I just recieved 3 64GB SanDisk Extreme USB Flash Drives and all three show SMART failures of Reallocated Bad Sectors. I find it hard to believe that all three could be bad at initial use. I use a program on the Mac (SoftRAID) to certify all drives prior to use, including SD cards and USB drives. I’ve never seen a failure until today.
The drives did show succesful certification but exhibit a SMART failure.
I agree that it is unlikely to have failed on initial use. Most likely it is a issue with the SMART attributes. IIRC sandisk does not support SMART for this product so it it formats with no error and data can be copied to the drives successfully I would not worry too much about it.