Prominent Bali Jewelry Firm Sued in US

By William J. Furney
Managing Editor
The Bali Times

SEMINYAK ~ One of Bali’s most stellar foreign-owned firms has been sued in an American court over claims the multimillion-dollar jewelry empire used intimidation and other tactics to force another Bali-based jeweler from selling designs it claims are protected under copyright, The Bali Times has learned.

The company formerly owned by Canadian-born John Hardy is being sued in the Northern District of Illinois, Eastern Division court, by BaliJewel Inc., which is seeking vindication that it does not infringe on any designs owned by John Hardy Ltd, according to a copy of the lawsuit seen by The Times.

However, John Hardy Ltd has filed a motion for dismissal of the suit and countersued BaliJewel for copyright infringement, allegedly at the hands of a former employee-turned-partner of the now-rival firm, Ketut Deni Aries.

BaliJewel alleges in its lawsuit that Aryasa, its chief designer, was subject to physical intimidation over his designs, and that the firm’s website, its sole means of advertising, was repeatedly taken down because of threats to companies hosting the site.

The suit claims one incident occurred in early February 2007 at the designer’s workshop in Denpasar.

“…a group of about twenty unidentified men arrived at Mr. Aryasa’s residence and studio. Without his consent, they entered his living room and confronted him, saying that they were from the Indonesian Copyright Office in Jakarta.

“One of them showed him a letter from PT Karya Tangan Indah, the name used by John Hardy Limited in Indonesia, accusing Mr. Aryasa of copying John Hardy’s jewelry designs, and in particular a design which John Hardy calls Batu Kali Kombinasi Motif. The Batu Kali Kombinasi Motif is in fact Mr. Aryasa’s own original jewelry design for BaliJewel, called Crocodile Motif,” the lawsuit reads.

When Aryasa asked the individuals for identification, or a search warrant, they were unable to produce either, the lawsuit says.

“The unidentified men refused to accept that Batu Kali Kombinasi Motif was in fact Mr. Aryasa’s own original design, called Crocodile Motif, and commenced to search Mr. Aryasa’s home, studio and workshop without permission,” says the suit.

BaliJewel claims the apparent intruders also became violent.

“Aryasa’s wife, then almost nine months pregnant, attempted to

close the door to his private design room and workshop, where his jewelry inventory and design sketches were kept. The men forced their way in to the room, nearly pushing her down, and warned Mr. Aryasa not to make any ‘aggressive moves’ or they would have him put in jail,” the lawsuit reads.

As a company, John Hardy has become wildly successful, with sales reportedly topping US$150 million in the US last year, and now has offices in New York, Hong Kong, and Bangkok. Its manufacturing base remains in Bali, where some 800 people are employed under PT Karya Tangan Indah. Last year the man whose company bears his name sold his firm to an array of investors, including its president and chief designer, relinquishing himself of all ownership.

While the new company, headquartered in Hong Kong, declined to disclose the transaction value of the sale to this newspaper, previous press reports said it was a multimillion-dollar deal.

John Hardy, 58, a flamboyant expatriate who, according to corporate information, stopped off in Bali in the early 1970s on a post-studies round-the-world trip and like so many others before and after him fell in love with the mystical island and began studying silversmithing and who now with his striking wife Cynthia throws legendary parties at his home near Ubud, swanky shenanigans that have given rise to overseas media coverage, including in The New York Times, remains a consultant to the international firm. He is currently building a “holistic” school near Ubud that is due to open later this year, as well as a hotel constructed from black bamboo.

Damien Dernoncourt, president of John Hardy Ltd, told The Bali Times from his Hong Kong office that the BaliJewel lawsuit was baseless, that the alleged acts of intimidation at the hands of John Hardy personnel was false and that the authorities had been acting in accordance with copyright laws.

“There has been no act of intimidation against BaliJewel’s employees, but an authorized intervention of agents from the Department of Copyright Protection in Jakarta, assisted by the police, following a complaint for copyright infringement John Hardy Ltd has filed before the Ministry of Justice,” he said.

“…it is important to stress the fact that one of our employees in Bali and her family have been physically threatened in relation to [this] case, so that we had to assure their physical protection,” said Dernoncourt.

He said his firm, wishing to protect its copyrighted designs, was entitled to ask website-hosting companies to take down the BaliJewel site.

“John Hardy Ltd, as an intellectual property holder, has the right to send notices of infringement to third parties, including internet service providers, whose responsibility can be sued for the contents of the websites they are hosting. The ISPs hosting BaliJewel’s website, both in Indonesia and in the US, have complied with their legal obligations to disrupt an infringing website on copyright owner’s demand.”

Speaking to The Bali Times from Chicago, BaliJewel president Christina Tobin said that although she had no initial desire to go to court, she was eventually forced to file the lawsuit because of the alleged intimidation of her business partner in Bali and also “for the people of Bali,” so that they would be able to continue to use centuries-old Balinese designs in their art.

“John Hardy is trying to claim ownership of all designs originating from Balinese folk art, which originated from the people of Bali, and belong to them. My primary objective in filing this lawsuit was to protect these Balinese motifs. It’s important to me that the Balinese people be able to produce these motifs, and offer them to the world,” she said.

She said that the alleged harassment, akin to that outlined in the lawsuit, may be continuing, according to her business partner in Denpasar.

“Since I filed the lawsuit, Deni, who is also a part owner, has been harassed a lot, but we have no idea where it is coming from. Personally, I never wanted to file this lawsuit; you can imagine how expensive it is for a small company. I had to file it because I feared the harassment would never stop. There has been a lot of harassment towards Deni and his family. His wife and kids are basically living in fear,” she said.

“I can’t prove that John Hardy (Ltd) is behind the new intimidation, but I know that back in February 2007, Ketut Deni Aryasa’s home was invaded by several men who took his drawings and jewelry samples, and we have reason to believe they were sent by John Hardy (Ltd). If John Hardy (Ltd) is behind the current threats, they must know it, whether they admit it or not.”

John Hardy Ltd is no stranger to the courts when it comes to protecting its designs, winning damages of $1.3 million against US jewelry company Real Imposters in early 2007 for copyright violations.

Also last year, the company settled out of court with another American firm, Sam Moon, which agreed to stop selling disputed items and paid an undisclosed amount to John Hardy Ltd.

Later in the year, a lawsuit was filed in the US against John Hardy Limited by jeweler Kathy Kamei, of Kathy Kamei Designs, after the former sent Kamei a cease-and-desist letter concerning infringement of copyrighted designs. Both sides reached an out-of-court settlement, however, with Kathy Kamei Designs consenting to stop selling infringing pieces and pay compensation to John Hardy on previous sales of such items.

Tobin said that in an attempt to stay out of the courts, she had written to John Hardy.

“I really hoped we could sort this out personally, and sent a letter on behalf of BaliJewel, Inc. directly to John Hardy. John Hardy’s (Ltd) New York law firm, Schiff Hardin, responded to the letter. They informed BaliJewel, Inc. to discontinue any direct contact with their client,” she said.

John Hardy Ltd said, however, that the only written communication it received from BaliJewel was after the lawsuit was filed, last July (an amendment was filed in December).

“Christina Tobin should have written to us before filing a complaint with the US courts, and not after. That would have been more constructive,” said Dernoncourt.

Meanwhile, Tobin, 26, insists her mission in the American courts goes far beyond her own business, which was established in the US only last year and which says it donates 10 percent of earnings to an educational program for underprivileged children in Ubud, Karuna Bali.

“I’m doing this primarily on behalf of the Balinese people. I hope this lawsuit will protect the Bali Motif,” she said.

Tobin, who first came to Bali at the beginning of 2005, after receiving a degree in graphic design and business, and plans to return soon, said that despite her company being young, she expects “a lot of growth” in 2008 and is this year attending jewelry exhibitions around the US, to meet with store buyers and promote her product line. While the lawsuit gathers steam, she is permitted to maintain BaliJewel’s presence on the internet and to sell contentious designs, she said.

“I feel very strong about the lawsuit, and very confident that the judge will see these designs are not similar,” Tobin said.

“The Bali Motif is like the Irish Shamrock; it’s as if they are trying to claim ownership of it. It’s got to be stopped,” she said.

Dernoncourt rejected Tobin’s assertion that John Hardy Ltd could not lay claim to indigenous Balinese designs, saying they were also emblematic of the highly successful John Hardy Ltd, which sells its jewelry in some of the world’s leading stores, including Saks Fifth Avenue and Neimen Marcus, and has graced the pages of such high-end fashion magazines as Vogue, where pop icon Madonna has posed wearing the Balinese ultra-stylish creations.

“All our jewelry designs, and in particular the famous and successful Kali and Jaisalmer collections, are original and have received copyright protection in the US, Indonesia and elsewhere,” said Dernoncourt.

“Deni Aryasa, who worked for our company in Bali for three years, should be fully aware of this. Therefore, the assertions of BaliJewel are groundless, which is not surprising from a defendant in a copyright infringement lawsuit,” he said.

A verdict in the case is expected by the end of this year.

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