FTC: Not Unfair or Deceptive to Call Lab-Made Diamonds ‘Cultured’

In a blow to efforts by the diamond industry to distance lab-made diamonds from natural, the U.S. Federal Trade Commission declined to amend the Guides for the Jewelry, Precious Metals, and Pewter Industries to state that it would be unfair or deceptive to use the term “cultured” to describe gemstones created in a laboratory.

The FTC decision follows a petition by a coalition of trade associations that requested an amendment to the guides, stating that it is deceptive or unfair to use the term to describe lab-created gemstones.

The commission rejected three surveys testing consumer perception of the term, stating that even if the term is misleading, “there is no evidence to suggest that the use of qualifying language in the Guides fails to render the term non-deceptive.”

“In addition, the Commission concludes that there is insufficient evidence to establish that the qualified use of the term ‘cultured diamonds’ is unfair,” it added.

Cecilia L. Gardner, CEO and general counsel of Jewelers Vigilance Committee, one of the petitioners in the case, said in response that while the FTC did not find the use of the term ‘cultured’ in itself deceptive, if a marketer were to use that term, it would be required to also use the term “laboratory created,” “laboratory grown,” “[manufacturer-name] created” or “synthetic.”

“The trade associations that signed the petition (including JVC, MJSA, AGTA, JA, CIBJO, the Cultured Pearl Association, AGS, DCA, WFDB and DMIA) universally took the position that the term “cultured” ought to be added to the list of terms that are deceptive and unfair when describing synthetic gemstones,” Gardner said in a written statement. 

“We are pleased with the FTC ruling as it condones the way that we use the term cultured,” Clark McEwen, COO of lab-made diamond maker Gemesis told IDEX Online. “Gemesis has always used the term in conjunction with other disclosure language such as ‘diamonds grown by man’ and will continue to do so.”

Both Gardner and McEwen pointed out the FTC’s ruling that using the terms “laboratory-grown,” “laboratory-created,” and “[manufacturer-name]-created” clarifies the nature of the stone. However, when it got to the term “synthetic” the tune changes.

McEwen said they applaud the JVC in its efforts to protect the consumer from misleading and misunderstood terminology and “would be more than happy” to join efforts in a petition to the FTC against terms such as “synthetic” which is viewed by consumers to mean fake.

However, the JVC, in its statement, could not help itself and called the stones “synthetic gemstones” when discussing consumer protection.

The FTC concluded its decision saying that it “will continue to evaluate advertising for ‘cultured diamonds’ on a case-by-case basis and recommend enforcement action when appropriate.”

Last update, July 24, 2008 4:23