SUBSEQUENT EVENTS

6 Months Ended

Jun. 30, 2011

SUBSEQUENT EVENTS [Abstract]

SUBSEQUENT EVENTS

12. SUBSEQUENT EVENTS

On July 26, 2011, the Company learned that BetterThanDiamond.com requested that the U.S. Patent and Trademark Office (“USPTO”) conduct an ex parte re-examination of the Company's U.S. Patent No. 5,723,391 (the “ ‘391 Patent”) for manufacturing silicon carbide gemstones based on claims of prior art. The ‘391 Patent may be re-examined only if the USPTO finds that the information provided in the request raises “a substantial new question of patentability.” The USPTO's determination of this issue is based solely on the information provided in the request and must be completed within three months. The Company firmly believes that the ‘391 Patent is valid and enforceable and is committed to vigorously defending the ‘391 Patent. Notwithstanding the ‘391 Patent, the Company's exclusive supply agreement with Cree for the supply of gem-quality SiC crystals required to fashion moissanite jewels extends through mid-2015.