The Platinum Controversy

The inconsistencies of life are endlessly interesting. Consider Hurricane Katrina and the justified criticism of the federal government for moving too slowly and awkwardly in addressing the aftermath of the storm, especially the human suffering and tragedy that resulted. In another galaxy, far, far away, the Federal Trade Commission, in what appears to be record time, decided to issue a staff opinion on the use of the word “platinum” based on the application of one firm. Interesting, isn’t it?

How is it possible for the FTC to conclude, with what some might call breakneck speed, a decision on a subject that elicits such a wide range of opinion? On the one hand there is a considerable body of opinion in the industry that believes referring to platinum product as “platinum” with anything less than 950 parts per thousand of pure platinum with solder or 985 parts per thousand of platinum without solder is deceptive and misleading.

On the other side of the aisle, there are those who see a business opportunity to mirror gold karatage nomenclature and apply it to platinum products to bring pricing into a more popular price range. The situation is not dissimilar to the old argument applied to simulated, synthetic products versus natural gemstones.

It is clear to many that products containing platinum of less than 950 or 985 parts per thousand are now on the market or will be on the market soon. As a practical matter you can argue both sides of this question. It seems to me, however, that the real issue in front of the industry is not whether or not it is one, but to recognize reality and craft a workable, satisfactory solution to the question.

In 1978, the FTC and the Jewelers Vigilance Committee engaged in an industry dialogue for the revision of the FTC Guides. Opinions were solicited from every quarter of the industry: Retailers, wholesalers, manufacturers, gemstone dealers, diamond dealers, pearl dealers, and the television networks selling jewelry all were invited to comment on the Guides.

The process was a long one. Perhaps it was too long. The important point was that there was much discussion, debate, disagreement, and, finally, resolution and agreement. It is an interesting fact of democracy that individuals do want to have a say when a proposal is made that will directly affect them.

The FTC has an obligation to follow through on questions such as this, because the ramifications—real and imagined—can significantly affect many in the industry, and consumers as well. As such, the agency should call for industry comment from a wide perspective. This is not to denigrate the efforts of Cecilia Gardner and the Jewelers Vigilance Committee, who quickly and effectively marshaled the resources of JVC, Manufacturing Jewelers and Suppliers of America, the American Gem Society, and Jewelers of America to poll their members on this matter. It is, however, a rebuke to the FTC for not soliciting opinions from many over a reasonable time period rather than rushing to judgment.

Federal speed is desirable in responding to emergencies like Hurricane Katrina. Speed in considering a long-held definitional principle of platinum might well create a storm of a sizable though different magnitude for the jewelry industry.