RealReal Class Action Says Company Overstates Gemstone Weights

Earlier this month, The RealReal Inc. was hit with a class action lawsuit accusing it of systematically overstating the weights of gemstones sold on its online luxury consignment website.

RealReal operates the luxury consignment website TheRealReal.com, which allows individuals to buy and sell luxury items available on consignment all over the world. When RealReal receives a luxury item from an individual, its team of “experts” authenticate, price and sell the item, the RealReal class action lawsuit says.

“Through RealReal’s authentication process, which they advertise behind their ‘team of authentication experts, horologists, and gemologists,’ RealReal guarantees that every item sold on their website and in stores is ‘100% the real thing,’” plaintiff Gaby Basmadjian says in the lawsuit.

Basmadjian asserts that RealReal’s gemstone weights vary by far more than allowed under Federal Trade Commission rules, which declare that it is unfair or deceptive to misrepresent the weight of a diamond. The FTC rules state that diamond weights must be listed to the last decimal point or the seller must include a disclaimer indicating the carat weight is approximated.

According to the RealReal class action lawsuit, Basmadjian purchased a ring from TheRealReal.com on Aug. 30, 2017. She says she paid $982.62 based in part on the company’s representation that the ring included 2.10 carats of diamonds.

Because she was purchasing the ring online, Basmadjian had no way of knowing whether the listed weight of the diamonds was accurate. According to the RealReal class action lawsuit, her purchase was not returnable.

When she received the ring, Basmadjian reportedly had the ring inspected by a gemologist, who found that the ring contained approximately 1.2 carats of diamonds. According to the RealReal class action lawsuit, there was no indication on the ring’s description that the carat weight was an approximation.

Basmadjian points to the FTC rules which would reportedly allow, based on the ring’s description, a weight range of 2.0955 to 2.1055 carats. Instead, Basmadjian allegedly purchased a ring that contained approximately 0.9 carats less than described. She claims RealReal intentionally overstated the weight of the diamonds.

Because the weight of diamonds in the ring she purchased was allegedly overstated by 75 percent, Basmadjian claims she is entitled to a refund of about 75 percent of the price she paid.

Basmadjian filed the RealReal class action lawsuit on behalf of herself and a proposed Class of U.S. consumers who, after Dec. 1, 2013, purchased from RealReal one or more pieces of jewelry in which the weight of the gemstones listed on the product label exceeded the actual weight of the gemstones in the jewelry by more than 1/100 of a carat.

The RealReal class action lawsuit asserts claims for violations of the California Unfair Competition Law, the California False Advertising Law, the California Consumers Legal Remedies Act, common law fraud, negligent misrepresentation, and breach of express warranty.

Basmadjian is represented by Keith Altman and Solomon Radner of Excolo Law PLLC and by Ari Kresch of 1-800-LAWFIRM.

The RealReal Gemstone Weight Inflation Class Action Lawsuit is Gaby Basmadjian v. The RealReal Inc., Case No. 3:17-cv-06910, in the U.S. District Court for the Northern District of California.