[Federal Register Volume 73, Number 38 (Tuesday, February 26, 2008)]
[Proposed Rules]
[Pages 10190-10199]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E8-3594]
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FEDERAL TRADE COMMISSION
16 CFR Part 23
Guides for the Jewelry, Precious Metals, and Pewter Industries
AGENCY: Federal Trade Commission (FTC or Commission).
ACTION: Request for public comment on a proposed amendment to the
platinum section of the Guides for the Jewelry, Precious Metals, and
Pewter Industries.
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SUMMARY: The Commission is seeking comments on a proposed amendment to
the platinum section of the FTC's Guides for the Jewelry, Precious
Metals, and Pewter Industries, 16 CFR part 23. The amendment provides
guidance on how to mark or describe non-deceptively products containing
at least 500 parts per thousand, but less than 850 parts per thousand,
pure platinum and no other platinum group metals. The Commission is
also seeking comment on whether the Guides for the Jewelry, Precious
Metals, and Pewter Industries should be revised to provide guidance on
how to mark or describe platinum-clad, filled, plated, or overlay
products.
DATES: Written comments must be received on or before May 27, 2008.
ADDRESSES: Interested parties are invited to submit written comments.
Comments should refer to ``Jewelry Guides, Matter No. G711001'' to
facilitate the organization of comments. A comment filed in paper form
should include this reference both in the text and on the envelope, and
should be mailed or delivered, with two copies, to the following
address: Federal Trade Commission/Office of the Secretary, Room 135-H
(Annex E), 600 Pennsylvania Avenue, N.W., Washington, D.C. 20580. If
the comment contains any material for which confidential treatment is
requested, it must be filed in paper (rather than electronic) form, and
the first page of the document must be clearly labeled
``Confidential.''\1\ The FTC is requesting that any comment filed in
paper form be sent by courier or overnight service, if possible,
because U.S. postal mail in the Washington area, and at the Commission,
is subject to delay due to heightened security precautions.
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\1\ Commission Rule 4.2(d), 16 CFR 4.2 (d). The comment must be
accompanied by an explicit request for confidential treatment,
including the factual and legal basis for the request, and must
identify the specific portions of the comment to be withheld from
the public record. The request will be granted or denied by the
Commission's General Counsel, consistent with applicable law and the
public interest. See Commission Rule 4.9(c), 16 CFR 4.9(c).
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Because U.S. postal mail is subject to delay due to heightened
security measures, please consider submitting your comments in
electronic form. Comments filed in electronic form (except comments
containing any confidential material) should be submitted by clicking
on the following: https://secure.commentworks.com/ftc-jewelry and
following the instructions on the web-based form. To ensure that the
Commission considers an electronic comment, you must file it on the
web-based form at https://secure.commentworks.com/ftc-jewelry. If this
[[Page 10191]]
Notice appears at http://www.regulations.gov, you may also file an
electronic comment through that website. The Commission will consider
all comments that regulations.gov forwards to it.
The FTC Act and other laws the Commission administers permit the
collection of public comments to consider and use in this proceeding as
appropriate. The Commission will consider all timely and responsive
public comments that it receives, whether filed in paper or electronic
form. Comments will be available to the public on the FTC website, to
the extent practicable, at http://www.ftc.gov. As a matter of
discretion, the FTC makes every effort to remove home contact
information for individuals from the public comments it receives before
placing those comments on the FTC website. More information, including
routine uses permitted by the Privacy Act, may be found in the FTC's
privacy policy at http://www.ftc.gov/ftc/privacy.htm.
FOR FURTHER INFORMATION CONTACT: Robin Rosen Spector, Attorney, (202)
326-3740, or Janice Podoll Frankle, Attorney, (202) 326-3022, Division
of Enforcement, Bureau of Consumer Protection, Federal Trade
Commission, 600 Pennsylvania Avenue, N.W., Washington, D.C. 20580.
SUPPLEMENTARY INFORMATION:
I. Introduction
The Guides for the Jewelry, Precious Metals, and Pewter Industries
(``Jewelry Guides'' or ``Guides'') address claims made about precious
metals, diamonds, gemstones, and pearl products. 16 CFR part 23. The
Jewelry Guides provide guidance on how to avoid making deceptive claims
and, for certain products, discuss when disclosures should be made to
avoid unfair or deceptive trade practices. The Commission is seeking
public comment on Section 23.7 of the Jewelry Guides, which addresses
claims for platinum products.
Industry guides are administrative interpretations of the
application of Section 5 of the FTC Act, 15 U.S.C. 45(a). The
Commission issues industry guides to provide guidance for the public to
conform with legal requirements. 16 CFR part 17. Failure to follow
industry guides may result in corrective action under Section 5 of the
FTC Act. In any such enforcement action, the Commission must prove that
the act or practice at issue is unfair or deceptive.
Platinum products marketed as ``platinum'' typically contain at
least 85% pure platinum or contain at least 50% pure platinum in
combination with other platinum group metals (``PGM'') that total 95%
PGM.\2\ During the last few years, some manufacturers have marketed
products as ``platinum'' that contain more than 50%, but less than 85%,
pure platinum, and no other PGM.\3\ In a Federal Register notice
published July 6, 2005 (``2005 FRN''),\4\ the Commission sought comment
on whether it should revise the platinum section of the Jewelry Guides
to address such products. The comment period closed October 12, 2005.
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\2\ The Platinum Group Metals include platinum, iridium,
palladium, ruthenium, rhodium, and osmium.
\3\ We are aware that some companies are selling similar
products but marketing them under names other than ``platinum.''
\4\ 70 FR 38834 (July 6, 2005).
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II. Background
The platinum section of the Jewelry Guides contains a general
statement regarding the deceptive use of the term ``platinum'' (and
other PGM) and provides specific examples of misleading and non-
violative uses of the term ``platinum.''\5\ Specifically, Section 7(a)
of the Jewelry Guides states that it is ``unfair or deceptive to use
the words `platinum,' `iridium,' `palladium,' `ruthenium,' `rhodium,'
and `osmium,' or any abbreviation to mark or describe all or part of an
industry product if such marking or description misrepresents the
product's true composition.'' 16 CFR 23.7(a).
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\5\ On April 8, 1997 (62 FR 16669), the Commission published the
current platinum section of the Jewelry Guides. The Commission
revised this section as part of a comprehensive review of all of the
provisions of the Guides.
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Section 7(b) provides examples of markings or descriptions for
products containing platinum that may be misleading:
(1) Use of the word ``Platinum'' or any abbreviation, without
qualification, to describe all or part of any industry product that is
not composed throughout of 950 parts per thousand pure Platinum.
(2) Use of the word ``Platinum'' or any abbreviation accompanied by
a number indicating the parts per thousand of pure Platinum contained
in the product without mention of the number of parts per thousand of
other PGM contained in the product, to describe all or part of an
industry product that is not composed throughout of at least 850 parts
per thousand pure platinum, for example, ``600Plat.''
(3) Use of the word ``Platinum'' or any abbreviation thereof, to
mark or describe any product that is not composed throughout of at
least 500 parts per thousand pure Platinum.
16 CFR 23.7(b).
Section 7(c) includes the following four examples of markings and
descriptions that are not considered unfair or deceptive:
(1) The following abbreviations for each of the PGM may be used for
quality marks on articles . . . [section lists the two-letter and four-
letter abbreviations for the PGM].
(2) An industry product consisting of at least 950 parts per
thousand pure Platinum may be marked or described as ``Platinum.''
(3) An industry product consisting of 850 parts per thousand pure
Platinum, 900 parts per thousand pure Platinum or 950 parts per
thousand pure Platinum may be marked ``Platinum,'' provided that the
Platinum marking is preceded by a number indicating the amount in parts
per thousand of pure Platinum. . . . Thus, the following markings may
be used: ``950Pt.,'' ``950Plat.,'' ``900Pt.,'' ``900Plat.,''
``850Pt.,'' or ``850Plat.''
(4) An industry product consisting of at least 950 parts per
thousand PGM, and of at least 500 parts per thousand pure Platinum, may
be marked ``Platinum,'' provided that the mark of each PGM constituent
is preceded by a number indicating the amount in parts per thousand of
each PGM, as for example, ``600Pt.350Ir.,'' 600Plat.350Irid.,''
``550Pt.350Pd.50Ir.,'' or ``550Plat.350Pall.50Irid.''
16 CFR 23.7(c).
On December 15, 2004, Karat Platinum, a jewelry manufacturer,
requested an opinion from the FTC staff regarding the application of
the Jewelry Guides to a product called ``Karat Platinum'' consisting of
585 parts per thousand (``ppt'') pure platinum and 415 ppt copper and
cobalt (non-precious metals).\6\ The request stated that the company's
reading of the Guides indicated that the platinum section did not
prohibit marking or describing the product as ``Platinum'' and that the
Guides did not address how to mark or describe an alloy with this
composition other than to require that any representation be truthful
and not misrepresent the product's composition.
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\6\ The request for a staff opinion and the staff's response to
that request can be found at www.ftc.gov/os/statutes/jewelry/letters/karatplatinum.pdf and www.ftc.gov/os/statutes/jewelry/letters/karatplatinum002.pdf, respectively.
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The staff posted this request on the FTC's website on December 17,
2004 and invited the industry to provide comments by January 5,
2005.\7\ The staff
[[Page 10192]]
received sixteen comments from jewelry trade associations and
retailers.\8\
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\7\ The staff later extended the comment period until January
10, 2005.
\8\ The Jewelers Vigilance Committee, Platinum Guild
International, Manufacturing Jewelers & Suppliers of America,
American Gem Society, Jewelers of America, Sonny's On Fillmore,
Kwiat, Inc., Cornell's Jewelers, Michael Bondanza, Inc., PMI,
Traditional Jewelers, Stanley Jewelers Gemologist, Davidson & Licht,
Henne Jewelers, Johnson Matthey, and MJ Christensen submitted
comments.
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On February 2, 2005, the staff responded to the request for an
opinion stating:
The Guides provide that, in order for a product to be marked or
described as ``platinum,'' the product must contain a minimum of 500
ppt pure platinum. 16 CFR Sec. 23.7(b)(3). In addition, the Guides
provide that, if a product contains 500 ppt pure platinum but less than
850 ppt pure platinum, the marketer must disclose the amount in ppt of
the remaining PGM in the product. 16 CFR Sec. 23.7(b)(2).
In our opinion, a literal reading of the Guides indicates that they do
not address the marketing of the Karat Platinum alloy, except to the
extent that they require a minimum of 500 ppt pure platinum. The
provisions of Section 23.7 that address misuse of the word ``platinum''
do not discuss how to mark or describe an alloy that contains over 500
ppt pure platinum but no other PGM.
The staff letter further explained that the marketing of the Karat
Platinum alloy would be subject to Section 23.1 of the Guides, which
contains a general statement on deception, as well as Section 5 of the
FTC Act.\9\
The letter stated that the staff considered ``this alloy to be
sufficiently different in composition from products consisting of
platinum and other PGM to require clear and conspicuous disclosure of
the differences.'' The staff letter also stated that it did not appear
``that simple stamping of the jewelry's content (e.g., 585 Plat., 0
PGM) would be sufficient to alert consumers to the differences between
the Karat Platinum alloy and platinum products containing other PGM.''
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\9\ Section 5 of the FTC Act prohibits deceptive acts or
practices, in or affecting commerce. 15 U.S.C. 45(a).
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Because of the public interest in this issue, on July 6, 2005, the
Commission issued a Federal Register notice soliciting public comment
regarding whether it should revise the Guides to address products
composed of at least 500 ppt, but less than 850 ppt, pure platinum and
no other PGM. The Commission received comments through the extended
October 12, 2005 deadline.\10\
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\10\ 70 FR 57807 (October 4, 2005).
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Additionally, the notice stated that the staff had received some
inquiries regarding the application of the platinum section of the
Guides to the marketing of platinum-clad or platinum-coated jewelry
products. The platinum section of the Guides currently does not address
platinum-clad, filled, plated, or overlay products. Other sections of
the Guides, however, address gold and silver-plated jewelry
products.\11\ These sections generally advise that the plating must be
of a sufficient thickness to ensure reasonable durability. The 2005
FRN, therefore, also sought comment regarding whether the Guides should
provide guidance on how to mark or describe non-deceptively platinum-
clad, filled, coated, or overlay jewelry products. The Commission
received several comments with regard to this issue stating that there
is a need for guidance for platinum-coated or plated products with
respect to the thickness of the coating and the purity of the
platinum.\12\ Because these comments did not propose specific guidance,
this Federal Register notice is seeking such guidance with regard to
platinum-clad, filled, coated, and overlay jewelry products.
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\11\See 16 CFR 23.4 and 23.6 (addressing gold-plated, gold-
filled, gold-overlay, gold-electroplated, and silver-plated jewelry
products).
\12\ The Jewelers Vigilance Committee, Platinum Guild
International, and a jeweler manufacturer (Sasha Primak) state that
there is a need for specific guidance regarding the thickness of the
coating or plate and the purity of the platinum employed to cover
the base metal.
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III. Response to June 2005 Notice Seeking Comment on the Platinum
Section of the Jewelry Guides
A. Summary of Comments
The FTC received 62 comments in response to the 2005 FRN. The FRN
requested comments on two main issues--first, should the platinum
section of the Guides be amended to address jewelry products containing
at least 500 ppt, but less than 850 ppt, pure platinum and no other PGM
(``platinum/base metal alloy''); second, if guidance is appropriate,
what should the guidance provide. With regard to the first issue, the
majority of the comments recommend that the Commission revise the
Guides to include guidance regarding appropriate markings or
descriptions for platinum/base metal alloy jewelry products. A joint
comment from several jewelry trade associations\13\ (hereinafter
``JVC'') states that ``[i]ndustry members universally believe that the
Guides should be revised to address products that contain 500-850 ppt
pure platinum and no other PGM. Since products employing this alloy
(and others) have become available, clarity in marking and description
standards for these products is needed.''\14\ Similarly, a comment from
Platinum Guild International (``PGI'') recommends that ``the FTC amend
the Platinum Guides and provide for an unambiguous and transparent
standard.''\15\ The majority of the comments from jewelry retailers
support the JVC and PGI recommendations.\16\
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\13\ The associations include: Jewelers Vigilance Committee,
Manufacturing Jewelers and Suppliers of America, Jewelers of
America, and American Gem Society.
\14\ JVC comment at 3.
\15\ PGI comment at 24.
\16\ The following comments recommend that the Commission revise
the Guides to include guidance regarding products contain 500 ppt,
but less than 850 ppt, pure platinum and no other PGM: Kwiat; Albert
Malky, Inc.; John A. Green (Lux Bond & Green); Loyd Stanley (Stanley
Jewelers Gemologist); JCK Publishing; Traditional Jewelers; Cathy
Carmendy, Inc.; Joan Mansbach (Mansbach Creative); M. Fabrikant &
Sons; Renee Moskowitz (Harper's Bazaar); Nessi Erkmenaoglu (Harper's
Bazaar); Stephen Walker (Walker Metalsmiths, Inc.); Lieberfarb,
Inc.; Gemstones, Etc.; Saturn Jewels; Kaiser Time, Inc.; Coge Design
Group; Day's Jewelers; Stuller, Inc.; Harvey Rovinsky (Bernie
Robbins Fine Jewelry); JCM Designs, Inc., d/b/a Judith Conway;
Joseph Barnard (Bernie Robbins Fine Jewelry); Jeff Cooper, Inc.;
Alexander Primak Jewelry, Inc.; Hearts on Fire Co.; Kirk Kara; Vogue
Magazine; Allan Freilich (Freilich Jewelers, Inc.); Cede
Schmuckdesign GmbH; Representative Henry A. Waxman (writing on
behalf of Martin Katz, Ltd.); Grando, Inc.; Susan Eisen (Susan Eisen
Fine Jewelry and Watches); Zoltan David (Zoltan David Precious Metal
Art); and Brian Guymon.
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Karat Platinum's comment takes a contrary position. Karat Platinum
asserts that the Commission does not need to amend the Guides because
the existing guidance in the platinum section, combined with the staff
opinion letter issued in February 2005,\17\ adequately inform marketers
how to mark or describe such products.
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\17\See supra note 6.
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With regard to the second issue, commenters disagree about the
guidance the Commission should provide for the marketing of platinum/
base metal alloy jewelry. The JVC and PGI comments argue that the
Commission should revise the Guides to prohibit marketers from marking
or describing platinum/base metal alloy jewelry as ``platinum''
entirely.\18\ JVC and PGI assert that
[[Page 10193]]
platinum is not like gold, which requires mixing with an alloy to make
it more durable for jewelry.\19\ Platinum jewelry, JVC and PGI explain,
has always been produced as nearly pure or combined with other PGM. JVC
and PGI state that alloys with non-PGM do not share the same
characteristics as pure platinum or platinum alloyed with PGM.\20\
These comments assert that disclosure of the differences between the
two types of alloys would be complicated and highly technical and
likely engender significant consumer confusion and deception.\21\
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\18\ JVC comment at 4; PGI comment at 26. The following
additional comments support this recommendation: Kwiat; Albert
Malky, Inc.; John A. Green (Lux Bond & Green); C.F. Kisner, Inc.;
Loyd Stanley (Stanley Jewelers Gemologist); JCK Publishing; Dana
Sergenian; Traditional Jewelers; Cathy Carmendy, Inc.; Joan Mansbach
(Mansbach Creative); M. Fabrikant & Sons; Renee Moskowitz (Harper's
Bazaar); Nessi Erkmenaoglu (Harper's Bazaar); Robert Rowe (Lucky
Magazine); Lieberfard, Inc.; Richard Krementz Gemstones; Saturn
Jewels; Kaiser Time, Inc.; Hank Siegel (Hamilton Company); Vittorio
Bassan (Stuart Moore, Ltd.); Coge Design Group; Day's Jewelers;
Stuller, Inc.; Harvey Rovinsky (Bernie Robbins Fine Jewelry); JCM
Designs, Inc., d/b/a Judith Conway; Joseph Barnard (Bernie Robbins
Fine Jewelry); Jeff Cooper, Inc.; Alexander Primak Jewelry, Inc.;
Hearts on Fire Co.; Kirk Kara; Vogue Magazine; Allan Freilick
(Freilich Jewelers, Inc.); Cede Schmuckdesign GmbH; Representative
Henry A. Waxman (writing on behalf of Martin Katz, Ltd.); Grando,
Inc.; Susan Eisen (Susan Eisen Fine Jewelry and Watches); Zoltan
David (Zoltan David Precious Metal Art); Techform Advanced Casting
Technology; Douglas Liebman (Douglas M. Liebman, Inc.); Brian
Guymon; and Wayne Schenk.
\19\ JVC comment at 4; PGI comment at 16.
\20\ JVC comment at 7-8; PGI comment at 17-19.
\21\ JVC comment at 7; PGI comment at 15.
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As its primary support, PGI commissioned a study from Thomas J.
Maronick, titled ``Platinum Awareness Study: An Empirical Analysis of
Consumers' Perceptions of Platinum as an Option in Engagement Ring
Settings'' (``Maronick study''). The Maronick study polled 332
consumers, aged 21 through 34, who expect to become engaged in the next
12 months. PGI also submitted a 2003 marketing survey conducted by Hall
& Partners (``Hall & Partners study'') that consisted of 600 online
interviews of women (ages 18-34) and men (ages 25-34). Additionally,
PGI submitted two tests evaluating platinum/base metal alloys. The
first test, by Hoover & Strong, compared a product that contained 59.2%
platinum, 36.59% copper, 3.9% cobalt and trace amounts of gold, silver,
and nickel to three products, one containing 950 ppt pure platinum, one
containing 950 ppt palladium, and one containing 14 karat white gold.
The second test, by Daniel Ballard of Precious Metals West, evaluated
the properties of three different 585 ppt pure platinum/base metal
alloys. It does not appear that the PGI tests evaluated a product
identical in composition to the Karat Platinum platinum/base metal
alloy.
The Maronick study concludes that consumers expect a high level of
purity in a product marked ``platinum.'' The majority of consumers
surveyed stated that they would expect a ring labeled ``platinum'' to
contain 80% or more pure platinum.\22\ The Maronick study also reports
that if a ring has 40% or more non-PGM, over a third of the consumers
surveyed would not expect the ring to be called ``platinum.''\23\ If
the ring does not have all of the properties of pure platinum, more
than 50% percent of consumers polled would not expect it to be called
``platinum.''\24\ The study further reports that even if a platinum
product with 40% base metals shared all the properties of pure platinum
products, 29% of consumers would not expect the product to be called
``platinum.''\25\
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\22\ PGI Comment, Attachment A, at Table 3.
\23\Id., Table 7.
\24\Id., Table 11.
\25\Id., Table 8.
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In addition, according to the study, 88% of consumers polled felt
it was at least somewhat important to know the properties of a product
before purchase (two-thirds of these consumers felt it was very
important).\26\ The study further concludes that the properties
typically associated with platinum are important to most consumers'
purchasing decisions. Specifically, between 60% and 90% of consumers
polled responded that it was important to know a jewelry product's
weight (76.2%) and whether the product is durable (93%), scratch and
tarnish resistant (89.8% and 90.5%, respectively), able to be resized
(82.2%), and hypoallergenic (64.4%).\27\
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\26\Id., Table 12.
\27\Id., Table 13.
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To further support its position, PGI refers to the Hall & Partners
survey, which reported that the majority of consumers polled associate
rarity, strength, and purity with platinum jewelry.\28\ These consumers
also view platinum as superior to other metals.\29\
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\28\ PGI Comment, Attachment B, at 16, 28.
\29\Id. at 15, 25.
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The PGI and JVC comments assert that, because consumers understand
platinum jewelry to be a pure or nearly pure product, marking products
with lower amounts of pure platinum and no other PGM as ``platinum'' is
deceptive.\30\ JVC and PGI explain that consumers believe that using
the word ``platinum'' conveys that the product is pure and contains the
qualities consumers expect from traditional platinum jewelry.
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\30\ JVC comment at 7-8; PGI comment at 17-19.
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The PGI and JVC comments also assert that consumers do not
understand numeric jewelry markings listing metal content, such as
585Pt/0PGM or 585Pt./415 Co.Cu., or the karat systems used for gold
markings.\31\ The Maronick study asked consumers whether they knew what
585 plat; 0 pgm meant and only 5.2% responded yes.\32\ Of that 5.2%,
however, only two consumers (less than 1% of the total consumers
surveyed) correctly described the marking. The Maronick study also
probed whether consumers understood a platinum/base metal alloy
marking, ``585 plat; 415 CO/CU.'' Only 7.5% stated they knew what this
marking meant, but only 6.9% of those consumers actually understood
that the marking described the proportion of platinum and other metals
in the jewelry product.\33\ Similarly, with respect to gold markings,
the Maronick study reports that although 82.2% of respondents indicated
they knew what 14 karat gold meant, only 16% of those respondents
accurately indicated that it meant 58-59% gold.\34\
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\31\ PGI comment, Attachment A, Table 14. JVC notes that
consumers are not experts in the Periodic Table of Elements and
likely would not even know that ``Co'' is the abbreviation for
copper. JVC comment at 7.
\32\ PGI comment, Attachment A, at 25.
\33\Id. at 26.
\34\Id. at 24.
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In addition, the PGI product testing shows that certain platinum/
base metal alloys are inferior to platinum/other PGM alloys in terms of
wear and oxidation resistance, weight loss, and ability to withstand a
welding/soldering procedure for sizing.\35\ The testing further shows
that the platinum/base metal alloys in these tests may not be
hypoallergenic.\36\ It is not clear from the testing PGI submitted that
all platinum jewelry products with less than 850 ppt pure platinum
alloyed with base metals would yield the same test results. These tests
evaluated products with 58.5-59.2% pure platinum. The record does not
address whether products that contain a higher percentage of platinum,
or the same percentage of platinum alloyed with different base metals,
would produce different test results.
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\35\ PGI comment, Attachment C.
\36\ PGI comment, Attachment D.
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Based on their tests, JVC and PGI assert that, to avoid deception,
marketers would need to disclose how platinum/base metal alloy jewelry
products differ from traditional platinum jewelry in durability,
strength, hypoallergenic properties, weight, purity, scratch
resistance, tarnishability, and ability of jewelers to repair or resize
the product. PGI and JVC, however, contend that appropriate and
prominent disclosures addressing such extensive information are not
feasible at the retail level.\37\ Accordingly, JVC and PGI assert
[[Page 10194]]
that given consumers' perceptions of platinum jewelry, consumer
confusion regarding jewelry markings, and their testing data, the
appropriate course to avoid deception is to amend the Guides to state
that products that do not contain at least 50% platinum and a
combination of at least 950 ppt pure platinum and other PGM cannot be
marked or described ``platinum.''\38\
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\37\ PGI contends that the Hall & Partners study supports this
assertion. That study showed that only 25-30% of those people
surveyed responded that sales people explained the differences
between the different metals (gold, white gold, and platinum), and
only 22-24% of consumers surveyed believed that sales people helped
them to understand the differences. PGI comment, Attachment B.
\38\ JVC comment at 4; PGI comment at 26.
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JVC and PGI further submit that state laws in California, New York,
New Jersey, Illinois, and Wisconsin do not permit platinum/base metal
alloy jewelry products to be marked or described as ``platinum.'' These
state laws are based on historical Department of Commerce Voluntary
Product Standards (``VPS''). JVC explains that the five state statutes
require products to contain 950 ppt pure platinum (with solder) or 985
ppt (without solder) to be marked or marketed as ``platinum'' without
qualification.\39\ These statutes permit qualified platinum markings
for products with at least 500 ppt pure platinum and 950 ppt total
PGM.\40\
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\39\ PGI comment at 3, 9 & n.33; JVC comment at 2 & n.2. Both
PGI and JVC cite Cal. Bus. & Prof. Code Sec. Sec. 22120-22132; Ill.
Comp. Stat. Sec. Sec. 395/0.01-395/0.11 (Platinum Sales Act); N.J.
Stat. Sec. 51:6 (Platinum and Alloys); N.Y. Gen. Bus. Sec. Sec.
230-238 (Platinum Stamping); Wis. Stat. Sec. 134.33 (Platinum
Stamping).
\40\ The statutes require that marketers must disclose the
product composition indicating the number in ppt of each metal to
qualify the platinum marking. See Cal. Bus. & Prof. Code Sec. Sec.
22120-22132; Ill. Comp. Stat. Sec. Sec. 395/0.01-395/0.11 (Platinum
Sales Act); N.J. Stat. Sec. 51:6 (Platinum and Alloys); N.Y. Gen.
Bus. Sec. Sec. 230-238 (Platinum Stamping); Wis. Stat. Sec. 134.33
(Platinum Stamping).
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Finally, JVC and PGI state that the International Standards
Organization (``ISO'') standard for platinum markings also precludes
marking or describing products as platinum unless they contain at least
850 ppt pure platinum.\41\ JVC and PGI contend, that because many
countries have adopted ISO standards, platinum/base metal alloy jewelry
generally could not be marked as ``platinum'' if sold abroad.\42\
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\41\ JVC comment at 8 & n.4; PGI comment at 20 (both citing ISO
9202:1991(E), ``Jewellery - Fineness of precious metal alloys'').
PGI explained that the ISO standard provides for three values in ppt
for platinum jewelry: 950, 900, and 850. Id.
\42\ JVC comment at 8; PGI comment at 20.
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Karat Platinum disagrees with JVC's and PGI's positions on
virtually every point. First, Karat Platinum states, that if the
Commission determines that revising the Guides is appropriate, the
revised Guides should simply codify the language in the February 2005
staff opinion letter. Karat Platinum further asserts that its platinum/
base metal alloy does share almost all of the same qualities as
traditional platinum products.\43\ It submitted testing of its alloy
showing that it is superior to traditional platinum products in terms
of strength, hardness, and casting ability, and that its ability to
resist corrosion is equivalent to other platinum products. The only
attribute of potential difference, according to Karat Platinum's study,
is density--its platinum/base metal alloy is less dense.\44\ Karat
Platinum's test did not evaluate whether its alloy is hypoallergenic.
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\43\Karat Platinum comment at 2.
\44\Id. at 3 and Exhibit A.
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Karat Platinum further explains that, consistent with the FTC
staff's advice, it will disclose its product's full composition, which
will give consumers complete information about the content of the
product and promote it as a ``new product.''\45\ Karat Platinum did not
submit any consumer survey evidence evaluating how consumers interpret
its proposed marketing. It asserts, however, that consumers will
understand that its product contains less platinum than traditional
platinum jewelry because the description will put consumers on notice
about the amount of platinum in the product and the ``new''
representations will alert consumers that it is different.\46\ Karat
Platinum asserts that consumers do understand karat markings. Karat
Platinum argues that consumers know that gold has different levels of
purity and is alloyed with different metals, and will similarly
understand that platinum jewelry is not pure and is alloyed with
different metals.\47\
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\45\Id. at 4.
\46\Id. at 5.
\47\Id. at 6-7.
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Prohibiting marketers from using the word ``platinum'' because a
product contains less than 85% platinum and no other PGM will not
benefit consumers, according to Karat Platinum. This prohibition, Karat
Platinum contends, will deprive consumers of truthful and accurate
information about the product and the opportunity to own more
affordable, high quality platinum jewelry.\48\
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\48\Id. at 1.
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B. Analysis of the Comments
The record supports the following conclusions: (1) a substantial
number of consumers believe products marked or described as
``platinum'' are pure and possess certain desirable qualities; (2) a
substantial number of consumers generally would not expect platinum/
base metal alloy jewelry to be marked or described ``platinum''; (3)
many consumers do not fully understand numeric jewelry markings and
chemical symbols and may find them confusing; (4) testing data in the
record suggests that some platinum/base metal alloys do not possess all
of the qualities of higher purity platinum jewelry that consumers
expect; and (5) the consumer perception and product testing data
support revising the Guides to address the marketing of platinum/base
metal alloys, as explained below.
1. Consumer Perceptions Regarding the Use of the Term ``Platinum''
The survey evidence PGI submitted, particularly the Maronick study,
provides insight into consumer perceptions regarding the use of the
term ``platinum'' to describe jewelry. The Maronick study presents
evidence that many consumers understand that products marked or
described as ``platinum'' are pure or nearly pure and that certain
qualities or attributes typically associated with platinum are
important to a substantial number of consumers. These qualities or
attributes include the product's weight, durability, scratch and
tarnish resistance, and whether it is hypoallergenic and can be
resized.
2. Consumer Expectations Regarding Products Described as ``Platinum''
The Maronick study further found that a majority of consumers would
not expect platinum/base metal alloys containing more than 40% base
metal to be called ``platinum,'' particularly if they do not possess
the qualities and attributes present in higher purity platinum or
platinum/other PGM products, such as those containing at least 850 ppt
pure platinum, or at least 500 ppt pure platinum and at least 950 ppt
PGM. These findings indicate that many consumers have high expectations
regarding products described as platinum, and draw the conclusion that
such products possess certain qualities or attributes that make them
superior to products consisting of other metals (e.g., superior
strength, durability, and resistance to scratching and tarnishing).
3. Consumer Understanding of Numeric Jewelry Markings
The Maronick study also provides evidence that many consumers do
not fully understand numeric jewelry markings, particularly those using
chemical symbols, such as 585 Pt./415 Co.Cu. The Maronick study,
however, does not address what consumers take away from these numeric
and symbolic markings for platinum jewelry products. The study asked
consumers: ``Do you
[[Page 10195]]
know what `585plat, 415 CO/CU' means?'' If consumers said no, the study
did not ask follow up questions probing their actual understanding.\49\
While consumers clearly could not identify the metals represented by
the markings, it is not clear whether they understood that the product
contained platinum and two other metals or that it contained a lower
percentage of platinum than products without the markings. In a
potentially analogous situation, the Maronick study showed that, even
though many consumers cannot define the term ``14 karat gold''
accurately, the term does convey important information. Specifically,
consumers understand that ``14 karat'' represents the amount of gold in
the product, and that 18 karat gold jewelry contains more gold than 14
karat gold jewelry.\50\
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\49\ PGI Comment, Attachment A, at 42.
\50\Id. at 24.
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While numerical and chemical markings may provide some useful
information to consumers, the record indicates that even using full
names and no chemical abbreviations to disclose the composition of
platinum/base metal alloys may be inadequate. Specifically, the
Maronick study shows that many consumers expect products described as
platinum to have certain qualities and attributes, even if they consist
in part of non-platinum group metals. Disclosure using full chemical
names, therefore, might not provide adequate notice that the product
may differ from products containing at least 850 ppt pure platinum, or
at least 500 ppt pure platinum and at least 950 ppt PGM, with respect
to one or more qualities or attributes important to consumers.
4. Testing Data of Platinum/Base Metal Alloys
It is, therefore, important to determine whether platinum/base
metal alloys have the same properties as products containing at least
850 ppt pure platinum, or at least 500 ppt pure platinum and at least
950 ppt PGM. The record provides a useful, albeit inconclusive, answer.
Specifically, the record suggests that at least some platinum/base
metal alloys do not possess all of the qualities of products containing
at least 850 ppt pure platinum, or at least 500 ppt pure platinum and
at least 950 ppt PGM. On one hand, PGI's testing indicates that certain
platinum/base metal alloys are inferior to higher purity platinum
jewelry in terms of wear and oxidation resistance, as well as weight
loss, and that they cannot be resized using certain procedures.\51\ On
the other hand, Karat Platinum's testing suggests that its alloy is
superior or equivalent to higher purity platinum jewelry in several
respects. Karat Platinum's testing, however, showed that its alloy is
less dense than higher purity platinum jewelry, and it did not test
whether the alloy is hypoallergenic.
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\51\ PGI did not test Karat Platinum's alloy.
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Accordingly, the record is incomplete regarding the extent to which
platinum/base metal alloys differ from higher purity platinum or
platinum/other PGM jewelry with respect to those qualities material to
consumers' purchasing decisions. The record is also incomplete
regarding the extent to which the qualities and attributes of jewelry
differ depending on the percentage of platinum and the type and
percentage of base metal in the jewelry. The record does indicate,
however, that at least some platinum/base metal alloys likely do not
have all, or substantially all, of the qualities or attributes that
consumers view as important in purer platinum products, such as those
containing at least 850 ppt pure platinum, or at least 500 ppt pure
platinum and at least 950 ppt PGM.
5. The Record Supports Amending the Platinum Section of the Guides
The record on consumer perception and the product testing described
above supports amending the Guides to address the marketing of
platinum/base metal alloys. In particular, the record supports revising
the Guides to state that marketers may describe platinum/base metal
alloys as platinum, provided they adequately qualify the claim.
The platinum section of the FTC's Jewelry Guides currently provides
that the unqualified use of the word ``platinum'' is deceptive for
products that do not contain 950 ppt or more pure platinum. It also
provides guidance on how marketers may qualify the word to describe
certain products containing less than 950 ppt pure platinum. The
Guides, however, do not address claims for products containing at least
500 ppt pure platinum alloyed with base metals. The JVC, PGI, and
numerous retailers recommend that the FTC amend the platinum section of
the Guides to state that even the qualified use of the word
``platinum'' to describe these products would deceive consumers.\52\
Based on the current record, however, the Commission cannot conclude
that the properly qualified use of the word platinum to describe every
platinum/base metal alloy would materially mislead consumers.
Accordingly, we do not propose to amend the Guides in this manner.
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\52\ JVC and PGI acknowledge that a qualified use of the word
``platinum'' could, in theory, address consumer confusion or
deception stemming from the use of the term ``platinum'' to describe
platinum/base metal alloys. Yet, JVC and PGI assert that it would be
impracticable and likely ineffective to make the lengthy, detailed
disclosures that they believe would be needed to prevent deception.
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The weight of the evidence leads us to conclude that there is a
high probability of consumer deception if marketers describe platinum/
base metal alloys as ``platinum'' qualified only with a disclosure of
the product's metal content using numbers and chemical
abbreviations.\53\ As discussed above, the record indicates that many
consumers have pre-existing beliefs about the qualities of products
marked or described as ``platinum,'' and at least some platinum/base
metal alloys may not meet their expectations. The record also provides
evidence that numeric markings and chemical abbreviations confuse many
consumers. Thus, describing a platinum/base metal alloy as platinum and
disclosing its metal content using numbers and chemical abbreviations
would most likely fail to inform many consumers that the product
differs from traditional platinum products with respect to the
product's purity as well as the qualities and attributes important to
consumers. The record, therefore, demonstrates that marketers selling
platinum/base metal alloys should disclose more detailed information to
prevent deception.
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\53\ Karat Platinum's suggestion that it will also market the
product as ``new,'' which, it contends, conveys that the product
differs from traditional platinum products and should prompt
consumers to seek information about the product, is, at best, a
temporary solution. Karat Platinum presumably will not market this
product as ``new'' forever. In any event, a mere representation that
a product is new would not disclose how it differs from products
containing a higher percentage of platinum.
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To address potential consumer confusion regarding numbers and
chemical abbreviations, the Commission proposes amending the Guides to
state that marketers of platinum/base metal alloys described as
platinum should expressly disclose that the product contains platinum
and other non-platinum group metals and also separately disclose the
product's full composition, by name and not abbreviation, and the
percentage of each other metal in the product.\54\ By
[[Page 10196]]
disclosing the composition of the jewelry in this manner, marketers
would alert consumers to the presence of particular metals and help
prevent deception regarding the purity of products described as
platinum.
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\54\ This disclosure provides for the use of percentages rather
than ppt because the survey evidence revealed that ppt markings,
like numbers and chemical abbreviations, confuse consumers. The
other provisions of the platinum section of the Guides provide for
compositional disclosures using ppt. As discussed below, the
proposed amendment would allow for the physical stamping of
platinum/base metal alloy jewelry using ppt and chemical
abbreviations. It is only the full composition disclosure that will
differ in that it provides for the use of percentages.
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For the reasons noted above, a full name composition disclosure
should alleviate the confusion regarding a platinum/base metal alloy
product's purity but would not necessarily alleviate all confusion
regarding the product's other properties. The record demonstrates that
use of the word ``platinum,'' even in conjunction with a compositional
disclosure, conveys important quality information to consumers (i.e.,
that the product possesses qualities typically associated with
platinum). As such, the record indicates a need for additional
disclosure to prevent deception. Therefore, the proposed Guides state
that marketers should expressly disclose that a platinum/base metal
alloy product may not have all the properties that consumers associate
with higher purity platinum/other PGM products.
The record does not address whether the term Karat Platinum or
other qualifying moniker, either in conjunction with a compositional
disclosure or without one, might imply that the product either differs
in some respects from other products containing platinum or is
comparable to other such products in material respects. Thus, we do not
have a basis to conclude that use of the term Karat Platinum or other
qualifying moniker will sufficiently alert consumers to the potential
differences between platinum/base metal alloy jewelry products and
higher purity platinum/other PGM products with respect to the
properties material to consumers.
As noted earlier, the record does not include sufficient evidence
for the Commission to identify which platinum/base metal alloys differ
from products containing at least 850 ppt pure platinum, or at least
500 ppt pure platinum and at least 950 ppt PGM, and with respect to
which attributes. Some platinum/base metal alloys, however, may be
equivalent to products containing at least 850 ppt pure platinum, or at
least 500 ppt pure platinum and at least 950 ppt PGM, with respect to
some, or all, of the attributes important to consumers depending upon
the percentage of platinum and both the percentages and types of base
metals. For this reason, the proposed amendment provides that a
marketer need not disclose that its product may not have the same
attributes or properties as products containing at least 850 ppt pure
platinum, or at least 500 ppt pure platinum and at least 950 ppt PGM,
if the marketer has competent and reliable scientific evidence that,
with respect to all attributes or properties material to consumers
(e.g., the product's durability, hypoallergenicity, resistance to
tarnishing and scratching, and the ability to resize or repair the
product), such product is equivalent to products containing at least
850 ppt pure platinum, or at least 500 ppt pure platinum and at least
950 ppt PGM.
C. Harmonization with State Law and International Standards
The record includes evidence that laws in at least five states and
an ISO standard that some countries have adopted do not permit
platinum/base metal alloy products to be marked or described as
``platinum.'' Thus, JVC and PGI contend that, if the FTC issues
guidance allowing such products to be marked as ``platinum,'' our
Guides will conflict with state law and international standards.
Although the Commission generally prefers to harmonize its guidance
with state and international laws and standards, Commission Guides must
be based upon the Section 5 deception or unfairness standard.\55\
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\55\ The Trade Agreements Act of 1979 states that no federal
agency ``may engage in standards-related activity that creates
unnecessary obstacles to the foreign commerce of the United States
and that federal agencies must, in developing standards take into
consideration international standards and shall, if appropriate,
base the standards on international standards.'' 19 U.S.C. Sec.
2532(2)(A). The term ``standard'' in the Act includes guidelines
that are not mandatory, such as the Jewelry Guides. The Act
provides, however, that ``the prevention of deceptive practices'' is
an area where basing a standard on an international standard ``may
not be appropriate.'' Id. at Sec. 2532(2)(B)(i)(II).
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The state laws and the ISO standard discussed above are not based
upon a deception or unfairness standard. As explained above, the state
laws that JVC and PGI cite are based upon VPS that the Department of
Commerce promulgated 75 years ago.\56\ VPS are developed through
general consensus among affected parties.\57\ Similarly, ISO standards
are technical industry standards developed through a consensus-building
process.\58\ Accordingly, although harmonization with state laws and
international standards is typically favored, where, as here, our
analysis of consumer perception data reveals that there is insufficient
evidence that a particular claim (i.e., a qualified platinum
representation) is deceptive, the Commission cannot promulgate a guide
stating that marketers should not make the representation solely to
achieve harmony.
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\56\ 61 FR 27185 n.99 (May 30, 1996) (explaining that the
Commerce standards were promulgated in 1933).
\57\See 15 C.F.R. Part 10.3 (setting forth the procedures for
the development of VPS). The states'statutes adopted the VPS
verbatim many years ago (e.g., California in 1941; New York in 1965;
Wisconsin in 1979). Even if the states conducted an independent
deception analysis when they adopted these standards, it is likely
that consumer perception regarding platinum representations and the
marketplace has changed over time. Indeed, it does not appear that
any platinum/base metal alloy jewelry products marketed as platinum
existed when the states adopted these standards. In addition, these
state statutes already conflict with the current platinum Guides.
The Commission revised the Guides in 1997 to harmonize the treatment
of platinum products containing 850, 900, or 950 ppt pure platinum
with the ISO standard and to simplify the Commission's guidance for
products containing less than 850 ppt, but more than 500 ppt, pure
platinum and 950 ppt PGM. The state statutes mirror the FTC's pre-
1997 Guides for these categories of platinum products. For example,
the state statutes provide that products containing at least 750
ppt, but less than 950 ppt pure platinum (with solder; 985 ppt
without solder) and 950 ppt PGM, may be marked platinum provided the
name or abbreviation of the other PGM that predominates precedes the
word platinum (e.g., Irid-Plat.). See, e.g., N.Y. Gen. Bus. Law
Sec. 234(b). Consistent with the ISO standard, the current Guides
provide that products containing 850 ppt or more pure platinum may
be ``platinum'' provided the name or abbreviation is preceded with
the amount in ppt of the platinum in the product. For products
containing at least 750 ppt, but less than 850 ppt, pure platinum
and 950 ppt other PGM, the Guides provide that marketers should
disclose both the amount in ppt of pure platinum in the product and
other PGM. 16 C.F.R. Sec. Sec. 23.7(c)(3-4).
\58\See www.iso.org/iso/standards_development/process_and_procedures/ how_are_standards_ developed.htm (explaining that ISO
standards are developed through a consensus-building phase that
takes into account the views of manufacturers, vendors and users,
consumer groups, testing laboratories, engineering professionals,
and research organizations).
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IV. Proposed Amendment to Platinum Section of the Jewelry Guides
A. Proposed Amendment
Based on the analysis above, the Commission seeks comment on a
proposed amendment to Section 23.7(b) of the Jewelry Guides. The
proposed amendment would allow marketers to physically mark or stamp
platinum/base metal alloy jewelry with a standard platinum jewelry
marking that lists the product's chemical composition (e.g., 585 Pt./
415 Co.Cu.), but also states that when making any other representation
that the product contains platinum they should disclose additional
information. This proposed amendment states that, to avoid misleading
consumers, marketers should clearly and conspicuously disclose,
immediately following the name or description of the product: (i) that
the product contains platinum and
[[Page 10197]]
other non-platinum group metals;\59\ (ii) the product's full
composition, by name and not abbreviation, and the percentage of each
metal;\60\ and (iii) that the product may not have the same attributes
or properties as products containing at least 850 ppt pure platinum, or
at least 500 ppt pure platinum and at least 950 ppt PGM.\61\
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\59\ The proposed Guide provides for this disclosure for
products that contain at least 500 parts per thousand, but less than
850 parts per thousand, pure Platinum, and do not contain at least
950 parts per thousand PGM. As such the provision applies to
platinum/base metal alloys but would also apply to a product that
contains platinum, base metals, and other platinum group metals--
e.g., 58.5% Platinum, 35% Copper/Cobalt, 10% Iridium. The second
disclosure, providing for a full name compositional disclosure,
would inform consumers of the presence of the other platinum group
metals in the product. Nothing in the Guide, however, would prohibit
marketers from also truthfully disclosing in this first disclosure
that the product contains other platinum group metals (e.g., this
product contains platinum, other platinum group metals and other
non-platinum group metals).
\60\ The proposed Guide provides that when using percentages to
qualify platinum representations, marketers should convert the
amount in parts per thousand to a percentage that is accurate to the
first decimal place (e.g., 58.5% Platinum, 41.5% Copper/Cobalt).
\61\ By making the second of these disclosures, a marketer would
not satisfy the requirements of the first disclosure. Specifically,
a consumer who received the composition disclosure would only
understand that the alloy contained non-platinum group metals if he
or she knew which metals comprised that group. The record, however,
while not specifically addressing this issue, tends to demonstrate
that many consumers do not have a clear understanding of metal
alloys. Therefore, the first and second disclosures are necessary.
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As noted above, the record indicates that a substantial percentage
of consumers believe products described as ``platinum'' are pure. The
first proposed disclosure will inform consumers directly that the
product is not pure. In addition, by stating that marketers should
include the full name, not the abbreviation, of each metal, the second
disclosure will alleviate consumer confusion regarding numerical,
abbreviated descriptions of jewelry content. The third proposed
disclosure is designed to avert deception regarding quality information
conveyed by the term platinum that the record demonstrates likely will
not be addressed by a content disclosure alone.
However, because some platinum/base alloy products may possess all
the attributes or qualities of platinum jewelry that are important to
consumers, the proposed amendment contains an additional provision.
That provision provides that a marketer does not need to make this
third disclosure if the marketer has competent and reliable scientific
evidence that, with respect to all attributes or properties material to
consumers (e.g., the product's durability, hypoallergenicity,
resistance to tarnishing and scratching, and the ability to resize or
repair the product), such product is equivalent to products containing
at least 850 ppt pure platinum, or at least 500 ppt pure platinum and
at least 950 ppt PGM.
The proposed amendment does not contain a definitive listing of the
attributes or properties material to consumers, nor does it specify the
type of scientific substantiation necessary to avoid making the
disclosure. Because the attributes or properties material to consumers
and the nature of the substantiation may change over time, the
Commission believes that flexible guidance is appropriate and that
members of the jewelry industry are well-positioned to comply with such
guidance. The Commission seeks comment on whether such guidance is
sufficiently precise for marketers to avoid deceiving consumers
regarding platinum/base metal alloys.
B. Text of the Proposed Amendment
The Commission proposes adding Section 23.7(b)(4) to the Jewelry
Guides as an additional example of markings or descriptions of platinum
that may be misleading.
The text of the proposed amendment of Section 23.7(b)(4) is as
follows:
(4) Use of the word ``Platinum,'' or any abbreviation accompanied
by a number or percentage indicating the parts per thousand of pure
Platinum contained in the product, to describe all or part of an
industry product that contains at least 500 parts per thousand, but
less than 850 parts per thousand, pure Platinum, and does not contain
at least 950 parts per thousand PGM (for example, ``585 Plat.'')
without a clear and conspicuous disclosure, immediately following the
name or description of such product:
(i) that the product contains Platinum and other non-platinum group
metals;
(ii) the full composition of the product (by name and not
abbreviation) and percentage of each metal; and
(iii) that the product may not have the same attributes or properties
as products containing at least 850 parts per thousand pure Platinum,
or at least 500 parts per thousand pure Platinum and at least 950 parts
per thousand PGM.
Provided, however, that the marketer need not make disclosure
23.7(b)(4)(iii), above, if the marketer has competent and reliable
scientific evidence that, with respect to all attributes or properties
material to consumers (e.g., the product's durability,
hypoallergenicity, resistance to tarnishing and scratching, and the
ability to resize or repair the product), such product is equivalent to
products containing at least 850 parts per thousand pure Platinum, or
at least 500 parts per thousand pure Platinum and at least 950 parts
per thousand PGM.
Provided, further, a product that contains at least 500 parts per
thousand, but less than 850 parts per thousand, pure Platinum, and does
not contain at least 950 parts per thousand PGM, may be marked or
stamped accurately, with a quality marking on the article, using parts
per thousand and standard chemical abbreviations (e.g., 585 Pt., 415
Co.Cu.).
Note to Sec. 23.7(b)(4): When using percentages to qualify platinum
representations, marketers should convert the amount in parts per
thousand to a percentage that is accurate to the first decimal place
(e.g., 58.5% Platinum, 41.5% Copper/Cobalt).
V. Request for Public Comment
The Commission seeks public comment on a proposed amendment to the
platinum section of the Jewelry Guides that provides guidance on how to
mark or describe non-deceptively products that contain at least 500
ppt, but less than 850 ppt, pure platinum, and that do not contain at
least 950 parts per thousand PGM. In addition, the Commission seeks
public comment on whether it should revise the Guides to provide
guidance on how to mark or describe platinum-clad, filled, plated, or
overlay products.\62\
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\62\See 16 CFR 23.4 and 23.6 (addressing gold-plated, gold-
filled, gold-overlay, gold-electroplated, and silver-plated jewelry
products).
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The Commission requests written responses to any or all of the
following questions. The Commission requests that responses be as
specific as possible, including a reference to the question being
answered, and a reference to empirical data or other evidence wherever
available and appropriate.
1. Should the Commission amend the platinum section of the Jewelry
Guides by adopting the proposed amendment?
a. If so, why? Please provide any evidence that supports your
answer.
b. If not, why not? Please provide any evidence that supports your
answer.
2. Should the Commission revise the language in the proposed amendment
to provide for additional disclosures to ensure that consumers are not
misled, for example, by including additional, more detailed disclosures
regarding how products that contain at least 500 ppt, but less than 850
ppt, pure platinum, and that do not contain at least 950 parts per
thousand PGM, differ from
[[Page 10198]]
traditional platinum products\63\ in terms of purity and rarity?
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\63\ ``Traditional Platinum Products'' referred to in these
questions means products containing at least 850 ppt pure platinum,
or at least 500 ppt pure platinum and at least 950 ppt total PGM.
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a. If so, how and why?
b. What evidence supports making your proposed revision(s)? Please
provide this evidence and explain why any such revision is necessary to
ensure that consumers are not misled.
c. If not, why not? Please provide any evidence that supports your
answer.
3. Should the Commission revise the language in the proposed amendment
to state that the disclosures should be physically attached to the
jewelry product?
a. If so, how and why?
b. What evidence supports making your proposed revision(s)? Please
provide this evidence and explain why any such revision is necessary to
ensure that consumers are not misled.
c. If not, why not? Please provide any evidence that supports your
answer.
4. Should the Commission revise the language in the proposed amendment
to provide that marketers need only make the third disclosure that the
platinum/base metal alloy may not have the same attributes or
properties as traditional platinum products, if they represent
expressly or by implication that such product has one or more of the
same attributes or properties as traditional platinum products (i.e., a
triggered disclosure)?
a. If so, how and why?
b. What evidence supports making your proposed revision(s)? Please
provide this evidence and explain why any such revision is necessary to
ensure that consumers are not misled.
c. Is there any evidence indicating that the disclosure of the
product's full composition will sufficiently alert consumers to the
differences between platinum/base metal alloys and traditional platinum
products containing a higher percentage of platinum or other PGM? If
so, please provide this evidence.
d. If not, why not? Please provide any evidence that supports your
answer.
5. Is there a specific word or phrase that could be used to describe
products that contain at least 500 ppt, but less than 850 ppt, pure
platinum, and that do not contain at least 950 parts per thousand PGM,
that would adequately convey that such products differ from traditional
platinum products?
a. If so, please identify such word or phrase and provide evidence
demonstrating that it adequately conveys the differences between the
products.
b. Would the term ``platinum alloy,'' if used to describe products
that contain at least 500 ppt, but less than 850 ppt, pure platinum,
and that do not contain at least 950 parts per thousand PGM, adequately
convey that such products differ from traditional platinum products?
Please provide any evidence that supports your answer.
c. Should the Commission revise the language in the proposed
amendment to address the use of such a specific word or phrase to
describe products that contain at least 500 ppt, but less than 850 ppt,
pure platinum, and that do not contain at least 950 parts per thousand
PGM?
(1) If so, how and why?
(2) What evidence supports making your proposed revision(s)? Please
provide this evidence and explain why such language adequately conveys
the differences between the products.
(3) If not, why not? Please provide any evidence that supports your
answer.
6. What, if any, additional disclosures are necessary to explain
that a product that contains at least 500 ppt, but less than 850 ppt,
pure platinum, and that does not contain at least 950 parts per
thousand PGM, may not have the same attributes as traditional platinum
products?
a. Should the Commission revise the language in the proposed
amendment to require any such additional disclosures? How and why?
b. What evidence supports making your proposed revision(s)? Please
provide this evidence.
c. If such disclosures are necessary, please explain the manner and
form in which marketers should make them to ensure that they are clear
and conspicuous to consumers.
7. The proposed amendment provides that marketers disclose the full
composition of the platinum/base metal alloy using full, unabbreviated
names and the percentage of each metal. Other provisions in the
platinum sections of the Jewelry Guides provide for compositional
disclosures using parts per thousand. Will the use of percentages for
this disclosure confuse consumers?
a. If so, please provide any evidence that supports your answer.
b. If evidence does indicate that percentage disclosures will
confuse consumers because the other platinum sections use parts per
thousand, is there other evidence that indicates that the benefits of a
percentage disclosure will outweigh the confusion?
c. If not, why not? Please provide any evidence that supports your
answer.
8. What evidence, not submitted in response to the Commission's earlier
request for comment, indicates what specific properties are important
to consumers when purchasing a product marked or described as
``platinum''? If there is such evidence, please provide this evidence.
9. Is there evidence indicating the meaning consumers take from
qualified platinum markings using abbreviations and chemical symbols
(e.g., 585 Pt., 415 Co.Cu.)? If so, please provide this evidence.
10. Is there evidence indicating the meaning consumers take from
qualified platinum markings using full-name compositional disclosures
(e.g., 58.5% Platinum, 41.5% Copper/Cobalt)? If so, please provide this
evidence.
11. Is there evidence indicating whether consumers think that products
that contain at least 500 ppt, but less than 850 ppt, pure platinum,
and that do not contain at least 950 parts per thousand PGM, share the
qualities, such as durability, luster, density, scratch and tarnish
resistance, ability to resize or repair, and hypoallergenicity, that
are associated with traditional platinum products? If so, please
provide this evidence.
12. Is there evidence indicating what qualities consumers associate
with non-platinum PGM products (products made with platinum group
metals other than platinum, e.g., palladium, iridium), such as
durability, luster, density, scratch and tarnish resistance, ability to
resize and repair, and hypoallergenicity, that are associated with
traditional platinum products? If so, please provide this evidence.
13. What constitutes ``competent and reliable scientific evidence'' to
substantiate representations regarding the qualities material to
consumers, such as the durability, luster, density, scratch and tarnish
resistance, ability to resize and repair, and hypoallergenicity of
traditional platinum products and products that contain at least 500
ppt, but less than 850 ppt, pure platinum, and that do not contain at
least 950 parts per thousand PGM? Please provide any evidence that
supports your answer.
14. Describe in detail the scientific tests used to determine or
substantiate representations regarding the qualities material to
consumers, such as the durability, luster, density, scratch and tarnish
resistance, ability to resize and repair, and hypoallergenicity, of
traditional platinum products and products that contain at least 500
ppt, but less than 850 ppt, pure platinum, and that do not contain at
least 950 parts per thousand PGM. Please provide any evidence that
supports your answer.
15. Describe in detail any differences between alloys that contain at
least 500
[[Page 10199]]
ppt, but less than 850 ppt, pure platinum, and that do not contain at
least 950 parts per thousand PGM, and traditional platinum products in
terms of the qualities material to consumers, such as durability,
luster, density, scratch and tarnish resistance, ability to resize and
repair, and hypoallergenicity. Please explain the basis for your answer
and provide evidence that supports your answer.
16. Is there evidence indicating what the terms ``Karat Platinum,''
``Platifina,'' ``Platinum V,'' and ``Platinum 5'' mean to consumers? If
so, please provide this evidence.
17. Do consumers associate the terms ``Karat Platinum,'' ``Platifina,''
``Platinum V,'' and ``Platinum 5'' with the qualities, such as
durability, luster, density, scratch and tarnish resistance, ability to
resize and repair, and hypoallergenicity, that are associated with
traditional platinum products? If so, please provide any evidence that
supports your answer.
18. Is there evidence indicating what the phrase ``other non-platinum
group metals'' means to consumers? If so, please provide this evidence.
19. Should the Commission amend the platinum section of the Jewelry
Guides to address other products that contain platinum, such as
platinum-clad, filled, plated, coated, or overlay products, that are
not currently addressed in the section?
a. If so, how and why?
b. What evidence supports making your proposed revision(s)? Please
provide this evidence and explain why any such revision is necessary to
ensure that consumers are not misled including specific guidance as to
the recommended thickness of the filling, plating, or overlay of such
platinum products.
c. If not, why not?
VI. Communications by Outside Parties to Commissioners or Their
Advisors
Written communications and summaries or transcripts of oral
communications respecting the merits of this proceeding from any
outside party to any Commissioner or Commissioner's advisor will be
placed on the public record. See 16 CFR 1.26(b)(4).
All comments should be filed as prescribed in the ADDRESSES section
above, and must be received on or before May 27, 2008.
By direction of the Commission.
Donald S. Clark
Secretary
[FR Doc. E8-3594 Filed 2-25-08: 8:45 am]
BILLING CODE 6750-01-S