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The Case of the Tarnished
Golden Rule

A salesperson becomes uncomfortable when the store owner 
buys a “knockoff” piece for a client.

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GLENN LASKIN FELT good about the 12 years he had spent building his business from the ground up. Granted, it turned out that 2007 was not exactly the best time to launch his new venture, but despite the tough start, Glenn managed to turn his modest inheritance, the several generations of industry knowledge he’d absorbed from his family over the years and a head full of creative ideas into a success story.

ABOUT REAL DEAL

Real Deal is a fictional scenario designed to read like real-life business events. The businesses and people mentioned in this story should not be confused with actual jewelry businesses and people.

ABOUT THE AUTHOR

Kate Peterson is president and CEO of Performance Concepts, a management consultancy for jewelers. Email her at [email protected]

While Glenn’s Diamonds & Design was thriving in early 2020, Glenn was beginning to feel the frustration of the daily retail grind. Careful analysis with a business consultant in preparation for his upcoming lease renewal made it clear that over 75 percent of his revenue was coming from his repair and custom design business. Glenn felt certain, however, that he and his small team spent well more than half of their time on far less productive activities, from changing watch batteries to selling silver replacement chains to waiting on what they called their “hunt-and-gather” bridal customers — university students looking for information who had no intention of purchasing from Glenn’s.

Like many others, Glenn was given plenty of time to reflect and plan while his store was closed through mid-2020. During that time, he renegotiated his lease, worked with a developer to create a new website, and hired a marketing team to orchestrate a brand reinvention. By the time the state was ready for businesses to reopen, Glenn’s Diamonds & Design had been transformed into a by-appointment-only custom design and fine jewelry repair shop, operating in a smaller space with a greatly reduced staff that included Mikael Balian, a highly skilled master jeweler; Vicki Gruening, GD&D’s top salesperson and Glenn himself as the designer and extra as-needed craftsman.

While most of the operation was much more efficient in the new model, one issue seemed to become even more of a challenge. It seemed to Glenn that there was an increasing number of customers taking up his time and energy, having him create designs that they then ended up having made elsewhere. In early January, after one especially frustrating situation involving a couple of soon-to-be medical school graduates, he posted the story to a popular industry Facebook group, asking for advice. The responses he saw were overwhelmingly consistent. Glenn decided to take the advice of dozens of designers in the group and changed his policy to require a $300 upfront design fee that could be applied to the cost of the completed piece.

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Everything seemed to be going remarkably well until one Saturday in early April when Vicki had an appointment with Eli Singer, a local professor, who selected a 2.34-carat E, VS1 emerald-cut diamond for an engagement ring.

Eli initially said he wanted a simple, modified solitaire setting. He left a deposit on the diamond and paid the design fee but said he wanted to get more specific information about the type of setting his fiancée liked before having Glenn start the design process. He came in several days later with a picture of a unique ring from his fiancée’s Pinterest board that her sister told him was the ring she wanted. The ring was from the website of a well-known West Coast designer who was direct-to-consumer only and who sold worldwide via his website and virtual consultation.

Glenn, not wanting to directly knock off the other designer’s piece, offered to come up with variations for Eli, but Eli was adamant that while he wanted to buy locally from Glenn and Vicki, the ring he presented had to look just like the one in the picture. Glenn asked for a few days to come up with options and said he would get back to Eli by the end of the week.

Later that afternoon, Glenn once again went to his favorite Facebook group and asked for advice. Within minutes, four different manufacturers offered to make an exact replica of the ring for him. Thinking that since he would be buying from a manufacturer, he wouldn’t need to worry about intellectual property or copyright, he chose one manufacturer, got a CAD rendering and model that were approved by his client, and had the ring made. Eli loved the finished ring, and Glenn assumed that Vicki was happy about making the $44,600 sale.

Several days later, Vicki came into Glenn’s office in obvious distress. She said that while she was happy that they were able to earn Eli’s business, she felt extremely uncomfortable with knowing that he had deliberately stolen the design from another artist — especially after all the times he’d complained when that same thing was done to him. She said she didn’t expect him to do anything about it at this point, but that she hated that this was the first time since she began working with him that she had serious doubts about his business ethics.

The Big Questions

  • Did Glenn cross a line? Does a retailer have any ethical responsibility if they buy a “knock-off” piece from a manufacturer that was made at his/her request?
  • What should Glenn do about Vicki?
  • Should he be concerned about regaining her trust — and if so, how can he go about doing that?
Amy C.
Grove, OK

This is a problem all over the industry. He definitely shouldn’t have copied the design directly. My suggestion to customers who wish to do this is to add a personalized feature to make it “theirs.” If they insist on copying, I will first try to get the ring from the actual designer. If they decline to sell to me, I will ask the customer to go ahead and order from the designer, but I will have to charge to set it and the designer will likely not warranty their item after someone else touches it. (This usually causes them to decide that having that particular design is not that important.) After this and a few more options for an original design, they come around and do something for just them that is NOT a copy. Who wants one identical to another’s, anyway?

Mark H.
Topeka, KS

Vicky needs to get off her high horse and realize that her ideas about not copying someone else’s work is like wishing for Santa Claus to show up and pay your house off. I can look at numerous “designers” that have copied and copied and copied other people’s ideas and put one extra diamond or 1/20 mm more gold somewhere and called it their own. There are many designers that know they have basically copied someone else’s work, yet they do it every day. Unless the piece is beyond crazy unique, there is no “one of a kind,” and again, one small modification makes it unique to the new designer. Maybe Ms. Vicky needs to grow up and join the real world that is not idealistic … and very realistic. The ultra-purest are always with their opinion UNTIL it starts to hit their pocketbook and they suddenly have a different feeling.

Steve S.
Galveston, TX

He knew he crossed the line when he hired someone else to copy the ring. He profited from someone else’s design. I have copied designs after calling the manufacturer to try to order it and being told it’s not available. I asked why, and they said the style was only safe manufactured up to a 1 carat. My customer owned a 2-carat in a different shape, so I made the design, the customer loved it, and I felt no guilt because I tried to go through them.

Peter T.
Show Low, AZ

If I pay somebody to rob a bank instead of robbing it myself, is that OK? Glenn got greedy. He should thank Vicki for the reminder that business ethics are more important than profits.

Jennifer F.
Colorado Springs, CO

Understandable frustration! There is ALWAYS a place to make a modification. It is a leader’s responsibility to lead by example, and guide clients as to WHY it is an ethical consideration to make even a small change. Anymore, all designs are derivative of something that already exists, whether it’s cars or fashion or jewelry. Putting the responsibility of intellectual property violations on another company is still knowingly participating by requesting it to be done. There’s a line that we all must choose to walk, and it is a personal choice. I like being proud of who I see in the mirror. Often, people don’t consider the ethics until their business suffers from their decisions. If Vicki is taking pause, Glenn should reevaluate who he wants to be moving forward (i.e., the guy who makes the sale or the guy who lives by business ethics).

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Charles E.
Troy, MI

Glenn absolutely crossed the line — not only the ethical, but the legal as well. As someone who works on these litigations, I will weigh in. If the designer whose intellectual property was infringed upon registers their designs, they can easily bring action against Glenn as well as the sub-contractor. In most cases, the holder of copyright will be entitled to what they would have sold the ring for, treble damages, legal and expert witness fees, and court costs. They will also have their own legal fees and the expert their lawyers will retain.

What Glenn should have done is reached out to the designer and asked them to create the semi-mount for his store at a wholesale or discounted rate. If the designer refused to create the piece, then Glenn should have explained to the client that it would be ethically and legally wrong for him to do so and the client could have one of his designs, or he would just sell him the diamond and offer to ship the stone to the designer.

Megan C.
Poulsbo, WA

As a custom design retail store, we’ve come across similar situations. We believe our integrity and honesty are the cornerstones of everything we do. If a client brings a design to us that is “exactly” what they want, we’re very open about why we won’t copy this design. We’ll only make a version of it, with the client approving the design, but we won’t copy. It’s happening too frequently for our comfort. It is hypocritical of Glenn to take this course of action. He could take this opportunity to think carefully about how he wants to address requests like this before it happens again and to reassure his staff that they work for a company they can believe in.

Troy L.
Orange County, CA

It’s common to see some jewelry manufacturers [names removed] selling rings similar to Tiffany and other popular designers; that is because people are asking for them. Though, unlike the designer who uses the same file to make an infinite amount of the same rings, a custom designer is making a one-off design in your ring size and with the exact measurements of the diamond. So unlike ordering one that is massed produced and needs to be modified, we are making one that is perfect and truly one-of-a-kind.

Janne E.
Cocoa, FL

I’m with Vicki: Glenn ABSOLUTELY crossed the line by commissioning a knockoff of another artisan’s design. The ethical responsibility is to decline the sale in the first place. (I actually run into this scenario relatively often, and I ALWAYS decline or present an alternative design.) It reads as though Glenn had adjusted his own business model TWICE, in part to address his design expertise being taken advantage of and then not being used for the actual work. I find his willingness to copy another artisan’s work thoroughly hypocritical. I don’t know that Vicki will ever fully trust him again. At the very least, I would think that she will need to see many, many more similar circumstances handled in a more ethical manner. And if Glenn doesn’t at least have some doubts or second thoughts about this sale, then if I were Vicki, I’d probably consider leaving.

Ralph H.
Connersville, IN

You pay your lawyer now so you do not have to pay for his grandkids’ college education later. Was the design in question copyrighted, or was it implicitly copyrighted under the law? If the answer to either question is yes, you violated the law. The original designer could sue you. Your lawyer could come up with a form to have the customer sign in a case like this, absolving you from blame and perhaps shifting responsibility to the customer (yeah, good luck with that). Likely you will not get caught this time, but the issue is that you knocked off someone else’s work, which is pretty much verboten in the trade. As an aside, a jeweler in Nashville (I believe) requires staged payments, in advance for each step in the design and manufacturing process, signatures at each stage … seems a good idea. You never get behind, and no one swipes your work to be done elsewhere. Review your design process and decide where your morals direct you. Good luck!

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Kate Peterson is president and CEO of Performance Concepts, a management consultancy for jewelers. Email her at [email protected]nceconcepts.net.

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