Industry / Legal / Watches

Suit: Chicago Jeweler Allowed Rolex Sales To Gray Market


On Feb. 11, a former employee of Chicago’s C.D. Peacock filed suit against the retailer, alleging that management of the authorized Rolex dealer “oversaw and enabled” a scheme to sell the brand’s watches on the gray market.

The store denied the allegations in a comment to JCK, calling them “baseless” and “false.”

The complaint, filed by former sales associate Suzana Krajisnik in Illinois federal court, noted that authorized Rolex retailers must abide by an agreement limiting how it sells brand watches. The 180-year-old store “strictly enforced” the policy until 2018, when the retailer set an internal goal of $10 million in sales, and a new employee was hired, according to the complaint.

This employee allegedly “post[ed] Rolex products on her Facebook page for sale in foreign countries,” as well as on Instagram and Chinese messaging app WeChat, a violation of the brand’s policies, the complaint charged.

Some of the sales were charged to the new employee’s credit card, and others were made in cash, but no IRS Form 8300s—required by law for cash sales over $10,000—were filed, the complaint alleged.

The complaint further charged that when the plaintiff and two other purported whistleblowers brought their concerns about this to store management, they ended up losing their jobs.

The complaint alleged the plaintiff was fired “under a false pretext of poor sales numbers.”

According to the legal filing, Krajisnik’s sales numbers “dipped through no fault of her own, but instead, as a result of a carefully orchestrated effort by the management to restrict her hours, deny her access to inventory,” and to “marginalize and fire her for her whistleblowing reporting.”

The suit charged the store and several of its employees with violating the Illinois Whistleblower Act, common law retaliatory discharge, among other counts. It requested unspecified back pay and attorney fees.

In its comment to JCK, C.D. Peacock said the suit was “filed by a former employee who worked with C.D. Peacock for 14 months before being terminated for cause.”

“Luxury watches are an extremely important part of our business,” the company added. “We follow all guidelines to preserve our brand partnerships. Our Rolex partnership has been renewed annually for 30 years. Our history and commitment to being a family-owned business aligns with Rolex’s values.… Our partnership is upheld by a strict customer vetting process in order to protect and respect the integrity of both brands and the industry.”

The news of the suit first appeared in watch publication Atelier de Griff.

(Image credit: Getty)

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By: Rob Bates

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