG Health LLC.- accused of violating multiple federal laws by improperly labeling and advertising various products.
The FTC’s referral to the U.S Department of Justice is outlined in the 116-page complaint, one of more than a dozen such federal cases initiated under the COVID-19 Consumer Protection Act against what the FTC characterizes as “COVID predators.”
“As Americans struggle to obtain safe, authentic personal protective equipment, the Commission will use every tool we have to root out false claims and phony labels,” said Sam Levine of the FTC’s Bureau of Consumer Protection. He added that the defendants “slapped the Made in USA label on masks that were made overseas, and now they’re paying the price.”
That price, the FTC says, is a civil penalty of $157,683 due immediately. Another $2.8 million put forth as a redress judgment is currently suspended due to the defendants’ claims of an inability to pay.
“Should the FTC discover that the defendants have misstated the value of any assets or failed to disclose them, the agency will seek to have the suspension lifted and the full judgment due immediately,” according to an FTC press release.
This is not the first time Harmon has run afoul with the FTC. In 2017, the agency closed an investigation into false Made in USA claims involving LED bulbs sold by Harmon’s Axis LED Group to the U.S. Government. The FTC’s Made in USA labeling rules require manufacturers and marketers who promote such claims to prove “all or virtually all” of a product was in fact made in America. The rule also requires Made in USA labeling in mail order catalogues and online to be truthful.
According to current federal complaint, Harmon admitted to FTC investigators back in 2017 that the U.S.-assembled LED bulbs his company sold contained “significant Chinese components.” The complaint alleges that since then, company employees have on occasion peeled “Made in China” stickers off LED products and replaced them with labels reading Made in the United States before shipping to customers.
Then in early 2020, as the COVID-19 pandemic began, Harmon is alleged to have begun selling PPE such as N95 respirators, gloves, and gowns from the ALG Health facility in Defiance, Ohio. Those sales were made consumers throughout the United States.
One of the company’s social media ads even advised customers to purchase American-made PPE “so that our heroic frontline workers do not have their safety put at risk by relying on foreign-made products.” The posting also stated that imported products “are not tested and could be unsafe.”
In reality, according to the FTC, Harmon was aware his company was sending those customers Chinese-made KN95 masks that employees had stripped off the Made in China labels before printing “ALG” and “NIOSH” on the products and then putting into N95 packaging with Made in USA labels.
But this not what Harmon told the National Institute for Occupational Safety and Health (NIOSH), which is part of the U.S. Centers for Disease Control and Prevention (CDC).
NIOSH is responsible for certifying certain respiratory protective devices, such as N95 masks, per U.S. standards. It does not certify masks manufactured in accordance with international standards, such as KN95 masks.
In January of this year, NIOSH published a notice on the CDC website announcing ALG Health voluntarily rescinded all NIOSH respirator approvals and that the company could no longer manufacture, assemble, sell, or distribute masks under those approval numbers.
“Despite this notice, Defendants continued to market certain of the identified products as MUSA and NIOSH-certified N95s, and sell these products to consumers,” the federal filing alleges. “Defendants have engaged in their unlawful acts and practices willfully and knowingly, and Defendants have continued their unlawful activities despite a previous FTC investigation, and investigations by other federal government agencies.”
The agency’s proposed preliminary injunction order seeks to Harmon and his companies from making further deceptive Made in USA claims as well as enforce the civil penalty for the past deceptive claims.
Gannett, parent company to the Arizona Republic, will commence layoffs and diminish salaries following a poor second quarter last week.
Gannett, which also owns half of the Arizona Daily Star, said in a press release that this “significant cost reduction program” would help pay down $150 to $200 million of their debt. The media conglomerate reported a net loss of $53.7 million, or over 7 percent of its margin. Gannett also experienced a 7 percent decrease in revenues, despite digital revenues increasing 1.5 percent to make up 35 percent of total revenues.
The Tucson Sentinel said that its sources confirmed that Gannett tasked managers with layoffs. Poynter sources clarified that salary cuts will have a 10 percent minimum, and that layoffs begin on Friday.
These layoffs will come, despite Gannett’s participation in initiatives like the Big Tech-funded program, Report for America, which supplied and covered portions of reporter salaries at 21 of its papers, including the Arizona Republic. The paper has hired three Report for America reporters so far. Report for America received an undisclosed sum of $5,000 to $50,000 from Gannett.
Report for America covers at least half of its reporters’ salaries the first year, a third of their salaries the second year, and just under a quarter of their salaries the third year, with the offer to cover the remainder of these salaries through fundraising.
The Arizona Republic subscriber base has declined over the years. According to their latest Securities and Exchange Commission (SEC) filing, their daily circulation was just over 109,000, with a Sunday circulation of over 320,200. That’s about 1.5 percent and 4 percent of the total Arizona population, respectively, and marks a decline of over 7,000 from 2020.
In 2019, their circulation numbers fell below 100,000, marking the steepest decline among Gannett papers.
The SEC filing reflected that the Arizona Republic is Gannett’s fourth-largest major news publication, with the third-largest daily and Sunday circulations.
USA Today has a daily circulation of nearly 781,200 and a Sunday circulation of nearly 534,600; Detroit Free Press has a daily circulation of over 83,700 and a Sunday circulation of over 896,600; and the Columbus Dispatch has a daily circulation of nearly 137,800 and a Sunday circulation of over 134,700.
Comparatively, the New York Times reported a $76 million profit for their second quarter despite being a smaller company than Gannett.
Gannett’s report inspired new criticisms from its journalists and their unions across the country. The Media Guild of the West indicated that Gannett’s recent decline occurred because the conglomerate was more concerned with corporate lobbying than sustaining newsrooms.
The guild cited Gannett’s network-wide advertising and editorial campaign in support of the Journalism Competition and Protection Act (JCPA) to remove antitrust restrictions preventing Gannett from being paid for content to appear on the platform feeds of social media giants like Google and Facebook.
The guild noted that Gannett authorized its CEO to buy more company stock rather than invest in retaining journalists.
A group of Arizonans are suing to stop a California union-backed ballot initiative aiming to render debt collection futile in the state.
The Predatory Debt Collection Act is by the political action committee (PAC), Arizonans Fed Up With Failing Healthcare, or Healthcare Rising AZ. In order to do so, it would cap medical debt interest rates to 3 percent, reduce maximum disposable earnings garnishment from 25 to 10 percent (or 5 percent if garnishment would result in extreme economic hardship), raise home equity protection from $150,000 to $400,000, raise vehicle protection from $6,000 to $15,000 or $25,000 for the physically disabled, raise bank account protection from $300 to $5,000, raise household goods protection from $6,000 to $15,000. All raised protections would also adjust for inflation annually beginning in January 2024.
The PAC markets its ballot initiative as primarily a protection against predatory medical debt collection, though its provisions go much further to encompass all other possible debts.
Healthcare Rising AZ has raised over $7.6 million in funds so far. Over $3.5 million (46 percent) of those funds came from the PAC’s former version of itself, Healthcare Rising AZ, or SEIU-UHW. The latter name refers to the California union, SEIU United Healthcare Workers, from which the current PAC received over $4 million (53 percent) of its funds.
Some Arizonans believe that the ballot measure’s summary language inaccurately reflects its scope, and may cause voters to approve something that would demolish the state’s lending industry, like credit and financing.
Arizonans opposed to the ballot initiative formed a PAC of their own, Protect Our Arizona, which filed a lawsuit against Secretary of State Katie Hobbs and Healthcare Rising AZ in the Maricopa County Superior Court. Judge Frank Moskowitz will oversee the case.
Protect Our Arizona has raised $302,500 so far, 85 percent of which came from the Arizona Creditors Bar Association.
On Monday, the Goldwater Institute filed an amicus brief in the lawsuit. The Phoenix-based public policy research and litigation organization argued that Healthcare Rising AZ made a patently false claim in its description by saying that the initiative wouldn’t change existing law regarding secured debt.
The Goldwater Institute also argued that the ballot initiative would increase the cost and procurement difficulty of credit and loans.
“The Act is breathtakingly wide in scope: severely restricting garnishments, raising the amount of home equity protected from unpaid businesses and creditors, and drastically increasing a host of other personal property exemptions, so as to leave businesses, landlords, and judgment creditors without legal recourse for unpaid debts,” wrote the organization. “If the Act were to become law, the enormous losses it would inflict on lenders and judgment creditors would have a devastating effect on the ability of Arizonans to obtain loans or to afford housing.”
The Arizona Chamber of Commerce and the Greater Phoenix Chamber both expressed opposition to the ballot initiative as well.
Support for the initiative includes the Arizona Democratic Party, Living United for Change Arizona (LUCHA), the Phoenix Workers Alliance, the Arizona Education Association (AEA), Our Voice Our Vote, Arizona Public Health Association (AZPHA), and the NAACP. The PAC currently has over 1,200 members.
Counsel for Healthcare Rising, the election and employment law firm Barton Mendez Soto, also served as counsel for the PAC’s effort the past several years.
The law firm is also behind another controversial ballot initiative that voters may decide on in November, Arizonans for Free and Fair Elections, funded with a similar amount of over $7.6 million from a Democratic network of dark money. That other initiative would eliminate voter ID and proof of citizenship for voter registration, allow same-day voter registration, bar election audits like the one authorized by the state senate for the 2020 election, raise small business taxes to increase political campaign funding, and restore private funding in election administration.
As part of their signature-gathering efforts, Healthcare Rising pledged donations that would relieve $100 in medical debt for Arizona patients.
The Predatory Debt Collection Act summary description is reproduced below:
Caps interest rate on ‘medical debt,’ as defined in the Act; applies this cap to judgments on medical debt as well as to medical debt incurred. Increases the value of assets — a homestead, certain household possessions, a motor vehicle, funds in a single bank account, and disposable earnings — protected from certain legal processes to collect debt. Annually adjusts these amended exemptions for inflation beginning 2024. Allows courts to further reduce the amount of disposable earnings subject to garnishment in some cases of extreme economic hardship. Does not affect existing contracts. Does not change existing law regarding secured debt.
The Department of Homeland Security (DHS) announced Tuesday it will lift the Trump-era “Remain in Mexico” program, formally known as the Migrant Protection Protocols (MPP).
The program required non-Mexican migrants seeking asylum to wait in Mexico while their claims were processed.
The DHS changes followed a Monday ruling from Judge Matthew Kacsmaryk with the Texas Northern District Court, which lifted his previous injunction from last August requiring DHS to reimplement the MPP in good faith. Kacsmaryk’s recent ruling aligned with the Supreme Court (SCOTUS) reversal in June of his August ruling.
DHS Secretary Alejandro Mayorkas has stated that the MPP stands in the way of the immigration system’s improvement.
“The MPP has endemic flaws, imposed unjustifiable human costs, pulled resources and personnel away from other priority efforts, and did not address the root causes of irregular migration,” stated Mayorkas.
Mayorkas cited the Biden administration mantra on immigration — “safe, orderly, and humane” — to contrast MPP with their reform goals.
The “safe, orderly, and human” slogan is cited frequently in left-wing circles. Immigration reform activists, like the Hope Border Institute, used it to praise the Biden administration’s initial rollback of MPP last March.
Catholic bishops along the southern border also cited the slogan while advocating for illegal immigration.
CBP Commissioner Chris Magnus — formerly Tucson’s controversial police chief who told officials not to enforce immigration laws and instead uphold sanctuary city policies — also used the slogan to describe their ideal reimagined approach to border security.
Over 5,700 migrants were enrolled in the MPP from December through June. That’s about 60 percent of initial MPP enrollments, totaling over 9,600, with the remaining 40 percent (over 3,400) disenrolled.
MPP enrollments make up less than one percent (.6 percent) of all illegal immigrant encounters along the southwest border since December: over 1.4 million. As of press time, the southwest border encounter totals for July have yet to be released.
There have been over 3.2 million southwest border encounters since President Joe Biden took office.
On Monday evening, FBI agents raided former President Donald Trump’s household-name Florida home, Mar-a-Lago. The Department of Justice (DOJ) is seeking at least 15 boxes of missing records from Trump’s administration that the National Archives seeks to recover.
Mainstream media received the inside scoop, many making retroactive edits and falling in line with a euphemistic switch from “raid” to “search” preferred by former and current Biden administration officials. Establishment media knowledge of the raid outpaced what Republican elected officials told the public they knew.
A number of unnamed insiders supplied details of the raid to the following outlets: Axios, Reuters, CNNreported that the raid concerned potentially classified documents taken by Trump, NBCreported that the search warrant was connected to the National Archives, the Washington Postreported that the potentially classified documents in question may have been taken to Trump’s residence instead of sent to the National Archives, and Politicoreported that paper records were seized.
The Arizona Republican Party said that the Biden administration crossed an “unprecedented line” in American history. The organization called on Senators Mark Kelly (D-AZ) and Kyrsten Sinema (D-AZ) to seek an explanation for the raid, which they claimed was a historical level of political targeting.
“[Biden’s] administration has weaponized the Judicial System — the raid at President Trump’s home was an act of political warfare,” stated the organization.
Neither Kelly or Sinema have commented on the Trump raid, as of press time. When Tuesday came, they focused their messaging on President Joe Biden’s passage of the CHIPS and Science Act: a $280 billion package with $52 billion in subsidies to increase domestic production of semiconductor chips, also called “integrated circuits” (ICs) or “microchips.” Both Democratic senators issued support in the hopes that Arizona would attract manufacturing plants from Intel and other companies.
The Arizona Democratic Party issued their response to the Trump raid in the context of the statement released by Republican gubernatorial candidate Kari Lake. Their party didn’t comment on the legitimacy or significance of the raid.
“Be wary of someone seeking government office who doesn’t understand the law, and pours fuel on the fire when issues arise,” said the organization.
Governor Doug Ducey didn’t remark on the raid. His silence wouldn’t be uncharacteristic. The Republican Governors Association (RGA) convened last November at the Biltmore resort in Scottsdale to plan the defeat of Trump-endorsed candidates.
Trump’s endorsed candidates swept the primaries last week. Lake, Blake Masters (U.S. Senate), Paul Gosar (incumbent, U.S. House), Mark Finchem (secretary of state), Abraham Hamadeh (attorney general), David Farnsworth (Arizona House), Anthony Kern (Arizona Senate), Wendy Rogers (Arizona Senate), Robert Scantlebury (Arizona Senate), and Janae Shamp (Arizona Senate) secured their spots as the Republican candidates for November.
Arizona’s Republican congressional leaders spoke out against the Trump raid.
Congresswoman Debbie Lesko (R-AZ-08) pointed out that the FBI was fixated on Trump but ignoring claims of corruption linked to the Biden family, via the evidence of Hunter Biden’s laptop, and Hillary Clinton via her mass email deletion.
“This seems to be yet another example of the Department of Justice’s hypocrisy and political bias,” stated Lesko.
Lesko pledged to investigate DOJ abuses if Republicans secure the majority come November. Congressman Paul Gosar (R-AZ-04) went one step further. He pledged support to get rid of the FBI.
Congressman Andy Biggs (R-AZ-05) said that he’s attempted to gather insight on why the FBI raided Trump’s home.
“The only thing missing from the unprecedented FBI raid at President Trump’s home is Muammar Gaddafi’s sunglasses and cap on Joe Biden,” tweeted Biggs. “I stand by President Donald J. Trump.”
Not all Democratic congressional leaders spoke out on the issue, but the one who did sided with the FBI.
Congressman Ruben Gallego (D-AZ-07) urged Trump to publicize a copy of the warrant.
The House Oversight Committee requested that FBI Director Christopher Wray provide it with a briefing.
White House Press Secretary Karine Jean-Pierre declared Tuesday that neither Biden or anyone in the White House had knowledge of the raid. Insiders that informed Politico of the raid confirmed the White House’s denial.
On Tuesday, Trump posted a campaign-style video that concluded with the statement, “the best is yet to come.” The post and its rhetoric led to speculations that Trump would launch a third presidential candidacy.
“We are a nation that’s become a joke. But soon we will have greatness again,” said Trump. “As long as we are confident and united, the tyrants we are fighting do not even stand even a little chance, because we are Americans and Americans kneel to God and God alone. It’s time to start talking about greatness yet again,” said Trump.
The Arizona Chamber of Commerce and Industry is hoping the U.S. House of Representatives takes a hard look at H.R. 5376, which was formerly known as the Build Back Better Act until being recently rechristened as the Inflation Reduction Act of 2022.
“Arizona job creators oppose the vast majority of the provisions in this bill,” Chamber CEO Danny Seiden said Sunday after the U.S. Senate passed the legislation on party lines. “This bill will not reduce inflation and it will not make the U.S. economy more competitive. Renaming a massive tax and spending bill the Inflation Reduction Act does not improve it.”
Seiden says Sen. Kyrsten Sinema met with Arizona business stakeholders to hear their concerns and did help blunt some of the more harmful provisions, especially those which impact manufacturing businesses already doubly hit by inflation and supply chain disruptions
He also acknowledged there are a few beneficial elements of H.R. 5376 such as provisions which encourage continued business investment and provide significant drought resiliency funding to promote a water secure future.
But despite some of “positive aspects,” Seiden insists H.R. 5376 leaves much to be desired. Which is why he and other state business leaders are calling on Arizona’s nine Representatives to take a closer look at the bill in advance of an expected Aug. 12 vote.
“With the bill headed to the House, we would encourage the Arizona delegation to consider the legislation’s negative effect on Arizona jobs,” Seiden said, adding that that renaming the unpopular Build Back Better Act does not improve the fact the legislation is a massive tax and spending bill.
The legislation is estimated to raise $740 billion in additional revenue from new taxes as well as more enforcement of existing tax laws. It also authorizes $430 billion in new spending, although a more thorough analysis by the Congressional Budget Office has not been completed.
One thing the CBO already knows, U.S. Senator Bernie Sanders said on the Senate Floor, is that what he labeled the “so-called” Inflation Reduction Act will have “a minimal impact on inflation.”
The CEO of the National Association of Manufacturers also expressed disappointment with H.R. 5376. According to Jay Timmons, the Inflation Reduction Act will stifle manufacturing investment in America, undermining the very businesses which kept America’s economy afloat during the COVID-19 pandemic.
“To be sure, (the bill) was worse before Sen. Sinema worked to protect some areas of manufacturing investment,” Timmons said. “But the final bill is still bad policy and will harm our ability to compete in a global economy.”
Also speaking out against H.R. 5376 is the Pharmaceutical Research and Manufacturers of America, whose members will be directly impacted by Medicare drug price controls included in the legislation.
“They say they’re fighting inflation, but the Biden administration’s own data show that prescription medicines are not fueling inflation,” said PhRMA CEO Stephen Ubl. “And they say the bill won’t harm innovation, but various experts, biotech investors and patient advocates agree that this bill will lead to fewer new cures and treatments for patients battling cancer, Alzheimer’s and other diseases.”