All Ali Rezaei wanted was a rose gold Patek Philippe Nautilus ref. 5980/1R. So, the Bay Area man walked down to his local boutique, long-time Patek authorized dealer Shreve & Co., to inquire about acquiring the gold Patek. This from a story that was first brought to our attention by SiliconValley.com that you can read here.
Not so fast, he says he was told by the folks at Shreve & Co. Instead, Rezaei was told he needed to build up his purchase history so that he could have the opportunity to buy a 5980. And so Rezaei did. He started with a Patek 5905R in September 2020 ($70k). Then, he bought two watches from Patek's women's collection totaling nearly $100,000, and finally, a diamond bracelet in March 2022 (another $50k). In all, he purchased $220,000 of merch from Shreve over an 18-month period. During that time, Rezaei says that Shreve and its sales associates continued to encourage him to buy items. Following the bracelet purchase in March 2022, Rezaei says a sales associate told him that "he was certain [Shreve] would offer him the Promised Watch that year." But the 5980/1R never came.
Shreve & Co.'s Bay Area roots date back to 1852 – the era of the California Gold Rush – and it was acquired by North Carolina-based Schiffman's Jewelers in 1992. Shreve was the second American retailer to represent Patek Philippe. But, Shreve lost its status as a Patek AD in April 2022. This was right after Rezaei bought that diamond bracelet; in other words, that promised 5980/1R was never going to come. The lawsuit alleges that Shreve knew it'd be losing this status long before it actually did in April 2022 and did not inform its sales reps (or Rezaei), "in order to reap additional sales revenue for as long as possible by induces its customers to purchase merchandise that they would not otherwise have purchased in order to be offered certain high-demand Patek Philippe watches."
Rezaei's alleged fact pattern is one that'll no doubt sound familiar to some who have tried to get a hot watch in the past couple of years, but here there's also the added complexity of Shreve recently losing its status as a Patek AD. The lawsuit brings some ten causes of action against Shreve, including breach of contract, intentional and negligent misrepresentation, fraudulent concealment, false promise, and unfair business practices, pursuant to California's Unfair Competition Law. The lawsuit was filed on June 9, and Shreve & Co. now has 30 days to file its response. We'll continue to keep an eye on the lawsuit, and while it might have as much of a chance as seeing a jury as Rezaei does of getting a 5980/1R, it'll be interesting to see if it sheds any additional light on these sorts of AD practices.
For the lawyers in the room, the case is Al Rezai vs. Shreve & Co. Jewelers, CGS-23-606973, filed in the Superior Court of California, County of San Francisco (link here).