Diamond resellers have begun receiving the proceeds of a $295 million antitrust settlement with world-leading diamond producer De Beers after the U.S. Supreme Court refused to consider longtime objectors’ final attempt to derail the agreement.
Berman DeValerio has acted as a lead counsel for the jewelry stores and other diamond resellers, who for decades have been overcharged by De Beers. The firm and its attorneys, following years of litigation, played a key role in obtaining a settlement for diamond purchasers. In addition to the $295 million cash payment, the settlement included an agreement by De Beers to submit to the jurisdiction of the U.S. court to enforce the terms of the settlement and a comprehensive injunction limiting De Beers’ ability to restrict the worldwide supply of diamonds in the future.
The case is significant not only because of the large cash recovery but also because previous efforts to obtain U.S. jurisdiction over De Beers in both private and government actions had failed.
“This was a tough, drawn-out case and we are delighted that the plaintiffs are finally beginning to receive the money they are owed,” said Joseph Tabacco, Jr., the Berman DeValerio partner who oversaw the case. “We also believe the injunctive relief we achieved will benefit U.S. diamond purchasers at the wholesale and retail level well into the future.”
The case began in 2004, when Berman DeValerio filed a complaint in federal court against De Beers on behalf of resellers, alleging that De Beers and its affiliates had conspired to fix the prices of diamonds and otherwise create a monopoly in the diamond market in violation of federal and state antitrust, consumer protection and deceptive trade practices laws.
The case, Sullivan, et al. v. DB Investments, Inc., et al., No. 04-cv-2819, is pending in the District of New Jersey before the Hon. Stanley R. Chesler. Similar lawsuits were filed by diamond consumers and direct purchasers.
Judge Chesler approved the settlement on May 22, 2008, but it would be a long time before the case was definitively resolved.
Objectors to the settlement appealed, arguing that the class should not have been certified because it included indirect purchasers of diamonds in certain states. A Third U.S. Circuit Court of Appeal panel ruled in the objectors’ favor in July 2010, but later agreed to rehear the matter with the entire Third Circuit sitting en banc. After a round of extensive briefing on a number of novel issues and further oral argument, in December 2011 the en banc Third Circuit affirmed the final approval order in all respects. Subsequent petitions for U.S. Supreme Court review were denied in May 2012.
*In August 2017, our firm name changed to Berman Tabacco. Case references and content published before that date may refer to the firm under our prior name, Berman DeValerio.