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Royal Asscher says no ties to Fabrikant

June 25, 2008

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New York—A recent lawsuit alleging that the former owners of M. Fabrikant and Sons diverted finances to their affiliates before filing for Chapter 11 bankruptcy protection, has prompted Netherlands-based Royal Asscher Diamond Co. to issue a statement stating it has no ties to the bankrupt company or its still-operating affiliates.

Court papers cited RA Cut LLC as one of the Fabrikant affiliate companies through which the Fortgang family, former owners of Fabrikant, diverted finances. In the court documents, the business is also alternatively referred to as "Royal Asscher Cut LLC" or "Royal Asscher," but the Dutch company's U.S. distributor says its name should not have been used in the court documents and it no longer has ties to M. Fabrikant or its ex-owners, the Fortgang family.

"In 2001, Royal Asscher Diamond Co. entered into a distributorship agreement with M. Fabrikant and Sons, whereby the company was responsible for the marketing and sale of our branded diamond cut the Royal Asscher Cut," Royal Asscher of America Inc. President Lita Asscher said in a statement issued on Tuesday. "Thus, Royal Asscher Cut LLC was established as a Fortgang entity, it was owned by Matthew and Susan Fortgang's private trusts and it was without the knowledge of Royal Asscher Diamond Co. or my family in Amsterdam. On request of the lawyers of Royal Asscher Diamond Co., the Fortgangs changed the name of that company to RA Cut LLC in 2007."

After M. Fabrikant dissolved, the distributor agreement was over, Asscher added. Royal Asscher of America was created as the only distributor of the Royal Asscher Cut in the USA and Canada.

"In the event of an agreement termination, M. Fabrikant and Sons were clearly precluded from using our good name, a name that has been built over 150 years, in the diamond industry," Asscher said in the statement. "The agreement did not grant any rights to M. Fabrikant and Sons in our entities or assets other than as a distributor. As per the terms of this agreement, Royal Asscher was not granted any rights in Fabrikant/Fortgang assets."

The statement added that the Fortgangs have no interest in any of Royal Asscher Diamonds's entities, nor are any of its entities in possession of any assets of Fabrikant or of the Fortgang families.

"Royal Asscher is a company that prides itself on ethics and integrity," the statement said. "People who deal with us regularly are aware of this, but it is important that we make a statement to protect our brand and reputation."
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