....I am sorry to read this....

[TempoKing]

JUSTICE DEPARTMENT SETTLES CIVIL CONTEMPT CLAIM
AGAINST ROLEX WATCH U.S.A. INC.

FOR IMMEDIATE RELEASE
TUESDAY, FEBRUARY 28, 2006


Rolex Watch U.S.A. Inc. Agrees to Pay $750,000

WASHINGTON, D.C. — Rolex Watch U.S.A. Inc. has agreed to pay $750,000 as part of a settlement with the Department of Justice that resolves Rolex's alleged violations of a 1960 consent decree that prohibited U.S. importers of Swiss watches and watch parts from engaging in anticompetitive practices in the U.S. watch industry.

Wow..it took some 46 years for the paper pushers in DC to finally settle (sic)

The Department today filed a petition in the U.S. District Court for the Southern District of New York asking it to find Rolex in civil contempt of the decree. The Department also filed a settlement agreement and order, subject to court approval, that would resolve its antitrust concerns. Part of the $750,000 payment to the United States includes reimbursement to the government for the cost of its investigation into Rolex's alleged violations. During its investigation of Rolex's alleged decree violations, the Department determined that, as a result of significant changes in the watch industry during the past 45 years, the decree is no longer necessary to protect competition and therefore should be terminated.

"The rule of law requires companies to abide by a court's lawful orders or pay the consequences. Even when a company believes that a court's order is no longer necessary to serve its original purposes, the appropriate recourse is to ask the court to modify its order, not to flout it," said Thomas O. Barnett, Assistant Attorney General in charge of the Department's Antitrust Division.

In today's filing, the Department said that certain provisions of a Rolex policy statement violate the decree by placing restrictions on the use, resale, and pricing of watch parts purchased from Rolex. According to the Department, Rolex's policy is not to sell watch parts to independent watch repair facilities or watchmakers unless the watchmakers agree that they will not use the parts in any watch that has non-Rolex parts or accessories. Rolex's policy also prohibits watchmakers from reselling spare watch parts under any circumstance and from charging an excessive markup for watch parts used in repairs. The Department alleges that these provisions of Rolex's policy violate the terms of the 1960 decree.

Today the Department also filed with the court a memorandum consenting to termination of the decree, subject to notice and an opportunity for public comment. Nevertheless, Rolex must still comply with the terms of the consent decree until and if the decree is terminated.

The Department filed an antitrust complaint alleging a wide-ranging conspiracy between Swiss and U.S. watch companies to fix prices, terms, and conditions of the sale of watches and watch parts, to restrict the manufacturing of watches and watch parts in the United States, and to control the export of watches and watch parts into the United States. More than 20 defendants were named in the complaint, including The American Rolex Watch Corporation, which today is known as Rolex Watch U.S.A. Inc.

Just prior to trial, the United States and 11 of the defendants, including Rolex, entered into a consent decree that resolved the complaint's antitrust concerns. Under the decree, the defendants are prohibited from placing certain restrictions on the use of watch parts or watchmaking machines purchased from the defendants. The decree also prohibits the defendants from entering into certain agreements that fix or control the terms or conditions on which watches, watch parts, or watchmaking machines purchased from the defendants may be resold. In addition, the defendants are prohibited under the decree from entering into certain agreements that fix or control the markup or the maximum or minimum price at which watches, watch parts, or watchmaking machines purchased from the defendants may be resold.

Rolex Watch U.S.A. Inc. is the U.S. subsidiary of the Swiss watch manufacturer Montres Rolex S.A. Rolex Watch U.S.A. imports, distributes and services Rolex watches, stopwatches, pocket watches, and clocks, and maintains a network of Rolex watch dealers in the United States.

Notice of the Department's intention to terminate the 1960 decree will be published in the Federal Register. Any person may submit written comments to John Read, Chief, Litigation III, Antitrust Division, U.S. Department of Justice, 325 7th Street, NW, Room 300, Washington, DC 20530 during a 60-day comment period. After the conclusion of the public comment period, the United States will file with the court copies of any comments that are received along with its response to those comments. At that time, the court may terminate the decree upon finding that termination serves the public interest.

[meloncap78]

Absolutely ridiculous. Sounds like the justice department doesn't have much else to do in it's most recent years? Great find!!

[dsimon9]

Any lawyers in the group who could provide in layman's terms what does it all mean? Both in the short term and in the long term? Are we going to be seeing more "fakes" out there or pseudo Rolex's?

Thanks,

Dex

[colemanitis]

Interesting read. It sounds like the govt is trying to take control away from Rolex to control the strict use and sale of their parts. Another example of the govt sticking their nose where it doesn't belong.

[Texsubmariner]

I actually applaud the Justice Dept. for this. This settlement will benefit the consumers by lowering the prices and makes it easier for us to find spare parts, perhaps even for the vintage pieces. What I am hoping for is that RUSA will honor the warranty for the second hand watches that are still within the warranty period. Well, I can dream...

[Luminor]

After reading through this, i come to understand that one may import as many Rolex watches as he likes without getting any bs from customs or any other authority.
This basically means anyone could start importing Rolex watches from other countries be it by usps, courier, air-frieght or by carrying them on the person.

"Notice of the Department's intention to terminate the 1960 decree will be published in the Federal Register. Any person may submit written comments to John Read, Chief, Litigation III, Antitrust Division, U.S. Department of Justice, 325 7th Street, NW, Room 300, Washington, DC 20530 during a 60-day comment period. After the conclusion of the public comment period, the United States will file with the court copies of any comments that are received along with its response to those comments. At that time, the court may terminate the decree upon finding that termination serves the public interest."

I think we should all write a letter to John Read, telling him that we agree with the termination of the decree.

I hope 500 letters is enough for public interest.

The article Tempoking has showed us should be forwarded to all Rolex lovers, and dealers ASAP.

Good find Tempoking. You deserve a pat on the back, or a lap dance from a Russian woman lolll

[East Bay Rider]

Note to self...
Buy only new Rolex watches from AD. Be especially wary of Frankenwatches as it seems that the less scrupulous out there have won a battle in the way of accessing "genuine" Rolex parts which can then be mixed with non Roxex parts to produce even better fakes.

Originally Posted by TempoKing

In today's filing, the Department said that certain provisions of a Rolex policy statement violate the decree by placing restrictions on the use, resale, and pricing of watch parts purchased from Rolex. According to the Department, Rolex's policy is not to sell watch parts to independent watch repair facilities or watchmakers unless the watchmakers agree that they will not use the parts in any watch that has non-Rolex parts or accessories. Rolex's policy also prohibits watchmakers from reselling spare watch parts under any circumstance and from charging an excessive markup for watch parts used in repairs. The Department alleges that these provisions of Rolex's policy violate the terms of the 1960 decree.

[JimSnyder]

So does this mean I can buy a Rolex from overseas and have it sent to me in Ohio now ? Jim

[oneillba]

Makes my head wiggle.

[Frampton]

This is ponderous. The Justice Department has filed a petition to punish Rolex for violating an ancient decree which, in its infinite bureaucratic wisdom, has determined to be wholly unnecessary. They want Rolex found to be found in contempt of the decree while simultaneously asking that the decree be abolished.

[ROLEX MAN]

he who have no problems maketh some!

[Leighton]

Seems to me there are more pressing matters for our Justice Department to deal with. Come on now, it's not like there are not a ton of watches out there for consumers to choose from. Rolex policies in no way prevent consumers from buying a freaking watch!

[Hatchet]

Seems to me that it relieves Rolex of this law and allows them to sell whatever to whomever they please(or don't please). This is probably when Rolex stopped selling parts to jewelers in the US.

[roadcarver]

Where's my lawyer lingo translater contraption?

From what I read, does it mean that US customers can now import Rolex watches?

[ezmoney46]

[jac67]

I don't understand. From what I gather, this basically abolishes Rolex's strangle hold of parts to independant watchmakers.

This IS a good thing, right. YES!!!

Why should Rolex have a monopoly on servicing their watches, with independant watchmakers having to source their parts from other means, including having to use non-genuine parts.

I for one, like having my watches serviced by Rolex, but some of their policies are draconian.

For example, if I want to put a genuine Rolex diamond bezel on my wife's TT DJ, then I should!

Also, if I wish to service my own Rolex (whether I'm a watchmaker or not), I should be able to source genuine parts.

Could you imagine the uproar if you could only service your Ford at Ford, and NO parts sold to the public.

As for the argument regarding more fake watches, this is ridiculous. Go down to any Chinatown, Canal Street etc, and you will be gobsmacked.


John.

[Baptistman]

Seems like a good thing to me, from what I can understand the US gets a raw deal, particulaly in obtaining Rolex from overseas and having them shipped into the States.

[SPACE-DWELLER]

Serves RUSA right, imho!

[astcell]

So now if I send in a watch with an after-market dial or bezel Rolex won't swap it back?

[mickeydainish]

...good post Tasos..... :-)

[dsimon9]

As a means of understanding what it means, let me propose a hypothetical situation:

An independent jeweler would be able to order parts from Rolex. He/she could take these parts, combine them with parts he might of obtained elsewhere and make the watch indistinguishable (or nearly so) from say, a vintage watch. Thus he/she has just introduced a nearly perfect fake into the market, and possibly having the effect of diluting the value of "true" vintage watches.

As a more specific example, would an independent jeweler be able to "make" a Comex labeled watch with authentic Rolex parts (ordered from Rolex, i.e. the dial) and yet the watch would not be a true Comex watch? And if indeed a jeweler could do this, would it not have the effect of diluting the value of the vintage Comex watches out there?

Just trying to have a good understanding of what the ruling means.

Dexter

[TempoKing]

Originally Posted by mickeydainish

...good post Tasos..... :-)

I thought you would enjoy reading this.

[f16570]

Interesting read,never understood a word of it. JOKING.
Is the situation the same in the UK & Europe?

[Portzed]

Originally Posted by TempoKing

FOR IMMEDIATE RELEASE
TUESDAY, FEBRUARY 28, 2006


Rolex Watch U.S.A. Inc. Agrees to Pay $750,000

.

Good find with many repercussions I'm sure.

How come it was for 'immediate release' over 2 years ago but it has taken this long to get 'found'

[TempoKing]

Somehow even with this decision Rolex is not selling any parts to outsiders.

I still have to buy "under the table"

Is this good or bad..?
The way you think, will make it so.