EGL USA Continues to Assert its Exclusivity

EGL USA, a diamond grading lab based in NY, is re-asserting its trademark in an apparent battle with the EGL labs outside North America, calling all materials bearing EGL marks, other than those authorized by EGL USA “illegal certificates”. 

It is not clear where or why the battle begun, but it does raise an eyebrow to say the least. Recently, at the request of the US lab, a border ban has been imposed by the US Bureau of Customs and Border Protection on the importation and distribution of grading certificates from EGL labs outside North America that are, according to the lab, in violation of the EGL trademarks in North America. 

The effect of the border ban is that all materials bearing EGL marks (including laser inscribed diamonds), other than those authorized by EGL USA, can be seized by the US Customs says Mark Gershburg, EGL USA’s Director, adding that the certificates are illegal and may be subject to confiscation or detention together with diamonds its accompanying.

In June 1999, EGL USA registered the EGL and European Gemological Laboratory trademarks in Canada after it bought all US rights to the EGL and European Gemological Laboratory name and trademarks from Guy Margel in 1986. Margel founded the European Gemological Laboratory in Antwerp in the early 80s.

One of the potential future battle lines might be over the trademark registration by EGL USA in Canada, as it appears that the rights sold by Margel were limited to the USA and might not include Canada.

Guy D. Benhamou, Managing Partner of EGL Israel flatly rejects the claims that his certificates are illegal. “They have a franchise, just like me. EGL USA has the right to grade diamonds in the USA under the EGL name, but they do not have an international monopoly,” adding that the act is “a major violation of a status quo”.

According to Benhamou, customs can act against products, but not against services, which is what gem labs provide. The certificate is only a testimony to the provided service, “The diamond is the product, the grading is an accompanying service”.

In a written statement Gershburg writes, “If members of the trade in North America currently hold illegal EGL certs, we will work with them to resolve this problem.  In regard to consumers, trademark laws only apply to commercial use; therefore consumers are not liable as long as the end use of their certificate is non-commercial”.

EGL has labs in Antwerp, London and Paris in Europe, in South Korea, Turkey and South Africa. EGL USA operates two labs in Canada, in Vancouver and Toronto in addition to the labs in the US.