I first read about a lawsuit against Shreve & Co., a historic and prestigious jeweller in San Francisco, a few days ago, but waited to report on it until I had given the retailer and Patek Philippe time to respond.
Both declined that opportunity, but that does not, in my opinion, mean they have any case to answer in this spurious incident.
In case you do not know the story, the jeweller is being sued by a customer because, after allegedly being told he would be able to buy a rare and highly desirable Patek Philippe golden Nautilus only after building up a purchasing history with the retailer, the watch he was promised never materialised.
He might be falsely asserting the promise of the Nautilus was a banker or Shreve, which lost its agency as an authorised dealer for Patek Philippe this year, was unable to keep that promise.
The court case, if it proceeds, will establish the rights and wrongs of the claim.
The plaintiff, Ali Rezaei, wants $500,000 in damages.
However, for me, this looks like a shake-down, and the court should throw out the case.
The lawsuit says that Mr Rezaei spent $220,000 on other Patek Philippe watches and fine jewellery because he was promised he would be able to buy the $109,000 golden Patek Philippe watch (Ref. 5980/1R-001) if he built up a purchase history.
It is not inconceivable that some sort of suggestion along those lines was made.
The court will establish whether that suggestion, verbal or in writing, amounts to any sort of “contract”.
I doubt it.
Finding in favour of Mr Rezaei in this case would set a dangerous precedent, effectively saying that a bit of salesroom banter amounts to an agreement he could take to the bank.
The details will come out in court, if it gets that far, but I have serious concerns about the implications of any settlement in favour of the plaintiff.
Right now, authorised dealers for Patek Philippe (and Rolex, Audemars Piguet and Richard Mille) face intimidation daily from people wanting to buy watches that can be flipped for a profit.
This feels like a new tactic in that ongoing battle.
These retailers train their staff to be courteous and professional to all prospective customers, but it is not unreasonable for them to at least try to separate genuine watch enthusiasts from speculators, particularly when the latter can become aggressive and intimidating.
A number of blogs have piled in on the side of Mr Rezaei, suggesting that it is about time customers were treated better.
I could not disagree more strongly.
I do not know Mr Rezaei, and perhaps his grievance is entirely justified, that is for the court to decide.
But I do not think a retailer should be forced to sell anything, let alone a hot Patek Philippe watch, to anybody.
The whole thing feels like a shake-down to me.
Hi Rob,
I think that you missed the main point of this story. It is well written in the lawsuit document.
The dealer promised him a timepiece (at retail of course) despite knowing that PP would cease their representation contract with Shreve & Co. According to the document, there are chronological facts supporting this element of the case.
What do you think of this behavior from the dealer?
Yves is right on the money here. Interested to read Rob’s response to this.
Forgetting the blatant misrepresentations of the deal, the watch buying public is sick and tired of ADs highly suggest we buy harder to sell watches and high profit jewelry in order to get access to highly desirable watches. Moving up the Phantom “waitlists” is a ruse as moat agree that these lists don’t exist. Each AD’s General Manager ultimately influences who gets each watch.
I have to disagree, Rob. If anyone was extorted, it was the guest. They promised him a watch that they knew that they couldn’t get, at least at some point.
The store is absolutely accountable for any lies that their salespeople tell guests. Refering to it as ” salesfloor banter” doesn’t mean that the company isn’t liable.
The public sentiment clearly illustrates that enough is enough. Authorized dealers have acted like gatekeeping lords, sneering at their clientele; although distasteful, treating your client base like dirt has been a successful business strategy for some. However, promising something you know you cannot deliver on is a lie. It is reprehensible, even if you do not benefit from it, and Shreve certainly benefited from Rezaei’s custom. False statements have no place in honest business, and defending them as “salesmanship” or “banter” is beyond the pale.
Very disappointing statements from you showing a lack of understanding of this tier of the retail market.
The court case may hinge on this question. If Shreeve was promising the Nautilus even after it was aware it had lost the Patek Philippe agency, then I agree telling the customer that buying expensive jewellery would move him up the waiting list (if this is what happened) would have been wrong. It would then be for the court to decide if that was illegal in some way and worth $500,000 in damages (a ludicrous claim in my opinion).
It’s about time that everyone realised what was happening. The watch houses and retailers are acting as a cartel. This has been the same for a number of years and shows the lack of respect they have for anyone that doesn’t increase their bottom line figures. I feel sorry for those who save hard to buy a watch to be sneered at for not spending many times more on things they don’t want.
I have been told that watch houses inspect retailers book to check that discount is not being given and rap their knuckles if it is, this is only one way they exert pressure on the retailers.
It’s about time this behaviour stopped and was properly investigated.
Speculation by all, as to the transition timing of when Shreve & Co., was no longer a PP Authorized Agency, and the Plaintiff’s claim is the nexus of the claim on a Watch that was mythical at that time. Patek Philippe controls its Distribution in the United States under the Henri Stern Co., in NYC, they solely decide who has the Authorization to sell their product. I would wager, at some point in 2016, when Shreve & Co. decided to re-locate further down Post Street and closer to Market, away from Union Square, that decision was made by PP, and Shreve & Co. no longer controlled the opportunity to make the sale, if the Timepiece became a reality. Concurrently, the building that Tiffany & Co was housed also sold to a Spanish Buyer for $135M, midway on Union Square between Sak’s and the Hyatt Union Square, a premium location for International Branding. Historically, on the Re-sale Market, a Timepiece that has the Tiffany & Co. name on the Dial of a Patek Philippe can be worth double that of identical Timepiece w/o the Retail Reference, of which Tiffany is the only U.S. Agency so blessed to do.
I recognize this is an opinion piece, but having been on the receiving end of a Patek AD’s mafia-style shakedown in the past year, I can tell you I 100% I believe the plaintiff in this case. My experience is remarkably similar. I was lured into the store to “establish” a relationship after being provided multiple reassurances that I don’t have to pay-to-play for any sort of consideration or allocation. I took the representative at his word and purchased over $72,000 of merchandise that I actually wanted with the understanding that I wouldn’t be asked to buy things I didn’t want. Suddenly, the rules changed. I had to buy multiples of other Patek pieces I didn’t want in order to “take a journey of the brand,” “diversify my purchase history,” and continually spend money to maintain a relationship just for the privilege of consideration. No promise of allocation or timing. Just keep spending and we might take care of you. When I asked to what end? No number given. Under such an arrangement I could be spending infinitely and in perpetuity with no expectation of allocation or timing. That, sir, is called fraud, and there are laws against it in the United States. Thank goodness I have written documentation that I had no intention of even entering the store if such an arrangement were true. The AD’s representative actually CALLED ME after I had turned this proposition down to provide the reassurances. Rest assured that I have my attorney involved and I will be receiving a full refund for the items purchased under the misrepresentations of how they do business. Patek corporate is aware of what happened, though I honest to goodness believe Patek doesn’t care and may actually condone this behavior. Patek is also aware that after attempting to purchases pieces now through two different ADs and having one close down and the other attempt to commit outright fraud, the only thing they’ll be able to help me with is registering the pieces I purchase secondary market. I actually a bit disappointed I didn’t get to litigate this and drag both the dealer and Patek out into the light for these sorts of sales tactics.