<<

Federal Register / Vol. 75, No. 248 / Tuesday, December 28, 2010 / Rules and Regulations 81443

Airport and cancellation of all Standard impact is so minimal. Since this is a FEDERAL TRADE COMMISSION Instrument Approach Procedures (SIAP) routine matter that will only affect air has eliminated the need for controlled traffic procedures and air navigation, it 16 CFR Part 23 airspace in the Lone Star, TX, area. The is certified that this rule, when FAA is taking this action to ensure the promulgated, will not have a significant Guides for the Jewelry, Precious efficient use of airspace within the economic impact on a substantial , and Industries National Airspace System. number of small entities under the criteria of the Regulatory Flexibility Act. AGENCY: Federal Trade Commission DATES: Effective date: 0901 UTC, March (‘‘FTC’’ or ‘‘Commission’’). 10, 2011. The Director of the Federal The FAA’s authority to issue rules Register approves this incorporation by regarding aviation safety is found in ACTION: Final Guides Amendments. reference action under 1 CFR part 51, Title 49 of the U.S. Code. Subtitle 1, subject to the annual revision of FAA section 106, describes the authority of SUMMARY: The Commission announces Order 7400.9 and publication of the FAA Administrator. Subtitle VII, amendments to the FTC’s Guides for the conforming amendments. Aviation Programs, describes in more Jewelry, Precious Metals, and Pewter detail the scope of the agency’s FOR FURTHER INFORMATION CONTACT: Industries. The amendments in authority. This rulemaking is particular provide guidance on how to Scott Enander, Central Service Center, promulgated under the authority Operations Support Group, Federal mark and describe non-deceptively an described in subtitle VII, part A, subpart of and non-precious Aviation Administration, Southwest I, section 40103. Under that section, the Region, 2601 Meacham Blvd., Fort metals, consisting of at least 500 parts FAA is charged with prescribing per thousand, but less than 850 parts Worth, TX 76137; telephone (817) 321– regulations to assign the use of airspace 7716. per thousand, pure platinum and less necessary to ensure the safety of aircraft than 950 parts per thousand total SUPPLEMENTARY INFORMATION: and the efficient use of airspace. This platinum group metals. History regulation is within the scope of that authority as it removes controlled DATES: Effective Date: December 28, On October 21, 2010, the FAA airspace at the former Lone Star 2010. published in the Federal Register a Company Airport, Lone Star, TX. notice of proposed rulemaking to FOR FURTHER INFORMATION CONTACT: remove Class E airspace for Lone Star, List of Subjects in 14 CFR Part 71 Robin Rosen Spector, Attorney, (202) 326–3740, Division of Enforcement, TX. (75 FR 64972) Docket No. FAA– Airspace, Incorporation by reference, Bureau of Consumer Protection, or 2010–0772. Interested parties were Navigation (Air). invited to participate in this rulemaking Janice Podoll Frankle, Attorney, (202) effort by submitting written comments Adoption of the Amendment 326–3022, Office of the Secretary, Federal Trade Commission, 600 on the proposal to the FAA. No ■ In consideration of the foregoing, the Pennsylvania Avenue, NW., comments were received. Class E Federal Aviation Administration Washington, DC 20580. airspace designations are published in amends 14 CFR part 71 as follows: paragraph 6005 of FAA Order 7400.9U SUPPLEMENTARY INFORMATION: Pursuant dated August 18, 2010, and effective PART 71—DESIGNATION OF CLASS A, to public comments and consumer September 15, 2010, which is B, C, D, AND E AIRSPACE AREAS; AIR survey evidence submitted in response incorporated by reference in 14 CFR TRAFFIC SERVICE ROUTES; AND to two Federal Register Notices, the 71.1. The Class E airspace designations REPORTING POINTS FTC amends the Platinum Group Metals listed in this document will be ■ 1. The authority citation for 14 CFR Section (hereinafter ‘‘Platinum Section’’) published subsequently in the Order. part 71 continues to read as follows: of the Commission’s Guides for the The Rule Jewelry, Precious Metals, and Pewter Authority: 49 U.S.C. 106(g), 40103, 40113, Industries (‘‘Jewelry Guides’’ or This action amends Title 14 Code of 40120; E. O. 10854, 24 FR 9565, 3 CFR, 1959– 1963 Comp., p. 389. ‘‘Guides’’), 16 CFR 23.7, and also Federal Regulations (14 CFR) part 71 by amends the Scope and Application removing the Class E airspace extending § 71.1 [Amended] Section of the Guides, 16 CFR 23.0. The upward from 700 feet above the surface ■ 2. The incorporation by reference in amendments to the Platinum Section at the former Lone Star Steel Company 14 CFR 71.1 of the Federal Aviation provide that marketers may non- Airport, Lone Star, TX. The airport has Administration Order 7400.9U, deceptively mark and describe been abandoned and all SIAPs have Airspace Designations and Reporting ‘‘platinum/base alloys,’’ those been cancelled, therefore, controlled Points, dated August 18, 2010, and containing at least 500 parts per airspace is no longer needed for the effective September 15, 2010, is thousand (‘‘ppt’’), but less than 850 ppt, safety and management of IFR amended as follows: pure platinum and less than 950 ppt operations. total platinum group metals (‘‘PGM’’) as The FAA has determined that this Paragraph 6005 Class E airspace areas ‘‘platinum’’ using certain disclosures.1 In regulation only involves an established extending upward from 700 feet or more supporting this conclusion, the above the surface. body of technical regulations for which following Federal Register Notice frequent and routine amendments are * * * * * provides background information; necessary to keep them operationally ASW TX E5 Lone Star, TX [Removed] summarizes the record established by current. Therefore, this regulation: (1) Is the public comments; analyzes this not a ‘‘significant regulatory action’’ Issued in Fort Worth, Texas, on December record based on the applicable 15, 2010. under Executive Order 12866; (2) is not Commission standard; and sets forth the a ‘‘significant rule’’ under DOT Walter L. Tweedy, text of the amendments to the Platinum Regulatory Policies and Procedures (44 Acting Manager Operations Support Group, FR 11034; February 26, 1979); and (3) ATO Central Service Center. 1 The Platinum Group Metals are platinum, does not warrant preparation of a [FR Doc. 2010–32572 Filed 12–27–10; 8:45 am] iridium, , ruthenium, , and regulatory evaluation as the anticipated BILLING CODE 4910–13–P osmium. 16 CFR 23.7(a).

VerDate Mar<15>2010 18:14 Dec 27, 2010 Jkt 223001 PO 00000 Frm 00073 Fmt 4700 Sfmt 4700 E:\FR\FM\28DER1.SGM 28DER1 srobinson on DSKHWCL6B1PROD with RULES 81444 Federal Register / Vol. 75, No. 248 / Tuesday, December 28, 2010 / Rules and Regulations

Section and to the Scope and requested an FTC staff opinion commenters asserted that platinum Application Section of the Guides. regarding the application of the jewelry has always been produced as Platinum Section to a new product nearly pure or combined with other I. Background consisting of 585 ppt platinum and 415 PGM (hereafter ‘‘platinum/PGM’’),10 and A. The Platinum Section of the Jewelry ppt and (non-precious that platinum/base metal alloys do not Guides metals). The request stated that the share the same characteristics as these 11 The Commission issued the Jewelry company believed that the Platinum products. Karat Platinum disagreed Guides to help marketers avoid making Section did not prohibit marking or that the use of the term ‘‘platinum’’ to jewelry claims that are unfair or describing the product as ‘‘platinum,’’ or describe platinum/base metal alloys is deceptive under Section 5 of the FTC address how to mark or describe the deceptive. Act, 15 U.S.C. 45. Industry guides, such product other than to prohibit The 2005 record included consumer perception studies and product testing. as these, are administrative misrepresentations. The staff responded PGI submitted a study it commissioned interpretations of the law. Therefore, on February 2, 2005, agreeing that the from Dr. Thomas J. Maronick, (‘‘2005 they do not have the force of law and Guides did not address the marketing of 6 Platinum Awareness Study’’),12 a 2003 are not independently enforceable. The this product, and providing guidance. Because of the public interest in this marketing survey conducted by Hall & Commission can take action under the issue, the Commission published a Partners,13 and two tests evaluating FTC Act, however, if a business makes Federal Register Notice (‘‘2005 FRN’’) 7 platinum/base metal alloys.14 The 2005 marketing claims inconsistent with the soliciting public comment regarding Platinum Awareness Study found that Guides. In any such enforcement action, whether it should revise the Guides to 39.5% of consumers believe that the Commission must prove that the act address this new product. The products marked or described as or practice at issue is unfair or deceptive Commission also sought comment ‘‘platinum’’ are pure or nearly pure and in violation of Section 5 of the FTC 2 regarding whether the Guides should that certain qualities or attributes Act. address how to mark or describe non- typically associated with platinum are To help marketers avoid unfair or deceptively platinum-clad, filled, important to a substantial number of deceptive acts or practices in coated, or overlay jewelry products. consumers.15 The study also found that connection with the sale of platinum, Based on the 2005 FRN comments a majority of consumers would not the Platinum Section contains a general and consumer survey evidence, the expect platinum/base metal alloys statement regarding the deceptive use of Commission issued a Federal Register containing more than 40% base metal to ‘‘ ’’ the term platinum (and the names of Notice in 2008 (‘‘2008 FRN’’) soliciting be called ‘‘platinum’’ if they do not other PGM) and provides examples of comment on a proposed amendment to possess the attributes present in higher potentially misleading and non- the Platinum Section to address these purity platinum or platinum/other PGM ‘‘ ’’ 3 violative uses of the term platinum. issues. Prior to the close of the comment products.16 In addition, the study Specifically, Section 7(a) states: period on May 27, 2008, the Platinum showed that the majority of consumers It is unfair or deceptive to use the words Guild International (‘‘PGI’’) and the do not fully understand numeric jewelry ‘‘platinum,’’ ‘‘iridium,’’ ‘‘palladium,’’ Jewelers’ Vigilance Committee (‘‘JVC’’) markings, particularly those using ‘‘ruthenium,’’ ‘‘rhodium,’’ and ‘‘osmium,’’ or requested a 90-day extension. The chemical abbreviations, such as 585 Pt./ any abbreviation to mark or describe all or Commission extended the comment 415 Co.Cu. The PGI product tests part of an industry product if such marking period until August 25, 2008.8 or description misrepresents the product’s indicated that certain platinum/base true composition.4 C. The 2005 FRN Comments metal alloys are inferior to higher purity platinum jewelry in terms of wear and Section 7(b) provides three examples of The vast majority of the 62 responsive oxidation resistance, as well as weight markings or descriptions for products comments 9 recommended that the loss, and that they cannot be resized containing platinum that may be Commission revise the Platinum Section using certain procedures.17 Karat 5 misleading. Section 7(c) provides four to include guidance for platinum/base Platinum submitted a test of its alloy examples not considered unfair or metal alloy jewelry. These commenters which suggested that the alloy is deceptive. further recommended that the superior or equivalent to higher purity B. Procedural History Commission provide that marking or platinum jewelry in several respects, but describing platinum/base metal alloy On December 15, 2004, Karat jewelry as ‘‘platinum’’ is deceptive. The 10 Currently the Guides specifically address the Platinum, a jewelry manufacturer, marketing of products containing: (1) At least 85% 6 The request for a staff opinion and the staff’s platinum; or (2) at least 50% and less than 85% 2 The Commission is adding two new paragraphs response to that request are located at http:// platinum, and at least 95% total PGM. to Section 23.0 to clarify the scope and application www.ftc.gov/os/statutes/jewelry/letters/ 11 See, e.g., JVC Comment 2005 at 4, 7–8; PGI of the Jewelry Guides. This does not represent a karatplatinum.pdf and http://www.ftc.gov/os/ Comment 2005 at 16–19. change in Commission law or policy. statutes/jewelry/letters/karatplatinum002.pdf, 12 PGI Comment 2005, Attachment A. The 3 On April 8, 1997 (62 FR 16669), the Commission respectively. The staff letter stated that ‘‘this alloy Maronick study title is ‘‘Platinum Awareness Study: published the current Platinum Section. The [is] sufficiently different in composition from An Empirical Analysis of Consumers’ Perceptions Commission revised this section as part of its most products consisting of platinum and other PGM as of Platinum as an Option in Engagement recent comprehensive review of the Guides. to require clear and conspicuous disclosure of the Settings.’’ 4 16 CFR 23.7(a). differences.’’ The staff letter also explained that it 13 Id., Attachment B. 5 These examples provide that it may be did not appear ‘‘that simple stamping of the 14 Id. at 3, and Attachments C and D. misleading: (1) To describe a product with less than jewelry’s content (e.g., 585 Plat., 0 PGM) would be 15 Id., Attachment A. These attributes included 950 ppt pure platinum as ‘‘platinum’’ without sufficient to alert consumers to the differences the product’s weight, durability, scratch and tarnish qualification; (2) to describe a product with less between the Karat Platinum alloy and platinum resistance, and whether it was hypoallergenic and than 850 ppt, but more than 500 ppt, pure platinum products containing other PGM.’’ could be resized. as ‘‘platinum’’ without qualifying the representation 7 70 FR 38834 (July 6, 2005). 16 Higher purity platinum or platinum/other PGM with a disclosure identifying the ppt of pure 8 73 FR 22848 (Apr. 28, 2008). products include those containing at least 850 ppt platinum and the ppt of other platinum group 9 The Commission’s summary and analysis of the platinum, or at least 500 ppt platinum and at least metals contained in the product; (3) to use the word 2005 FRN comments is detailed in the 2008 FRN, 950 ppt PGM. ‘‘platinum’’ or any abbreviation to mark or describe 73 FR 10190 (Feb. 26, 2008). The 62 comments to 17 It does not appear that the PGI tests evaluated any product that contains less than 500 ppt pure the 2005 FRN are posted at: http://www.ftc.gov/os/ a product identical in composition to the Karat platinum. 16 CFR 23.7(b). comments/jewelryplatinum/index.shtm. Platinum platinum/base metal alloy.

VerDate Mar<15>2010 18:14 Dec 27, 2010 Jkt 223001 PO 00000 Frm 00074 Fmt 4700 Sfmt 4700 E:\FR\FM\28DER1.SGM 28DER1 srobinson on DSKHWCL6B1PROD with RULES Federal Register / Vol. 75, No. 248 / Tuesday, December 28, 2010 / Rules and Regulations 81445

is less dense than higher purity all attributes material to consumers (e.g., and attributes.24 PGI argued that platinum jewelry. Karat Platinum did the product’s durability, because of these perceptions, it is not test whether its alloy is hypoallergenicity, resistance to inherently misleading to refer to hypoallergenic. tarnishing and scratching, and the platinum/base metal alloys as Several comments also suggested that ability to resize or repair the product), ‘‘platinum,’’ and the deception cannot be the Commission provide guidance on their product is equivalent to products cured by qualifying language.25 how to describe platinum-clad, filled, containing at least 850 ppt pure Therefore, JVC and PGI asserted that plated, or overlay products, but most platinum, or at least 500 ppt pure marketers should describe platinum/ did not discuss what guidance the platinum and at least 950 ppt PGM. base metal alloys using a name that does Commission should provide. In the 2008 FRN, the Commission not include ‘‘platinum’’ or ‘‘plat,’’ so again sought comment whether it consumers will not be confused or II. The 2008 FRN and Comments should revise the Platinum Section to misled about the alloy’s contents or A. The 2008 FRN address platinum-clad, filled, plated, or attributes.26 Tiffany & Co. (‘‘Tiffany’’) agreed, suggesting that platinum/base Based on the 2005 FRN record, the overlay products and, if so, how. metal alloys should be ‘‘creatively and Commission issued a 2008 FRN B. Summary of the Comments individually named by the soliciting comment on a proposed In response, the Commission received manufacturer.’’ 27 Several other revision to the Platinum Section to 58 comments.20 Most were short commenters recommended that the FTC address the marketing of platinum/base without detailed discussion. However, ‘‘consider a new and different name’’ for metal alloys.18 The Commission Karat Platinum; JVC, on behalf of the alloy but did not propose a explained that the record supported the several industry associations; 21 and PGI particular name.28 conclusion that a substantial number of submitted detailed comments. The JVC Karat Platinum disagreed, arguing that consumers believed products marked or and PGI comments included survey the term ‘‘platinum’’ can be qualified described as ‘‘platinum’’ are nearly pure evidence. sufficiently so that consumers and possess certain desirable qualities We summarize the comments and understand that a product is not pure that some platinum/base metal alloys survey evidence below addressing: (1) platinum.29 Karat Platinum, however, may not possess. In addition, the Use of the word ‘‘platinum’’ to describe did not submit any survey evidence. Commission stated that the record platinum/base metal alloys; (2) the indicated that if a description of a 2. The Commission’s Proposed Commission’s proposed disclosures; (3) Disclosures platinum/base metal alloy as ‘‘platinum’’ harmonization with international is qualified only with a content standards; (4) the commenters’ proposed JVC and PGI asserted that the disclosure using numbers and chemical amendments to the Guides; and (5) Commission’s three proposed abbreviations, consumers likely would guidance regarding platinum-clad, disclosures were confusing, inadequate, not understand the disclosure. However, filled, plated, or overlay jewelry. there was no evidence that a more 24 PGI Comment at 10–11. PGI’s consumer descriptive disclosure would not 1. Use of the Word ‘‘Platinum’’ surveys asked consumers whether they would adequately qualify the claim. The expect products described with these terms to Many commenters asserted that use of possess the attributes of higher purity platinum/ Commission, therefore, proposed the term ‘‘platinum’’ to describe a other PGM products. PGI Comment, Attachment A, specific qualifying disclosures.19 platinum/base metal alloy would 2008 Platinum Attitude Study 2 at 1–4. The survey The Commission’s proposal provided deceive consumers in a manner that found: Karat Platinum: Definitely Yes, 18%; that marketers may physically mark or Probably Yes, 42%; Maybe, 21%; Platinum Alloy: could not be remedied with Definitely Yes, 6%; Probably Yes, 18%; Maybe, stamp a platinum/base metal alloy disclosures.22 Most made this assertion 24%; Platinum Five: Definitely Yes, 8%; Probably jewelry article with the product’s without supporting evidence. JVC and Yes, 23%; Maybe, 36%; Platinum V: Definitely Yes, chemical composition (e.g., 585 Pt./215 8%; Probably Yes, 25%; Maybe, 33%; Platifina: PGI, however, relied on the findings Definitely Yes, 3%; Probably Yes, 8%; Maybe, 22%; Co./200 Cu.), but that when making any from PGI’s 2005 Platinum Awareness Palarium: Definitely Yes, 4%; Probably Yes, 8%; other representation that the product Study and provided 2008 survey Maybe, 19%. contains platinum, marketers should evidence (‘‘2008 Platinum Attitude 25 PGI Comment at 3. See also Tiffany & Co. clearly and conspicuously disclose, Study’’).23 Specifically, PGI pointed to Comment (stating that consumers expect a product immediately following the name or labeled ‘‘platinum’’ to contain an industry standard the 2008 survey’s findings that metal of 500 ppt pure platinum with 950 total description of the product: consumers expect products marked or PGM); Lowell Kwiat Comment (explaining that (1) That the product contains described as ‘‘platinum’’ to be nearly today’s platinum is generally 95% pure); Gaetano platinum and other non-platinum group pure and that products with ‘‘platinum,’’ Cavalieri Comment (noting that the industry metals; standard practice for generations has restricted in their name, such as ‘‘Karat Platinum,’’ platinum to alloys containing no fewer than 850 ppt (2) The product’s full composition, by ‘‘Platinum Five,’’ or ‘‘Platinum V,’’ pure platinum); Richard Frank Comment name and not abbreviation, and the confuse or mislead consumers (commenting that platinum has traditionally been 90% platinum, 10% iridium); William Holland percentage of each metal; and concerning the products’ metal content (3) That the product may not have the Comment (noting that platinum jewelry has always been known to be 90% pure or higher); Joseph same attributes or properties as products 20 The 58 comments can be found at: http:// Klein Comment (platinum was never less than 85% containing at least 850 ppt pure www.ftc.gov/os/comments/jewelryplatinum2/ pure under any definition); Charles Wallace platinum, or at least 500 ppt pure index.shtm. Comment (‘‘[p]latinum has forever been sold as an platinum and at least 950 ppt PGM. 21 JVC submitted its comment on behalf of JVC, item of purity and should remain so.’’). the Manufacturing Jewelers and Suppliers of 26 See PGI Comment at 2, 12, 26–28, 34–35; JVC The proposed amendment also included America, the Jewelers of America, and the Comment at 2–3, 6–7, 14, 18. a substantiation provision that allowed American Gem Society. 27 Tiffany Comment at 3. Kwiat agreed, stating marketers to forgo the third disclosure if 22 See JVC Comment at 2; PGI Comment at 2–3. that marketers should call consumers’ attention to they had competent and reliable 23 Dr. Thomas J. Maronick conducted both this ‘‘new innovation’’ by giving it ‘‘a different name which reflects the fact that it is different than what scientific evidence that, with respect to studies. The title of the 2008 Attitude Study is: ‘‘Platinum Attitude Study: Four Empirical Studies has been customary.’’ Lowell Kwiat Comment at 2. of Consumers’ Attitudes Toward Platinum and 28 See, e.g., Birks & Mayors, Inc. Comment; Ben 18 73 FR 10190 (Feb. 26, 2008). Substitutes as Options in Engagement Ring Bridge Jeweler Comment; Joseph Cresalia Comment. 19 Id. at 10196–10197. Settings.’’ 29 Karat Platinum Comment at 6–8.

VerDate Mar<15>2010 18:14 Dec 27, 2010 Jkt 223001 PO 00000 Frm 00075 Fmt 4700 Sfmt 4700 E:\FR\FM\28DER1.SGM 28DER1 srobinson on DSKHWCL6B1PROD with RULES 81446 Federal Register / Vol. 75, No. 248 / Tuesday, December 28, 2010 / Rules and Regulations

and unworkable. Karat Platinum equivalent of platinum products that are Karat Platinum, however, did not disagreed, but suggested some revisions at least 85% platinum.34 PGI added that submit any consumer perception to the third disclosure and asserted that listing the percentages of each metal evidence indicating that the current marketers of higher purity platinum or still may not alert consumers of the marketing for higher purity platinum/ platinum/PGM jewelry should be differences between ‘‘diluted’’ platinum other PGM products misleads subject to the proposed second and alloys and higher purity products.35 consumers. third disclosures. Below, we discuss the Tiffany agreed and asserted that three proposed disclosures. disclosing each alloying component in (c) Third Proposed Disclosure full without abbreviation would not The Commission’s third proposed (a) First Proposed Disclosure achieve consumer knowledge. Tiffany disclosure provided that marketers The first proposed disclosure noted that research has shown that disclose ‘‘that the product may not have provided that marketers of platinum/ consumers do not understand metal the same attributes as products base metal alloys state that their product content disclosures. Thus, it contended containing at least 850 parts per ‘‘contains platinum and other non- that ‘‘disclosing that the ‘platinum’ piece thousand pure Platinum, or at least 500 platinum group metals.’’ Several has a certain percentage of copper * * * parts per thousand pure Platinum and at commenters argued that this disclosure is not instructive.’’ 36 least 950 parts per thousand PGM.’’ 43 will confuse consumers. For example, In contrast, Karat Platinum asserted The proposed amendment further 54% of consumers surveyed in the 2008 that disclosing the composition of provided that a marketer need not make Platinum Attitude Study did not know platinum/base metal alloys using the this third disclosure ‘‘if the marketer has what the phrase ‘‘other non-platinum full names and percentages of the competent and reliable scientific group metals’’ meant.30 PGI further constituent metals is a good practice.37 evidence that, with respect to all stated that when the survey asked It explained that the Commission’s attributes material to consumers * * * consumers to classify metals as proposed disclosures—that the product such product is equivalent to [higher platinum or non-platinum group, they contains platinum and other non- purity platinum/other PGM] products.’’ 31 were largely unable to do so correctly. platinum group metals and the full Many commenters asserted that this Karat Platinum, by contrast, commented names and percentage of the metals— disclosure is confusing and unworkable. that this disclosure would provide ‘‘provides the greatest likelihood of useful information to consumers about effectively conveying information to (i) The Disclosure Is Confusing the product.32 consumers.’’ 38 However, it noted that Several commenters asserted that the marketers of ‘‘high grade and platinum/ (b) Second Proposed Disclosure third disclosure is confusing because it PGM’’ do not have to disclose their does not require that marketers specify The Commission’s second proposed products’ full composition.39 Karat the attributes of platinum/base metal disclosure provided that marketers list Platinum asserted that the Commission alloys that differ from platinum/PGM the full composition of the product (by should remedy this inconsistency and products or explain how the alloy name and not abbreviation) and the modify the second proposed disclosure differs with respect to these attributes. percentage of each metal. JVC and PGI to provide that all marketers of platinum The 2008 Platinum Attitude Study asserted that consumers will not products make full compositional asked consumers about eight separate comprehend this disclosure. In support 40 disclosures. product attributes of platinum/base of this position, JVC cited the 2008 Karat Platinum opined that full metal engagement rings: durability, Platinum Attitude Study. Specifically, compositional disclosure for all luster, density, scratch resistance, when consumers were asked whether platinum products would benefit tarnish resistance, ability to be resized they understood the meaning of ‘‘58.5% consumers in at least two ways. First, it or repaired, hypoallergenicity, and the Platinum and 41.5% Copper/Cobalt,’’ ‘‘ ’’ asserted that it is a myth that retention of content over 55% said yes, 33% stated that they did platinum/PGM products are composed not know, and 12% stated that they time. From 40% to 80% of consumers of an industry-standard material. It surveyed (depending on the product were not sure.33 Moreover, JVC opined noted that high-grade platinum products property) would expect a salesperson to that because consumers will not may have ‘‘dramatically different’’ inform them about these attributes and understand the disclosure, they will characteristics. For example, it would also want the information focus only on the term ‘‘platinum’’ and compared two platinum rings, one physically attached to the product.44 believe that the product is the containing 95% platinum and 5% JVC asserted that these results ruthenium with another containing 95% demonstrate that the proposed 30 PGI Comment, Attachment A, 2008 Platinum platinum and 5% iridium. It stated that disclosure ‘‘will not impart any of the Attitude Study 4 at 1–2. In addition, 26% stated the former product is ‘‘significantly they were not sure what ‘‘other non-platinum group information consumers want and more scratch resistant and durable.’’ 41 metals’’ were. need.’’ 45 The 2008 survey, however, did 31 Second, Karat Platinum explained that Id. at 2. Respondents were asked whether they not evaluate consumer understanding of understood the phrase ‘‘other non-platinum group certain marketers ‘‘have engaged in the metals’’ and then were given a list of metals and long-standing practice of characterizing the third proposed disclosure. asked if any of them were ‘‘other non-platinum JVC asserted that ‘‘[t]o make this group metals.’’ In response to the follow-up, 29% high-grade and platinum/PGM alloys as ‘pure’ platinum’’ when the products all disclosure fair and complete, full of respondents stated that palladium was an ‘‘other disclosure about each of the eight non-platinum group metal;’’ 61% said they were not contain less than 100% platinum.42 sure; and 11% said no. Palladium is a platinum important attributes * * * would be group metal. Similarly, 39% stated copper was an 46 34 JVC Comment at 8. required.’’ JVC explained: ‘‘[a] ‘‘other non-platinum group metal;’’ 47% stated they 35 PGI Comment at 4. consumer could easily purchase a were not sure; and 13% said no. Copper is a non- 36 platinum group metal. Id. Tiffany Comment at 2. [platinum/base metal alloy] ring without 37 32 See Karat Platinum Comment at 6. Karat Platinum Comment at 6. 38 43 33 See JVC Comment at 8. See PGI Comment, Id. 73 FR 10190, 10197. 39 Attachment A, 2008 Platinum Attitude Study 3 at Id. 44 PGI Comment, Attachment A, 2008 Platinum 2. By contrast, when asked if consumers knew what 40 Karat Platinum Comment at 6–7. Attitude Study 1 at 3. 585Pt.415Co.Cu. meant 81% said no, 13% said yes, 41 Id. at 6. 45 JVC Comment at 11. and 7% said they were not sure. Id. at 1. 42 Id. at 7. 46 Id.

VerDate Mar<15>2010 18:14 Dec 27, 2010 Jkt 223001 PO 00000 Frm 00076 Fmt 4700 Sfmt 4700 E:\FR\FM\28DER1.SGM 28DER1 srobinson on DSKHWCL6B1PROD with RULES Federal Register / Vol. 75, No. 248 / Tuesday, December 28, 2010 / Rules and Regulations 81447

understanding that it might not hold a equipped to discuss this complex the proposed disclosures with the as well, or might tarnish, or metallurgical disclosure and simply will marketing materials ‘‘is more than may not be hypoallergenic.’’47 Other not provide the information, or will sufficient to ensure that the information commenters expressed similar provide incorrect information.54 PGI is available to consumers.’’ 62 It further concerns.48 noted that it would be difficult, if not opined that, by making marketing Tiffany, for example, explained that impossible, to ensure that the sales material available, consumers are ‘‘[o]ur experience has shown that personnel impart correct information ‘‘provided with sufficient information to consumers who are in the process of comparing all of the differences between put them in a position to inquire from buying a platinum product, feel as a multitude of new alloys.55 their jewelers, or from other though they understand the product’s In addition, JVC submitted a Jewelers knowledgeable sources, such as a makeup (platinum is pure) and of America (‘‘JA’’) study that asked JA company’s marketing information, Web characteristics (hypoallergenicity and members about the ‘‘realities’’ of selling site, or the Internet, as to the relative others) and are there (typically in a jewelry. The JA study, in part, found value, properties, and characteristics of rush) to decide based on issues such as that 57.4% of the respondents said that a product.’’ 63 Similarly, another style and fit, not a chemistry discussion it would be ‘‘difficult’’ or ‘‘very difficult’’ commenter stated that the point of sale of alloy makeup.’’ 49 Tiffany opined that to tell consumers that the jewelry may is the ideal way to inform consumers of this disclosure, combined with the not have the attributes of higher purity the platinum/base metal alloy content.64 second, full composition disclosure, platinum products and to explain those will baffle and frustrate consumers, differences.56 JVC asserted that such (d) The Substantiation Provision potentially causing them to walk away technical disclosures—spoken or Many commenters asserted that the from the sale. written—at the point of sale are likely substantiation provision that allows to have a ‘‘chilling’’ effect and that marketers to avoid making the third (ii) The Disclosure Is Unworkable consumers ‘‘may very well walk away disclosure is inadequate and The comments further asserted that from any product that requires these unworkable because it is too vague and marketers cannot realistically deliver confusing, lengthy and unappealing gives marketers too much discretion. the third proposed disclosure. disclosures.’’ 57 JVC and PGI explained that, even Specifically, JVC and PGI contended Moreover, JVC explained that nearly though the proposed amendment lists that the 2008 Platinum Attitude Study half of the respondents to the JA study five important attributes as examples,65 found that consumers expect jewelry stated that attribute disclosures could the seller self-determines which product information to be physically attached to not be attached to the jewelry in the attributes are material.66 JVC asserted 58 the product.50 However, both JVC and form of a tag or other physical means. that a disclosure that relies on a PGI asserted that the volume of Several commenters concurred, subjective standard presents endless information included in the disclosure, asserting that without physical possibilities for non-compliance.67 combined with the first and second attachment, the disclosures likely will Moreover, JVC explained that because proposed disclosures, cannot be not remain with the jewelry product ‘‘there are no industry-wide, universally- attached to the jewelry itself, or on a over time. JVC explained that the accepted testing methods that produce small tag affixed to the jewelry.51 JVC jewelry could be re-sold, repaired, or ‘competent and reliable’ evidence,’’ further stated that if the third proposed appraised without any identification of 59 there is no standard for testing these disclosure is revised to include the alloy. It asserted that a jeweler attributes.68 PGI similarly noted that additional information necessary to repairing a platinum/base metal alloy marketers are inappropriately left to fully inform consumers, this additional might not know the contents and this their own devices to ‘‘cherry pick’’ information will make attachment to could create the risk that the item will which tests they should conduct to self- 52 be damaged during the repair process. A jewelry more difficult. Therefore, JVC determine that they are exempt from jewelry repair dealer expressed similar noted, jewelry sales personnel will need making a particular disclosure.69 concern, explaining: ‘‘it will be virtually to orally disclose the information, or Karat Platinum raised three concerns impossible for any jewelry repair provide it in writing with the purchase. with the adequacy of the platinum technician to properly repair or size Several commenters asserted that attributes listed in the provision. First, * * * jewelry under the new reliance on the salesperson or on it explained that the five attributes proposal.’’ 60 Another commenter written information delivered with the listed in the provision do not include all opined that, short of an assay of the purchase is problematic. JVC opined the attributes that the 2005 Platinum jewelry piece, the platinum/base alloy that the average jewelry salesperson Awareness Study identified as product distinctions ‘‘will not be would be hard pressed to deliver this important to the greatest number of information.53 It further asserted that discernible even to the well trained 70 61 consumers. For example, in that study the jewelry retail sales force is not professional.’’ In contrast, Karat Platinum asserted a substantial majority of consumers that the proposed disclosures do not indicated they would want to know the 47 Id. at 10–11. weight of a product setting, yet that 48 See, e.g., Anne Howitt Comment; Michael need to include more detailed Kranish Comment. information or be physically attached to 62 Karat Platinum Comment at 5. 49 Tiffany Comment at 4. the platinum/base metal alloy products. 63 Id. 50 JVC Comment at 12; PGI Comment at 11. It suggested that marketers’ inclusion of 64 Hoover & Strong Comment. Hoover & Strong is 51 JVC Comment at 11–12; PGI Comment at 4. a wholesale jewelry manufacturer. 52 JVC Comment at 12–13. 54 JVC Comment at 12. 65 The five attributes in the proposed amendment 53 Id. Similarly, a jeweler commented that it is 55 PGI Comment at 4. are: durability, hypoallergenicity, resistance to unrealistic for the public to depend on retail sales 56 JVC Comment at 12–13; Attachment Six A. tarnishing, resistance to scratching, and the ability personnel to accurately disclose and explain the 57 Id. at 13. to re-size or repair the product. differences between platinum/PGM products and 58 66 JVC Comment at 9; PGI Comment at 4. the platinum/base metal alloy. This jeweler stated Id. at 12–13. 67 that the reality of the marketplace is that sales 59 Id. at 13. JVC Comment at 9. personnel are unlikely to explain jewelry 60 Steven DiFranco Comment. See also Anne 68 Id. specifications unless they are specifically asked. Howitt Comment; Peter LeCody Comment. 69 PGI Comment at 4. Lowell Kwiat Comment at 1. 61 Lowell Kwiat Comment at 1. 70 Karat Platinum Comment at 4.

VerDate Mar<15>2010 18:14 Dec 27, 2010 Jkt 223001 PO 00000 Frm 00077 Fmt 4700 Sfmt 4700 E:\FR\FM\28DER1.SGM 28DER1 srobinson on DSKHWCL6B1PROD with RULES 81448 Federal Register / Vol. 75, No. 248 / Tuesday, December 28, 2010 / Rules and Regulations

characteristic was not included of U.S.-made products, threatening the deceptive practices.82 Its proposed explicitly in the third proposed integrity of the entire U.S.-platinum provision stated that surface- disclosure. Second, Karat Platinum jewelry market abroad.’’ 77 Tiffany with platinum should be composed of at noted that because Dr. Maronick pre- agreed, noting that the FTC should not least 950 ppt platinum and specified a selected the attributes, the participants take actions to place manufacturers in a minimum thickness of .125 microns of had no choice in deciding which situation where their products are not platinum electroplate and .5 microns for characteristics were important. Third, it salable overseas.78 heavy electroplate. JVC’s proposal also asserted that when participants were provided that, if the plating is of at least allowed to write in the characteristics 4. Other Suggestions Regarding the 950 ppt platinum, but does not meet the important to them they ‘‘indicated that Commission’s Proposed Amendments minimum thickness, then the product they would want to know ‘everything’ JVC proposed that the Commission should be described as ‘‘platinum- about the platinum product.’’ 71 Thus, amend the Guides to provide that flashed’’ or ‘‘platinum-washed.’’ The Karat Platinum recommended the marketers cannot describe any product proposal also stated that certain Commission ‘‘conduct independent fact containing more than 5% non-platinum descriptions may be misleading: to determine what properties are group metal as ‘‘platinum.’’ 79 JVC also ‘‘overlay,’’ ‘‘filled,’’ ‘‘clad,’’ ‘‘rolled-plate,’’ material to consumers.’’ 72 proposed revising the Guides to state ‘‘covered,’’ or ‘‘coated.’’ 83 However, JVC In addition, Karat Platinum that certain practices are unfair or did not provide evidence that contended that the Commission should deceptive instead of stating that they consumers are being, or are likely to be, provide that all marketers of platinum may be misleading. Karat Platinum deceived by any current marketing for products—not just those marketing suggested that the provision in the platinum-plated jewelry or evidence platinum/base metal alloys—‘‘maintain Commission’s proposed amendment that JVC’s proposed terms would not evidence that their product meets those allowing marketers to physically stamp mislead consumers. expectations,’’ or alert consumers that platinum/base metal alloys with their 73 III. Analysis they do not. chemical composition and the substantiation provision be included in Based on the complete record, the 3. Harmonization with International Commission amends the Guides to Standards section 23.7(c) of the Platinum Section, instead of section 23.7(b).80 Because address the marketing of products JVC, PGI, and numerous other section 23.7(c) discusses markings that containing platinum/base metal alloys. commenters asserted that the the Commission would not consider The purpose of the Jewelry Guides is to Commission’s proposal is not in help marketers avoid deceptive or unfair misleading, Karat Platinum explained harmony with international standards conduct.84 The record demonstrates that that the amendment permitting physical and will impede foreign commerce.74 deception will likely result if marketers stamping is more appropriate in that JVC explained that products made of describe platinum/base metal alloys as section. platinum/base metal alloys cannot be ‘‘platinum’’ without disclosing sold as ‘‘platinum’’ in foreign 5. Platinum-Clad, Filled, Plated, or additional information. The record, jurisdictions that have adopted Overlay Products however, does not show that the standards promulgated by the qualified use of the term ‘‘platinum’’ In its 2008 FRN, the Commission also International Organization for would be deceptive. Moreover, the solicited comments concerning whether Standardization (‘‘ISO’’) or the World record furnishes sufficient evidence for Confederation (‘‘CIBJO’’).75 it should amend the Platinum Section to the Commission to provide guidance on Moreover, JVC noted that platinum/base address other products that contain qualifying disclosures. metal alloys could not be sold as platinum, such as platinum-clad, filled, Thus, the Commission concludes that ‘‘platinum’’ products in ‘‘hallmarking’’ plated, coated, or overlay products, it should amend the Guides to state that countries—those that require that which the Guides currently do not marketers may describe platinum/base precious metal jewelry (including address. The Commission received metal alloys as ‘‘platinum’’ with platinum) be stamped by approved several comments in response. Most did appropriate disclosures. Amending the assaying guilds before they are sold— not recommend specific guidance, but Guides in this manner is superior to the because they contain base metals.76 asserted that, if the Commission amends other available options: (1) Amending Thus, JVC opined that if platinum/base the Guides to provide that platinum/ the Guides to state that marketers metal alloy products are marketed as base metal alloy products should be should not describe such products as ‘‘platinum’’ in the U.S., it ‘‘will described with a ‘‘non-platinum’’ ‘‘platinum,’’ or (2) not addressing the undermine the international perception descriptor, then such ‘‘descriptors issue in the Guides at all. should also apply to plated, filled, Commenters, however, raised several 71 Id. at 5. rolled, and any other form that is not concerns about the disclosures the 72 Id. complete or near complete of platinum Commission proposed in its 2008 FRN. 73 Id. content.’’ 81 The Commission has considered these 74 See, e.g., JVC Comment at 14–18; PGI Comment JVC commented that the Commission comments and addresses them below, at 5, 18–20; Ben Bridge Jeweler Comment; Birks & should provide ‘‘standards’’ regarding either revising its previous proposal or Mayors Comment; Gaetano Cavalieri Comment at 1– 3; Joseph Cresalia Comment; Shannon Daly the thickness of the plating to ensure explaining why the record does not Comment; Tiffany Comment at 1–2; Anne Howitt durability—similar to those set for Comment; Norie Jenkins Comment; Annette Kinzie —to protect consumers against 82 JVC Comment at 26–27. JVC commented that Comment; Robert McGee Comment; Mark Noelke because there is no indication that marketers are Comment; Elizabeth Parker Comment; M. Strutz selling platinum-filled or platinum-clad items, the 77 Comment; Craig Warburton Comment. Id. at 18. Guides do not need to address those products. Id. 75 JVC Comment at 14–18. JVC explained that the 78 Tiffany Comment at 1. 83 Id. Attachment Three, which contains a ISO and CIBJO standards restrict the use of the 79 JVC Comment at 2–3, Attachment One at 2. comment by Michael A. Akkaoui from Tanury word ‘‘platinum’’ to platinum/PGM alloys. Id. at 16– 80 Karat Platinum Comment at 3–4. Industries, regarding platinum plating, is in accord 17. 81 Michelle Broyles Comment; Don Broyles with JVC’s comment. 76 JVC explained that England, France, Germany, Comment; Walter Hardin Comment; Vickie Martin 84 See 16 CFR 1.5. The purpose of the Guides is and Switzerland are hallmarking countries. Id. at Comment; Robert Pate Comment; Randall Sims to prevent deception, not to codify the rules set by 15, n.22. Comment. standard setting bodies. See id. §§ 1.5–1.6.

VerDate Mar<15>2010 18:14 Dec 27, 2010 Jkt 223001 PO 00000 Frm 00078 Fmt 4700 Sfmt 4700 E:\FR\FM\28DER1.SGM 28DER1 srobinson on DSKHWCL6B1PROD with RULES Federal Register / Vol. 75, No. 248 / Tuesday, December 28, 2010 / Rules and Regulations 81449

support revision. Finally, the in terms of wear and oxidation consumers (55%) understood the Commission declines to amend the resistance, as well as weight loss, and proposed full name and percentage Guides to address the marketing of that they cannot be resized using certain content disclosure.94 In contrast, only products with platinum plating or procedures.90 Moreover, Karat 13% of consumers said they understood coatings at this time. Platinum’s 2005 testing shows that its disclosures using abbreviations.95 platinum/base metal alloy is less dense Moreover, the study likely understates A. The Record Shows That Deception than platinum/PGM products.91 the effectiveness of the proposed full Will Likely Result if Marketers Describe Therefore, describing such products as name and percentage content disclosure Platinum/Base Metal Alloys as ‘‘platinum’’ without qualification is for several reasons. First, this disclosure ‘‘Platinum’’ Without Qualification likely to result in deception regarding is designed to work in tandem with the In 2005, the Commission found that their purity and attributes. third proposed disclosure (that the deception would likely result if B. The Record Does Not Support product may not have all the attributes marketers describe platinum/base metal Amending the Guides To State That of platinum/PGM), and the study did alloys as ‘‘platinum’’ without disclosing Using the Term ‘‘Platinum’’ To Describe not test the third disclosure, either alone information regarding their composition or in conjunction with the full name 85 Platinum/Base Metal Alloys Is and attributes. The 2008 comments do Necessarily Deceptive and percentage content disclosure. not dispute this finding.86 In fact, newly Second, some consumers who stated submitted consumer perception data As noted earlier, JVC, PGI, and that they did not understand the further supports this conclusion. numerous retailers opposed amending disclosure may have understood that the Specifically, the 2008 Platinum the Guides to state that marketers of item contained 58.5% platinum but Attitude Study, like the 2005 Platinum platinum/base metal alloys may found the phrase ‘‘41.5% Copper/ Awareness Study, shows that most describe them as ‘‘platinum’’ in a Cobalt,’’ which did not disclose the consumers expect products described as qualified manner. These commenters percentage of each metal, confusing. ‘‘platinum’’ to contain a high percentage contended that marketers cannot Third, as discussed in section III.C.2 ‘‘ ’’ of platinum. Fifty-nine percent (59%) of describe such alloys as platinum below, consumer perception data the consumers surveyed expect a without deceiving consumers no matter regarding gold jewelry shows that the product described as ‘‘platinum’’ to what information they disclose. proposed full name and percentage contain at least 80% pure platinum and Accordingly, they recommended that content disclosure likely would be even 69% expect at least 75% pure the Commission amend the Guides to more effective than the above figures state that marketers should not describe platinum.87 The new data also show suggest. On its face, this second such alloys as ‘‘platinum.’’92 that many consumers expect products disclosure appears to be clear, and the described using names that include the In evaluating whether a representation is misleading the record lacks any evidence to the word ‘‘platinum,’’ or the root ‘‘plat,’’ to Commission examines not only the contrary. have the same attributes as products claim itself, but the net impression of Finally, guidance stating that traditionally marketed as ‘‘platinum’’ to the entire advertisement.93 Thus, in marketers cannot describe platinum/ consumers in the United States.88 For order to state that marketers should base metal alloys using the term example, 60% of those surveyed expect never describe platinum/base metal ‘‘platinum’’ would deprive consumers of that a product described as ‘‘Karat alloys as ‘‘platinum,’’ the Commission truthful information, specifically that Platinum’’ would definitely or probably would have to conclude that no those products are primarily comprised have the same attributes as ‘‘platinum;’’ 96 reasonable qualification is sufficient to of platinum. and 24% expect that even a product render the term non-deceptive. The described as ‘‘Platinum Alloy’’ would C. The Record Demonstrates That record, however, does not support this definitely or probably have the same Disclosure Is the Appropriate Means for position. The 2008 Platinum Attitude attributes as platinum.89 Attempting To Prevent Deception Study suggests that a clear majority of These expectations, however, will Having determined that describing often not be met with products made 90 PGI Comment 2005, Attachments C and D. It platinum/base metal alloys as from platinum/base metal alloys. does not appear that the PGI tests evaluated a ‘‘platinum’’ without qualification will Specifically, PGI’s 2005 testing indicates product identical in composition to the Karat likely to deception, and that the that certain platinum/base metal alloys Platinum platinum/base metal alloy. record does not show that the qualified are inferior to platinum/PGM products 91 Karat Platinum’s testing showed that its alloy use of the term ‘‘platinum’’ would be is superior to platinum/PGM products in terms of strength, hardness, and ability, and that its deceptive, the Commission concludes 85 See 73 FR 10190, 10192–10194 for a detailed ability to resist is equivalent to other that disclosures are the appropriate summary of the 2005 FRN comments. platinum products. See Karat Platinum Comment means for attempting to prevent 86 See, e.g., PGI Comment at 1–2; JVC Comment 2005 at 2–3. deception. Because the comments and at 5; Karat Platinum Comment at 2. 92 JVC and PGI acknowledged that a qualified use 87 PGI Comment, Attachment A, 2008 Platinum of the word ‘‘platinum’’ could, in theory, address new consumer perception evidence Attitude Study at 5 (these percentages are consumer confusion or deception stemming from cumulative). the use of the term ‘‘platinum’’ to describe platinum/ 94 See PGI Comment, Attachment A, 2008 88 PGI identified the four most commonly used base metal alloys. Yet, JVC and PGI asserted that it Platinum Attitude Study 3 at 1–2. When asked if platinum alloys in the United States: 90% would be impracticable and likely ineffective to they understood the meaning of ‘‘58.5% Platinum Platinum/10% Iridium; 95% Platinum/5% Iridium; make the lengthy, detailed disclosures that they and 41.5% Copper/Cobalt,’’ 55% said yes, 33% 95% Platinum/5% Cobalt; and 95% Platinum/5% believe marketers would need to make to prevent stated no, and 12% stated that they were not sure. Ruthenium. Maerz, Jurgen J., ‘‘Platinum Durability deception. 95 Id. When asked if they knew what 585Pt; vs. Scratching,’’ posted at http:// 93 Deception Policy Statement, 103 F.T.C. at 179 415CoCu meant, 81% said no, 13% said yes, and www.platinumguild.com/files/pdf/ n.32 (when evaluating representations under a 7% said they were not sure. V6N8W_platinum_durability.pdf. All four alloys deception analysis, one looks at the complete 96 Advising marketers not to use the term have at least 90% platinum. Several comments advertisement and formulates opinions ‘‘on the ‘‘platinum’’ to describe platinum/base metal alloys explained that platinum jewelry generally or basis of the net general impression conveyed by would prevent them from describing a product traditionally has had at least 85%, 90%, or 95% them and not on isolated excerpts’’). Depending on composed of 84% platinum and 16% copper as platinum. See supra note 24. the specific circumstances, qualifying disclosures ‘‘platinum,’’ while competitors could use the term 89 PGI Comment, Attachment A, 2008 Platinum may or may not cure otherwise deceptive messages to describe a product composed of only 50% Attitude Study 2 at 1–4. or practices. Id. at 180–81. platinum, 45% iridium, and 5% copper.

VerDate Mar<15>2010 18:14 Dec 27, 2010 Jkt 223001 PO 00000 Frm 00079 Fmt 4700 Sfmt 4700 E:\FR\FM\28DER1.SGM 28DER1 srobinson on DSKHWCL6B1PROD with RULES 81450 Federal Register / Vol. 75, No. 248 / Tuesday, December 28, 2010 / Rules and Regulations

reinforce the concerns the Commission perception data suggests that the attribute, between 28% and 43% of the considered in its 2008 FRN, the majority of consumers understand this respondents indicated the ring would following analysis begins with the disclosure. Indeed, 55% of those differ from platinum.106 This data Commission’s proposed three-tiered surveyed indicated that they knew what suggests that many consumers exposed disclosure regime. the phrase ‘‘58.5% Platinum and 41.5% to this type of disclosure do not have Copper/Cobalt’’ meant.101 In addition, the impression that platinum/base metal 1. The Commission’s First Proposed the ‘‘vast majority’’ of those who alloys have the same attributes as Disclosure indicated either they ‘‘knew’’ or ‘‘were platinum/PGM products. More than half The first proposed disclosure not sure’’ what the disclosure meant the consumers surveyed, however, provided that marketers of platinum/ correctly identified the platinum and indicated that they ‘‘were not sure’’ or base metal alloys disclose that their copper/cobalt combination or indicated ‘‘did not know’’ whether the product products ‘‘contain platinum and other that the product had a combination of differed from platinum.107 Therefore, non-platinum group metals.’’ The 2008 the metals.102 further disclosure is needed to avoid Platinum Attitude Study, however, Although a substantial minority of deception. suggests that few consumers understand consumers surveyed said they did not this disclosure. Only 20% of those understand the disclosure, or were not 3. The Commission’s Third Proposed surveyed indicated that they knew what sure what it meant, many of those Disclosure the phrase ‘‘other non-platinum group consumers may have understood that a The third proposed disclosure metals’’ meant.97 Moreover, many product with 58.5% platinum is less advised marketers to state that a consumers who said either they ‘‘knew’’ ‘‘pure’’ than traditional platinum platinum/base metal alloy may not have or ‘‘were not sure of’’ the disclosure’s products.103 Indeed, consumer all the attributes that consumers meaning did not know whether cobalt, perception data addressing gold jewelry associate with higher purity platinum/ copper, palladium, rhodium, and suggests that this is the case. PGM products. It also provided that are non-platinum group metals (over Specifically, even though many marketers need not make this disclosure 60% for cobalt, palladium, and consumers cannot define the term ‘‘14 if they possess competent and reliable rhodium, and 47% for copper and karat gold’’ accurately, they understand scientific evidence that, with respect to silver).98 The Commission, therefore, that ‘‘14 karat’’ represents the amount of all attributes material to consumers, concludes that this disclosure is gold in the product and that 18 karat such product is equivalent to products unlikely to provide useful information. gold jewelry contains more gold than 14 containing at least 850 ppt pure Accordingly, the adopted amendment karat gold jewelry.104 Similarly it is platinum, or at least 500 ppt pure excludes this provision.99 reasonable to conclude that consumers platinum and at least 950 ppt PGM. The would understand that a product comments filed in 2008 raise six 2. The Commission’s Second Proposed labeled 58.5% platinum would contain concerns regarding this provision. Disclosure a lower percentage of platinum than a First, commenters noted that many The second proposed disclosure product they expect to have 85% consumers do not understand the terms provided that marketers of platinum/ platinum. Therefore, the Commission ‘‘platinum group metals’’ or ‘‘other non- base metal alloys disclose the product’s concludes that the second proposed platinum group metals.’’108 As a result, full composition, by name and not disclosure is the best option for it is likely that these consumers would abbreviation, and the percentage of each addressing possible deception regarding not fully understand this disclosure. To metal in the product.100 The consumer the purity of platinum/base metal address this issue, the Commission has alloys. revised the disclosure to replace the 97 PGI Comment, Attachment A, 2008 Platinum Furthermore, consumer perception reference to PGM with the phrase Attitude Study at 16. data suggests that this type of disclosure ‘‘traditional platinum products.’’ 98 Id. at 16–17. would also help prevent deception The most common platinum jewelry 99 The Commission considered revising this provision to state that marketers should disclose regarding the attributes of platinum/ currently marketed in the United States that platinum/base metal alloys contain ‘‘platinum base metal alloys. Specifically, survey contains at least 85% platinum.109 and other metals’’ or ‘‘base metals.’’ The record, participants were asked whether a ring Consumers, therefore, would reasonably however, does not include any consumer containing 58.5% Platinum and 41.5% understand that traditional platinum perception evidence suggesting that these disclosures would provide useful information. Copper/Cobalt is likely to differ from a products are those having the attributes Furthermore, the second disclosure already platinum ring on eight specific of products containing at least 85% provides the metal content of platinum/base metal attributes.105 Depending on the platinum. This conclusion is further alloys. More importantly, many platinum/PGM supported by the 2008 survey and products also contain metals other than platinum, correctly responded that it meant ‘‘585 parts including base metals; therefore, such a disclosure comments from industry demonstrating platinum, 415 parts cobalt/copper.’’ Therefore, would not likely help consumers distinguish that consumers expect platinum keeping the percentage disclosure will assist platinum/base metal alloys from such products. consumers’ understanding of the product’s content. products to be from 85% to all or almost 100 The 2005 Platinum Awareness Study suggests 101 PGI Comment, Attachment A, 2008 Platinum all pure. The amended Guides, that most consumers do not understand numeric Attitude Study at 14–15. Thirty three percent (33%) jewelry markings using parts per thousand and stated that they did not know, and 12% stated that 106 chemical abbreviations, such as ‘‘585 Pt./415 Id. they were not sure. Id. 107 Co.Cu.’’ PGI Comment 2005, Attachment A, 2005 Id. Between 47% and 55% of those surveyed 102 Platinum Awareness Study at 7–8, 25–26. Indeed, Id. at 15. The 2008 Platinum Attitude Study indicated they ‘‘did not know’’ or ‘‘were not sure’’ only 7.5% stated they knew what this marking did not indicate the number or exact percentage of whether the product differed from platinum, meant, and only 6.9% of those consumers actually respondents who responded in this manner, only depending on the attribute. understood that the marking described the this characterization. 108 JVC Comment at 8; see also PGI Comment at proportion of platinum and other metals in the 103 Id. at 14–15; see also PGI Comment at 10–11. 13, 35–36 (The 2008 Platinum Attitude Study jewelry product. Id. at 26. The 2008 Platinum 104 PGI Comment 2005, Attachment A, Platinum revealed that 80% of consumers do not understand Attitude Study suggests that most consumers do not Awareness Study at 24. the phrase ‘‘other non-platinum group metals.’’); understand chemical abbreviations. Indeed, 81% of 105 The attributes were durability, luster, density, Attachment A, 2008 Platinum Attitude Study at 16– those surveyed said they did not know what ‘‘585 scratch resistance, tarnish resistance, ability to be 17. Pt; 415 CoCu’’ meant. PGI Comment, Attachment A, resized, hypoallergenicity, and retention of precious 109 The Commission derived this percentage from 2008 Platinum Attitude Study at 14–15. Of those metal over time. PGI Comment, Attachment A, 2008 the comments and PGI’s Web site. See also supra who said they knew or were not sure, only one Platinum Attitude Study at 16. notes 25 and 88.

VerDate Mar<15>2010 18:14 Dec 27, 2010 Jkt 223001 PO 00000 Frm 00080 Fmt 4700 Sfmt 4700 E:\FR\FM\28DER1.SGM 28DER1 srobinson on DSKHWCL6B1PROD with RULES Federal Register / Vol. 75, No. 248 / Tuesday, December 28, 2010 / Rules and Regulations 81451

therefore, treat ‘‘traditional platinum’’ as attributes, these differences may be subjective, and therefore, that containing at least 85% pure insignificant to consumers, and the unworkable.116 They contended that platinum. This change provides record does not indicate that consumers marketers will differ in their consumers with a short, clear disclosure have been deceived as a result. If some understanding of which attributes are which is consistent with their current traditional platinum products differ material and the tests they should use views. Additionally, the new definition from each other in immaterial ways, it to determine differences. They added provides a more limited universe of follows that some platinum/base metal that no industry-wide, universally- comparison, which should help alloys may likewise differ from accepted testing methods or standards marketers respond to questions traditional platinum in immaterial relating to the attributes of jewelry precipitated by the disclosure.110 ways. The Commission, therefore, currently exist. Second, several comments suggested concludes that a platinum/base metal Neither of these arguments warrants that the Commission specify each alloy marketer need not make the third further modifying the proposed proviso. material attribute identified in the disclosure to prevent deception if the Marketers are responsible for consumer perception data instead of material attributes of its product do not substantiating their claims.117 In this merely listing examples. Adopting this differ materially from the attributes of case, the evidence demonstrates that suggestion should provide greater any traditional platinum product. using the term ‘‘platinum’’ to describe a clarity for marketers. Accordingly, the Fourth, JVC argued that only full platinum/base metal alloy conveys the provision now states that marketers disclosure of every materially different claim that the product has the same need not make this disclosure if they attribute would prevent deception attributes as traditional platinum. have the required evidence ‘‘with because consumers want and expect this Marketers, therefore, may make respect to the following attributes or information.113 JVC further contended disclosures to dispel this claim, avoid properties: durability, luster, density, that it would be impractical for the claim altogether, or obtain scratch resistance, tarnish resistance, marketers to make such disclosures; and competent reliable scientific evidence to hypoallergenicity, ability to be resized therefore, the Commission should substantiate the claim. For marketers or repaired, retention of precious metal amend the Guides to prevent marketers seeking to avoid the disclosure and still over time, and any other attribute or from using the term ‘‘platinum’’ to use the term ‘‘platinum’’ to describe their property material to consumers.’’ 111 describe platinum/base metal alloys. platinum/base metal alloys, the proviso Third, Karat Platinum contended that The Commission disagrees. The purpose identifies eight material attributes of the Commission provides insufficient of the Guides is not to maintain jewelry based on the consumer guidance regarding the evidence needed uniformly high product standards, but perception data in the record. If to substantiate that platinum/base metal to prevent unfairness and deception.114 additional attributes are, or become, alloys have the same material attributes The potential deception here is material to consumers, marketers are as higher purity platinum products. consumers’ assumption that platinum/ responsible for determining what those Specifically, Karat Platinum explained base metal alloys are as pure as attributes are and obtaining the that marketers would not know which traditional platinum and/or that they corresponding substantiation.118 This higher purity platinum products to have the same attributes as traditional places jewelry sellers in no different a which they should compare their platinum. A clear and conspicuous position than any other marketer.119 products. To support this point, Karat disclosure of a product’s composition Furthermore, the record shows that Platinum submitted evidence showing and that its attributes may differ from tests do exist for determining how some that traditional platinum products can those of traditional platinum addresses material attributes of jewelry products differ from each other with respect to this potential deception. If consumers differ from each other. Indeed, both scratch resistance and durability.112 are then interested in how this new Karat Platinum and PGI submitted tests Although the record shows that product differs from traditional showing whether, and to what extent, traditional platinum products can differ platinum products, they can seek certain material attributes of various from each other with respect to certain further information before purchasing a platinum/base metal alloys differ from jewelry product.115 those of platinum/PGM products. 110 Instead of comparing attributes to all products Fifth, some commenters argued that Moreover, marketers need not rely on containing either at least 85% platinum or at least industry-wide, universally-accepted 50% but less than 85% platinum and at least 95% the substantiation proviso is too PGM, platinum/base metal alloys marketers need only compare their products’ attributes to any one 113 JVC Comment at 10–11. 116 JVC Comment at 5–6, 9; PGI Comment at 4, 17. traditional platinum product. 114 61 FR 27224, 27225 (May 30, 1996). See also 117 The law requires marketers to have 111 The last phrase, ‘‘and any other attribute or 16 CFR 1.5. substantiation for their claims. See Telebrands property material to consumers,’’ does not provide 115 The Commission followed a similar approach Corp., 140 F.T.C. 278, 342 (2005), aff’d, 57 F.3d 354 the certainty some commenters may desire, but the in 1997 when it revised the Guides to provide that (4th Cir. 2006); FTC Policy Statement Regarding surveys never asked consumers which attributes fully disclosing the content of platinum/PGM Advertising Substantiation, Appendix to Thompson they think are material. Instead, the surveys simply products that contain less than 85% platinum Medical Co., 104 F.T.C. 648, 839 (1984). provided a list of attributes and asked consumers would be sufficient to avoid deception. The 118 The provision does not specify every material to comment. Therefore, the record does not Commission reasoned that ‘‘[a]n informative attribute or the type of scientific substantiation demonstrate that the terms provided are marking or description will put consumers on necessary to avoid making the disclosure, although comprehensive. Moreover, over time consumers notice that the product contains certain precious it does identify material attributes that seem likely may find additional attributes material. The metals, thereby putting them in a position to to remain material over the long term. Because we uncertainty posed by the catch-all phrase, however, inquire of the jeweler as to the relative value of the may discover that consumers find other attributes puts platinum marketers in no different position different metals and the overall value of the material now or in the future, and the nature of the than all other marketers in the economy who must product.’’ 62 FR 16669, 16673 (Apr. 8, 1997). Other substantiation may change over time, the substantiate all their material claims. Commission Guides and Rules similarly prevent Commission believes that flexible guidance is 112 Karat Platinum cited to PGI data showing that deception by providing that marketers disclose appropriate and that members of the jewelry products containing 95% platinum and 5% enough information for consumers to make an industry are well-positioned to comply with such ruthenium are more durable and scratch resistant informed choice or to seek the information needed guidance. than products containing 95% platinum and 5% to do so. See, e.g., Section 260.7(d) of the Guides 119 See Sears, Roebuck & Co., 95 F.T.C. 406, 511 iridium. The data also showed that both of these for the Use of Environmental Marketing Claims (1980), aff’d, 676 F.2d 385 (9th Cir. 1982) (finding products are more durable and scratch resistant (Example 4), 16 CFR 260.7(d); Section 424.1 of the that an advertiser is responsible for all claims, than a product containing 100% platinum. Karat Retail Food Store Advertising and Marketing express and implied, that are reasonably conveyed Platinum Comment at 2–3. Practices Rule, 16 CFR 424.1. by the advertisement).

VerDate Mar<15>2010 18:14 Dec 27, 2010 Jkt 223001 PO 00000 Frm 00081 Fmt 4700 Sfmt 4700 E:\FR\FM\28DER1.SGM 28DER1 srobinson on DSKHWCL6B1PROD with RULES 81452 Federal Register / Vol. 75, No. 248 / Tuesday, December 28, 2010 / Rules and Regulations

tests or standards, so long as they have statement that it may differ from commenters base their argument on competent and reliable scientific traditional platinum. Moreover, the conflicts between the Commission’s evidence.120 Indeed, marketers Commission has reduced the size of the proposed amendment and ISO and frequently develop evidence to proposed disclosures by eliminating the CIBJO standards. These standards, substantiate their claims even in the first proposed disclosure, and has however, are technical industry absence of industry-wide, universally- simplified the language in the third standards developed through a accepted tests or standards.121 The proposed disclosure. These changes consensus-building process based on a challenges in developing such evidence make the disclosures shorter and non- variety of considerations—such as cited by commenters are not unique to technical, and therefore, easier to facilitating trade and promoting the jewelry industry and do not warrant comprehend. Additionally, the 2008 international cooperation—and not further modification of the proviso. Platinum Attitude Study suggests that solely upon deception.126 Finally, some commenters contended most consumers can read and Harmonization with international that the third proposed disclosure understand disclosures regarding the standards is typically favored. Where, as would present endless possibilities for composition of jewelry using the full here, however, there is insufficient non-compliance and enforcement would name and percentage of each metal. evidence that a particular claim (i.e., a be hopelessly difficult.122 The With regard to the inability of sales qualified platinum representation) is Commission issues guidance to help personnel to make oral disclosures, the deceptive, the Commission cannot those marketers who are trying to record includes the JA e-mail survey promulgate a guide stating that comply with the law, not for those who showing that 52.5% of the retailers marketers should not make the are intent on violating it. The Guides surveyed would find it ‘‘difficult’’ or representation solely to achieve themselves, however, are not very ‘‘difficult’’ to make the disclosures harmony.127 independently enforceable. Therefore, orally. Sales clerks, however, need not Third, some commenters argued that the Commission would have to bring make any disclosure if marketers clearly any written disclosure regarding the any enforcement action under Section 5 and conspicuously make the written composition of platinum/base metal of the FTC Act and prove that a disclosures provided in the amended alloy jewelry would likely become marketer lacked substantiation for its Guides. Moreover, simply because separated from the jewelry over time.128 claims, regardless of what the Guides making a disclosure is difficult does not They contended that, as a result, provided. mean that it cannot reasonably be jewelers could not effectively appraise, D. Commenters’ General Objections to done.124 resize, or repair the jewelry at a later the Disclosure Provisions Do Not Justify With regard to any chilling effect time. However, the commenters’ Further Modification disclosure may have on sales, no proposed solution, amending the Guides to state that marketers should not The comments filed in 2008 raise four commenter has a larger stake in robust describe platinum/base metal alloys as general objections to the proposed sales of platinum/base metal alloy ‘‘platinum,’’ fails to resolve this problem. amendment, none of which warrant products than Karat Platinum. Yet Karat Specifically, describing such alloys as modifications. First, commenters Platinum, an entity that would be something other than ‘‘platinum’’ at the contended that the proposed disclosures responsible for making the disclosures, time of purchase does not insure that are unworkable because: Consumers indicated that the disclosures are jewelers would have the information will not read lengthy, technical written workable and does not object to them. necessary to identify, value, resize, or disclosures; the average jewelry sales The Commission, therefore, finds this personnel lack the expertise to make argument unpersuasive. repair the jewelry in the future. Physically stamping or marking oral disclosures effectively; and the Second, many commenters objected to jewelry to indicate its composition disclosures will likely have a chilling the proposed amendment because it would address this concern. The Guides effect on sales.123 conflicts with international standards. These objections are not persuasive. As the Commission explained in its currently do not require stamping, and With regard to written disclosures, there 2008 FRN, however, this is not a basis there is no evidence that such a is no evidence in the record indicating for rejecting the amendment. Although requirement is necessary in this case. In that consumers will not read written the Commission generally prefers to fact, Karat Platinum already marks its disclosures regarding a platinum/base harmonize its guidance with products with composition 129 metal alloy’s composition and a simple international laws and standards, information. However, the Commission Guides must be based upon Commission amends Section 23.7(c) of 120 ‘‘Competent and reliable scientific evidence’’ deception or unfairness.125 The means tests, analyses, research, studies, or other into consideration international standards and evidence based on the expertise of professionals in 124 Presumably marketers are already accustomed shall, if appropriate, base the standards on the relevant area, conducted and evaluated in an to answering questions about the differences international standards.’’ 19 U.S.C. 2532(2)(A). The objective manner by persons qualified to do so, between the jewelry products they sell and term ‘‘standard’’ in the Act includes guidelines that using procedures generally accepted in the competing products. If marketers can explain the are not mandatory, such as the Jewelry Guides. The profession to yield accurate and reliable results. See difference between jewelry made from platinum/ Act provides, however, that ‘‘the prevention of Guides for the Use of Environmental Marketing PGM, gold, or platinum/base metal alloys not deceptive practices’’ is an area where basing a Claims, 16 CFR 260.5; and Telebrands Corp., 140 currently described as platinum, for example, they standard on an international standard ‘‘may not be F.T.C. 278, 347 (2005), aff’d, 57 F.3d 354 (4th Cir. should be able to explain the differences between appropriate.’’ Id. at § 2532(2)(B)(i)(II). 2006). In the absence of industry-wide, universally platinum/PGM products and platinum/base metal 126 See http://www.iso.org/iso/standards accepted tests, marketers can rely on tests alloys described as platinum. In fact, the JA e-mail development/process and procedures how are conducted and evaluated objectively using survey also showed that 23.1% of the retailers standards developed.htm. Gaetano Cavalieri procedures generally accepted by professionals in surveyed would find it ‘‘easy’’ or ‘‘very easy’’ to Comment at 2. the area. make the disclosures orally (the remaining 24% 127 Moreover, the current Guides already conflict 121 See, e.g., Mohawk Petition, 74 FR 13099, responded ‘‘not sure’’ or did not answer the with ISO and CIBJO standards in that they allow 13102–13103 (Mar. 26, 2009). question). marketers to mark products as platinum, with 122 JVC Comment at 9, 14; PGI Comment at 2, 4, 125 The Trade Agreements Act of 1979 states that certain qualifications, even though they contain less 17–18. no Federal agency ‘‘may engage in standards-related than 85% platinum (provided they contain at least 123 See, e.g., JVC Comment at 12–13; PGI activity that creates unnecessary obstacles to the 50% platinum and 95% PGM). Comment at 15–16, 23; Lowell Kwiat Comment at foreign commerce of the United States and that 128 See, e.g., JVC Comment at 13. 1; Tiffany Comment at 4. Federal agencies must, in developing standards take 129 Karat Platinum Comment 2005 at 2.

VerDate Mar<15>2010 18:14 Dec 27, 2010 Jkt 223001 PO 00000 Frm 00082 Fmt 4700 Sfmt 4700 E:\FR\FM\28DER1.SGM 28DER1 srobinson on DSKHWCL6B1PROD with RULES Federal Register / Vol. 75, No. 248 / Tuesday, December 28, 2010 / Rules and Regulations 81453

the Guides to clarify that marketers may E. The Record Is Insufficient To Warrant bind the FTC or the public. The mark or stamp platinum/base metal Amending the Guides To Address the Commission, however, may take action alloy jewelry accurately to indicate Marketing of Products Containing under the FTC Act if a marketer or other composition using parts per thousand Platinum Plating or Coatings industry member makes a claim and standard chemical abbreviations Several comments proposed that the inconsistent with the guides. In any (e.g., 585 Pt., 415 Co.) without triggering Commission provide detailed guidance such enforcement action, the the new disclosure. This amendment regarding the marketing of products Commission must prove that the should insure that marketers are not containing platinum plating or coating. challenged act or practice is unfair or deterred from marking their products The JVC comment, for example, deceptive in violation of Section 5 of the based upon the Commission’s new proposed addressing a number of issues FTC Act. (e) The guides consist of general platinum guidance. The Commission relating to the marketing of such principles, specific guidance on the use proposed this amendment in its 2008 products, including the platinum of particular claims for industry content and thickness of platinum FRN, and no commenter specifically products, and examples. Claims may plating, washing or flashing, and heavy objected. If actual deception occurs raise issues that are addressed by more plating. The record, however, does not based on the lack of marking, or the lack than one example and in more than one include any evidence regarding how of further disclosure, the Commission section of the guides. The examples consumers perceive products with may consider amending the Guides at a provide the Commission’s views on how platinum plating or coating or the later date. reasonable consumers likely interpret claims made for them. Nor does the certain claims. Industry members may Finally, although Karat Platinum record include any evidence showing use an alternative approach if the supported the Commission’s general how the industry proposal would approach satisfies the requirements of approach, it argued that the Commission address any problem that may exist, or Section 5 of the FTC Act. Whether a should level the playing field by how consumers would perceive the particular claim is deceptive will amending the Guides to provide that disclosures contemplated by the depend on the net impression of the marketers of both platinum/base metal proposal. Accordingly, the Commission advertisement, label, or other alloys and platinum/PGM products declines to amend the Guides to address promotional material at issue. In make the same composition and the marketing of products with addition, although many examples attribute disclosures detailed above. platinum plating or coatings at this present specific claims and options for Karat Platinum argued that consumers time.130 qualifying claims, the examples do not do not understand the chemical List of Subjects in 16 CFR Part 23 illustrate all permissible claims or abbreviations used to describe Advertising, Jewelry, Labeling, qualifications under Section 5 of the platinum/PGM products containing less FTC Act. than 95% platinum any better than they Pewter, Precious metals, and Trade ■ 3. Amend § 23.7 by adding paragraphs understand the chemical abbreviations practices. (b)(4) and (c)(5) to read as follows: used to describe the content of ■ For the reasons set forth in the platinum/base metal alloys. It also preamble, the Federal Trade 23.7 Misuse of words ‘‘platinum,’’ argued that platinum/PGM products Commission amends 16 CFR part 23 as ‘‘iridium,’’, ‘‘palladium,’’ ‘‘ruthenium,’’ differ from each other with respect to follows: ‘‘rhodium,’’ and ‘‘osmium.’’ * * * * * material attributes such as durability PART 23—GUIDES FOR THE and scratch resistance. (b) * * * JEWELRY, PRECIOUS METALS, AND (4) Use of the word ‘‘Platinum,’’ or any The record suggests that marketers of PEWTER INDUSTRIES abbreviation accompanied by a number at least some products consisting of at ■ or percentage indicating the parts per least 50% but less than 85% platinum 1. The authority citation for part 23 is revised to read as follows: thousand of pure Platinum contained in and at least 95% PGM may need to the product, to describe all or part of an make additional disclosures when Authority: 15 U.S.C. 45, 46. industry product that contains at least describing their products as ‘‘platinum’’ ■ 2. Amend § 23.0 by adding paragraphs 500 parts per thousand, but less than to avoid deception; however, further (d) and (e) to read as follows: 850 parts per thousand, pure Platinum, evidence is needed. The attributes of and does not contain at least 950 parts these products may vary depending 23.0 Scope and application. per thousand PGM (for example, ‘‘585 upon the combination of metals used. * * * * * Plat.’’) without a clear and conspicuous We have no evidence whether these (d) These guides set forth the Federal disclosure, immediately following the differences are material to consumers. Trade Commission’s current thinking name or description of such product: Absent such evidence we decline to about claims for jewelry and other (i) Of the full composition of the product amend the Guides to provide for articles made from precious metals and (by name and not abbreviation) and additional disclosures. Marketers of pewter. The guides help marketers and percentage of each metal; and these products must ensure that they are other industry members avoid making (ii) That the product may not have the not making deceptive statements about claims that are unfair or deceptive same attributes or properties as traditional under Section 5 of the FTC Act, 15 platinum products. Provided, however, that their products based on reasonable the marketer need not make disclosure under consumer perception. U.S.C. 45. They do not confer any rights on any person and do not operate to § 23.7(b)(4)(ii), if the marketer has competent We, therefore, conclude that the and reliable scientific evidence that such product does not differ materially from any disclosures, described above, are the 130 The Commission agrees with Karat Platinum one product containing at least 850 parts per best option for addressing deception that one provision in the amendments adopted thousand pure Platinum with respect to the regarding the attributes of platinum/ herein belongs in Section 23.7(c) rather than 23.7(b). Accordingly, the Commission decided to following attributes or properties: durability, base metal alloys described as add this provision to Section 23.7(c) and revise it luster, density, scratch resistance, tarnish ‘‘platinum.’’ in a non-substantive manner so that the wording is resistance, hypoallergenicity, ability to be consistent with the other parts of Section 23.7(c). resized or repaired, retention of precious

VerDate Mar<15>2010 18:14 Dec 27, 2010 Jkt 223001 PO 00000 Frm 00083 Fmt 4700 Sfmt 4700 E:\FR\FM\28DER1.SGM 28DER1 srobinson on DSKHWCL6B1PROD with RULES 81454 Federal Register / Vol. 75, No. 248 / Tuesday, December 28, 2010 / Rules and Regulations

metal over time, and any other attribute or Freedom of Information Reading Room If a system of records contains property material to consumers. (Room 1621) at the above address. The investigative material compiled for law Note to paragraph (b)(4): When using telephone number for the Reading Room enforcement purposes, section (k)(2) of percentages to qualify platinum is (202) 622–5164 (not a toll-free the Privacy Act permits the head of an representations, marketers should convert the number). agency to promulgate a rule to exempt amount in parts per thousand to a percentage FOR FURTHER INFORMATION CONTACT: Earl a system of records from the Privacy that is accurate to the first decimal place Act’s provisions granting individuals (e.g., 58.5% Platinum, 41.5% Cobalt). Prater, Senior Counsel, Office of Professional Responsibility, at (202) certain rights with respect to the records (c) * * * 622–8018 (not a toll-free number). that pertain to them, including the right (5) An industry product consisting of to review and copy the records. As SUPPLEMENTARY INFORMATION: The Joint at least 500 parts per thousand, but less permitted by section (k)(2), the Joint Board is proposing to simplify the than 850 parts per thousand, pure Board published the following administration of its Privacy Act Platinum, and not consisting of at least documents to exempt certain systems of systems of records by consolidating the 950 parts per thousand PGM, may be records: current nine systems into three systems marked or stamped accurately, with a On August 27, 1975 (40 FR 39387), of records and to revise the data quality marking on the article, using the Joint Board published a proposed elements of consolidated systems of parts per thousand and standard rule to exempt five systems of records, records notices so as to ensure that they chemical abbreviations (e.g., 585 Pt., designating the rule as 20 CFR part 903. 415 Co.). accurately reflect the jurisdictional On September 30, 1975 (40 FR 45113), coverage and operational requirements the Joint Board published its proposed By direction of the Commission. of the Joint Board’s regulations, which Donald S. Clark, Privacy Act regulations, designating are set out at 20 CFR parts 901 through such regulations as 20 CFR part 903, Secretary. 903. and in the same publication, the Joint The Joint Board will publish [FR Doc. 2010–32273 Filed 12–27–10; 8:45 am] Board republished its proposed rule to separately in the Federal Register a BILLING CODE 6750–01–P exempt five systems of records, notice proposing to consolidate and redesignating the exempting rule as 20 revise its Privacy Act systems of CFR 903.8. JOINT BOARD FOR ENROLLMENT OF records. As described in the notice, the On January 8, 1976 (41 FR 1493), the ACTUARIES Joint Board proposes to consolidate its Joint Board published its final Privacy systems of records as follows: Act regulations as 20 CFR part 903 and JBEA–2, Charge Case Inventory Files, 20 CFR Part 903 in the same publication, the Joint Board will be renamed ‘‘Enrolled Actuary published its final rule to exempt five Privacy Act of 1974; Implementation Disciplinary Records’’ and will systems of records, designating the consolidate all disciplinary-related AGENCY: Joint Board for the Enrollment exempting rule as 20 CFR 903.8. records from that system and from the of Actuaries. The systems of records for which the following systems— Joint Board has claimed exemptions are ACTION: Direct final rule. JBEA–4, Enrollment Files; JBEA–8, Suspension and Termination listed in 20 CFR 903.8(a) as follows: SUMMARY: In accordance with the JBEA—Enrollment Files; Files; and requirements of the Privacy Act of 1974, JBEA—Application Files; JBEA–9, Suspension and Termination as amended, the Joint Board for the JBEA—General Information; Roster. JBEA—Charge Case Inventory Files; Enrollment of Actuaries (Joint Board) is JBEA–4, Enrollment Files, will be and amending the requirements regarding ‘‘ renamed Enrolled Actuary Enrollment JBEA—Suspension and Termination access to records to revise the listing of ’’ Records and will consolidate all Files. the Joint Board’s systems of records for enrollment-related records from that which the Joint Board has claimed This direct final rule will amend 20 system and from the following CFR 903.8 as follows: exemptions, under section (k)(2) of the systems— Privacy Act, from certain of the Privacy a. The exempt system currently listed JBEA–1, Application Files; as ‘‘JBEA—Charge Case Inventory Files’’ Act’s provisions, to revise language that JBEA–2, Charge Case Inventory Files; will be listed as ‘‘JBEA–2, Enrolled incorrectly implies that the Joint Board JBEA–3, Denied Applications; ’’ has yet to seek such exemptions or that JBEA–5, Enrollment Roster; Actuary Disciplinary Records. incorrectly implies that the Joint Board’s JBEA–7, General Information; b. The exempt system currently listed claims for exemption are still pending, JBEA–8, Suspension and Termination as ‘‘JBEA—Enrollment Files’’ will be and to correct internal references. Files; and listed as ‘‘JBEA–4, Enrolled Actuary Enrollment Records.’’ DATES: This rule is March 28, 2011 JBEA–9, Suspension and Termination c. The following systems will be without further action, unless adverse Roster. deleted from the listing of exempt comment is received by January 27, JBEA–6, General Correspondence , systems: 2011. If adverse comment is received, will be renamed ‘‘Correspondence and JBEA—Application Files; the Joint Board will publish a timely Miscellaneous Records.’’ The following systems of records will JBEA—General Information; and withdrawal of the rule in the Federal JBEA—Suspension and Termination Register. be deleted upon implementation of the consolidated and revised systems: Files. ADDRESSES: Comments should be sent JBEA–1, Application Files; d. Language such as ‘‘Exemption will to: Executive Director, Joint Board for JBEA–3, Denied Applications; be claimed’’ (§ 903.8(b)), which the Enrollment of Actuaries, c/o Internal JBEA–5, Enrollment Roster; incorrectly implies that the Joint Board Revenue Service/Office of Professional JBEA–7, General Information; has yet to seek exemptions, and Responsibility, SE:OPR, 1111 JBEA–8, Suspension and Termination language such as the ‘‘the Joint Board Constitution Avenue, NW., Washington, Files; and seeks exemption’’ (§ 903.8(c)(2)(i), (ii), DC 20224. Comments will be available JBEA–9, Suspension and Termination (iii), (iv), (v), and (vi)), which for inspection and copying in the IRS Roster. incorrectly implies that the Joint Board’s

VerDate Mar<15>2010 18:14 Dec 27, 2010 Jkt 223001 PO 00000 Frm 00084 Fmt 4700 Sfmt 4700 E:\FR\FM\28DER1.SGM 28DER1 srobinson on DSKHWCL6B1PROD with RULES