De Beers Diamond Class Action Settlement

Were The De Beers Attempting to Monopolize the Diamond Industry?

A lot of people thought so and that’s what they say prompted them to file a lawsuit. The results of the De Beers Diamond Class Action are as follows…

A Fairness Hearing was held on April 14, 2008 and Judge Chesler issued an order approving the De Beers Settlement on May 27, 2008. And as you may already know, De Beers has appealed the ruling. Attorneys for the diamond giant have since filed appeals contesting final approval of the Settlement, and these appeals will postpone resolving claim calculations. No payments will be made on any eligible claims until all of the appeals have been resolved. It is uncertain how long these appeals will take to resolve.

The De Beers Diamond Settlement

The De Beers Diamond Company has agreed to settle a whopping $295 million class action lawsuit over price fixing through manipulation and monopolization. The truth be told, $295 million is a drop in the bucket to De Beers. The judgment entered as a result of the settlement may provide refunds of up to 30% to De Beers' customers who purchased a diamond for personal use - covering resellers separately - between 01-01-1994 and 03-31-2006. You had until May 18^th, 2008 to file your claim. If you didn’t get in by that deadline, sorry! As they say you are SOL, Stone Out of Luck!

Through the years the De Beers has been subjected to much criticism. In one such incident they were levied a palsy $10 million dollars for price fixing and conspiring with General Electric Company to manipulate the pricing of industrial diamonds.
 

The Basics of The De Beers Diamond Class Action Settlement

The Court has conditionally certified two classes, or groups, of diamond buyers: the Direct Purchaser Class and the Indirect Purchaser Class. Members of the Direct Purchaser Class purchased from De Beers or De Beers' Diamond Mining competitors while members of the Indirect Purchaser Class purchased from someone OTHER THAN De Beers or De Beers' Diamond Mining Competitors. The Indirect Purchaser Class is divided into two subclasses: Consumers and Resellers.

Consumers

How are you classified as a Consumer? All persons located in the United States who purchased any diamond or diamond jewelry or other products containing gem diamonds for personal use and not for resale between January 1, 1994 and March 31, 2006. For example, Consumers include people who purchased diamond jewelry to wear or to give as a gift.

Resellers

How are you classified as a Reseller? All persons or entities located in the United States who purchased for resale any gem diamond or diamond jewelry or other product containing gem diamonds between January 1, 1994 and March 31, 2006 from someone other than De Beers or De Beers' Diamond Mining Competitors. Resellers include diamond jewelry manufacturers and retailers, among others.

Here is a Summary of the Settlement

De Beers is the largest supplier of rough diamonds in the world. Beginning in 2001, Plaintiffs in several states filed lawsuits against De Beers in state and federal courts alleging that De Beers unlawfully monopolized the supply of diamonds, conspired to fix, raise, and control diamond prices, and issued false and misleading advertising. De Beers denies it violated the law or did anything wrong.

The Settlement Agreement provides that $22.5 Million be distributed to the Direct Purchaser Class, and that $272.5 Million will be distributed to the Indirect Purchaser Class. De Beers also agrees to refrain from engaging in certain conduct that violates federal and state antitrust laws and submit to the jurisdiction of the Court to enforce the Settlement.

It is not possible to tell how much, if any, each claimant will receive before the Claims Administrator finishes processing all claims submitted for that claimant’s class or subclass. More information about the calculation of claims can be found at the De Beers Diamonds Class Action Settlement website. 

We will update you on the De Beers appeal process as we receive new information.