Robert Webber says he spotted the 1845 U.S. silver dollar as a Chinese counterfeit the minute he saw it.
Webber, of Goldsboro, N.C., returned the bogus coin to Burnsville Coin Co. last year for a refund of $449. He included a note warning that the other two coins he had ordered, at a cost of $12,400, must be certified as authentic by the Professional Coin Grading Service (PCGS) -- or else.
It appears that Burnsville Coin owner Barry Skog is about to find out what that means.
Webber said the other coins he received -- 1851 and 1858 silver dollars -- not only were fakes, but also were encased in counterfeit PCGS holders. He showed them to PCGS representatives at a Boston coin show last year, and its parent company, Collectors Universe Inc., filed a lawsuit Dec. 7 against Skog and his company in a California federal court alleging trademark infringement.
Skog never formally responded to the charges; a handwritten denial he sent to the judge last month was rejected as improper. The clerk of the court declared Skog in default. Collectors Universe, based in Santa Ana, Calif., is now seeking a judgment against him.
In filings this week, the company asked the court to bar Burnsville Coin from selling coins in counterfeit PCGS holders; to order Skog to turn over all counterfeit coins and holders for destruction; and to turn over all profits his company made by selling any coins in counterfeit PCGS holders. The company also seeks $11,772 in legal costs.
Stephen Mayer, chief operating officer for Collectors Universe, said in court filings this week that the damages are hard to calculate.
"In correspondence with Mr. Webber, defendants [Burnsville Coin] stated that they sold 400-500 coins per month. We cannot, at this time, determine how many of those coins were Chinese counterfeits, but suspect there were numerous sales such as those to Mr. Webber," Mayer said. He said he's received several phone calls from people who claim that Skog sold them counterfeit coins in PCGS holders.
In an e-mail Thursday, Skog wrote that a hearing is pending in California "in which we plan to plead 'Not Guilty' and we have requested a change in venue. We have been in business for over 35 years and sold nearly 5,000 coins last year alone! There is a question on two of them. That should say something!"
In an earlier e-mail, Skog claimed that both of the coins he sold Webber had been graded and certified by PCGS.
"They were never returned to us for refund or exchange," he wrote. "We did not tamper with the coins and PCGS guarantees their work. That is why the coins are certified in the first place!"
Webber insists that Skog knew the coins were fakes because PCGS denies that he ever sent the coins in for certification. That infuriates Webber, who is vice president of his local coin club.
"Most people would be tickled to just get their money back. And he would be glad to give me my money back, I'm sure, for me to go away. But he needs to be put out of business," Webber said.
"Say they sell to your father some fake coins in fake holders and he just puts them in a safety deposit box. And when he dies, you carry them off to get them sold. They'll say, 'These coins aren't worth a dollar.'"
Armen Vartian, an attorney for Collectors Universe, said counterfeit coins and holders from China are becoming more common. Five years ago, he said, they would be easily detected by numismatists, but no more.
Webber agreed. In a test, he passed the silver dollars that he bought from Burnsville Coin around to 20 members of his coin club. Just five concluded correctly that they were fakes, he said.
Collectors Universe suspects that Skog has coins made to order in China, complete with specific dates and mint marks, Vartian said.
Webber said he filed a complaint with the Minnesota attorney general's office and was told that when it started doing research on Skog, investigators learned that he was in China, "looking for certain dimes."
The attorney general's office declined to comment, citing restrictions of the Minnesota Government Data Practices Act.
Dan Browning • 612-673-4493
