UPDATE 2-Overstock.com going fur-free

(Adds statement from J.C. Penney)

SAN FRANCISCO, July 10 (Reuters) - Overstock.com Inc (OSTK.O: Quote, Profile, Research, Stock Buzz), which sells excess inventory of clothing, accessories and furniture, will no longer sell fur on its website, the online retailer said on Thursday.

The decision to go fur-free came after the company was contacted by the Humane Society of the United States, which now counts some 100 retailers and designers -- including Calvin Klein, Tommy Hilfiger and BCBG -- who have pledged to shun the use of animal fur in their goods.

"The more we heard about the fur industry, the more we thought we didn't want anything to do with it," said Overstock.com Chief Executive Patrick Byrne during a conference call.

Overstock sold between $1 million to $5 million per year in furs before making this decision, Byrne said, adding that sales growth of fur-related products had been about 30 percent on the site.

The Humane Society, the largest animal protection organization in the country, has been testing garments made overseas, especially in China, after undercover investigations revealed that garments sold in American stores were mislabeled.

The fur from domesticated dogs, cats or raccoon dogs, a type of canine, was found on clothing in which the label indicated the fur was fake; at other times it was found to be from other animals such as rabbits.

Some retailers have pulled the garments off their shelves, but others, including Macy's Inc (M.N: Quote, Profile, Research, Stock Buzz), JC Penney Co Inc (JCP.N: Quote, Profile, Research, Stock Buzz) and Neiman Marcus have been slow to respond, said Humane Society Chief Executive Wayne Pacelle.

"We believe they may be selling dog and cat fur or raccoon dog fur," Pacelle said, adding the organization has met with the Federal Trade Commission to seek civil and criminal penalties for retailers who falsely advertise fur garments.