Court Dismisses Lazare Kaplan RICO Case against Antwerp Diamond Bank

LKI President Templesman will need to prove his claims in Belgium

(IDEX Online News) – These are tough times at Lazare Kaplan International (LKI). After it once again notified the stock market and investors that it couldn't file its annual results, a U.S. court has dismissed a racketeering case the diamond firm filed against Belgian banks.

On Wednesday, District Judge Andrew Carter granted a motion to dismiss the RICO case Lazare Kaplan brought against Antwerp Diamond Bank, KBC and a number of their executives, stating that Belgium is the proper location for trying the case.

LKI went on what some commentators viewed as an all out battle against diamond trader and former partner Erez Daliyot. According to the December 2011 court filing, LKI alleges that the banks and some of its executives were involved in "racketeering, fraud, money-laundering, tortious interference with prospective business advantage, commercial bad faith, conversion, negligence, breach of the covenant of good faith and fair dealing, and unjust enrichment."

LKI sued the banks for allegedly stealing $135 million, claiming that the banks cooperated with Daleyot. LKI, which is seeking $500 million in damages, further alleges that senior KBC and ADB bankers received $20 million in bribes from Daleyot-controlled accounts to assist with the money-laundering scheme.

Judge Carter noted that LKI acknowledges that the alleged acts happened in Belgium and other countries outside the U.S.

LKI already took the matter to a Belgian court, which is scheduled to hear it in March 2013.

On August 30, LKI filed a notification stating that the company has been "unable to resolve a material uncertainty" concerning its ability to collect certain assets and therefore unable to finalize its financial statements for the 2012 fiscal year.

LKI has not filed annual financial statements since 2009.