Two Israeli companies—E.Y. Orot Assets and Omega Eco Diamonds—have filed a $5 million lawsuit against Diamond Foundry, alleging the lab-grown manufacturer failed to comply with an Israeli court judgment.
According to a complaint filed on June 26 in California federal court (Diamond Foundry’s headquarters is in the San Francisco area), the Israeli companies signed a contract in November 2020 to buy goods from Diamond Foundry for five years and made a $2.5 million down payment, as required by the agreement.
The relationship soured after Orot and Omega contended its shipments contained diamonds with worse color than they expected, the filing says. Diamond Foundry disputed the quality claims and told the plaintiffs that if they kept refusing shipments, it “will have no further obligation” to them, and will “retain all the payments paid to [it] in advance by the plaintiffs,” according to translated Israeli filings attached to the complaint.
In 2022, the companies sued Diamond Foundry in Tel Aviv district court, seeking the return of the unused portion of the down payment, plus interest and damages. Orot and Omega say Diamond Foundry didn’t respond to that suit within the allotted time period, leading the Israeli court to enter a default judgment in their favor.
After that, Diamond Foundry hired Israeli counsel and petitioned the court to set aside the default judgment—which the court agreed to do, provided Diamond Foundry first deposit 3 million shekels (approximately $810,000 per the exchange rate at the time) with the court and pay certain fees, the complaint said.
Diamond Foundry appealed that ruling and lost, then never delivered the deposit by the court-mandated deadline, the plaintiffs maintain. The two companies are now asking that the U.S. court enforce the Israeli court’s default judgment.
Diamond Foundry’s attorney did not return a request for comment by the time of publication.
(Photo: Getty Images)
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