A diamond king is embroiled in a corporate divorce that resembles a box-office thriller—from a $70 million jewelry heist in France to the sale of untraceable stones and internal espionage, according to a new lawsuit.
Israeli billionaire Lev Leviev, whose diamond empire LGC USA Holdings is based on Fifth Avenue, accuses business partners of freezing him out of three highly lucrative gem companies, in the Manhattan civil suit.
Leviev claims the Julius Klein Group, led by Martin, Abraham, Moishe and Malka Klein of upstate New York “Have kept [him] in the dark as to the businesses’ operations, thus shielding the full extent of their misconduct from view,” since the partners separated last year.
During the split this past July, a lone gunman strolled into the Carlton Intercontinental Hotel in Cannes and swiped stone-encrusted rings, watches and earrings on exhibition from Leviev’s inventory. French press have dubbed the theft the “Heist of the Century.”
Leviev says the brazen daytime robbery has “heightened” his request for relief because he fears the Kleins will pocket insurance proceeds for the stones while undervaluing their price to Leviev.
They have allegedly “refused to keep [Leviev] fully apprised of this theft or the resulting insurance claims and investigation,” court papers say.
The billionaire boasts that the subjects of the suit “are individuals who are, and have been for many years, major players in the diamond industry, both as wholesalers and manufacturers of rough and polished diamonds.” He says the companies have a net worth and yearly sales of “hundreds of millions of dollars.”
The two sides first joined forces in 2002, and Leviev claims he has a 43.5 percent interest in the joint venture, KLG Jewelry.
But Leviev, 57, says he hasn’t been paid any profits since last September as the parties have attempted to reach a settlement agreement for a “complete corporate divorce.”
Leviev wants the court to prevent his colleagues from selling “highly mobile and not easily traceable” diamonds.
When he dispatched daughter Chagit Sofiev-Leviev to inspect Kleins’ records, they “spied on her with the use of a camera,” the sparkling suit charges.
The magnate, whose Leviev retail chain has outposts in New York, London, Dubai and Singapore, is worth $1.5 billion, according to Forbes. He also owns diamond minds in Africa and convenience stores in Texas.
Leviev also accuses his estranged business partners of keeping on two employees who allegedly helped themselves to over $1 million in improper commissions and consulting fees while operated “a secret competing venture.”
The billionaire is currently in arbitration with the Kleins over the dispute, but wants the court to intervene to prevent them from draining company assets before negotiations conclude.
A spokeswoman for the Kleins said the company was unable to respond because of the Jewish holiday Sukkot.