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Sotheby’s auction house may be responsible for four million dollars worth of missing diamonds. She allegedly gave them to a “stranger”. This month, the Court of Appeal ruled on it.
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The lawsuit was filed by M&L Financial, which claims it handed over the diamonds to Sotheby’s for valuation in April 2019. A few months later, M&L claimed that Sotheby’s gave the diamonds to a company representative, who pledged the stones to M&L as collateral for a loan. Since then they have been according to the server CNN missing diamonds
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The diamonds were the property of Jadelle Jewelry and Diamonds of Beverly Hills, owned by Jona Rechnitz, a political fundraiser known in New York and Hollywood celebrity circles. Jadelle has dressed several celebrities including Kim Kardashian, who has often been photographed wearing her jewelry. Rechnitz allegedly gave the stones to M&L because he had a “substantial debt” with them.
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While the diamonds were held by Sotheby’s, someone impersonated an agent for Jadelle Jewelry and picked up the jewelry at Sotheby’s. This was after Rechnitz alerted the auctioneer that a gem agent would be coming.
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The case has been dragging on since 2020, when M&L sued the auction house. She claimed the gems should never have been released to Jadelle Jewelry’s agent.
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According to the judgment, everything depends on the wording of the contract. However, the US Court of Appeals pointed to the “fine print” on the back of the document, which stated that “M&L had transferred the diamonds to Sotheby’s and held them for appraisal in anticipation of a consignment sale”.
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However, the contract did not mention any agreement to auction the gems for M&L, even though it was the purpose of Sotheby’s involvement in the whole case. However, the auction house breached the agreement by handing over the diamonds to a stranger.
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A spokesperson for Sotheby’s disputed the allegation, telling CNN Business: “The person who acquired the property was an authorized representative of Jadelle Jewelry. Consignors regularly instruct Sotheby’s to issue by proxy and in this case the proxy presented the necessary identification as requested upon collection.’
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Sotheby’s also said in a statement that it considers the complaint unfounded and full of falsehoods and misrepresentations. “We will continue to vigorously defend ourselves in court,” the auction house said.
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CNN Business could not be reached for comment from the other actors. Jadelle Jewelry’s phone number has been disconnected and its website no longer exists. Rechnitz could not be reached, nor could M&L.
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