FRAUD – Drew Brees Jewelry Fraud Claim / Jewelry Lawsuit against San Diego Jeweler

FRAUD – Drew Brees Jewelry Fraud Claim / Jewelry Lawsuit against San Diego Jeweler

May 10, 2019

            Back in April 2018 Drew and Brittany Brees, filed a fraud lawsuit against San Diego Jeweler, Vahid Moradi and Vahid Moradi, Inc, DBA CJ Charles Jewelers.  At some point a financial advisor encouraged the family to appraise the jewelry they had purchased from the defendants.  Appraisal values were significantly below the purchased price, and in response the Brees family filed an underling fraud complaint, seeking approximately $9 million dollars in damages against the San Diego Jeweler and his business.

Per the fraud complaint the Brees family met Moradi back in 2003 and formed a relationship with the San Diego jeweler.  In 2012 the Breeses started purchasing more substantial pieces, specifically “investment-grade” diamonds with the intention to make a “long-term investment”. In the underlying complaint the Breeses have plead several causes of action, including: Fraud by Intentional Misrepresentation, Breach of Fiduciary Duty, Fraud By Concealment, Breach of Oral Contract, Conversion, Account Stated and Violation of Business and Professions Code Section 17200, et. seq.

This case is interesting on multiple grounds. The underlying complaint includes terminology such as “markup” and “trust”, which begs the question: what do we expect from jewelry retailors? Are we capping profits on jewelry sales? Does a “high markup” constitute unfair and deceptive business practice?  Do we expect total transparency from jewelers? Do we now require jewelers to disclose their costs on each item and provide current appraisal values?

Moreover the underlying complaint alleges breach of fiduciary duty. We generally see this cause of action alleged against stockbrokers, financial agents, corporate officers for breaching their duty to act with the utmost good faith and best interest of their clients and partners.  So this lawsuit begs the question: Do jewelers owe a duty to act in the best interest of their customers?

The civil jury trial was originally set for May 31, 2019 in San Diego Superior Court, Department C-66.  Earlier this week, Hon. Kenneth J. Medel continued the trial and we hope to keep a close eye on this pending matter.

If you or someone you know has fallen victim to a breach of contract, investment fraud or have any questions as to investor rights, we encourage you to call our offices today at 619-432-5145 for a free consultation with one of our Fraud Attorneys and Investment Lawyers.