London—The U.K.’s Advertising Standards Authority (ASA) has ruled in favor of the Natural Diamond Council (NDC) in a case against the online fine jewelry retailer Skydiamond for alleged misleading marketing and advertising of lab-grown diamonds.
Skydiamond, as stated on its website, employs a patented process utilizing atmospheric carbon dioxide and rainwater, powered by renewable energy sources like solar and wind, to produce diamonds.
NDC raised concerns about Skydiamond’s use of terms such as “Skydiamonds,” “diamonds,” and “diamonds made entirely from the sky” in its early 2023 advertisements across press, Instagram, and its website. Additionally, NDC contested the labeling of Skydiamonds as “real diamonds” on the retailer’s FAQ page.
In its judgment, the ASA, akin to the U.S. Federal Trade Commission (FTC), supported NDC, declaring that Skydiamond’s ads failed to transparently communicate that the diamonds were lab-grown. The ASA deemed the terms used misleading and found the ads in violation of several sections of the U.K. Code of Non-Broadcast Advertising, Sales Promotion, and Direct Marketing, including rules regarding misleading advertising and qualification.
According to the code, marketing communications must not obscure or omit material information that could mislead consumers.
The ruling highlighted that all of Skydiamond’s ads prominently featured gemstones and references to diamonds, potentially leading consumers to perceive them as naturally occurring. While some consumers might understand that diamonds can be synthetically produced, many may not.
ASA instructed Skydiamond to refrain from using the disputed terms without clear qualifiers such as “synthetic,” “laboratory-grown,” or “laboratory-created” to avoid confusion. Furthermore, the retailer was prohibited from reusing the ads in their current form and from describing lab-grown diamonds as “real diamonds.”
In response, Skydiamond expressed intentions to appeal the ruling, dismissing it as an error.
The NDC, which filed the complaint in March 2023, based its argument on the Diamond Terminology Guideline, recognized by Trading Standards in the U.K. market and endorsed by industry bodies including the U.K.’s National Association of Jewellers.
While the FTC has its own rules on diamond terminology, they are not applicable to diamonds sold outside the United States.
The guideline stipulates that communication related to natural and lab-grown diamonds must use specific terms like “synthetic” or “laboratory-grown” to distinguish lab-grown diamonds from natural ones—an aspect referenced by the ASA in its ruling.
Skydiamond, in its defense, questioned the comprehensiveness of the guideline and highlighted distinctions in its production process compared to conventional methods. However, ASA maintained that despite variations, lab-grown diamonds necessitated clear identification to inform consumer decisions accurately.
