W. B. David & Co. Inc. filed suit in federal court in Manhattan Thursday against 90 defendants, including the De Beers entities, their principals, the Diamond Trading Company, Diamdel, J. Walter Thompson, the DTC sightholders, their accountants, and others for $100 million, injunctive relief, and attachment of De Beers’ U.S. assets.
The third-generation firm, which has been in the diamond business since 1949, made the announcement in a statement released late Thursday.
“The De Beers cartel and its confederates and co-conspirators have inflicted serious injury on us,” W.B. David said in its statement. “We are prepared to pursue this matter vigorously to a successful conclusion.”
The 140-page complaint contains more than 30 counts, including claims under the U.S. and New York antitrust laws, racketeering under the U.S. RICO statute, fraud, aiding and abetting fraud, misappropriation of trade secrets, unfair competition, aiding and abetting unfair competition, accounting, breach of contract, tortious interference with business relationships, unjust enrichment, defamation, and breach of fiduciary duty.
The complaint, according to the statement, details the history of the De Beers “cartel” and De Beers’ dominance of the worldwide market for rough diamonds for over a century and explains that De Beers’ principals have been unable to enter the U.S. due to, among other things, “an outstanding indictment against De Beers for its monopolistic conduct.” It describes J. Walter Thompson’s role as De Beers’ “U.S. agent and alter ego through which De Beers illegally conducts business in the U.S.”
W.B. David was a De Beers sightholder for more than 35 years. The company used to refer to itself as the “Sightholders to America’s Jewelers.”
W.B. David refers to De Beers’ decision to remove it as a sightholder as an “unlawful decision” to deprive the company “of its source of supply and to steal its proprietary marketing initiative.”
The complaint alleges that all of these injuries were inflicted upon W.B. David “as part of the effort of the De Beers cartel and its confederates and co-conspirators to increase De Beers’ market domination and monopoly power.”