May 29--Over the last six and a half years, nine men, one woman, three corporations and one government have laid claim to the giant emerald that's been at the center of a protracted ownership dispute in Los Angeles County Superior Court.
On Thursday, Judge Michael Johnson, the second judge to preside over the case, said he has finally determined the owner.
Johnson's tentative ruling hands victory to a holdings company owned by three businessmen, who claimed the emerald became theirs after it was put up as collateral in a $1.3-million deal for diamonds that ultimately fell through.
The company -- co-owned by Idaho businessmen Kit Morrison and Todd Armstrong, and Jerry Ferrera of Florida -- "has presented evidence establishing clear title to the Bahia Emerald as against all other ownership claims," Johnson wrote in his decision.
In a 14-page ruling, Johnson chronicled the tortuous history of the gem after it was first discovered in a mine in the Brazilian state of Bahia in 2001. (Although media reports, including The Times', have put the gem at 840 pounds, Johnson said in his 14-page ruling that it was a mere 751.77 pounds,and nearly 3 feet long at its tallest point.)
The Bahia Emerald, a massive black schist with nine protruding emerald crystals, was shipped from Bahia onto Sao Paulo; San Jose, Calif.; New Orleans; South El Monte and Las Vegas. During its journey, the stone was at the center of a number of failed business deals, soured partnerships and unkept promises. During Hurricane Katrina in 2005, the emerald was submerged in flood waters.
It was seized by Los Angeles County sheriff's detectives in 2008 after one businessman reported it stolen from a Los Angeles-area warehouse. Sheriff's officials tracked the gem to a Las Vegas vault. Since then, it has remained in sheriff's custody in an undisclosed location as the legal battle slogged through the courts.
Since the case was first filed in early 2009, two men's claims to the emerald were rejected by the courts, and the rest have dropped or settled their cases, leaving only the three men behind the holdings company still claiming ownership.
"A lot of very strange players showed up in this case," said attorney Brown Greene, who represented the prevailing group.
Then last fall, the government of Brazil attempted to intervene in the case and halt the legal proceedings, alleging that the stone was illegally mined and should be returned to its home country. Johnson ruled the case should go forward nonetheless, saying he was not making a ruling on whether Brazil may have a claim to the giant gem.
An attorney for the nation has previously said that the Brazilian government was in talks with U.S. authorities about the return of the emerald.
"This ruling will not stop Brazil's efforts to recover the Bahia Emerald," attorney John Nadolenco said Friday. The emerald, he said, was "illegally mined, illegally exported and almost certainly illegally imported."
At a one-day trial earlier this month, Kit Morrison, one of the three businessmen, took the witness stand to describe the 2008 deal in which he was to purchase a large quantity of uncut diamonds. He paid a $1.3-million advance for the diamonds, and was promised the emerald as collateral in case the diamonds weren't delivered, Morrison told the judge.
"Quite frankly, I didn't know what I would do with the Bahia Emerald," he said.
"It seems like a very strange transaction," the judge remarked at the time.
Nonetheless, Johnson found that each person who sold or transferred the emerald leading up to the diamond deal had the proper authority to do so. Morrison and his business partners also properly researched the emerald and purchased it in "good faith," the judge wrote.
Objections to the tentative decision can be filed within a 15-day period before the judgment becomes final.
Attorney Andrew Spielberger, who represents Morrison, said that when Morrison first surrendered the emerald to detectives, he thought he'd have it back in a matter of weeks.
"My clients have waited six years, so we'll wait the 15 days," Spielberger said.
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