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Helzberg removes proposed class action suit over diamond weight to federal court

By Andrew Thomason | Sep 16, 2013

Helzberg Diamond Shops Inc. has removed a class action lawsuit involving the weight of its diamonds from Cook County Circuit Court to federal court.

Plaintiff Michael Ian Caprarola filed the original complaint Aug. 15, accusing Helzberg of misrepresenting the total weight of the diamonds in certain engagement rings and engagement ring sets, including a set he purchased.

Caprarola claims he bought an engagement ring set from Helzberg for $1,999 that was advertised as having one carat of diamonds, but in reality, it only had three-fourths of a carat.

He asserts he rejected an offer from Helzberg to refund the purchase of the ring set, as well as a $300 gift card intended to rectify the disagreement because it was not enough to compensate for discrepancy.

Caprarola’s individual suit includes claims for breach of contract, breach of implied covenant of good faith and fair dealings, violating the Illinois Consumer Fraud and Deceptive Business Practices Act, breach of express warranty under the Illinois Commercial Code and unjust enrichment.

His class action claims are based on alleged violations of state consumer protection laws and violations of the state Uniform Commercial Code express warranty laws.

Caprarola is seeking relief against Helzberg in the form of actual damages, treble damages, restitution, statutory damages, compensatory damages, punitive damages, attorneys’ fees, expenses, recoverable costs, prejudgment interests and injunctive relief, as well as all other relief deemed necessary and proper.

In the Sept. 11 removal notice, attorneys for Helzberg claim federal court has jurisdiction over the suit under the Class Action Fairness Act (CAFA), which requires the amount in controversy to exceed $5 million and the suit to have minimal diversity in geography between the parties involved, as well as numerosity.

Caprarola seeks to certify a class and subclass in the suit.

The class would include anyone in the United States that purchased jewelry from Helzberg with a diamond carat weight that was less than what was represented at the time of the purchase while the subclass would be limited to people in the United States that purchased the same engagement ring set Caprarola did, his suit states.

In his class action claims, Caprarola asserts that since there are more than 230 Helzberg retail outlets throughout the nation, there are thousands of potential class members who purchased jewelry with an actual diamond carat weight less than what was claimed at the time of sale.

“Based upon Plaintiff’s own allegations, the CAFA’s requirement of at least 100 class members is satisfied,” Helzberg attorney Ashley H. Nall wrote in the removal notice.

Nall, an attorney at Bryan Cave LLP in Chicago, goes on to write that the amount in dispute can easily meet the $5 million floor set by CAFA, especially given the number of potential class members and the multiple areas of damage the class seeks relief for.

In his class action complaint, Caprarola is seeking all damages possible under state consumer protection laws and Uniform Commercial Code express warranty laws.

Caprarola doesn’t identify how much money he is seeking under each statue, or how much each putative class member’s claim would be, but Nall estimates the amount sought by the subclass alone to be roughly $9.6 million, not including the breach of warranty class claim, attorneys’ fees or the value of injunctive relief.

“Helzberg vigorously disputes the procedural, legal and factual validity of Plaintiff’s claims and denies that this case is appropriate for class treatment," Nall wrote in the removal notice.

"However," she adds, "for purposes of determining whether federal jurisdiction exists under the CAFA, it is clear that the aggregate amount in controversy exceeds $5 million."

The CAFA requires that only one member of the plaintiff class be a citizen of a different state than a defendant. Helzberg is headquartered in Missouri, making it a citizen of that state, while Caprarola is an Illinois citizen.

Capraroloa is represented by Clinton A. Krislov, Michael R. Karnuth and Christopher M. Hack, all of Krislov & Associates Ltd. in Chicago.

As of today, no order has been entered on Capraroloa's motion to certify a class in his suit. Court records show that the motion will not be heard at a Sept. 18 hearing, but that a status hearing has been scheduled for Oct. 23.

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