The story here:

“I think the company does have an opportunity right now to do what is ethnically and morally right by acknowledging their wrongs and pulling the line, but also apologizing and owing up to the fact that [they] did clearly engage in this level of corporate appropriation,” Brown said. “I hope people start critically thinking and integrating into their social consciousness that we are here, we do still exist.”

She cites a very prominent old law:

She claimed they violated the Federal Trade Commission Act and Federal Indian Arts and Crafts Act of 1990, which “prohibits misrepresentation in marketing of Indian arts and crafts produced within the United States” and states the following:

“It is illegal to offer or display for sale, or sell any art or craft product in a manner that falsely suggests it is Indian produced, an Indian product, or the product of a particular Indian or Indian Tribe or Indian arts and crafts organization, resident within the United States.”

While the law is the law, we must also realize that the free market is more than capable of handling this type of “problem.”  If people en masse didn’t like the idea of cheesy culturally inspired products being sold, they won’t buy them and a product line marketed in such a way will not be a success.  I’m really not sure as to where the idea comes from that some “Indian-inspired” merchandise is offensive.  There are racially offensive products in the toy aisle of every super-store in this country.   Cheesy culturally offensive products are abundant. You can find all kinds of offensive physical or intellectual merchandise all over the internet and all over the market. Is it the governments role to make sure no one gets offended?
The lady makes a good point, but I just have to weigh in and say that it’s a bit blown out of proportion and that this type of thing happens all the time and no one hardly raises an eyebrow.  Don’t you think it’s unfair that in the “cowboys and Indians” toy packages in stores it’s only the cowboys who get guns? That’s awfully unfair and prejudice if you ask me.  Not to mention unrealistic, plenty of Indians had guns.

My $.02