Hong Kong Investors Win $2.5 Million Case Against Company That Promised to Repurchase Luxury Watches

By Thea Felicity

May 06, 2024 02:08 PM EDT

A poster of the Patek Philippe Ref 96 Quantieme Lune timepiece, once owned by Aisin-Gioro Puyi, the Chinese Qing dynasty's last emperor, is seen on display in Phillips auction house in Hong Kong on May 23, 2023 ahead of its auction in the territory on the same day. The most expensive watch ever sold at auction was a super-complicated Patek Philippe "Grandmaster Chime", which sold for US$31 million in 2019.
(Photo : PETER PARKS/AFP via Getty Images)

The High Court found The WatchFund, a Hong Kong-registered luxury watch investment firm led by Singaporean expert Dominic Khoo, guilty of breaching contracts with five investors from Hong Kong. According to the Straits Times, the court ordered the firm to repurchase luxury timepieces worth $2.5 million, fulfilling its contractual obligations.

The WatchFund, established in 2013 by Mr. Khoo, facilitates luxury watch investments. Investment fees are collected upon agreement signing, and sale fees are collected upon repurchase. 

Despite legal setbacks, the company operates independently from a similarly named Singapore-registered entity.

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The Lawsuit From Hong Kong investors

In a lawsuit, it was revealed that WatchFund failed to honor its agreement to repurchase luxury watches within a year, as per the investors' contract, resulting in legal action from investors.

Justice Teh Hwee Hwee concluded that The WatchFund's actions constituted a breach of contract, dismissing claims of misrepresentation but ordering the firm to fulfill its contractual obligations. Khoo attempted to cancel repurchase offers, but Justice Teh ruled these cancellations invalid since it is the company's obligation to adhere to contractual terms.

In addition to breach of contract, the Hong Kong investors also accused Khoo of providing false information about the value of the watches, but the court found there wasn't enough proof to support these allegations. 

Furthermore, the court rejected the investors' request for Mr. Khoo to be held personally liable, ruling that his status as the only shareholder and director did not support personal liability.

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