July 2, 2012

“There’s Gold In Them Hills”: The FTC Solicits Public Comments on Its Jewelry Guidelines

Seller Beware: Consumer Protection Insights for Industry

The Federal Trade Commission (FTC) is seeking to polish its Jewelry Guidelines officially known as the Guides for the Jewelry, Precious Metals, and Pewter Industries (the "Guides or the "Jewelry Guidelines"). The Commission is soliciting public comments, including on potential modifications to those Guides.

Through its Jewelry Guidelines, the Commission assists marketers and other members of the jewelry industry in avoiding making claims considered "unfair" or "deceptive" under Section 5 of the FTC Act. The Guides apply to a virtual treasure trove of products, including gemstones, precious metals such as gold, silver and pewter, pearls (natural, cultured and imitation) and even watch bands detached from watches. They specify, among other things: the proper meaning of the word "diamond"; when a product can appropriately be described as "hand-made"; how a product's gold or silver content should be marketed; and many other facets of jewelry advertising.

The FTC most recently conducted a complete review of the guidelines more than a decade ago, in 1996, and is now looking to the public to provide gems of wisdom on a variety issues. For example, the Commission questions how freshwater pearls should be described, noting that consumers formerly associated "freshwater pearls" with those that were irregularly-shaped (as opposed to round, cultured pearls). Yet, developments in the culturing process have resulted in some freshwater cultured pearls appearing similar in shape to round saltwater cultured pearls. The FTC also seeks comments on whether the Guides should direct disclosure of treatments to pearls, such as their artificial coloring.

Among other subjects, the Commission also seeks public comments on how the content of alloy products (usually mixtures of metals) that contain precious metals in amounts less than that specified in the current Guides can be described in a way that is not deceptive. For example, Section 23.4 of the current Guides states that it may be misleading to use the word "gold" to describe a product that is comprised of an alloy of gold that is less than 10 karats. Similar regulations exist for the content of silver and platinum.

The actual request for comments, which may be found, poses 24 questions with subparts addressing these and many other issues. Those interested in commenting must file their comments electronically or by paper on or before August 27 of this year. If you prefer to file electronically.

© Arnold & Porter Kaye Scholer LLP 2012 All Rights Reserved. This blog post is intended to be a general summary of the law and does not constitute legal advice. You should consult with counsel to determine applicable legal requirements in a specific fact situation.

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