Whatever Happened…

Each issue of JCK contains dozens of news stories. Some are complete as written, with nothing further expected to occur. But most are ongoing. A law suit is filed; was it ever settled? A new line is to be launched; was it and how did it do? A new gem deposit is discovered; did the find live up to its initial promise? People prominent in the industry drop out of the limelight; where are they now?

As new stories come along, it’s easy for us to overlook the old ones. That’s why JCK periodically looks back at issues of the previous few years to find stories that weren’t followed up. In these pages, we’ll tell you what happened &endash; or, in some cases, is still about to happen.

AMERICAN JEWELRY COUNCIL PONDERS INDUSTRY’S ROLE

The American Jewelry Council wants to help legislators and consumers understand the importance of the jewelry industry to the nation’s economy.

AJC, formerly called the Jewelry Coordinating Committee, took its new name, adopted a new mission statement and revised its bylaws in August 1994. Members &endash; who include representatives of many industry associations &endash; said their goal was to improve the industry’s low profile and poor recognition in Congress.

Since then, members have met several times to set up a budget and discuss what actions to take, says Ron Winston of Harry Winston Inc., chairman of the council. One project being considered is a short film that would explain the industry’s role to legislators and consumers. The film may be produced in conjunction with Jewelers of America, he says.

“The idea would be to purvey a notion that although it’s not food, clothing and shelter, jewelry is still very much a part of our society,” says Winston. “We want Washington to know this is a big industry and a fairly important component of the economy so they don’t target jewelry the next time they talk about a luxury tax.”

Winston says another project might be creation of an industrywide hallmark such as those used by the wool and cotton industries. The goal would be to emphasize the image of jewelry as a product.

Matthew Runci, a cochairman of the council and executive director of Jewelers of America, notes that one important factor has changed since the council reformulated itself in 1994. The “Republican revolution” in Washington will likely shift much legislative activity from the nation’s capital to individual state capitals. “The objective the council set for itself to increase awareness of the jewelry industry’s economic and social significance is still valid,” he says. “But we need to turn our attention to this new environment and consider what strategy is most effective. It might call for different steps than when everything was pretty much located in Washington.”

He hopes a meeting will be scheduled in early 1996 to discuss strategy RM.

TIFFANY IN JAPAN: A YEN FOR SUCCESS

In 1993, Tiffany & Co. took over direct control of the 29 boutiques it then operated in Mitsukoshi department stores in Japan. Recent results indicate that was a smart move. Same store sales there fell 14% in 1993, but rose 3% in ’94 despite generally cautious buying by Japanese consumers. Helping out were price cuts on half of Tiffany’s products, made in response to the strong yen.

“We’re very pleased with the progress we’re making there,” says Mark Aaron, vice president of investor relations for Tiffany. The firm now operates 38 Japanese boutiques (most still in Mitsukoshi stores). Indeed, Japan is Tiffany’s second biggest market, providing 28% of its revenues.

Tiffany expects long-term growth in the Japanese market. Strong retail sales in both Japan and the U.S. contributed to the firm’s 40% gain for the six months ended July 31; international retail sales rose 28% to $151.8 million.

Over the next few years, Tiffany plans to open more stores (including perhaps a flagship store in Tokyo); increase its share of the Japanese market (now 1%) and build its corporate gift business in Japan. The international luxury retailer now operates 83 stores around the world, including 18 in the U.S. – WGS

LONDON ASSAY: MISSED OPPORTUNITIES

Two years ago, the Jewelers Vigilance Committee helped open England’s London Assay Office to U.S. firms. Today, that office is one of the American jewelry industry’s most underused resources, says Joel Windman, JVC executive vice president.

Windman originally said that having American gold jewelry products hallmarked by the London office would help them compete better internationally and assure overseas customers that U.S. products are up to legal standards. But Windman says the effort’s been “basically a waste of time.” In the two years since JVC made the deal, there have been only “a half dozen or fewer inquiries” about the service.

“TV reports like Dateline [which reported on underkarated gold being sold in retail stores] show we’ve got a quality problem in this industry and this response shows the industry isn’t interested in doing very much about it,” he says.

The London Assay Office will still assay U.S. products within 24 hours of receipt for $15 for each lot of samples, plus small charges for applying the hallmark. The assay leaves no visible mark. The service is open to manufacturers and retailers at the Worshipful Company of Goldsmiths, Goldsmiths’ Hall, Gutter Lane, London EC2V 8AQ, England. – RS

More Joaillerie by Chanel

Chanel introduced a fine jewelry line called Chanel Joaillerie Collection in the U.S. in the fall of 1994 and it’s doing extremely well, says Amy Hoadley, coordinator of fashion public relations for the firm. The line is sold in Chanel fine jewelry stores; five were opened starting in October 1994 in Bal Harbour and Palm Beach, Fla., Beverly Hills, Cal., Aspen, Colo., and Honolulu, Hi. Two more were to open this fall in New York and Hawaii.

The line originally debuted in Paris in 1993, and was partly inspired by Chanel’s successful watch sales. It features 18k gold rings, pendants, bracelets, earrings and necklaces with diamonds, pearls and colored gemstones. New pieces are added to the collection twice per year; the collection now features almost 175 pieces.

– HTS

VAN CLEEF & ARPELS: TOMORROW, THE WORLD

In September 1994, JCK reported that Van Cleef & Arpels planned to distribute a new line of jewelry called “Boutique” in its own stores and through a small network of prestigious U.S. retailers.

The jewelry debuted that fall as scheduled. But the network was delayed because reaction to it from jewelers in both the U.S. and Europe was so good, says Henri Barguirdjian, president of Van Cleef & Arpels-U.S.

Barguirdjian and his colleagues decided to revise the distribution plan and create “a complete package of Van Cleef and Arpels [products]” which the luxury jeweler will push through a worldwide net of jewelers. This has required “a lot of testing, a lot of studying, all of which takes time,” he says. But barring any major problems, Van Cleef & Arpels’ worldwide network could launch as early as spring 1996. Within two-and-a-half years it should include at least 150 retail outlets in the U.S. and about the same number in Europe. (Retail partners in Asia already operate 28 stores under Van Cleef & Arpels’ name.)

Meanwhile, the Boutique jewelry collection has been “tremendously successful,” says Barguirdjian. Designed and made in the U.S. (though also distributed in Europe), it is created to appeal to younger, affluent consumers and broaden the jeweler’s market. Backed by new image advertising, the collection is doing exactly that, says Barguirdjian, attracting “a tremendous amount of new clients.”

New designs were to debut this fall and cover a broad spectrum, from a $1,200 pendant to $150,000 necklace. – WGS

FROM RUSSIA WITH DIAMONDS

Golden ADA, the San Francisco-based diamond firm set up by Russian emigres remains in business, though executives do not want to comment on its operations.

The company caused international speculation when it opened early last year and received some $88 million worth of rough diamonds from Russia. It was reported then that company founders Ashot and David Shagirian and Andre Kozlenok, all of Russian origin, expected the operation to become the major diamond link between Russia and the U.S. market.

The firm underwent several management changes in the ensuing year as Russian press reports suggested that the rough was never paid for and that Russian officials were under investigation. No Golden ADA official was ever accused of wrongdoing, and the Russian probe was quietly scotched. But neither Golden ADA nor Russian officials ever fully accounted for the stones’ whereabouts.

Golden ADA executives did say they would use the rough to begin polishing and marketing high-quality diamonds from Russia this year. But trade sources say little or no polished has been sold thus far. – RS

NEW KASHANS REPLACE ORIGINALS IN MARKET

The original Kashan rubies marketed by Steve Ruyle and Kuruvinda Corporation (now re-named Ruyle Laboratories) in Dallas, Tex., have been taken off the market. Ruyle says his inventory of original Kashans is just about gone.

The late H. Trueheart Brown and his wife Nancy developed Kashan synthetic rubies in the 1970s and ’80s, but production stopped in 1984 after their company’s bankruptcy. Ruyle, a friend of Trueheart’s and an avid crystal grower, purchased the remaining Kashan inventory for re-sale in the U.S and the Far East about two years ago.

Ruyle Laboratories’ own version of Kashan rubies reportedly will be available for sale in the next few months. Ruyle says that he couldn’t get the crystals to grow properly for a while. “A few runs ago the crystals were growing too fast,” he says. “We got very large – up to 4,000-ct.– crystals. But we couldn’t have cut even a 1-ct. clean ruby from the production due to the quality. Now we are getting consistent, cuttable crystals.”

Ruyle says the flux-grown gems are virtually indistinguishable from the original Kashans. “If people encounter this new material in a lab they will label it as a Kashan,” he says. “That’s because under the microscope the inclusions are all the same as the ones we see in Kashans, they were grown the same way and have the same wide variety of color variations.”

Ruyle, who says he has two furnaces producing the crystals, hopes to reach an 8,000-carat-a-month capacity soon. He feels his price point is very competitive. “At about $100 per carat for top-quality 1-ct. stones, we’re hard to beat.”

Does Ruyle Laboratories plan to make other crystal types? Steve Ruyle says there is too much competition in the synthetic emerald business and that other crystal families such as tourmalines are too complex to reproduce economically. But he says his company is working hard to produce synthetic diamonds. – RW

OUTLETS FOR EXCESS

Two years ago, during its bankruptcy reorganization, Zale Corp. opened three outlets to sell excess merchandise, some of it from the several hundred stores it closed. Today Zale is financially strong, but it still operates the outlet stores, now numbering four. They are a useful channel, say Zale officials, for excess and distressed merchandise from the corporation’s 1,200 outlets.

“We work with vendors to return [left-over merchandise], then move to the outlets, after that to liquidators and then, if necessary, melt [what’s left],” says Zale spokesperson Laura Moore.

“We look at every opportunity to maximize profit” from remaining wares. Of course, she says, “as we get better and better at implementing our retail strategies, the goal is to have less and less excess merchandise.”

All stores are in outlet malls, with two in Texas and one each in Pennsylvania and Virginia. Zale has no plans to add more.

– WGS

WHO’S MISLEADING?

In Rockford, Ill., independent retailer B. Sanfield and leased jewelry department operators Finlay Fine Jewelry, New York, continue to lock horns in a misleading advertising suit filed by B. Sanfield. Last January (page 16), we reported that Finlay’s attempt to have the suit dismissed was unsuccessful. Both sides gathered evidence until the summer, when Finlay filed a countersuit against B. Sanfield alleging it had engaged in misleading advertising similar to that which Sanfield has accused Finlay of creating. Sanfield’s lawyer Brian Shore called the countersuit a stalling tactic that may slow the court process, but will not halt it. He added that both sides continue to gather evidence for a trial he expects early next year. Sanfield’s ongoing deceptive advertising suit against J.C. Penney also is in discovery, he said. – MT

MONTANA SAPPHIRES: WINTER HIBERNATION

Predictions of strong supplies of Montana’s beautiful corundum palette failed to materialize in 1995 as developers and suppliers continued to squirrel away their sapphire production.

“We’re still amassing an inventory of calibrated goods for large manufacturers and retailers,” explains Greg Dahl, CEO of American Gem Corp. in Helena, Mont. “Currently we have in excess of 120,000 calibrated stones.”

Dahl says his firm produces some 20,000 cuttable stones each year and that a company goal is to exceed that output figure five fold. It also wants to cut at least 6,500 stones per day by March 1996. “The limiting factor really is the cutting,” says Dahl.

American Gem plans to show its goods at the 1996 Tucson gem shows, at the Holiday Inn.

Gem River Corp.’s Tom Lee, based in Grand Rapids, Mich. says his company is taking a much more cautious approach to the marketing of its Montana sapphire. “We’re not sure that Tucson is the right market environment for what we are addressing. We feel that the grade of our goods is deserving of a more qualitative presentation,” he says.

Lee also says that the volumes of merchandise needed for mass merchandising present special problems, which his company is studying. “For now we are engaged in pre-marketing discussions with buyers and taking the time to do things correctly,” he says. “We feel it is our responsibility to develop an interactive CD and point-of-purchase literature which will help salespeople get to know our product.”

Will Gem River start marketing the gems soon? Tom Lee hoped to start the process last month. – RW

UPBEAT ON 47TH STREET

New York’s 47th Street will be a safer, more pleasant place to do business thanks to an initiative by the Manhattan Borough President’s Office and the Diamond and Jewelry Industries Development Corp.

The city plans to designate the block between Fifth Ave. and Avenue of the Americas as a business improvement district (BID). That makes it eligible for city money to fund a facelift and improve security. Businesses will be assessed 25¢ per commercial square foot to fund a yearly budget of $325,000; the city will invest $700,000 in capital improvements. (The industry also hopes the BID plan will help them battle a proposal by city planners to include 47th St. in a proposed “combat zone” that would restrict pornographic shops to specific areas of the city.)

Several firms have their own plans, reports the Diamond Registry, an industry newsletter. DGA Alarm Services plans to install security cameras in strategic places around the block, which houses 2,800 separate businesses.

The Manhattan Borough President’s Office launched the initiative to work more closely with New York’s jewelry industry after a study by Columbia University’s School of International Studies found it generated lots of taxes and employment opportunities but received little city attention. – RS

SWATCH STORES PROLIFERATE

Swatch’s plans to enhance the number of retail outlets it operates in the United States is on track, according to William Schoonmaker, director of public relations.

The firm’s goal for the end of 1996 is at least 40 individual stores, be they franchise or owned, an additional 20 or more in-store boutiques and a yet undetermined number of free standing kiosks in malls or other retail outlets.

Expect much more on all fronts from the Swatch car, called Smart, to the continued public relations and advertising blitz centered on Swatch’s official timer status at the 1996 Olympic Games in Atlanta. – MT

LURIA & SON: `SUPER’ SHIFT

For decades, Luria & Son was one of Florida’s leading catalog showroom retailers. But competition from discounting and TV shopping led the firm to shift its format from showrooms to special discount stores, specifically “superstores.”

The changeover began two years ago. By year’s end, Luria will have 11 superstores (out of 43 total) throughout Florida. More will be added next year, says Peter Luria, president and chief executive officer. It will expand existing stores or build new sites “in new and stronger locations” as old store leases end.

The makeover strategy and superstores – whose sales far outpace those of older Luria stores – are “doing very nicely,” says Luria. “They’re the best performing stores we have, with some doing double-digit business. “

The shift has been so successful that Luria & Son this year discontinued its annual catalog, a major symbol of its catalog showroom business. (Direct mail promotions, however, remain an active part of its marketing.)

The stores measures up to 40,000 sq. ft. and sell a variety of consumer goods, including giftware, bridal goods, housewares, lighting and clocks. But jewelry provides about 40% of Luria’s annual business and both jewelry and watches enjoy much-expanded departments in the new superstores. – WGS

RUSSIAN ROUGH NOT ENHANCED

Rumors that Russians were selling enhanced rough swept the world’s diamond centers in 1993 after a number of manufacturers reported an abnormally high percentage of broken stones and color regression on their diamond wheels. Dealers say now that they’ve encountered no more unusual problems with rough diamonds, though the mystery of the rash of troublesome stones has never been solved.

The Russians admitted they have developed experimental treatments that improve the color or clarity of rough diamonds, but denied they sold such stones on world markets. De Beers agreed at the time that no enhanced rough was being slipped into its purchases from Russia or sold on the open market. – RS

JEWELRY CHANNEL MAY LIFT OFF BY CHRISTMAS

The Jewelry Channel, a TV shopping network devoted exclusively to jewelry, hopes to take off soon. It expects to reach some 30 million households with jewelry priced between $100 and $500.

The network had planned to go on the air in late summer. However, Elvin Feltner, TJC chairman, said in September that the satellite to be rented to transmit the broadcasts failed to go into orbit – one of five launched since last summer by the U.S., China and France that have done so. “It has been like something out of a bad movie,” he said. “As soon as [one is up and operating], we can go on.” He hoped that would be by this Christmas season.

Feltner also is chairman of Krypton International of Palm Beach, Fla., which has holdings in several film companies and television stations. Ed James, formerly with Elgin Watch and Bulova Corp., is president of The Jewelry Channel. – WGS

STERLING SILVERSMITHS GUILD DISBANDS

The 76-year-old Sterling Silversmiths Guild of America, one-time watchdog for manufacturers of sterling flatware and hollowware, ended operations on July 31.

The reason was “lack of support from a sufficient number of manufacturing silversmiths,” says Robert M. Johnston, long-time director of the guild. In recent years, Johnston had administered the guild from the Baltimore offices of his consulting business, R.M Johnston & Associates (which continues to provide some services, for a fee).

Founded in 1919, the guild’s original purposes were to police the metal content of sterling, promote high standards of business, prevent unfair or fraudulent practices and maintain free competitive relations among members of the sterling trade. After federal stamping laws were passed earlier in this century, the guild redirected its efforts to marketing and national advertising, striving to increase the public’s demand for sterling silver products.

Guild projects included an annual design competition for advanced design students, teaching aids on table setting for high school economics classes and a sales training program for retail salespeople. The guild also functioned as a worldwide information center on sterling and published news releases for both trade and consumer publications. – WGS

NO MORE BACCARAT BIJOUX

Baccarat Inc., the U.S. arm of the French luxury crystal company, last year tested the waters of the jewelry market with a specialty mystery-themed consumer catalog called Hot Ice. The market apparently proved more ice than hot because the catalog was discontinued, as was the Baccarat Bijoux line of jewelry it featured. The pendants, earrings, cuff links, rings and other pieces retailed for $110 to $2,100. Officials at Baccarat declined to comment. – HTS

US AVENUE CLOSED TO BUYER TRAFFIC

US Avenue, a proposed interactive TV marketing and merchandising channel, is closed to buyer traffic for the foreseeable future.

The project was created by US West, the largest telephone and cable provider in the U.S., serving some 20 million homes; J.C. Penney and Nordstrom were charter collaborators. Viewers were to use a special remote control unit to search through merchandise offered on screen by the two retailers. But despite successful tests in Omaha, Neb., US West shelved the project this summer.

Robin Boca, spokesperson for US West Marketing and Resources Group, says the technology to deliver such interactive service to millions of homes in a way that is cost effective for retailers is still in its infancy.

“Creating a new technology and its software simultaneously is not going as fast as the [telecommunications] industry predicted two years ago when we started,” she explains. “We still believe interactive TV is the wave of the future – but in 10 years, not three to five, as originally predicted.”

Overall tests of interactive programming continue in Omaha and Orlando, Fla. US West and Time Warner, for example, are trying a video-on-demand application. But for now US West is stressing “interim technologies,” using the phone network for on-line computer applications, enhanced TV and more video options, such as ordering from a video catalog. And, says Boca, “we are looking at additional retail partnership relationships for these and future projects.” – WGS

VIETNAMESE RUBIES: STILL BEAUTIFUL, STILL DIFFICULT

Will Vietnam ruby ever make a comeback? That depends in part on its accessibility and pricing strategy, as well as the supply of material from Mong Hsu deposit in Myanmar. Some dealers say such supplies already are a bit shorter and that finer stones are beginning to command higher prices. That might signal renewed interest in Vietnamese goods. For now, however, demand for Vietnamese goods is weak at best.

When rubies from Vietnam debuted on world markets in 1990 experts hailed the beautiful, slightly pinkish red gems and inevitably compared them with the world’s highest standard, the rubies from Myanmar’s Mogok stone tract. Because Myanmar rubies were then unavailable, the new beauties took on special significance.

But ruby activity in Vietnam subsided in 1993 when the Mong-Hsu deposit was found and supplies from the new locality poured into the marketplace.The gems were a beautiful color, particularly after heat-treatment; the reds were even more saturated than those from Vietnam, though often more included. – RW

COMPETITIVE MOVES

Simon Katz, owner of Simons, a retailer in Clayton, Mo., says his legal disagreement with Oscar Heyman & Bros., New York, was settled in August when the two parties agreed to terms whereby Simons would again sell goods from Oscar Heyman. In his lawsuit Katz had said that Oscar Heyman & Bros. stopped selling goods to his store with no prior notice as required by state law.

The disagreement was part of a larger lawsuit Katz filed against a competing retailer for unfair competition (see August JCK, pages 24-25). Katz alleged that Heyman and the competitor, Elleard B. Heffern, conspired to keep retail prices high and that Heffern was instrumental in Simon’s losing the Oscar Heyman account. While the suit against Heffern continues, all references to Oscar Heymen & Bros. have been deleted from the suit.

– MT

LOOKING EAST

A number of foreign jewelers from the East may soon join the International Jewelers Organization (IJO), but they’re more likely to say “G’Day” than “Konnichi wa.”

Nippon Gold Chain, a Japanese jewelry-store group with 100 members, approached IJO last year, saying a joint venture would benefit both their members. Officials of both groups have talked since then, most recently at IJO’s Westport, R.I., headquarters in June. But now talks are “on hold until they decide what they want to do,” says IJO President Jack Gredinger.

NGC likes the marketing and promotional services IJO offers members, says Gredinger, but isn’t sure IJO can understand the Japanese market sufficiently to make them work there. He says, “We told them, `No problem. We’ll hire a Japanese professional and make him your person in Japan.'” But NGC officials remained undecided at press time.

Meanwhile, IJO is moving ahead on two other foreign fronts.

· Talks about “a full-blown working relationship” with Showcase PTY, an Australian group of jewelers, are continuing, says Gredinger. Though smaller than IJO (200 member stores versus IJO’s 900-plus), Showcase’s operations are similar. Like NGC, its officials are impressed with IJO’s marketing and merchandising services – especially its Antwerp diamond buying program. A joint venture would significantly expand IJO’s presence in Australia, where it now has seven member stores.

· IJO officials met with members of Great Britain’s National Association of Goldsmiths (NAG) in July. (IJO already has three British members.) A detailed presentation to NAG officials in London may come this spring, says Gredinger. NAG has 80 members, representing a couple of hundred stores in the United Kingdom. – WGS

BRAVO BRAVA

Krementz & Co. launched its Brava Collection of upscale fashion jewelry in late 1993, targeting it toward the women’s self-purchase market. And Mike Horowitz, executive vice president, says it’s doing very well.

When Krementz introduced the line, Horowitz noted that moderately priced fashion jewelry didn’t fit the image of a fine jewelry store, but that women were tending to buy their high-end fashion jewelry in outlets other than jewelry stores. Krementz created the Brava line to fill that niche, with pieces retailing from $35 to $165.

It is now a regular feature in the Krementz catalog, and jewelers are happy with the sales results, says Horowitz. Since Brava’s introduction, both silver and two-tone looks have been added to the line. The two-tone, says Horowitz, is especially popular and selling extremely well.

“It’s really hot,” he says.

– HTS

JEWELRY INDUSTRY ALLIANCE KEEPS LOW PROFILE

An alliance of organizations formed in late 1994 to promote harmony in the jewelry industry had a quiet first year. The alliance – which has no name, officers or bylaws – held an organizational meeting but has not met formally since then.

Benjamin Kaiser, chairman of Baume & Mercier Inc. and a spokesman for the alliance, says another meeting will be held early in 1996.

The alliance’s stated purpose is to develop “a heightened level of harmony between and among the trade associations they collectively represent.” There were eight original members: American Gem Society, American Gem Trade Association, American Watch Association, Jewelers’ Security Alliance, Jewelers of America, Jewelers Vigilance Committee, Jewelry Information Center and Manufacturing Jewelers and Silversmiths of America. JSA subsequently dropped out, saying its input in general discussions would be limited because of its focus on just the security aspect of the industry. – RM

CANADIAN PEOPLES

The early 1990s were rough for the country’s largest jeweler. It suffered through stale sales, financial problems, bankruptcy reorganization and sale to new owners. No, we’re not speaking of Zale Corp., but of Peoples Jewellers, Canada’s largest jeweler.

Peoples and Swarovski International co-purchased Zale in 1986. But debt from that, plus Zale’s purchase of Gordon Jewelry in 1989, Zale’s 1992 bankruptcy and recession-caused sale slumps in Canada and the U.S. drove Peoples itself into bankruptcy in late ’92.

A year later, after restructuring, it exited bankruptcy, changed its name to Peoples Jewellery Corp. and officially acquired the assets of its predecessor, People Jewellers Ltd. The renamed firm, still Canada’s largest jeweler, downsized from a pre-bankruptcy total of 290 stores to 190 in late `93 to 137 today.

Now financially stable, Peoples has a new credit system, new point-of-purchase equipment, a new sales training program and an expanding merchandise selection. Though over half its wares are Canadian-made, Peoples is increasing its sources in Asia and Europe.This year, the firm started renovating and installing a new store design in its shops. – WGS

PREDATORY HIRING

In October 1993, the Zale Corporation filed suit in Dallas accusing the Jan Bell Corp., Sunrise, Fla., of predatory recruiting and unfair competition (see December 1993 JCK, pages 21-22). Zale claimed that Jan Bell had hired 25 Zale managers and tried to hire at least 10 more; Jan Bell denied the charge.

In December, a court granted Zale a temporary restraining order that barred Jan Bell from hiring any more Zale employees. Zale requested a jury trial, damages and legal costs, but the two firms settled the case out of court in May 1994, according to Andrea Parks, Zale director of external communications. No terms were disclosed. – MT

SAPPHIRE SNAFU

A Boston-area gem dealer’s suit alleging that Cartier damaged a Kashmir sapphire ring he had consigned to the company may come to court this month.

In his lawsuit filed in Massachusetts Superior Court, Fred Feldmesser of Middlesex, Mass., claimed that the 4.76-ct. gem was “scratched and abraded” while in Cartier’s care. Cartier’s attorneys denied the allegations.

Feldmesser was seeking the $105,000 wholesale price of the sapphire plus damages and fees because the stone “was not returned in the same condition” as when it was left with Cartier. – RS

SANTA IS COMING

A jewelry catalog featuring black-and-white photos of celebrities such as Sharon Stone and distributed by seven of America’s top jewelers last Christmas was highly successful, says Lori Christopher of Muller & Co., the Kansas City-based advertising agency that produced the book. So some of those seven – including Tivol of Kansas City, Mo., and Mann’s Jewelers of Rochester, N.Y. – will join forces again this year to sponsor another holiday catalog.

The new version will repeat last year’s arrangement of 28 identical pages for all participants and eight pages customized for each. Last year’s celebrity theme will not be repeated, however. Instead, the 1995 catalog will feature contemporary abstract model photography overlaid with jewelry.

“It’s a very fashiony-looking catalog, with manipulated color background images of a naked model,” explains John Muller of Muller & Co. “We’re really trying to make sure our work looks unique and that people want to keep it around.” He says it was a challenge to create the artistic photographs of the naked model while ensuring the images wouldn’t offend anyone.

Most manufacturers who participated last year are back, along with some newcomers. The catalog was expected to drop in late October or by the first of November.– HTS

THE GORDONS RETURN TO RETAILING

One of the best-known U.S. jeweler names has returned to retailing – this time as landlord.

The Gordons of Houston founded and led Gordon Jewelry Corp., which grew to 612 stores in 42 states before being sold to Zale Corp. for $300 million in 1989. Now family members are building a major retail and residential center in a Houston suburb.

The project, called The Fountains on the Lake, is located in Stafford, Tex., a 25-minute drive from downtown. Involved (as the “Fountain Properties” partnership) are Aaron Gordon, former chairman of Gordon Jewelry, and sons Daniel, former president and CEO; James, former vice president and chief operating officer; and Thomas, who has been in real estate development for 25 years.

The 150-acre tract – part of a 220-acre cotton farm which Aaron bought in 1943 – will include a man-made lake, a 16-screen movie theater, a 450,000-sq.-ft. power shopping center, residential areas (including high-quality apartments and townhouses) and several lakefront restaurants. The cinema is expected to open this month, and the entire retail and residential complex by Christmas 1996. When completed, The Fountains will be worth an estimated $100 million. – WGS

NAT LIGHT: READY TO RETURN

A year ago, Nathan R. Light, then president of Sterling Inc., was one of the most visible and active leaders of the U.S. retail jewelry industry. Today, he is a man of leisure, keeping a low-profile but “chomping at the bit to get back into action” soon.

Light, 60, led Sterling for 18 years, taking it from a small Ohio firm to its current position as the country’s second-largest jewelry chain. Last February, he resigned suddenly – reportedly due, at least in part, to disagreement with the London-based parent firm, Signet Group, over the running of Sterling.

Since his resignation, Light and wife Patty have been catching up on vacation time missed in years past. They’ve been to the south of France and sailed his boat in the waters of Nantucket. Light also remains active in The RP Foundation, which raises money for research to fight blindness. But he told JCK in September that he’s ready to return to business.

He has looked at some possibilities outside the industry. Alternatively, his agreement with Signet not to work for any jewelry-related business ends in February. He doesn’t rule out coming back to jewelry after that. – WGS

WHATEVER HAPPENED TO MEXICAN FIRE OPAL?

First it was hot and then, suddenly, it was not. A big boom in Mexican faceted fire opals started in late 1992 and lasted through most of 1994. The orange, red and milky orange gems were suddenly the “hottest” gemstone around, getting huge publicity when they were picked up and promoted by TV shopping networks.

Why did the bubble burst? Basically because those who cashed in on the trend didn’t know enough about the product. They didn’t realize that Mexican fire opals need to be “stabilized.” Traditionally they are left out in the Mexican or California sun for months at a time to see if they will develop “crazing,” a series of cracks which radiate through the gem. Opals which do not craze are deemed suitable for sale. “Crazed” opal, of course, is not suitable for jewelry because it’s unstable and unsightly. At worst, these stones can fall apart in a jewelry mounting.

Thousands of pieces were sold without the appropriate waiting period and when customers began to have problems, the returns started. Quality-conscious shopping networks decided to opt for safety and the orders came to a grinding halt.

Given fire opals’ jittery past, what about its future? Gem dealers tell us that while we’ll probably never again see the juicy orders of the past, there has been a slight upwards trend in purchase orders, signalling renewed interest.

“It’s trickling back into existence. We just had an order for 150 pieces,” says Laurie Watt of Mayer & Watt, Maysville, Ky. “While this does not compare with a 5,000-piece order from the networks, there still are a few volume users who are interested.”

Simon Watt says there’s a strong demand for 5- to15-carat gems from high-end jewelers and designers who carry one-of-a-kind pieces. He feels that the future for the opal in selected, fine qualities is good.

He adds: “I just hope the TV networks will never carry it again; that way Mexican opal will be able to stay as the small but significant gem it is.”

– RW

GERALD RATNER: WAITING FOR OPPORTUNITY

One-time boy-wonder jeweler Gerald Ratner is waiting for opportunity to knock again.

In the 1980s and early `90s, Ratner was chairman of The Ratners Group, which used discounting to become the largest retailer of jewelry in Great Britain. A series of acquisitions there and in the U.S. (including Sterling Inc.) then made it the largest jewelry chain in the world.

But in the early `90s, the firm hit hard times. Over-expansion led to financial and operating problems, while recession slowed sales. Then Ratner himself jokingly told a major meeting of financial investors that some of his low-priced products were “crap” and others had a shorter duration than a cheap snack. Both British and American press picked up and repeatedly replayed the ill-advised joke, speeding the Ratner Group’s slide into red ink.

In 1991, Ratner’s directors replaced him as chairman; he was forced out of the firm in 1992. (The board cut its last link in 1994 by changing the company name to The Signet Group.)

Now Ratner is back in discount retailing. Since 1993, he has been consultant to and front man for a firm developing London’s former “Tobacco Dock” area into a mall of factory outlet stores. Unfortunately, say recent British press reports, after two years it lacks tenants and has missed several opening deadlines. Even so, Ratner reportedly said he expected things to pick up “in the next few months.”