Phyllis Michaels sang in a country band for decades. She was on the road for five of those years, rubbing elbows with George Jones, Hank Williams Jr. and Jan Howard. To fit the glittering image, Michaels spent a chunk of her earnings to adorn herself with diamond rings, necklaces and bracelets.
So in 2007, when Michaels heard a TV news report that De Beers, the world’s largest diamond seller, would pay $295 million to settle allegations of rampant price-fixing, she knew she wanted in on the gig.
Michaels, 66, of Minneapolis, is one of legions of consumers who bought diamonds or diamond jewelry between 1994 and 2006 and joined a class-action lawsuit against DB Investments Inc., the Luxembourg-based parent of the De Beers companies.
Five years after the final settlement was announced, she’s still waiting for her money.
Michaels contacted Whistleblower in 2010 to ask for help getting her money, but a reporter found that the settlement was under appeal. In March 2012, she asked Whistleblower to “light a fire under their butts or something.”
In May 2012, the New Jersey Supreme Court refused to hear an appeal of an appeals court decision affirming the district court’s decision. Michaels started checking her mailbox.
Months later, she contacted Rust Consulting Inc., the Minneapolis-based claims processing firm appointed to hand out the money. She was told payment would be made in the next couple of months, she said.
“Then they said the early part of 2013. Now they’re saying in the next few months because we’re still auditing. I think there’s something fishy going on,” she said.
But the checks may actually soon be in mail. A deadline came and went Monday without anyone formally objecting to a payout proposal filed with a New Jersey district court in April.
“We’re just waiting for [District Judge Stanley Chesler] to issue an order. We just called his chambers today to inquire about the status,” Eric Fastiff, an attorney for San Francisco law firm Lieff Cabraser Heimann & Bernstein, said Thursday. “We’re expecting that order to issue any day now.”
As long as the proposal is approved as submitted, Rust may be able to send out checks in as little as a week or 10 days, said Fastiff, who is one of the lead attorneys for the class.
De Beers denied allegations
Between 2001 and 2005, seven lawsuits were filed “alleging that the De Beers group of companies used its market dominance to wrongfully raise the prices of rough diamonds,” the settlement order stated.
De Beers’ chairman “declared publicly” that it “violates [U.S. antitrust law] by managing the diamond market, controlling supply, managing prices and acting collusively with other firms in the diamond industry,” according to a complaint filed with the court.
Plaintiffs alleged De Beers owned 65 percent of the diamond market, a court document stated.
Michaels said she has firsthand knowledge of the alleged price fixing.
“I was working at Goodman Jewelers in 1995. And my boss came up to me and said, ‘Well, if there’s anything you want you better buy it now because the prices are going up.’ That was due to De Beers upping their prices,” Michaels said.
De Beers denied those allegations and asserted that a U.S. court has no jurisdiction over its business. But it eventually agreed to settle the lawsuits. The collective settlement included antitrust language and placed De Beers under U.S. court jurisdiction in certain instances.
Poll: Should Justin Morneau get the final National League All-Star spot?