Robert Procop claims that one of Hilton's blog posts on April 17 wrongly accused him of committing criminal and civil fraud in connection with a 1985 diamond necklace transaction.
Procop is seeking more than $500,000 in damages.
Hilton has yet to comment.
The blog post stated that Procop had not only been sued for fraud, but that an $89,000 judgment was rendered against him, according to his court filing. The posting further stated that the buyer thought he was getting a 25.5-carat necklace, but that in reality it only had 17.62 carats, the suit says.
The jeweler said his reputation suffered as a result of Hilton's post, and that the blogger has refused to issue a retraction or take down the posting.
However, the only post that mentions Procop found on Hilton's blog did not contain any information about the diamond necklace transaction.
City News Service contributed to this report.