WD Sues Diamond Growers over CVD Patents

A 9.04-carat round brilliant produced by WD Lab Grown Diamonds in 2018 using chemical vapor deposition.

The companies behind WD Lab Grown Diamonds have filed three lawsuits against competitors, accusing them of infringing patents for diamond synthesis and treatment.

The Carnegie Institution of Washington, a science organization, and M7D Corporation, which trades as WD Lab Grown Diamonds, took action Thursday again six companies that produce or sell diamonds made using chemical vapor deposition (CVD).

One of the complaints targets Pure Grown Diamonds (PGD) and IIa Technologies, which produces CVD goods for PGD. A second filing is against Mahendra Brothers, a De Beers sightholder, and its affiliate, Fenix Diamonds. The third suit takes aim at Altr, another lab-grown supplier, and its owner, R.A. Riam.

Carnegie invented and patented a version of CVD, known as microwave-plasma CVD (MPCVD), that can create a purer diamond because it doesn’t involve electrodes, which often contaminate the product, according to the lawsuits. It also patented a method for enhancing a stone’s visual characteristics through heat treatment at high pressure and temperature. M7D holds the license to both patents, the three similar lawsuits continued.

“The existence of the patents…are well-known in the lab-grown diamond industry, and in particular are well-known by lab-grown diamond manufacturers, importers and sellers,” Carnegie and M7D claimed.

Carnegie and M7D are seeking damages and a judgment declaring that the six companies violated their patents. The companies were not available for comment Sunday.

Source: Diamonds.net

De Beers Issues Synthetics Guidelines

De Beers has provided its rough-diamond clients and Forevermark partners with guidelines on how to operate in the lab-grown market if they wish to continue tapping into its branding.

The mining company, which in 2018 forayed into gem-quality synthetics with the launch of its Lightbox brand, is demanding businesses make full disclosure about their product, segregate synthetics from their natural supply, and do not make unproven claims about either category. The “Statement of Principles” outlines the legal structures companies with lab-grown diamond units must have if they wish to use the sightholder logo, as well as the procedures and training they are required to implement to avoid contamination or misleading marketing.

While De Beers already had rules mandating disclosure and other best practices, the new principles “ensure there is no room for doubt” about how clients may use the sightholder logo, explained David Johnson, head of strategic communications for De Beers. Some of the rules form part of De Beers’ contract with clients, allowing the miner to penalize those who flout them, while others are only recommendations.

“We believe the principles within the document set out a responsible approach, and that they are important for ensuring people can make clear and informed choices about what they are buying,” Johnson added.

The document refers to lab-grown diamonds as “artificial” products that “do not have the same inherent, naturally occurring characteristics or enduring value” as natural diamonds. The miner continues to define diamonds as a natural mineral in line with the International Organization for Standardization (ISO).

De Beers sent the guidelines to clients earlier this month, as numerous sightholders have launched lab-grown businesses under separate entities and trading names.
The following is a summary of the guidelines:

De Beers customers may only use the sightholder license — including displaying the sightholder logo — for business entities that are exclusively natural-diamond businesses. Entities with both natural and lab-grown activities may not use the logo.
The miner recommends setting up distinct and independent businesses for any lab-grown diamond activities, with separate systems, processes and workforces.
The rules prohibit “false, misleading or unsubstantiated” claims about the enduring value of lab-grown diamonds, whether directed at other businesses or at consumers. They cannot state or imply that lab-grown diamonds have the “identical inherent value characteristics” as natural diamonds.
Similarly, unproven claims about the environmental benefits or ethical advantage of lab-grown diamonds over natural ones are forbidden.
Sellers must provide the buyer with full and unambiguous disclosure before the transaction is complete.
They’re also required to ensure segregation at all stages of the supply process, such as storage, cutting and polishing, packaging, and transportation. Ideally, suppliers should handle natural and lab-grown stones in separate sites.
De Beers customers must “take steps” to ensure full disclosure and segregation further along the supply chain, down to the consumer.
Clients must have protocols to identify and mitigate contamination risks, and train staff members on the “operational, commercial and reputational impacts” of lab-grown diamonds.
Preferably, companies should disclose the countries in which the synthetic diamond was grown, polished and made into jewelry, as well as the identity of the grower. De Beers says businesses should “strive” to declare this, though it’s not an absolute requirement.
Grading language must contain words that make it clear a stone is lab-grown.
Customers must follow relevant laws, regulations and best practices, such as the standards that the US Federal Trade Commission (FTC) and the ISO have published.

Source: Diamonds.net

Everything Changes, Some Things Stay the Same

The diamond and jewelry trade tends to be reactive rather than proactive.

That was clear during the recent conference season, with the World Federation of Diamond Bourses (WFDB), the International Diamond Manufacturers Association (IDMA), the World Jewellery Confederation (CIBJO) and the World Diamond Council (WDC) all holding their annual meetings in October.

Much of the discussion, according to reports from the meetings, was centered on how the trade should relate to synthetic diamonds. It’s a difficult question following the recent decision by the Federal Trade Commission (FTC) to expand the definition of “diamond” to include those grown in a laboratory.

How does that apply to invoicing, advertising or grading reports? Having reached equal footing with mined diamonds in the eyes of the FTC, should lab-grown stones be allowed on the bourse trading floors? Of course not. And the trade restated its position that the use of the word “diamond,” without any qualifiers before it, refers to a natural stone by default.

But language isn’t really the issue. Behind the debate lies a deep concern about the growing acceptance of synthetics — both in retail and within the trade. De Beers’ entry into the market has played a significant role in that development, giving others a green light to follow suit.

Forget De Beers’ claim that it is helping differentiate natural from synthetic diamonds through pricing. The company is encouraging demand for a product that will ultimately eat into the natural-diamond market. We’re seeing that already, with more retailers, such as Macy’s and JCPenney, convinced that consumers will “grow in love” with synthetic-diamond jewelry.

The trade’s leadership claims it was blindsided by De Beers and the FTC. But its efforts at this point to engage with the FTC to revoke the decision will ultimately prove to be a case of too little, too late.

Rather, we must recognize that the industry trade groups that met in Mumbai, along with CIBJO, which met in Colombia, failed their constituents. So did the Diamond Producers Association (DPA), of which De Beers holds the current chairmanship.

Why was the natural-diamond-industry lobby ineffective a year ago — if active at all — while synthetics producers were convincing the FTC to include them in its definition? Where is the outrage from DPA members over their chairman actively working against the group’s mandate to promote natural diamonds as real and rare?

The industry’s reactive approach to the synthetics issue signals a need to update its strategy. Perhaps an initiative to combine the roles of the WFDB and IDMA into one organization would bring them new energy and purpose.

For now, the inability to change leadership at these organizations suggests the rest of the trade sees them as ineffective. As the WFDB and IDMA begin another term with the same leadership and a new committee working to spread the WFDB’s influence, we urge trade groups to be more proactive in dealing with the many challenges facing the natural-diamond market.

Source: diamonds.net

FTC Drops ‘Natural’ From Definition of Diamond, A Win for Lab-Grown Producers

In what can only be described as a victory for laboratory-grown diamond producers, the US Federal Trade Commission (FTC) has dropped the word ‘natural’ from its definition of a diamond, essentially redefining ‘diamond’ to include non-mined gemstones, as part its new guides for the jewelry industry. It further gives additional leeway to existing standards regarding the description of lab-grown diamonds (and metal alloys), and has dropped ‘synthetic’ as an appropriate descriptor of lab-grown diamonds except under certain circumstances. “The revision makes relatively far-reaching changes in what’s allowed as far as marketing lab-grown diamonds,” writes JCK’s Rob Bates, “and these changes almost entirely tilt toward the lab-grown sector.”

According to section § 23.12 of the Guides for the Jewelry, Precious Metals, and Pewter Industries, “Definition and misuse of the word ‘’diamond’,” the FTC writes: “A diamond is a mineral consisting essentially of pure carbon crystallized in the isometric system”, whereas it previously read “natural mineral”. “The Commision,” reads the Guide, “no longer defines a “diamond” by using the term “natural” because 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.” Later in the explanation of its changes, the commission describes why it sided with Diamond Foundry: “Diamond Foundry asked that the Commission remove “natural” from the diamond definition. It contended, “[t]he fact that diamonds exist in the soil of Earth” is “not a necessary attribute.” In its analysis, “The Commission agrees. The final Guides therefore eliminate the word “natural” from the diamond definition. 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. 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.”

‘Synthetic’ no longer recommended

In addition to this fundamental change to the definition of ‘diamond’, the FTC has opened the door to a much wider range of discriptors for lab-grown diamonds, provided they are not confusing for consumers. The Guides details its consideration of “cultured diamonds” according to the issues presented by the International Grown Diamond Association (IDMA) and Diamond Foundry on the one hand, and the Diamond Producers Association and Jewelers Vigilance Committee on the other. While the former did not get all it asked for (such as restricting the use of “ethical” or “conflict-free” diamonds to those from countries adhering to US labor standards), they tilted the balance in their favor. As Rob Bates points out, “In the past, the Guides listed the following approved descriptors for non-mined diamonds: laboratory-created, laboratory-grown, [manufacturer-name]-created, and synthetic. The new Guides still recommend the first three descriptions – though they no longer include synthetic. They also say that manufacturers can use other phrases if those terms “clearly and conspicuously convey that the product is not a mined stone.” And while adjectives such as created, grown and foundry are not recommended as descriptors, the commission says if the “suggested terms could be used non-deceptively in context (e.g., as part of an ad highlighting that the product is man-made), there is nothing to prevent marketers from doing so.”

As for using the word “cultured” to describe non-mined stones, the commission said it should be qualified, 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. Yet the commission goes even a step further in loosening its guidance on the use of ‘cultured’: While it still recommends against using the term cultured on its own, it now says that cultured can be used even if not immediately preceded by one of the approved descriptors.

Several commenters cited in the report, however, stated that the commission’s proposed guidance is inconsistent with international standards, which ban even the qualified use of “cultured” to describe synthetic diamonds. For example, a standard adopted by the International Organization for Standardization (ISO) in 2015 prohibits using “cultured” and “cultivated” to describe synthetic diamonds, and requires sellers to describe such products as “synthetic,” “laboratory-grown,” or “laboratory-created.” The JVC contended that the purpose of the ISO standard is “fully aligned” with the FTC Jewelry Guides. The fact that the FTC decided otherwise points to a rift between the new American standards and international ISO standards (a not uncommon rift nowadays). While the FTC removed ‘synthetic’ from its suggested descriptors, it declined to prohibit its use (another request by diamond growers), arguing that the term is not deceptive in every instance. But it did rule that it is misleading to use the term synthetic to “suggest a competitor’s lab-grown diamond is not an actual diamond.”

The changes, approved unanimously by the five-member commission, cap a six-year process of revamping the much-talked-about standards for marketing jewelry and gems. This revision marks the Guides’ first major overhaul in 22 years.

Source: thediamondloupe.

WFDB RESPONDS TO REVISED FEDERAL TRADE COMMISSION GUIDELINES

The World Federation of Diamond Bourses (WFDB) has responded to the revised U.S. Federal Trade Commission’s (FTC) guidelines released last week as they relate to the issue of descriptors for diamonds. The new guidelines are not in line with the Diamond Terminology Guidelines as agreed last year and implemented by the WFDB, the International Diamond Council, the International Diamond Manufacturers Association and CIBJO, the World Jewellery Confederation, said WFDB President Ernie Blom. However, he pointed out that the new guides do require that all lab-grown diamonds must be clearly and conspicuously disclosed.

“We have a united stand regarding nomenclature which was agreed with all the combined knowledge and experience of the leading industry bodies, but the FTC appears to have moved in a different direction,” Blom said.

Previously, the FTC’s guidelines approved non-mined diamonds: laboratory-created, laboratory-grown, [manufacturer-name]-created, and synthetic as descriptors, and while the first three remain, it has removed the term synthetic. “We feel that these changes provide too much of a bias towards the lab-grown diamond sector,” said Blom. “We appreciate the hard work of the FTC, but we do not feel that the views of the diamond sector were taken sufficiently into account, though we acknowledge there was consultation with American industry bodies. The guidelines do not include the views of the global diamond trade which the WFDB represents, although we are pleased that lab-grown stones have to be clearly marked as such.

“Our paramount aim is always consumer confidence and the revision has the potential to cause a degree of confusion. The FTC notes that manufacturers that make diamonds in a factory setting are free to use other descriptors as long as they ‘clearly and conspicuously convey that the product is not a mined stone,’ but we feel that this might provide too much latitude in their marketing claims.

“We appreciate that the FTC rejected a bid by diamond growers to include terms such as [manufacturer-name]-grown, foundry, created, and grown. These are stones created to order in a factory. We are also pleased that the FTC makes clear that any descriptors for non-mined diamonds must be absolutely clear and prominently displayed to consumers. A diamond sold without any descriptors must be a natural diamond.

“We hope that the door is still open for us to go back and approach the FTC in order to try and persuade the organization to re-think its decision,” Blom added.

De Beers to Sell Diamonds Made in a Lab

De Beers, which almost single handedly created the allure of diamonds as rare, expensive and the symbol of eternal love, now wants to sell you some party jewelry that is anything but.

The company announced today that it will start selling man-made diamond jewelry at a fraction of the price of mined gems, marking a historic shift for the world’s biggest diamond miner, which vowed for years that it wouldn’t sell stones created in laboratories. The strategy is designed to undercut rival lab-diamond makers, who having been trying to make inroads into the $80 billion gem industry.

De Beers will target younger spenders with its new diamond brand and try to capture customers that have been resistant to splurging on expensive jewelry. The company is betting that it can split the market with mined gems in luxury settings and engagement rings at the top, and lab-made fashion jewelry aimed at millennials at the bottom.

“Lab grown are not special, they’re not real, they’re not unique. You can make exactly the same one again and again,” Bruce Cleaver, chief executive officer of De Beers, said in an interview Tuesday.

Unlike imitation gems such as cubic zirconia, diamonds grown in labs have the same physical characteristics and chemical makeup as mined stones. They’re made from a carbon seed placed in a microwave chamber and superheated into a glowing plasma ball. The process creates particles that can eventually crystallize into diamonds in weeks. The technology is so advanced that experts need a machine to distinguish between synthesized and mined gems.

A host of lab-grown diamond makers and retailers have sprung up in recent years. Diamond Foundry, one of the biggest producers, grows diamonds in a California laboratory and has been backed by Leonardo DiCaprio. Warren Buffett’s Helzberg’s Diamond Shops Inc. also sells the stones.

Customers are currently “confused” by the difference between mined and lab-produced diamonds, Cleaver said. De Beers is hoping to create big price gap with its new product, which will sell under the name Lightbox in the U.S. A 1-carat man-made diamond sells for about $4,000 and a similar natural diamond fetches roughly $8,000. The lab diamonds from De Beers will sell for about $800 a carat.

Lowest Cost

Still, De Beers says that its move isn’t to disrupt existing lab-diamond producers, but create a small, profitable business in its own right.

“Given we are the lowest-cost producer, we can make a good business out of this,” Cleaver said. “We have the tools, why wouldn’t we do this?”

De Beers is so adamant that the man-made diamonds are not competing with mined stones that it will not grade them in the traditional way. That’s a stark contrast to current man-made sellers who offer ratings such as clarity and color, replicating terminology used for natural stones.

“We’re not grading our lab-grown diamonds because we don’t think they deserve to be graded,” Cleaver said. “They’re all the same.”

The pricing strategy will also be different. De Beers plans to charge $200 for a quarter-carat, $400 for a half and $800 for a carat, another sharp break from natural stones that rise exponentially in price the bigger the diamond gets.

Man-Made Gems

While De Beers has never sold man-made diamonds for jewelry before, it’s very good at making them. The company’s Element Six unit is one of the world’s leading producers of synthetic diamonds, which are mostly used for industrial purposes. It has also been producing gem-quality stones for years to help it tell the difference between natural and man-made types and to reassure consumers that they’re buying the real thing.

Man-made gems currently make up a small part of the diamond market, but demand is increasing. Global diamond production was about 142 million carats last year, according to analyst Paul Zimnisky. That compares with lab production of less than 4.2 million carats, according to Bonas & Co.

De Beers has been researching lab-made diamonds since the end of World War II and accelerated its work after a Swedish company synthesized the first diamond in 1953. The company has focused on lab diamonds for industrial uses, but also kept investing in technology for jewelry-grade gems.

The shift to lab-diamond jewelry comes at a sensitive time for De Beers and its relationship with Botswana, the source of three quarters of its diamonds. The two have a sales agreement that lets the company market and sell gems from Botswana, giving De Beers its power over global prices. The deal will soon be up for negotiation and Botswana is likely to push for more concessions.

On Tuesday, De Beers said it had extensive talks with Botswana about the decision to sell man-made diamonds and the country supports the move.

Source: bloomberg.com

9ct. Synthetic Sets ‘World Record’

WD Laboratory Grown Diamonds has created what it claims to be the world’s largest known synthetic diamond made using chemical vapor deposition (CVD).

The ideal cut, round brilliant 9.04 carat, VS2 clarity stone broke the synthetic diamond producer’s own previous world record of 6 carats, the company said last week.

“No other CVD diamond manufacturer has come close to this size and quality,” Clive Hill, its founder and chairman, claimed. “But this is not an easy task, and we overcame significant hurdles that we’ll undoubtedly face and overcome again.”

WD Lab Grown Diamonds intends to work on producing even larger CVD synthetics, Hill added.