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Sunday, Jan 29, 2023

Judge Scales Back Claims on 840-Pound Emerald

A long-running legal battle over ownership of the world’s largest emerald – a tale with more twists than a pulp novel – appears to be nearing a resolution.

A Los Angeles Superior Court judge last week denied a request by the Brazilian government to dismiss a case that could determine ownership of the 840-pound gem, known as the Bahia Emerald.

The Brazilian government has claimed the stone, valued at about $340 million, belongs to it and has sought to have the matter adjudicated at the federal level. In dismissing Brazil’s request, Judge Michael Johnson brought the matter a step closer to being resolved at the local level.

Since 2009, some half-dozen people have claimed ownership of the gem, but the courts over time eliminated all but a partnership of Kit Morrison, Todd Armstrong and Jerry Ferrara.

Then, in September, just as it started to seem that the Morrison Group would be deemed the owners, the Brazilian government made a claim based on its theory that the emerald was mined illegally in 2001. The South American nation in August hired John Nadolenco, partner in the downtown L.A. office of Mayer Brown, to represent the country in court. He filed a request to dismiss the case the following month.

“Though this wasn’t the ruling Brazil was hoping for, it is not surprising that the court felt invested in continuing with the case after so many years,” Nadolenco said.

A status conference is slated for April 27. Johnson could rule that the Morrison Group must continue to defend its claim or determine that it is the owner and bring the matter to a close. The group’s attorney, Andrew Spielberger, was confident the court will soon deem his clients the rightful owners.

“There’s nobody left in the case,” he said. “We’ve defeated everyone who opposed us and everyone else has settled with us.”

Still, Nadolenco said it’s not over.

Brazil is still working with the U.S. government, outside of court, to repatriate the Bahia Emerald.

For now, the behemoth of a rock remains locked in a Los Angeles County Sheriff’s Department safe, where it’s been since 2008. Ever since it was unearthed in the eastern Brazilian state of Bahia in 2001, the gem has traveled a circuitous path. At one point, it was submerged in New Orleans in the aftermath of Hurricane Katrina and was later involved in a banking transaction with convicted fraudster Bernie Madoff.

If nothing else, Spielberger said, the case has been full of surprises.

“This is a fascinating legal case with so many different legal issues,” he said. “It’s part of the joy of practicing law.”

Courting Victory

L.A. billionaire Don Hankey’s auto finance company Westlake Financial Services was handed a big win from the U.S. Patent and Trademark Office last month, but an attorney representing the company said it was a victory for many other businesses, too.

Credit Acceptance Corp., a Southfield, Mich., competitor to Westlake, accused the company of infringing on its patented software designed to facilitate consumer’s vehicle purchases on credit.

But the Patent Trial and Appeal Board of the U.S. Patent and Trademark Office ruled that the software is a generic system that cannot be patented.

The outcome should make it harder for similar software patents to stand after re-examination, said John van Loben Sels, Westlake’s attorney and managing partner at Fish & Tsang’s Silicon Valley office.

“It allows defendants like Westlake to challenge the patents that shouldn’t have been issued,” he said. “Patent-owning companies and patent trolls have long been targeting businesses with their software patents. … (This case) makes it harder for patent-owning companies to dominate.”

News & Notes

Gov. Jerry Brown last month appointed George F. Bird, Michael C. Small and Kevin P. Stennis to judgeships in the Los Angeles Superior Court. … Business trial litigators Adam F. Streisand and Nicholas J. Van Brunt joined the Century City office of Sheppard Mullin Richter & Hampton last month. Both lawyers made the move from Loeb & Loeb. … Downtown L.A. law firm Lewis Brisbois Bisgaard & Smith hired Trang K. Le last month as an associate in its health care practice. … Nixon Peabody has promoted Sonia A. Nayak to counsel in its real estate and community development practice at its downtown L.A. office. …West L.A. transactional law firm O&A has hired Michael Borenstein as an associate in the firm’s technology and corporate practices. … New York legal staffing firm Tower Legal Solutions, which opened an L.A. office earlier this year, has announced Daniela Dakshaw will serve as managing director for the West Coast. … Steven Atlee has joined the Century City office of Stroock & Stroock & Lavan as a partner in the financial services and class-action practice group. … Court Appointed Special Advocates, or CASA, of Los Angeles has completed renovations of its Monterey Park facilities last month. The improvements were done as a result of increased demand for services for local foster children.

Staff reporter Cale Ottens can be reached at cottens@labusinessjournal.com or (323) 549-5225, ext. 221.

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