Two rival jewelers go on charm offensive
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The Rhode Island jewelry makers Alex and Ani, and Luca and Danni, have a lot in common. Both companies make feel-good bracelets embellished with charms or designs. Both are named for the children of their founders.
And both sell their product with a marketing message of love, inspiration, and passion.
So much for that.
On Monday, Luca and Danni filed a complaint with the Federal Trade Commission charging Alex and Ani with unfairly blocking its bracelets and charms from stores. Alex and Ani, the complaint said, mailed letters to its authorized retailers warning that they are "prohibited from selling similar or competitive products" such as those made by Luca and Danni.
Lawyers for Luca and Danni's also sent a cease and desist letter to Carolyn Rafaeliant, the Alex and Ani founder, demanding that her company stop threatening retailers. Luca and Danni, the letter said, would not "stand idly by while a larger business targets us with anti-competitive practices."
Alex and Ani did not respond to a request for comment and it is unclear how many retailers received letters. The company sells its jewelry at 50 namesake stores, including one on Newbury Street in Boston, as well as from display cases inside hundreds of gift store and stationery chains, including Paper Source Inc. of Washington and Hannoush Jewelers of Springfield.
Camile Hannoush, who owns the chain with his five brothers, said he carries Alex and Ani and said it's their prerogative to choose the retailers to sell their jewelry.
"I've seen Luca and Danni," he said. "It's a similarly made line."
Frank Dorman, a spokesman for the Federal Trade Commission, declined to comment on the complaint, which will be reviewed by the commission.
The dispute pits two jewelry companies located just 3 miles apart in Cranston, R.I.. Rafaelian launched Alex and Ani 11 years ago in a corner of her father's Cranston jewelry plant, naming it for her two eldest daughters.
The bracelets — premade bangles with charms that can be worn in stacks — are marketed as imbued with New Age energy. The company even employed a full-time psychic.
Sales soared to $230 million between 2010 and 2013, according to Inc. magazine, although the privately held company has not disclosed recent figures. Rafaelian's success has allowed her to buy homes in Palm Beach, Fla., Providence, and Jamestown, R.I., as well as a winery and mansion in Newport, R.I., known as Belcourt Castle.
Luca and Danni was founded less than two years ago by Fred Magnanimi, a former Wall Street derivatives trader. Magnanimi's family had specialized in religious jewelry and he decided to move back to Cranston after the death of his 33-year-old brother, Danny, from leukemia.
Magnanimi, 37, created the Luca and Stella brand of bracelets in August 2014. In July, he changed the name to Luca and Danni because, he said, it is a combination of his daughter's middle name and his late brother's. The company's website describes the jewelry as born "of love and loss, and the enduring bond of family."
Magnanimi said his company's sales were "several million" in 2015. He insisted that the company's bracelets are made "using a radically different design" that share little overlap with Alex and Ani's jewelry.
Magnanimi said Alex and Ani also has threatened legal action against dealers who carry jewelry made by other companies, such as Chrysalis, a British brand, and Angelica Collection, made by Royal Chain Group of New York. Those companies did not respond to requests for comment.
Mario Piedra, owner of Butterfly Tree Gift Shops in Medford, Needham, and Marston Mills, said he has received similar letters from vendors during his 25 years in retail and simply ignored them.
He stopped selling Alex and Ani last year, but still carries Luca and Danni jewelry. He said his decision had nothing to do with the feud and more to do with his bottom line.
Alex and Ani sales, he said, have slowed significantly from its heyday a few years ago when they brought in as much as $400,000 in revenues.
"They're just like any fad," he said. "They come and they go."
Alex and Ani's success has been followed by controversy in recent years. In 2013, the former general counsel filed a wrongful termination lawsuit that was settled for an undisclosed amount. Last year, a former executive at Seven Swords, an advertising subsidiary of Alex and Ani, also went to court, alleging he was promised stock options that he never received. Alex and Ani has countersued.
Last summer, another company executive was arrested in Jamestown after he crashed a jet ski he did not have permission to take during an all-night party.