EGL USA Battles Overseas EGLs

EGL USA has gotten into a bitter spat with the overseas EGLs, after persuading U.S. Customs to prevent other EGL reports from entering the country.

EGL USA says it can do this because it is the exclusive owner of the EGL trademarks in the United States and Canada. That means reports from labs outside North America infringe on its trademark and are therefore illegal.

EGL USA director Mark Gershburg says the lab made the move because “people would come to us with questions about the certificates from the overseas EGLs, and we couldn’t answer them. It was creating a lot of confusion and negative feelings towards EGL in general. We are trying to build and improve our name, and this was hurting us.”

The final straw, he says, was when the overseas EGLs began to advertise in U.S. trade magazines. “That’s a clear violation of our trademark rights,” he said.

The overseas labs were predictably upset.

“The whole thing is crazy,” says Dr. Menahem Sevdermish, president of the European Gemological Center and College in Ramat Gan. “It’s like saying if you buy a Rolex overseas you can’t bring it into the U.S. They want the United States all to themselves. Are they afraid of fair competition?”

Sevdermish notes that, until recently, EGL USA touted its association with the worldwide lab network on its Web site.

“We had a good relationship and suddenly they’ve become so nasty,” he says.

EGL USA spokespeople say that they bought the EGL names and trademarks from founder Guy Margel in 1986, and that the labs no longer have any association. Margel disputes this, calling EGL USA’s status “similar to a franchise.”

At press time, the overseas EGLs vowed to fight the ban, and both sides were talking to lawyers. Margel, meanwhile, is philosophical. “It’s like a family squabble,” he says. “Everyone gets all excited and three months later it gets back to normal.”