CollectionsApr 19, 2024
Piece of the Week: Retrouvaí’s Treasure NecklaceA new addition to the “Heirloom” collection, this one-of-a-kind piece features 32 custom-cut gemstones.
EditorsJul 26, 2010
What's next for De Beers class-action suit?
After the whirlwind of news that was the last two weeks I feel compelled to circle back around and delve deeper into one of the big headliners: the decision on the De Beers class-action lawsuit. As many of you probably...
After the whirlwind of news that was the last two weeks I feel compelled to circle back around and delve deeper into one of the big headliners: the decision on the De Beers class-action lawsuit.
As many of you probably heard, on July 13 the U.S. Court of Appeals for the Third Circuit rejected the 2006 settlement De Beers reached with diamond buyers who sued the diamond giant based on allegations of price fixing, a violation of U.S. antitrust laws. Under the settlement, De Beers had established a $295 million fund to be distributed to millions of diamond buyers separated into two classes. Under the settlement, direct purchasers--companies that bought directly from De Beers or De Beers' mining competitors-were to share a pot of $22.5 million. Indirect purchasers, a group that includes retailers and consumers, were to divide up the remaining $272.5 million.
The court's latest decision likely leaves those with interest in this case (including interested consumers and retailers) with two main questions: Why was the settlement rejected? And, when will I ever get my money?
I'll attempt to answer these questions below, with input from Howard Bashman, the Pennsylvania attorney who filed the successful objection, and another class attorney in the case, Joe Tabacco of Berman DeVallerio in San Francisco.
Why?
In filing his objection, the point Bashman made--which the Third Circuit Appeals Court in Philadelphia agreed with--is that under antitrust laws in some states, you can only sue if you're the direct purchaser of a product or service.
So, Bashman argued, it was unfair for indirect purchasers from certain states to receive a portion of the settlement, since antitrust recovery is limited to only direct purchasers in the states where they reside. (As a point of note, according to the suit, the states are divided on the issue: about 25 allow indirect purchasers to recover in antitrust suits and 25 don't.)
"In this settlement, everyone got to recover no matter what state you're in," Basman says. "The consequences are people like my client are going to get less."
Bashman represents a single individual in this case, a woman from Texas, one of the states that allows indirect purchasers to sue in antitrust cases. Bashman is based in Willow Grove, Pa.
This is a short, simple explanation of the 75-page ruling in the case, which you can read in its entirety by clicking here.
Look at pages 29-31 for a breakdown
on which states allow indirect purchases to recover in antitrust cases and which don't.
While much has been written and said about the attorneys involved in this case, particularly those for the objectors, I think two points need to be made here. One, like the delay or not, Bashman brought forward a valid point of law or the court never would have agreed with his objection. Two, the court ruling points out that this type of sweeping settlement has never been attempted in an antitrust case before. The lawyers in this case were trying something new that seems to have failed, at least for now.
What happens now?
Bashman said the attorneys in the case have until July 27 to ask the appeals court to reconsider their decision. If they chose not to, or if the appeals court denies the request, it returns to the trial court.
There, any number of things could happen. What Bashman would like to see is a new settlement organized on a state-by-state basis and limited to indirect purchasers who live in states with antitrust laws that allow them to sue, potentially meaning more money for those individuals.
Or, as Gemological Institute of America (GIA) diamond expert Russell Shor speculated in the July 16 GIA Insider e-newsletter, the case could splinter into separate lawsuits.
Will I ever get my money?
It's pretty widely known at this point that while the big diamond guys--the direct purchaser class --could net a substantial sum, the recovery for smaller players isn't going to be as much. But these days, money is money and I don't know many retailers that would turn down a check for any amount, no matter how miniscule.
Tabacco said the appeals court decision could delay the distribution of funds by four to 12 months or longer.
Stay tuned...
While much has been written and said about the attorneys involved in this case, particularly those for the objectors, I think two points need to be made here. One, like the delay or not, Bashman brought forward a valid point of law or the court never would have agreed with his objection. Two, the court ruling points out that this type of sweeping settlement has never been attempted in an antitrust case before. The lawyers in this case were trying something new that seems to have failed, at least for now.
What happens now?
Bashman said the attorneys in the case have until July 27 to ask the appeals court to reconsider their decision. If they chose not to, or if the appeals court denies the request, it returns to the trial court.
There, any number of things could happen. What Bashman would like to see is a new settlement organized on a state-by-state basis and limited to indirect purchasers who live in states with antitrust laws that allow them to sue, potentially meaning more money for those individuals.
Or, as Gemological Institute of America (GIA) diamond expert Russell Shor speculated in the July 16 GIA Insider e-newsletter, the case could splinter into separate lawsuits.
Will I ever get my money?
It's pretty widely known at this point that while the big diamond guys--the direct purchaser class --could net a substantial sum, the recovery for smaller players isn't going to be as much. But these days, money is money and I don't know many retailers that would turn down a check for any amount, no matter how miniscule.
Tabacco said the appeals court decision could delay the distribution of funds by four to 12 months or longer.
Stay tuned...
More on Editors
The Latest
CrimeApr 19, 2024
Grand Jury to Hear Case Against Jeweler Charged in Fatal Shove Following IJO ShowLast month in Dallas, David Walton pushed another jeweler, David Ettinger, who later died.
MajorsApr 19, 2024
Unique Designs Acquires China PearlThe move will allow the manufacturing company to offer a more “diverse and comprehensive” range of products.
Brought to you by
The Blueprint for Success in Scalable, Personalized Jewelry RetailWith Ho Brothers, you can unlock your brand's true potential and offer customers the personalized jewelry experiences they desire.
GradingApr 19, 2024
AGS Ideal Report Now Available in Printed FormFrom now through mid-May, GIA will be offering the reports at a 50 percent discount.
Weekly QuizApr 19, 2024
This Week’s QuizTest your jewelry news knowledge by answering these seven questions.
SourcingApr 18, 2024
Diamond Trade Remains Cautious Amid Economic UncertaintyDe Beers’ rough diamond sales were down 18 percent year-over-year in its latest round of sales.
Supplier BulletinApr 18, 2024
Discover History’s Hidden Gems at the Las Vegas Antique Jewelry & Watch ShowSponsored by the Las Vegas Antique Jewelry & Watch Show
Brought to you by
How Jewelers of America Represents Your BusinessFor over 30 years, JA has advocated for the industry, fought against harmful legislation and backed measures that help jewelry businesses.
WatchesApr 18, 2024
Watch E-tailer Collectability Hires Kelly YochThe Patek Philippe expert will serve as personal curator for the brand-focused company.
WatchesApr 18, 2024
TAG Heuer Opens Its Largest Standalone Boutique at SeaThe 553-square-foot shop is aboard the Carnival Jubilee cruise ship.
Policies & IssuesApr 17, 2024
NDC Prevails in U.K. Case Over Lab-Grown Diamond AdvertisingNDC filed a complaint against Skydiamond for use of phrases like “diamonds made entirely from the sky.”
Events & AwardsApr 17, 2024
And the 2024 Winner of the Shipley Award Is … John Carter received the AGS’s highest honor Tuesday afternoon at Conclave in Austin, Texas.
FinancialsApr 17, 2024
LVMH’s Q1 Jewelry Sales Fall 5%LVMH said the company performed well despite an uncertain geopolitical and economic environment.
MajorsApr 17, 2024
Stuller’s B&D Opens New HeadquartersB&D Sales and Service held a ribbon-cutting event for its new location in Cranston, Rhode Island.
CollectionsApr 16, 2024
Akaila Reid Launches ‘Eat Cake’ CollectionIt’s ultra-feminine and filled with gold, pearls, and soft pastels.
MajorsApr 16, 2024
Loudr Adds 2 DirectorsEmily Highet Morgan and Emily Bennett have joined the agency’s team.
MajorsApr 16, 2024
Stuller Releases First Lab-Grown Diamond Jewelry CatalogIts updated book for mountings is also now available.
SourcingApr 16, 2024
Karen Rentmeesters Takes Over as Interim CEO of AWDCShe has been with the organization since 2010, most recently serving as its chief officer of PR and industry relations.
TechnologyApr 15, 2024
Judge Rules Jeweler’s Lawsuit Against PNC Bank Can Move ForwardJoyce’s Jewelry sued the bank after cybercriminals drained its accounts of nearly $1.6 million through a series of wire transfers.
IndependentsApr 15, 2024
Alfred W. DeScenza of DeScenza Diamonds Dies at 95He is remembered by loved ones for his loyalty, integrity, and kindness.
AuctionsApr 15, 2024
Madeleine K. Albright Jewelry, Pins Coming to AuctionHosted by Freeman’s | Hindman, the sale will take place May 7-8.
AuctionsApr 15, 2024
All of Sotheby’s ‘Rough Diamonds’ Sold in Less Than an HourThe auction house said all 24 timepieces offered in its underground sale of rare and avant-garde watches quickly found buyers.
Events & AwardsApr 15, 2024
10 Can’t-Miss Sessions at AGS Conclave 2024From lab-grown diamonds and AI to the inevitable Taylor Swift mention, here are some of Conclave’s most intriguing educational offerings.
Recorded WebinarsApr 12, 2024
Watch: What Jewelers Need to Know About InsuranceFrom cybersecurity liability to trade show coverage, insurance experts share tips on how to build the right policy.
CollectionsApr 12, 2024
Piece of the Week: Lionheart’s Evil Eye Gemstone CharmThe charm is a modern rendition of the evil eye amulet that has been worn for thousands of years.
Events & AwardsApr 12, 2024
The Jewelry Symposium Announces 4 Scholarship WinnersAhead of its trade show next month, TJS awarded free registration and accommodations to one jewelry professional and three students.
Policies & IssuesApr 11, 2024
SRK Exports’ Journey Toward Net Zero Impact By the end of this year, SRK’s diamond manufacturing complexes will achieve net zero emissions, one of an impressive array of achievements.
