Buyer Beware...Lab Grown Diamonds vs. Mined Diamonds, Ongoing, Updated Information
If you're shopping for diamond, make sure you ask if it's a lab-grown diamond. Lab grown diamonds have the exact carbon structure as mined diamonds and are indistinguishable from natural diamonds without testing equipment.
An expensive device developed by DeBeers for diamond dealers is an instrument which uses ultraviolet light to detect the difference between natural and lab grown diamonds. Lab grown diamonds will show a strong phosphorescent glow that is not common to natural diamonds.
Some say the development of lab-grown diamonds are exactly the same as mined diamonds. This statement is causing an upheaval in the jewelry industry.
Lab grown diamonds are promoted as ecologically progressive, however this has not been documented or proven. My concern is the lack of disclosures about what the waste byproducts are comprised of and the disposal procedures. We should be asking questions; how is this affecting our environment? Without this information how can lab grown diamonds be marketed as environmentally safe?
Lab grown diamonds are produced world wide; is not a futuristic idea. Produced in large to very small sizes by several private companies, including DeBeers and the Swarovski Group.
The process starts by placing a small sliver of a mined diamond (called a seed) into a machine which will ultimately produce a larger diamond with the use of gases under high temperatures and pressure which aids in the binding of carbon molecules to the seed diamond to increase in size.
One of the first diamonds made for commercial sales was a ten carat diamond by a Russian diamond lab in 2015.
The cost difference of lab grown diamonds are currently 20%-30% less (expected to drop) than mined diamonds. This discounted amount will make it possible for more people to wear diamonds; comparable to the history of culturing pearls in the early twentieth century enabling more affordable pearls.
However, in my opinion, as more lab grown diamonds are produced worldwide the economics of 'supply and demand' will affect the overall pricing...similar to the cultured pearl industry years ago.
The term 'cultivated diamond' is used incorrectly to represent lab grown diamonds. For example, a cultured pearl is produced from oysters that are raised in 'farm' like conditions.
Diamonds do not grow; the molecular structure is expanding with additions of carbon molecules due to the properties of carbon in certain conditions that a lab is providing.
Make sure that you are aware of what you are purchasing. Lab grown should be fully disclosed to the buyer and sold with certificates.
Russel Shor, from the Gemological Institute for America believes that the desire for mined diamonds will remain because "it comes from deep from Mother Earth...they are billions of years old, probably, the oldest thing we can buy."
The abbreviations you should know when purchasing a diamond: The Gemological Institute of America (GIA) identifying stones that laboratories have produced using chemical vapor deposition (CVD) or High Pressure-High Temperature (HPHT).
I frequently post ongoing discussions and links to information about the pros and cons of lab grown diamonds vs. mined diamonds.
Language changes. In jewelry, terminology usually grows out of a trend or the evolution of an idea.
One of the most well-known contemporary examples of a nickname entering the official jewelry vocabulary is when diamond line bracelets became tennis bracelets afterChris Evertdropped hers on the court while playing in the 1978 U.S. Open.
During the 1920s, rectangular shaped diamonds were designated as emerald-cut diamonds because the shape was a popular one for emeralds. It was also a new shape for diamonds that was achieved with advancements in diamond cutting. The name “emerald-cut diamond” has stuck despite the fact that it feels like a misnomer.
It’s not a coincidence that both of these examples are related to diamonds. The gem has gone through more changes in terminology over the years than any other area in the jewelry field. One reason for the steady evolution stems from the fact that diamonds are such an important ingredient in fine jewelry. “Diamonds are the common denominator of jewelry,” is how Nicola Bulgari succinctly explained it to me when I was interviewing him for my bookDiamonds: A Century of Spectacular.
One of the watershed moments in modern diamond terminology happened in the early 1940s when the 4Cs concept was launched by the Gemological Institute of America’s founder Robert M. Shipley. The master gemologist came up with the mnemonic aid to help people have a better understanding of the qualities a gem is judged by: cut, clarity, color and carat weight. Needless to say, the idea caught on.
Diamond grading as we know it today was another program invented by the GIA. In 1953, a team of gemologists lead by Richard T. Liddicoat came up with a color scale for diamonds ranging from D to Z. People often wonder why the best color grade is “D” as opposed to “A.” The answer relates to the color scale it replaced. Gems were once unsystematically graded A, AA and AAA. The new set of letters beginning with D moved far away from that. Somewhat counterintuitively, the thinking at the GIA was to begin with a letter for the best quality that had a negative connotation so it wouldn’t be misused.
Today, diamond terminology is being updated again. Diamonds mined from the earth have been rechristened natural diamonds. Promotion of the name change is being spearheaded by the Natural Diamond Council, a group formerly known as the Diamond Producers Association (DPA), that is composed of seven diamond producers: Alrosa, De Beers, Dominion, Lucara, Murowa Diamonds, Petra and Rio Tinto.
‘GMA’ and the Consumer Who Bought an Undisclosed Lab-Grown Diamond
It was a story that the industry had long feared, but perhaps knew would eventually come.
The unwelcome wake-up call aired on Thursday’s episode of Good Morning America.The ABC news show ran a segment featuring a consumer who bought a diamond that she thought was natural, but turned out to be lab-grown.
According to the show, Molly Carlson bought her diamond engagement ring at an unnamed “jewelry store at a local mall.”
“I took it to another jewelry store, and I said, ‘What can you tell me about my ring?’ ” she said. “And they told me, ‘Well, I can tell you, it’s not a natural diamond.’ ”
“Turns out, Molly’s dream diamond was actually a diamond created in a lab,” said reporter Amy Robach.
“[The salesperson mentioned] the style, the, color, and the clarity,” said Molly’s fiancé, Scott Long. “But never once, this is lab.”
The show pointed out that that the Federal Trade Commission’sJewelry Guidessay that retailers must clearly and conspicuously tell customers if their diamond is man-made. full article
The Lab-Grown Diamond Patent Battle Is Heating Up
To grow diamonds, you need a lot of heat and pressure. And now, we’re seeing that on the legal front as well.
On Friday, the High Court of Singapore ruled that diamond grower IIa Technologies had infringed on a patent (SG 872) held by De Beers’ industrial diamond division, Element Six.
The patent relates to the production of diamonds using the chemical vapor deposition method.
In her 199-page ruling, which followed a trial and four years of litigation, Justice Valerie Thean ordered IIa—whose diamonds are sold by sister company Pure Grown Diamonds—to cease producing any items that infringe on Element Six’s CVD growing patent. read article
WD Sues 6 Lab-Grown Diamond Companies Over Patents
On Thursday, the Carnegie Institution of Washington and M7D Corp.—the legal name of WD Lab Grown Diamonds—sued six created-diamond companies for allegedly violating Carnegie’s patents for growing and enhancing diamonds with the chemical vapor deposition method.
The suits, filed yesterday in Southern District of New York federal court, target three pairs of related lab-grown diamond companies: Pure Grown Diamonds, based in New York City; IIa Technologies, based in Singapore; Fenix Diamonds, based in New York City, Mahendra Brothers, based in India; and ALTR Inc. and R.A. Riam Group, both based in New York City.
The three suits, which use similar language and make similar claims, allege that that the companies are infringing on two Carnegie Institution patents, to which M7D holds the license.
The first, patent number6,858,078, issued in February 2005, lays out a method for producing CVD diamonds using a microwave-plasma process. The second, patent,RE41189, reissued in April 2010, covers a method for improving a diamond’s visual qualities using high-pressure, high-temperature treatment, a process sometimes called annealing. Diamonds grown with chemical vapor deposition that haven’t been treated are knownas “as-grown.”
According to the three complaints, the patents at issue are “well-known in the lab-grown diamond industry and in particular are well-known by lab-grown diamond manufacturers, importers, and sellers.”
The plaintiffs seek an injunction against the production of any allegedly infringing products and that M7D and Carnegie receive a “reasonable royalty” from any past sales of infringing products.
“We are very serious about protecting our rights and our investment,” WD’s chief executive officer Sue Rechner, who was appointedin September, tellsJCK. “The decision to start litigation is not one any company takes lightly. It’s typically a last resort. We don’t want to go into litigation, but if we must, we must. We are adamant that our intellectual property be respected.” more
How to Talk (Correctly!) About Lab-Grown Diamonds
When it comes to lab-grown diamonds, you don’t want to get too creative with language. Here’s a refresher on the lingo (and legalities).
In 2018, theFederal Trade Commission (FTC) concluded a major overhaul of its Jewelry Guides, including its recommendations on lab-grown diamonds. Many in the lab-grown community, with some validity, hailed the changes as a major victory.
And yet, in the months since, some have gotten “creative” with their interpretations of the new Guides, says Jewelers Vigilance Committee (JVC) president and CEO Tiffany Stevens. A year after the overhaul, the FTC sent eight companies that sell lab-grown diamonds and diamond simulants letters about their marketing, warning their advertisements could possibly “deceive” consumers.
Which is why it’s important to review what the FTC Guides do—and don’t—say:
Disclosure is still required.
In perhaps the most commented-upon change, the FTC removed the wordnaturalfrom the definition of a diamond. “It is no longer accurate to define diamonds as ‘natural’ when it is now possible to create products that have essentially the same optical, physical, and chemical properties as mined diamonds,” the FTC wrote, explaining the change.
That has led some to insist that the FTC has declared “a diamond is a diamond.” While that’s a possible interpretation of the change, the commission never used that particular wording. Under the new FTC Guides—just like the old ones—the unadorned worddiamondcan still refer only to a natural, mined gem. That means disclosure remains a requirement for non-natural diamonds.
“Marketers still need to make those disclosures [if they are not selling] a mined diamond,” says Reenah L. Kim, staff attorney for the FTC’s enforcement division, who worked on the revamp. Furthermore, the disclosures need to be clear and conspicuous—and the closer the disclosure comes to the claim, the better.
“Some advertisers reveal the true nature of their products behind vague hyperlinks, in an FAQ section, or on an ‘education’ page,” wrote the FTC in a June blog post. “That won’t do. Consumers could easily overlook the information because it’s not close to the product description.”
Marketers even have to be careful on social media. If the only descriptor comes in a hashtag (#labgrown), that could be misleading, the FTC says.
The FTC recommends three descriptors for lab-grown diamonds.
So how should companies describe lab-grown diamonds? The FTC recommends the termslaboratory-grown,laboratory-created, and[manufacturer name]-created. It has okayed use of the wordcultured, but manufacturers need to use other descriptive or qualifying language.
The termsyntheticwas once on that list of recommendations, but it was removed with this revision. However, contrary to some assertions,synthetichasn’t been prohibited; some lab-grown companies currently use it in their marketing.
The new guides do give marketers leeway to use other descriptors “if they clearly and conspicuously convey that the product is not a mined stone.” But that doesn’t mean marketers can call their diamonds whatever they want. For instance, in the warning letters it sent out in June, the FTC cautioned against using the descriptorsabovegroundandreal diamonds created in America, which it felt “[do] not clearly and conspicuously disclose that the diamonds are laboratory-created.”
“As a federal agency, [the FTC is] always balancing consumer protection against free speech,” Stevens said on “The Jewelry District,”JCK’s podcast. “They wanted to give a little more of that free speech breathing room. Their line of thinking is, ‘Let’s open this up. And if anyone steps over the line, we’ll slap them down.’ Which they did.”
Stevens thinks the safest bet is that companies stick to the three recommended descriptors. “That fourth category is a little unknown,” she says.
Simulants are different from lab-grown diamonds.
The FTC—as well as the world of gemology—has always been clear that a simulant, or simulated diamond, may look like a real gemstone but has a different chemical composition. Moissanite, cubic zirconia, and YAG are examples of simulants. Partial-diamond hybrids are also considered simulants.
A lab-grown diamond is chemically the same as a natural diamond, but it’s grown by a machine rather than beneath the surface of the earth.
In its warning letters, the FTC charged that some marketers were deliberately fudging the difference between the two. It warned companies to “avoid describing [simulants] in a way that may falsely imply that they have the same optical, physical, and chemical properties of mined diamonds.”
Among the descriptors the FTC singled out in its warning letters: lab-created DiamondAura and contemporary Nexus diamond. It has said that the termslab-createdandlab-grownshould be used only for products that have “essentially the same optical, physical, and chemical properties as the stone named.” For simulants, it recommends the terms imitationorsimulated.
You can still call natural diamondsnatural diamonds.
Another common misconception is that the FTC is not allowing mined diamonds to be callednaturalorreal. Those terms are still allowed, but only for diamonds that come from the earth.
The FTC did, however, warn that those terms can’t be used in a misleading context. “It would be deceptive to use the terms real, genuine, natural, or synthetic to imply that a lab-grown diamond(i.e., a product with essentially the same optical,physical, and chemical properties as a mined diamond) is not, in fact, an actual diamond,” it wrote.
Don’t say lab-grown diamonds are eco-friendly.
The FTC’s Green Guides have long warned against what it calls “general environmental benefit” claims, like eco-friendly and sustainable. read more
Why a Few Lab-Grown Diamonds Temporarily Change Color
Laura Sipe couldn’t believe her eyes. In February, the owner of J.C. Sipe Jewelers in Indianapolis was readying an I-color lab-grown diamond for a customer. She had always heard that lab-growns fluoresce differently under ultraviolet light, so she decided to take out her UV lamp and check for herself.
When she removed the stone, it was no longer an I. It was gray. And she “freaked out.”
She called up her vendor, who was just as surprised. “One person in the office said she had heard of something like this. She said the diamond turned purple and then it reverted back.”
Sipe’s diamond indeed returned to its original color the next day. She still told the vendor to take it back.
If a customer saw that, “that would freak everyone out,” she says. “Including us.” She hasn’t had that happen to any stone since.
What brings this up is this week’s announcement that Gemological Science International saw something similar at its lab this summer.
A 2 ct. diamond grown with the chemical vapor deposition (CVD) method transformed from near-colorless to slightly blue (pictured) after a few minutes’ exposure to short-wave UV radiation in a DiamondView machine.
“It was a dramatic change,” says chief information officer Nicholas DelRe. “I thought I was seeing things.”
The diamond retained the blue tinge when it was tucked into parcel papers and only returned to its original hue after two and a half hours in the sun. (Typically, the color reverts after about a half hour of exposure to sunlight.)
As well as significant savings that allow you to reduce your budget or supersize your diamond, part of the allure of lab-grown is a supply chain that promises no human rights violations and less environmental damage. Though a recent report – funded by a collective of diamond miners – has suggested that the high temperatures required to create lab-grown diamonds cause a larger carbon footprint than mined diamonds, prompting the US Federal Trade Commission to send letters to eight companies warning them off describing the gems as eco-friendly. more...
Is There a Resale Market for Lab-Grown Diamonds?
Last week, at the urging of acommenter, I looked into Kay’s and Jared’s policy for lab-grown diamond upgrades and trade-ins, now that both of those chains areselling them. Suffice it to say, it’s not the same as for naturals. Here’sJared’s:
Our diamond trade-in and upgrade services allow you to take any diamond jewelry (excluding lab-created diamonds) you no longer wear and trade it in for a brand new one.
Lab-grown manufacturer Diamond Foundry has traditionally touted its“forever 100% value guarantee”,which “guarantee[s] the value of your diamond forever” with a “free lifetime upgrade.” At press time,JCKcould not find the guarantee still listed on its site. The company did not respond to requests for comment about the guarantee’s current status.
This is a thorny issue for the lab-grown diamond world. Given that technology cheapens over time, and created-diamond production isn’t limited by nature, most believe that synthetic prices will drop. In fact, that process has already started, with prices falling over the last year despite a clear spike in demand. (Natural diamond priceshave fallen recently, too, though not as much.) Last December, Diamond Foundryannounced that it was setting its diamonds at 55% below the Rapaport list. A vendor just approached me on LinkedIn, promising prices 78%–89% below Rap.
Retail prices are falling, too. Analyst Paul Zimnisky estimates they have dropped an average of 20%–30% since the beginning of the year. In January, a 2.01 ct. J SI2 very good–cut lab-grown with an IGI report sold for $6,800 on Brilliant Earth. Recently, a lab-grown with similar specs was being sold on the site for about $3,000.
Which may explain why some sellers are skittish about trade-ins. Though not all are.
Both Ada Diamonds and MiaDonna offer lab-grown upgrades, though they require the purchaser spend a certain price on the new stone—one and one-half times the original in Ada’s case and two times in MiaDonna’s. That isn’t unusual; many traditional sellers havesimilar policies.
If the approaches here seem all over the map, they point to a larger issue: Do lab-grown diamonds have resale value? Many in the mined world maintain they don’t.
Thereisa secondary market for lab diamonds, though it’s still a small one. (Which makes sense, as the category is still small.) Ada Diamonds has had abuyback programsince May 2018. This year saw the launch of a somewhat-mysterious site,We Buy Lab Diamonds. And, of course, you can sell anything on eBay.
RAPAPORT...Six synthetic-diamond companies have signed up for a pilot program aimed at creating a sustainability standard for the sector.
SCS Global Services, a third-party auditing specialist, will analyze companies’ environmental, social and governance records, with the goal of devising an independent sustainability certification for lab-grown diamonds.
Crystal brand Swarovski and jeweler Helzberg Diamonds — both sellers of lab-grown — are among the participants, SCS said last week. They are joined by four synthetics growers: Florida-headquartered Green Rocks, Maryland-based WD Lab Grown Diamonds, Indian chemical vapor deposition (CVD) producer Goldiam, and Israel-based Lusix. A newly launched Standard Review Committee comprising lab-grown-diamond producers, retailers, academics and nonprofit organizations will oversee the process.
The Lab Grown Diamond Council (LGDC), which came into being earlier this year, brought in SCS to work on the standard following criticism of the sector’s portrayal of synthetics as green alternatives to natural diamonds. The US Federal Trade Commission wrote to eight synthetics companies in March, warning them against making unproven environmental claims such as “eco-friendly,” “eco-conscious” and “sustainable.”
The pilot program will help confirm facts about the production operations behind lab-grown diamonds, noted Stanley Mathuram, vice president of SCS. “The pilot audits mark an important step in the process of certifying sustainability,” he said.
Image: A 9.04-carat round brilliant produced by WD Lab Grown Diamonds in 2018 using chemical vapor deposition. (WD Lab Grown Diamonds) link
Lab-Grown Diamonds Get Ready for Their Eco Close-Up
Six lab-grown diamond companies and retailers have signed up for apilot programthat will audit their environmental, social, and governance performance against preset criteria.
If they pass, their diamonds will be certified by SCS Global Services as sustainably grown, though it’s possible that label will change.
Only individual diamonds will bear the certification, after they have been tracked and traced from grower to the retailer. So, for example, it’s possible a ring’s center stone will carry the the SCS certification, while its side stones won’t. (Just like a center stone sometimes carries a GIA report, while its side stones don’t.)
The pilot, commissioned by thenewly formed Lab-Grown Diamond Council, will involve four growers—Green Rocks, Goldiam USA, Lusix, and WD Lab Grown—as well as two retailers, Helzberg Diamonds and Swarovski.
The news comes after the Federal Trade Commission (FTC) in April warned eight lab-grown diamond sellers against using general environmental benefit claims, likeeco-friendlyandsustainable, which are prohibited by the the agency’s Green Guides.
Interestingly, none of the lab-grown diamond sellers thatwere cautioned by the FTCare participating in the pilot program. In fact, most of the participating companies haveshied awayfrom making eco claims in the past.
“These are companies that want to do the right thing,” says Stanley Mathuram, vice president for SCS, which has also worked with Brilliant Earth and the Responsible Jewellery Council. “The message they are giving now is, ‘We support sustainability, and here are our practices to prove it.’ This won’t be just about how these companies compare to mined diamonds. It’s about each company’s own practices and how they measure up to a transparent standard.”
While Diamond Foundry has been certified carbon-neutral by Natural Capital Partners, this new standard goes beyond that toward “climate neutrality,” Mathuram says.
“It’s not just that we measure your electrical footprint and then you buy offsets,” says Mathuram. “It may be looking at ways to reduce electricity use. This is going beyond carbon-neutral and looking at a multitude of issues. We will also be looking at black carbon, ozone, and methane, and other pollutants that are hot-button topics for climate. We are talking about water, we are talking about solvents, we are talking about chemicals.”
It will also monitor the companies that cut the diamonds and make sure they adhere to existing labor and safety standards. read entire article
Diamond Foundry Signs Power-Full Factory Deal
On June 6, San Francisco gem grower Diamond Foundry inked a deal with a Washington state public utility that will enable its “megacarat” production facility to operate at full capacity by March 2020.
The agreement with the Chelan County Public Utility District (PUD) calls for the construction of a new energy substation that will meet the Wenatchee, Wash., facility’s power needs.
Located in a former fruit warehouse, the facility is expected to grow as many as 1 million carats a year at full capacity. The company also plans to keep growing diamonds in San Francisco.
A joint statement provided a rare glimpse at the amount of power that’s needed to grow diamonds in a lab. The factory will require up to 19 megawatts of power—about what’s used to power an estimated 14,250 to 19,000 American homes, according to California’s department of energy, or, by another calculation, about 11,000 homes in the Pacific Northwest.
The factory’s energy mix will be 98.46% hydropower, with less than 2% of energy from other sources, says Kimberlee Craig, PUD spokesperson.
Transitioning to mostly hydropower will help the company maintain a zero-carbon footprint, the statement said.
As far as other possible ecological impact, the company declined to estimate the factory’s anticipated water usage. “We do not have that information,” says director of public relations and communications Ye-Hui Goldenson.
The PUD lacked the capacity to meet Diamond Foundry’s power needs at its location, requiring the construction of the substation. While that typically takes 18 months, this project is slated to be completed in less than a year because of the factory’s anticipated economic benefit to the local community: It’s expected to bring between 35 and 50 jobs to the area.
“We are a customer-owned utility,” explains Craig. “We are following the direction of our customer-owners, who want us to use our resources to help support the economy.”
When it publicly debuted in 2015, Diamond Foundry announced it had raised $100 million from a range of investors, including actor Leonardo DiCaprio, a group of Silicon Valley billionaires, and firms such as Obvious Ventures. more
The new created-diamond battle may be over intellectual property.
In an interview this week, executives at WD Diamonds said they believe that certain competitors are infringing on the company’s licensed patents for growing diamonds using chemical vapor deposition (CVD)—and they might take some retailers to court over it.
Since 2011, WD has licensed the diamond-growing technology developed by the Carnegie Institution of Washington, which has an ownership stake in the company.
“What Carnegie did is they established the conditions that you could [grow diamonds] to a reasonable size,” says WD president and founder Clive Hill. “That is patented. We [believe] that you cannot grow CVD outside those conditions.”’
Carnegie’s portfolio of patents also involve post-growth treatment of CVDs using annealing.
While WD has sent warning letters in the past, Hill says it is now taking its efforts to a new, “more significant” level.
“We have sat down and assessed possible costs,” says Hill. “If we have to end up in court, we will end up there.… We have spent a lot of money on this. We are working with [law firm] Perkins Coie. Within a very short period of time we will start some action with some retailers.”
Among the companies it has in its sights: big retailers, manufacturers of growing equipment, and a few smaller players.
“Hopefully we can pick one or two, and people will cooperate with us a bit better,” he says. “We want to work with people. That is our modus operandi. But we want it to be fair. I don’t think that’s unreasonable. We think that retailers, particularly the significant retailers, will want to make sure that happens.”
The company is now able to pursue this avenue because of the capital infusion it received from Detroit-based private equity firm Huron Capital Partners .
Huron senior partner Michael Beauregard says that WD isn’t trying to limit supply in the market and that it will consider licensing or other arrangements.
“What we would like to do is supply those retailers that we haven’t been supplying,” he says. “The goal is not to create hostilities. The goal is to be able to sell this company’s technology to more customers. There are several retailers that are good and viable customer prospects for this company that have chosen some or part of their product flow to come from parties that have been infringing, in our opinion, on one or more of the patents. They are going to be made aware of that.”
The company is initially targeting retailers, rather than the companies that produce the diamonds, because “we can’t necessarily trace diamonds back to the source,” says Michael Zukas, vice president of private equity for Huron and a WD director. “But we can buy from a retailer and test those diamonds from the retailers and [allege], ‘this is a violation.’
“We have invested in our partnership with Carnegie and the technology that we are licensing,” he says, “and we want to make sure that the playing field is fair and we want to make sure the investment is protected.”
While WD stayed mum on possible targets, JCKreached out to other CVD diamond producers for comment. Diamond Foundry chief executive officer Martin Roscheisen responded via email: “We have invested years of research and development to take the technology for growing high-quality diamond to a distinctly new level. Our proprietary intellectual property stands on its own.” Singapore-based IIA Technologies, which is currently in a patent disputewith Element Six, did not return a request for comment. The agreed purchase of Scio Diamond has suggested that other companies are infringing on itspatents. more
Last month, the Federal Trade Commission (FTC) shocked the industry by sending out warning letters to eight sellers of lab-grown diamonds and diamond simulants.
The move received a lot of attention as it’s unusual for the FTC to do any kind of enforcement of its Jewelry Guides—never mind sending letters to eight jewelry companies at once.
Letters from the FTC to the Lab Grown Diamond Sellers
In response to a Freedom of Information Act request, JCK recently received the eight unredacted letters, all signed by James A. Kohm, the associate director of the FTC’s division of enforcement. The FTC had previously posted a redacted letter.
Three of the letters were sent to companies that exclusively sell lab-grown diamonds—Ada Diamonds, Diamond Foundry, and Pure Grown Diamonds—and the other five were sent to companies that sell diamond simulants—Agape Diamonds, Diamond Nexus, MiaDonna & Co., Stauer, and Timepieces International. Some of the simulant sellers, including MiaDonna and Stauer, also sell lab-grown diamonds.
The letters to the three lab-grown diamond companies advised that sellers of man-made gems should clearly and conspicuously disclose their stones’ origin. The Diamond Foundry and Pure Grown letters cautioned against using non-FTC-recommended terminology, such as “real diamonds created in California” and “above Earth diamonds.”
Kohm acknowledged in the letters that the companies all had portions of their websites that disclosed that their diamonds did not come from a mine. But “consumers could easily overlook” that, he said. Two of the letters also suggested that solely including a #labgrown hashtag may not be considered sufficient disclosure in a social media post.
The FTC also cautioned the companies not to make “unqualified general environmental benefit claims”—such as using terms like environmentally friendly andsustainable—”because it is highly unlikely that they can substantiate all reasonable interpretations of these claims.”
While there are differences of opinion on the environmental impact of man-made versus mined diamonds, the FTC does not seem to be endorsing any side of that argument. It is simply cautioning companies against using those terms and making those broad overarching claims.
Ada Diamonds said it had settled the matter. Diamond Foundry did not return a request for comment says it “prides itself” on being a lab diamond producer that “has worked collaboratively with the FTC for years.” Pure Grown Diamonds declined comment.
The letters to the five simulant sellers said that retailers of those stones should “avoid describing their products in a way that may falsely imply that they have the same optical, physical, and chemical properties of mined diamonds.” (Simulants are look-alikes, such as cubic zirconia, which do not have the same chemical makeup as diamonds, whether natural or lab-grown.)
The letters mentioned Agape’s use of its diamondslabcreated.com as its web address; Diamond Nexus’ use of contemporary Nexus Diamond; Stauer’s use of lab-created DiamondAura; and Timepieces International’s use of diamondeau.
As with the lab-grown companies, Kohm’s letter acknowledged that the companies’ sites have sections that identify the products as simulants. But he again noted that consumers might overlook them.
The letters to the simulant companies, except for Timepieces, also cited their environmental benefit claims.
Stauer president Michael Bisceglia says his company is in the process of changing its site.
“We think the FTC comments were helpful and more than fair,” he says. “We sell mined diamonds, lab diamonds, and diamond simulants, and it was helpful to have that additional clarity.”
MiaDonna chief executive officer Anna-Mieke Anderson tells JCK via email that her company has “spoken to the FTC directly in response and they are satisfied with the verbiage adjustments and additions we will be making to language describing the technology options we offer—especially in regard to the Diamond Hybrid simulant we offer. Our lab-grown diamonds and gemstones do not fall into this same category, but I welcome anything we can do to improve and evolve as an industry while helping to educate the consumer.”
Brittany Bozmoski, chief marketing officer of Forever Companies, parent company of Diamond Nexus Labs, emails: “Forever Companies is an open book with our customers, as well as the FTC, and are happy to benefit from the feedback of both. We’re delighted with every opportunity to educate consumers and regulators about how our products compare to mined diamonds in look, durability, cost, chemistry, and environmental impact. ” more
From the JCK, December 10, 2018 By Rob Bates
"Production of lab-grown diamonds has risen dramatically and will continue to do so, though their prices will likely continue to fall, said a new report from Bain & Co.
The report produced for the Antwerp World Diamond Centre, estimates current lab-grown gem production at 2 million cts. a year, with the majority of that under 0.18 cts. It estimates that production is currently growing at 15–20 percent annually.
It reports that it costs $300–$500 per ct. to produce a CVD lab-grown diamond, compared with $4,000 per ct. in 2008. It calculates that the retail price of gem-quality lab-grown diamonds has fallen by about half in the past two years, while wholesale prices have fallen threefold. It forecasts that trend will continue as efficiencies increase, new competitors enter the market, and the product gets “commoditized” like natural diamonds.
“Lab-grown diamonds are clearly here to stay,” the report says, pointing to De Beers’ entrance into the market and the Federal Trade Commission’s decision to remove the word natural from its definition of diamond.
“Given the pace of declining production costs and wholesale and retail prices,” it adds, “we expect lab-grown stones to become accessible to a wider consumer audience.”
However, in the short- and medium-term, it says that the man-made market will be constrained by limits on manufacturing capability, funding, and access to technology and intellectual property.
A lot depends on how much consumers embrace the product. It suggests three possible scenarios for how this could play out: In the first, customers no longer perceive a difference between natural and lab-grown diamonds except for the highest-quality stones. In the second, the natural segment does differentiate itself, perhaps by limiting lab-growns to the fashion category. The third is “some combination of the two,” where naturals are differentiated in every category but low-end stones.
Regarding natural diamonds, the report estimates that diamond jewelry sales rose an unimpressive 2 percent in 2017, but suggests that this year’s number may be higher, led by strong U.S. demand. It forecasts continued growth in the diamond jewelry market, though it warns that a protracted trade war between China and the United States could hurt consumer confidence in both countries.
Rough diamond production spiked 19 percent in 2017 to reach 151 million cts., ending an eight-year trend of flat output. Yet, last year may represent the “pinnacle” of rough diamond production, and the report expects that the mine output going forward will be “flat at best” as existing mines get depleted.
Both rough and polished diamond prices trended up during the first half of 2018, by 3 and 2 percent, respectively, though last year the price of polished fell 3 percent.
Profitability in the midstream—dealers and manufacturers—equaled about 1–3 percent. India continues to dominate the cutting and polishing segment, manufacturing more than 90 percent of world production, with its market share continually growing."
"Traditional diamond organizations said they were disappointed at the Federal Trade Commission’s (FTC) overhaul of its Jewelry Guides—even as man-made diamond companies cheered.
In its latest revision announced last week, the FTC made a number of changes to its traditional guidance regarding both lab-grown diamonds and diamonds in general. It removed the word natural from the definition of a diamond; allowed new descriptors for lab-grown gems as long as they clearly describe the product as not mined; said that implying lab-grown stones are not real could be deceptive; deleted the word synthetic from its list of approved lab-grown descriptors; and okayed the previously forbidden word gemstone to describe man-made stones.
The Guides still mandate clear disclosure of lab-grown diamonds, FTC attorney Reenah L. Kim said in an interview with JCK last week.
In a statement, World Federation of Diamond Bourses president Ernest Blom complained the new Guides show “too much of a bias” toward the lab-grown sector and noted they diverge from the Diamond Guidelines agreed to by his organization and other groups.
“Our paramount aim is always consumer confidence, and the revision has the potential to cause a degree of confusion,” he said. “[Allowing lab-grown companies to use new descriptors] might provide too much latitude in their marketing claims.”
Martin Rapaport, chairman of the Rapaport Group, arced that the change in the diamond definition “focus[es] on physical properties instead of scarcity and value differentiation, which are key factors in product definition and vital for consumer protection.” CONTINUE READING
Lab-Grown Diamonds Are Diamonds, Says FTC
Jul 25, 2018 10:07 AM By Rapaport News
RAPAPORT... "The Federal Trade Commission (FTC) has expanded its definition of “diamond” to include those grown in a laboratory, as part of several changes to its jewelry guidelines.
The FTC’s previous definition of a diamond stated: “A diamond is a natural mineral consisting essentially of pure carbon crystallized in the isometric system.” This is no longer applicable, the commission said Tuesday. The new listing does not include the word “natural.”
“When the commission first used this definition in 1956, there was only one type of diamond product on the market — natural stones mined from the earth,” the FTC said. “Since then, technological advances have made it possible to create diamonds in a laboratory. These stones have essentially the same optical, physical and chemical properties as mined diamonds. Thus, they are diamonds.”
The fact that diamonds exist “in the soil of [the] earth” is not a necessary attribute, lab-grown producer Diamond Foundry argued after the FTC requested input from members of the trade. The commission agreed.
One should also qualify the word “cultured” when describing man-made stones, the commission added, as the term on its own often leads consumers to believe a diamond is mined. The commission suggests marketers use words such as “man-made,” “lab-grown” or “foundry” to qualify “cultured,” thereby avoiding confusion about a diamond’s origins.
However, marketers should not use the word “synthetic” to qualify “cultured,” the FTC noted, as it creates confusion among consumers, who believe the term indicates a stone is fake or artificial.
The Diamond Producers Association (DPA) declined to comment until it had studied the implications of the new guidelines further. In January, the DPA was one of several trade organizations that collaborated on a universal standard for referring to diamonds, saying that “diamond” on its own implied natural origin."
What are Synthetic Diamonds? Gemological Institute Report, 1/5/2018 read
DIAMONDS / TECHNOLOGY Synthetic Diamond Bears Fake Inscription Matching Natural Report November 13, 2017 by ROB BATES
In an episode that has frightening implications for an industry trying to keep its diamonds distinguished, a synthetic round diamond was recently submitted to GIA’s gem lab with a phony inscription meant to identify it as natural.
According to a GIA Lab Note, its Carlsbad, Calif., laboratory recently took in a 1.76 ct. F VS1 excellent cut round. It bore an inscription (pictured) for a GIA report issued in 2015, which was meant for a 1.74 ct. D VVS1 natural untreated stone.
GIA’s screening process, however, determined that the stone needed additional testing. Further research showed the stone was grown by HPHT.
“Rarely do we encounter the type of blatant fraud described here,” said note authors Christopher M. Breeding and Troy Ardon, adding, “We believe the submitting client noticed inconsistencies with the GIA report information and sent it to the lab for an updated report.”
This is not the first time the trade has seen this kind of episode. In 2016, man-made diamonds sold with natural reports—advertised as such—were discovered on Asian website Alibaba."
Lab-Grown Diamonds Become a Bandwagon November 16, 2017 by ROB BATES
"Yes, many in the industry remain wary of lab-grown diamonds, and events like this week’s report of a fake GIA inscription certainly don’t help matters. But at the same time, we are swamped with announcements of new companies entering the business.
Lab-grown certainly seems to have become a bandwagon that many in the industry are merrily climbing on board. (Just today we got word of a new created diamond company, Love Earth Jewelry, headed by former Gregg Ruth CEO Daniel Schreiber.)
There’s even an attempt to form a virtual lab-grown diamond bourse, called the Lab Grown Diamond Network. Principals include Diamond Foundry veteran Alon Ben-Shoshan, as well as mined diamond companies that “have chosen not to publicly list their names.”
“I probably see a new lab-grown diamond offer/pitch/ad once a month, from someplace in the world,” says Tom Chatham, one of the pioneers of the created market. But he feels he’s seen this movie before: “In the 1990s we had many companies claiming to produce emeralds…and some did, but they failed at the marketing end. Many of these newcomers are just resellers and will fall by the wayside.” entire article...
QUOTE FROM CNBC NEWS
"The Diamond Foundry was created by Martin Roscheisen, founder of solar power company Nanosolar. After that company folded in 2013, Roscheisen gathered the same team to come up with a proprietary discovery that can grow diamonds more efficiently than existing technologies. Not murky, synthetic diamonds, but clear, white gems that are atomically identical to diamonds mined from the earth. The Diamond Foundry starts with a sliver of an earth-mined diamond. That seed diamond is then heated to temperatures as hot as the outer layer of the sun. Layers of identical crystal atoms stack on top of the diamond, and it can grow up to nine carats in two weeks of uninterrupted time in the reactor."continue reading
QUOTE FROM THE DIAMOND FOUNDRY
"Impeccable provenance Our diamonds are cultivated in San Francisco. Our foundry re-creates the environment in which nature forms diamond on its own. Earth forms diamonds within hours actually; our process cultivates them over months. Our production is boutique relative to the industrial scale of mining. While diamonds usually go through dozens of owners, traders and dealers, ours is direct from us. We also cut the carbon footprint – for a diamond as rock-solid as your values."
QUOTE FROM RAPAPORT DIAMOND EXPERT
"SELLING A PRODUCT WITH CONTINUOUSLY FALLING PRICES Synthetic diamonds are man-made, which means man can make unlimited amounts of them. It is important to note that synthetic diamond technology is driven by U.S., Chinese and other government defense departments seeking to create strategic military innovations.
Martin Roscheisen, CEO of Diamond Foundry, the company supported by Leonardo DiCaprio, has reportedly raised $100 million to invest in synthetic diamonds. He claims that his “company can create pure diamond material at about 150 times the rate at which the industry now produces it.”
With Alibaba’s infinite competitive lower cost supply proposition and Moore’s law of exponential technological growth, it is likely that synthetic diamond prices will fall by at least 50 percent every 18 to 24 months. Prices for less expensive synthetics will likely plummet faster as they are much easier to create and compete with. Given the unlimited supply scenario, I see no reason why synthetic diamonds should not settle down to price levels slightly higher than cubic zirconia or very fine-cut Swarovski crystals.
Synthetic sellers make a big point about disclosing that their synthetic diamond is exactly the same as a natural diamond. That is not true. Natural diamonds have natural scarcity, which enables them to be a store of value. Synthetic diamonds have no scarcity and are not a store of value.
Consumers think they are buying a diamond with all of its attributes. They do not realize that they are buying something that does not hold value.
The fact that sellers try to sell synthetics at a discount to natural prices, instead of on a cost-plus basis, enforces the lie that synthetic diamond values are just like diamond values — only cheaper. If Millennial consumers are tricked into replacing natural diamonds with synthetic diamonds that do not hold value, they may be turned off to all diamonds forever when they find out the resale value of their synthetics." continue reading
FROM ONLINE JCK MAGAZINE
"The Barneys release of designer jewelry using lab created diamonds calls the stones cultivated. The term cultivated has not been approved for use by the Federal Trade Commission. Diamond Foundry said in response, “Our diamonds being man-made is the whole point of our marketing, which we are very clear about. This is consistent with FTC principles of making sure that consumers get what they think they get.” The president of the Jewelers Vigilance Committee Cecilia Gardner confirmed that using the term 'cultivated' in regard to lab-grown is not complying with the FTC guidelines."
"Hedda Schupak, a market analyst and editor of the Centurion Newsletter, is skeptical that lab-grown companies are actually as sustainable as they claim to be. While Diamond Foundry boasts that its machines are powered through hydropower and solar power, others don't disclose the details of their production. This is a concern publications like JCK have raised before.
Two years ago, Jewelers Vigilance Committee president and CEO Cecilia Gardner told JCK that lab-grown companies using the term "eco-friendly" might be in violation of FTC standards because there's no proof that these factories (minus Diamond Foundry, which has let reporters from publications like Quartz see its operation to prove its machines are solar-powered) are green at all. And as JCK editor Rob Bates notes, lab-grown diamonds aren't replacing mined ones — they're just being created in addition to them.
"Unless they claim to be using solar or wind power, they are not carbon-neutral," Schupak says. "And it takes a lot of energy to do what needs to be done to make a diamond."
So far, little research has been done on what actually goes on in these labs. According to one report in the Stanford University alumni magazine that uses Canada's Ekati mine as an example, "replacing this one mine's annual diamond production with synthetic diamonds created in a lab could save the equivalent of about 483 million miles' worth of auto emissions." But University of Vermont professor Saleem Ali writes in his report "Ecological Comparison of Synthetic versus Mined Diamonds" that "this data may be misleading because we do not have any accurate metrics of the raw material used to make the synthetic diamonds" since lab procedures are labeled proprietary and are not shared with the public. The industry's lack of disclosure leaves people like Michelle Graff, who covers the industry for the trade site National Jeweler, dubious.
"There's a certain irony in the lab-grown biz. They keep trading on how it's so ethical, and cleaner, but then what are they all hiding?" she asks. "The mined industry is constantly under scrutiny to share and disclose, why shouldn't they do the same?"
It goes without saying that lab-growing will only become more sophisticated and cheaper in the coming years, and that accountability will have to follow. But what happens when synthetic diamonds flood the market? Will natural diamonds still retain their value? The unsatisfying answer is: nobody knows." continue from Racked
QUOTE FROM VOGUE
"Synthetic, or cultured, diamonds are not new. They have been manufactured for decades, first developed for General Electric in 1954 for industrial purposes and by the 1990s reaching gem-grade status among select producers. Their rising cachet has a simple explanation: provenance. The supply chain in the diamond industry has long been associated with conflict and environmental damage, largely brought into the public consciousness by the 2006 film Blood Diamond. The Kimberley Process, which set requirements for certifying diamonds “conflict-free,” went into effect in 2003, but in a world of increasingly judicious consumers, the untraceable status of so many of the world’s diamonds remains troublesome.
So it was news last year when Leonardo DiCaprio (along with ten billionaires) invested in Bay Area start-up Diamond Foundry, which had developed a technique for producing brilliantly clear, colorless, gem-quality stones.
Here is how it works: Diamond Foundry starts with a rough, earth-extracted Canadian diamond and takes a wafer-size slice of it—about 7 mm by 7 mm. This is placed in a hydrogen plasma reactor that mimics the conditions on the outer core of the sun (“We’ve created the sun on Earth!” says Roscheisen, who is boisterous, sharp, confident, and prone to the occasional evocation of Silicon Valley demigod culture). Add gases like carbon dioxide and methane inside the reactor, and atom by atom a crystal lattice is built. To see a cut-and-polished cultured diamond is to see, well, a diamond: It sparkles brilliantly, it refracts light, it is colorless and clear.
The process takes two weeks, Roscheisen explains as we make our way into the cavernous production room humming with white reactor machines. Since the slightest glitch can affect an entire batch, the reactors are monitored constantly. “People are eating eggs Benedict at brunch right now and checking on them from their iPhones,” he assures me.
Are synthetics the same as natural diamonds? According to the Gemological Institute of America, a lab-grown diamond is materially a diamond and can be evaluated using nearly the same standards of cut, clarity, carat, color, and other technical markers."
And yet is there a world in which, if I were getting engaged again, I’d want my walk by the Venice Canals to end with a diamond sourced just six hours north of where I live? Maybe. Cultured diamonds are beautiful, with an unbeatable provenance—but I’ll admit that the fact that improved efficiencies in the way they’re grown might eventually make them less expensive gives me pause." Continue Reading
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