Reuters today reports that a a federal judge ruled today that a New York diamond merchant was found to have acted in bad faith when he sought to capitalize on the famed De Beers name as part of his plan to sell diamonds on the Internet.
A joint venture of South Africa’s De Beers Group brought the trademark lawsuit against Marvin Rosenblatt in 2004. The case went on trial in May in federal court in Manhattan.
U.S. District Judge Denise Cote ruled Rosenblatt violated trademark law through the use of the name DeBeers Diamond Syndicate Inc. that rightly belonged to plaintiffs De Beers LV Ltd., a joint venture of De Beers and luxury goods maker LVMH Moet Hennessy Louis Vuitton (LVMH.PA: Quote, Profile, Research).
Rosenblatt’s decisions to apply for dozens of Internet domain names with the name De Beers, obtain a Web site proposal and seek investment dollars “were done in entirely bad faith,” she said.
Spokespeople for Rosenblatt and De Beers were not immediately available.
Rosenblatt incorporated under the name DeBeers Diamond Syndicate Inc. in 1981 in Delaware, but the registration lapsed. In 2002, he renewed the incorporation and then registered it with the U.S. Patent and Trademark Office to buy and sell loose diamonds, according to court papers.
De Beers, which controls about two thirds of the world’s uncut diamond supply, made its initial foray into diamond retailing in London in 2002 in its joint venture with LVMH. The first De Beers store in the United States opened in June 2005 in New York.
During the trial, lawyers for De Beers LV argued the company had exclusive ownership of the name in the United States and that use of both the De Beers and DeBeers Diamond Syndicate names created confusion among consumers.
Rosenblatt’s lawyer argued De Beers’ trademark in the United States does not cover diamonds, but instead covers other products including clocks, candy and playing cards.
De Beers has faced antitrust cases in the United States since 1945. Last year the company pleaded guilty in federal court to a decade-old price-fixing charge, paving the way for it to again compete directly in America instead of using intermediaries. uters today reports that