MAFS Jeweller Ordered to Pay $800,000 After Secretly Diverting Show Deal
A Sydney jeweler hid a lucrative 'Married At First Sight' sponsorship from his business partner, a judge found.
Sydney jeweller Pierre Germani has been ordered to pay his former business partner more than $800,000 after a judge determined he dishonestly steered the "Married At First Sight" (MAFS) sponsorship deal to a new company he secretly established. Justice Scott Nixon of the NSW Supreme Court found that Germani, with over 35 years in the jewelry trade, breached his duties as a company director and fiduciary.
The court heard that Germani and his company must pay $690,000 plus interest, totaling over $800,000, to Valtimo Holdings, a company controlled by his former partner, Fred Grotte. Grotte had previously held a 40% stake in two companies that operated Pierre Jewellery, located in Sydney's Strand Arcade.
Diversion of Sponsorship Deal
The partners reportedly fell out by March 2022, with Grotte rejecting Germani's offers to buy his stake. In April 2022, Germani established a new company, Prodiamonds, operating under the trading name Pierre Diamonds. The court was informed that he began trading from the same shop without informing Grotte.
Three months later, MAFS producers contacted Germani, indicating that Pierre Jewellery had been selected as the show's exclusive jeweler for the 2023 season. Germani responded positively but provided the new company's name and trading name to the producers, stating that Pierre Jewellery was undergoing a brand update.
Justice Nixon found that Germani deliberately concealed the existence and sales of Prodiamonds from his estranged partner. He rejected Germani's defense that the new venture was not a continuation of the old business and that his name was the primary asset.
Financial Difficulties and Company Collapse
Around the time the MAFS deal was being finalized, the landlord of the shop, Vicinity Centres, contacted Germani about unpaid rent. By August, a breach notice was issued for $233,000 in arrears. Germani reportedly informed the landlord that the business had no funds.
Weeks later, Germani placed the Pierre Jewellery companies into administration, and they subsequently went into liquidation. Justice Nixon concluded it was probable that Germani intentionally caused the old companies to default on rent payments to facilitate the transfer of the lease to Prodiamonds. The court heard that Germani continued trading under the new company, billing customers under either name, while the original companies were in administration and liquidation.
In October 2022, Germani allegedly negotiated a new lease for Pierre Diamonds after agreeing to personally repay the rent arrears. The case was initiated by Valtimo Holdings to recover losses incurred due to Germani's new venture.
The parties are scheduled to return to court next month to address further orders and costs.