The U.S. District Court for the Southern District of New York issued a judgment that enjoins Pacific Technology Corporation (PTC) of New York from infringing Lazare Kaplan International’s diamond laser inscription patents.

This judgment effectively slaps a permanent injunction on PTC, halting all diamond inscription services and equipment sales that violate LKI’s patent. PTC has until Oct. 1, 2001, to conform to the court’s rulings, after which LKI may search out companies that have purchased laser equipment from PTC.

William Moryto, vice president and chief financial officer for Lazare Kaplan International in New York, says the ruling should put other diamond inscription companies on notice that LKI’s intellectual property rights will be protected.

“We put a lot of money and effort into these machines,” Moryto says. “With the whole branding emphasis today, the need for inscriptions is obvious. And we intend to capitalize on it.

“The next step is to see to what extent there are machines now in the market that should not be there and to take action to remove those machines from the market,” he adds. He notes that, as far as LKI has been able to determine, PTC only performed inscription services for the laboratories and the local diamond trade and had not sold any laser inscription machines.

If there are any other PTC laser inscription machines being used, Moryto says they will be considered in violation of the judgment and subject to an order of contempt. “The existing laser inscription machines infringe our patents,” he says. “There is no provision to continue their use. It is not the objective of this action to collect license fees at this time on those machines.”

Diamond inscription services have been advertised heavily over the past few years. “We are constantly looking at the marketplace to see what laser inscription technologies are out there. In the case of PTC, we have been pursuing this matter for approximately two years,” says Moryto. “In patent litigation you need to do substantial due diligence prior to initiating infringement litigation.

“There are a number of other parties in the market that have laser inscription machines that may well infringe on our patent,” Moryto adds. “We’ve already begun direct contact with these firms and have informally asserted that they have infringed. It still has to be documented that the process is an infringement of the LKI patents before a case can be presented to the courts.” Moryto says there will likely be additional litigation.

JCK