Who Should Pay?

wondercoin

Here are the facts in this hypothetical case:

1. Mechaincal Error - An obvious SMS CAMEO Kennedy half dollar gets slabbed as a business strike coin with the holder designated as CAMEO.
2. Submittor (a collector) choses to sell off coin rather than simply send it back to grading service to fix. Collector puts it up for auction with $1,000 buy it now (coin is worth around $50 tops as an SMS Cameo)
3. Collector hits the buy it now and buys coin.
4. Collector realizes months later he made a big mistake buying the (mechanical error) coin (when numerous collectors and/or dealers email him concerning the "bogus" coin entered in his set). Collector wants full $1,000 reimbursement from grading service as the coin left their building this way and collector's position is grading service should pay.
5. Grading service takes position that the mechanical error was obvious and they are not responsible for this $1,000. Grading service position is that buyer should take it up with the seller of the mechanical error to get his money back.

Who should pay?

Wondercoin

oreville

I agree with the grading service.

Grading service is correct in taking the position that the mechanical error was obvious and they are not responsible for this $1,000. The buyer should take it up with the seller of the mechanical error to get his money back.

Of course, this presumes that the grading service never recognizes any business strike issues of that year as a cameo, otherwise.

fcloud

The grading service should pay!

It is too bad it was a mechanical error.

As people get older and their vision is not what it was when they were younger they could be relaying on the grading service to take the guess work out of it.

The grading company made the error not the seller and not the buyer.

rainbowroosie

"The grading company made the error not the seller and not the buyer."

TAClough

Who should pay? This question requires a little thought and reasoning.

First, for anyone that has been collecting Kennedy’s for any length of time, the fact that a circulation strike with the designation of CAMEO on a PCGS holder should be a ‘red flag’ for the years 65-67. Having said this, I’m still not convinced that it should be “buyers beware”.

Let me back up a little and repeat what I’ve said in other posts in this forum. I started buying PCGS certified coins about 15 years ago on big ticket items (say over $100) because of the fraud that I felt was going on within the hobby by a few of the less desires people . I researched different TPG and I liked PCGS the best. Here is a copy of part of a previous post:

What is the point of getting or buying a coin certified by PCGS? When I buy a PCGS coin, yes I’m buying the coin first, but I’m also buying the plastic (or better said, I’m buying the guarantee that comes with the plastic). I’ve heard / read too many war stories of someone buying a raw coin and then later finding out that the coin was altered, cleaned, a counterfeit, whizzed, or artificially toned. A lot of people don’t have a neighborhood coin store, and the closest store could be several hundred miles away. Today with mail order and the internet, it is easier and not uncommon to be on the east coast and buy a coin on the west coast then going to the nearest coin store. The reason, I thought PCGS got started was so a person could buy a coin sight unseen and have an assurance that the coin was guaranteed to being genuine, properly graded and was exactly what the label was purporting it to be (I understand that grading the condition of the coin is not an exact science. But if I bought a coin certified by PCGS sight unseen and it was purporting to be a 1998-S Kennedy SMS in MS69 on the label, and when I received the coin in the mail it had the label mentioned but it was a PR69DCAM – I would be pissed. If the seller refused to take it back, not only would I stop doing all business with that person but I would expect PCGS to honor its guarantee and make me whole).

Getting back to your hypothetical case, if this was a new collector, it might not have been obvious. If the facts were changed just a little, and the coin being bought was a PCGS 1967 Kennedy graded MS 67 without the CAM designation, I might even have had been victim. But back to you case, did the buyer try to return the coin to the seller (even months after the transaction when other collectors and deals let him know it was bogus). Can the buyer document this effort of dealing with the seller and trying to get the seller to make the transaction good? Is there a connection between the seller and the buyer (could this be a scam to rip off PCGS)?

If the buyer has tried to resolve the issue with the seller, and if there is no connection between them, then YES, I think PCGS needs to step up to the plate and make the buyer whole. PCGS needs to “preserve the integrity of their guarantee”. The buyer needs to cooperate with PCGS and PCGS might have recourse to address with the seller. In my view point, the fact that PCGS has a Mechanical Verification as the final quality control checkpoint where the paperwork is matched up and the coin and holder are examined for defects or improper information on the PCGS label means that PCGS has some liability here, more then the buyer.

Again, this is just my humble opinion,
Tim

oreville

<< <i>"The grading company made the error not the seller and not the buyer." >>



Rainbowroosie: So I should get full reimbursement for the value of an 1878-S Trade dollar in MS-64? I am blameless? Really?

Russ

I don't know who should pay, But the coin should be removed from the registry set where it resides.

Russ, NCNE

Steve27

The TPG company made the error and they should pay. They should then pursue the original submitter for $950, as this falls into the category of unjust enrichment.

rainbowroosie

Since I know zip about special mint sets, I am a perfect example of a neophyte collector and a perfect example of one who should identify who is to blame.... TPGs get paid to grade coins, not buyers...when you are paid to grade coins -- "because you offer security to unknowing buyers" -- then you ought to provide this security....otherwise, why should you have been paid for your service??? If you want your opinion to matter, you need to own up to your mistakes.... Where was the "finalizer" when this "obvious" mistake was made???

LincolnsRule

Maybe the tpg shouldn't be forced to pay... but it would be a nice gesture if they would...

RBinTex

"...Grading service takes position that the mechanical error was obvious and they are not responsible for this $1,000..."

Obvious to who? Does the grade guarantee now SUBJECTIVELY select to cover only those that have achieved a certain level of knowledge over an imaginary (not to mention a moving) target/threshold?

DAM

IMO... the grading service.

Third party grading provides an opinion as to the grade and genuineness of a coin. Sight unseen tranactions are common now, as a result of third party grading. Some of these transactions are done by less knowledgeable collectors. Grading services have made it easier for less knowledgeabe collectors to buy coins while not being proficient in grading. Perhaps this is a down side of third party grading.

Regardless, if a coin is mislabed, misattributed, blatently misgraded, or obviously mis-anything else as a result of a mistake by the third party grading service, it should be the responsiblity of the TPGS to correct the wrong. It's an issue of "quality control".

I think this says it all...

Grading service takes position that the mechanical error was obvious and they are not responsible for this $1,000.

The grading service didn't create the coin, they certified the coin. Therefore, they should be responsible for errors generated in the certification process.

zkcoins

IMO, for this case I would say the TPG should pay because this is not as obvious error as a 1878-s trade dollar in ms64. I would expect that someone know their series enough to tell the differnece between sms and bussiness, but sometimes its tough. Look at the 2005 satin finish debacle.

I understand that the tpg makes mechanical errors but it is just that....their error not ours. For $14+ per coin I would like to see the coins in the right holder, JMO.

mas3387

Edited because I don't post "anything constructive"

wondercoin

Tim: For my hypothetical, assume no collusion between submittor and bidder - of course, that scenerio would be an easy outcome. Also, in my hypothetical, assume buyer simply demands grading company pay him $1,000 and that he is intent on getting his money back from the grading service.

Oreville: Agreed that the grading company does not assign a cameo designation to business strike Kennedy Half Dollar.

RbTEX: Yes, grading service takes position that the mechanical error was "obvious" under THEIR subjective standard of when a mechanical error will not result in the guarantee being effective.

Fcloud, rainbowroosie, Steve, RBTex, Dam, ZXCoins - does your opinion change if the buyer hit a buy it now for $10,000?

Mas: I already smoked Oreville's peace pipe - what is your opinion on this question, if you wouldn't mind sharing?

Wondercoin

zkcoins

Mitch,

My opinion would still be the same for a $10k coin. However, much beyond $10k I would expect the collector to know better and would shift the responibility to the buyer. If you are going to drop $10k+ on a coin I would hope you know what you are buying. If not then you bought a hard lesson. Of course I would suspect that most of the mechanical errors are on lower priced coins.

Just curious, what are your thoughts Mitch?

Zach

STEWARTBLAYNUMIS

1) The Grading Service has the ability to determine if the ORIGINAL SUBMITTER is the SAME PARTY as the SELLER on E Bay.If the SELLER ON E BAY is the SAME PARTY as the ORIGINAL SUBMITTER then the buyer should be assisted in getting his money returned from the seller and/or/by the Grading Service.

Stewart

2)Perhaps the seller on e bay paid only $40 for the coin and is taking a big shot via e bay.Then the grading service should not in the least bit be responsible.

wondercoin

Zach: Interesting that your position on the liability of the grading company shifts with the value of the coin. You see how that becomes a very "slippery slope" - no? $3,999 sale- grading company liable. $4,000 sale grading company not liable, or something to that effect?? I intend to comment after I absorb the thoughts of the boards.

Stewart: Interesting position that if the ebay seller was NOT the original submittor, but rather had purchased it for $40 from the original submittor, that his sale for $1,000 on ebay would trigger no liability on the part of the grading company.

Wondercoin

TAClough

<< <i>Tim: For my hypothetical, assume no collusion between submittor and bidder - of course, that scenerio would be an easy outcome. Also, in my hypothetical, assume buyer simply demands grading company pay him $1,000 and that he is intent on getting his money back from the grading service. >>



I see nothing wrong with PCGS sending the complainant (buyer) a complaint form, requiring the specifics of the transaction, when and how the problem was discovered and what steps were taken for recovery. I also see nothing wrong with PCGS requiring documentation upto and including responses given to the buyer from the seller. Bottom line, the complainant (buyer) should be required to assist PCGS in recovering the funds from the seller. As long as the complainant has assisted PCGS to the best of his/her ability, then yes PCGS needs to make the owner whole and remove the coin from the market place. If the complainant is not willing to work with PCGS, then they sit on the coin until they are willing to work with them.

Yes, PCGS has the liability! But the complainant (Buyer) was a responsibility too.

Just my thoughts,

wondercoin

Tim: Did your analysis not change if buyer paid $10,000 for the coin?

Also, what if submittor sold the coin for $40 to this seller I speak of and this seller decides to ask $1,000 or $10,000 for the coin? Any impact on the grading company's liability?

Wondercoin

TAClough

It doesn't matter to me if it $1 or $100,000 the guarantee should be the same. Getting back to your hypothetical (to a degree), lets say the coin in question was a PCGS 1967 Kennedy MS 67 (non - SMS):

1. The submitter sold the coin for $50.
2. The buyer then sold it on eBay or another forum for $10,000.
3. Several months have gone by and the new owner had the coin checked and it was a SMS coin.
4. The person who sold the coin on eBay tells the new owner that he sold the coin in good faith and the return privilege has expired after ten days.
5. The new owner files a complaint with PCGS and provides all the details.
6. PCGS should make the new owner whole, in this case I would think replacing the coin would be the best situation for a PCGS 1967 Kennedy in MS 67 (non -SMS) should cost no more then $1,500. If the new owner was willing to pay $10,000 for it, that is his problem. I think PCGS should have the chose of reimbursing the purchase price or replacing the coin with the coin / grade indicated.

Tim

wondercoin

Tim: But, in my hypothetical, the coin in question was thought to be an "exceedingly rare" CAMEO business strike - a coin which PCGS could never replace in the open market, as the coin does not even exist. So, you would never have a situation like yours where the buyer paid $10,000 but PCGS only had to pay $1,500 to buy the coin on the open market -right?

Wondercoin

TAClough

I was hoping that you wouldn't notice the fact that I dropped the Cameo disignation!!!!!!

Like I said in my first post in this thread, a circulation strike coin with the cameo disignation should have been a red flag to anyone that has been saving / collecting coins. When did the present owner accur the coin? When did he start collecting coin?

If it can be argued that the present owner bought the coin in good faith and legitimately thought the coin was genuine based on the PCGS label, I think PCGS still has liability here. But the present owner has the responsibility to try and get his money back first from who he bought it from.

I mean, fair is fair. If I am going to try and get a company to honor it's guarentee, I am going to show that I did everything else first.

Tim

Russ

This buyer has known forever that they have a bogus low pop coin in their registry sets. Why have they not removed it?

Russ, NCNE

TAClough

<< <i>This buyer has known forever that they have a bogus low pop coin in their registry sets. Why have they not removed it? >>




I think the questions is, "Why hasn't PCGS removed it?" Yes, the owner should have removed it as soon as he was told that it was a mis - labeled coin, but how long has PCGS waited for the owner to do the right thing without stepping up to the plate themselves?

Tim

zkcoins

<< <i>Zach: Interesting that your position on the liability of the grading company shifts with the value of the coin. You see how that becomes a very "slippery slope" - no? $3,999 sale- grading company liable. $4,000 sale grading company not liable, or something to that effect?? I intend to comment after I absorb the thoughts of the boards.

Wondercoin >>



I agree that it is interesting. However I persoanlly have bought several sight un-seen coins in the $500-800 range (and I was very happy with all of them so far). So $1000 is not a real big leap. However I would never consider buying a coin from someone sight unseen if it cost $10k. I would want to touch it, look at it, see it, etc. Of course up close I would discover the mislabeled coin. Sight un-seen I would have no chance to discover the error.

I must point out one more thing as well, I persoanlly don't think the seller did a great job themselves. The odds of them knowing what they had is really high and doesn't look good for their business if this is the kind of transaction we can expect from them and all for what $950???

Zach

TAClough

<< <i>I agree that it is interesting. However I persoanlly have bought several sight un-seen coins in the $500-800 range (and I was very happy with all of them so far). So $1000 is not a real big leap. However I would never consider buying a coin from someone sight unseen if it cost $10k. I would want to touch it, look at it, see it, etc. Of course up close I would discover the mislabeled coin. Sight un-seen I would have no chance to discover the error. >>



I can remember a number of years ago, before I had internet access, buying both the Grant & Grant w/Star in PCGS MS 65 for $2250. These coins were bought sight - unseen, all I had were the certification numbers before I bought them (yes I did run the numbers through NCIC to make sure they were not reported stolen before I bought them). But I did buy them based on PCGS's guarentee of them being genuine, unaltered and fairly graded. Also, the example of the Spanish Trail (PCGS) MS 66 cost me over $1000 for another sight unseen purchase. Just a note: Since buying these three coins, I have bought several more from the same dealer and he is outstanding, finding what I like, but the first few purchases when we were just getting to know each other well.... that PCGS guarentee meant a lot to me back then.

I concider myself just an average collector, so a coin valued at one or two thousand dollars is not that big of a leap for buying sight unseen for a coin certified by PCGS and knowing that that guarentee is there (having a return policy in place is desireable too).

Tim

zkcoins

<< <i>
I can remember a number of years ago, before I had internet access, buying both the Grant & Grant w/Star in PCGS MS 65 for $2250. These coins were bought sight - unseen, all I had were the certification numbers before I bought them (yes I did run the numbers through NCIC to make sure they were not reported stolen before I bought them). But I did buy them based on PCGS's guarentee of them being genuine, unaltered and fairly graded. Also, the example of the Spanish Trail (PCGS) MS 66 cost me over $1000 for another sight unseen purchase. Just a note: Since buying these three coins, I have bought several more from the same dealer and he is outstanding, finding what I like, but the first few purchases when we were just getting to know each other well.... that PCGS guarentee meant a lot to me back then.

I concider myself just an average collector, so a coin valued at one or two thousand dollars is not that big of a leap for buying sight unseen for a coin certified by PCGS and knowing that that guarentee is there (having a return policy in place is desireable too).

Tim >>



Tim,

I agree. Most of the coins that I buy sight unseen are not just blind purchases, but rather from someone (a board member) who really knows his department. I have been very happy with all of the products from him and other dealers that I buy from periodically.

Zach

badger

I bought the following from Teletrade at a steal price. The only MS67 Cameo Lincoln in 1950-1958!!! Wow, worth a zillion. Can't wait for the pop reports to catch up to this coin.



Even confirms the coin on the Cert Verification. I'm taking best offers over $100k.
Badger

DAM

Fcloud, rainbowroosie, Steve, RBTex, Dam, ZXCoins - does your opinion change if the buyer hit a buy it now for $10,000?

No. I think the TPGS should be responsible only up to "market value", which may be tough to determine in some cases. If the buyer paid more than market value, then the loss above "market value" should be assumed by the buyer.

The Registry has created a fever in some collectors to own the finest "label". A TPGS shouldn't have to be financially responsible for a collector's irrational bidding/spending.

wondercoin

"No. I think the TPGS should be responsible only up to "market value"

DAM: What is the "market value" of a pink elephant or a business strike Kennedy in cameo?

Wondercoin

MrEureka

In this case, the PCGS guaranty gives them the absolute right to avoid responsibility by claiming "mechanical error".

However, in practice, PCGS judges each potential claim on a case by case basis. I have seen them do "the right thing" many times, but not every time. In the given scenario, assuming all relevant facts have been presented, it's clear to me that PCGS should offer the buyer a check for $1000.

wondercoin

Geez Andy - now I don't even have to answer myself.

Different conclusion if the sale was $10,000?

Wondercoin

DAM

DAM: What is the "market value" of a pink elephant or a business strike Kennedy in cameo?

If, in this "hypothetical case", such a coin exists, and a settlement was to be made, that decission would ultimately be made by the grading service.


Edited to add:

I certainly would have "NO CLUE" as to the value.

wondercoin

"If, in this "hypothetical case", such a coin exists"

Well - an insert tag exists, but surely not the "coin".

Wondercoin

badger

Wondercoin,

My last post was in jest - now for a more serious post. Shouldn't there be some code of conduct like in golf? It is up to me to keep score. If I remove debris and move the ball - even if no one else sees - I charge a penalty stroke.

The coin that I posted is clearly a proof. I bought it as such (and an oddity misprint). I do not want to claim a penalty from PCGS.
Nor do I have intention of trying to pass that off as a 'rare' MS to an unsuspecting person on EBay. Isn't the first line of defense for integrity of the hobby with the submitter or owner as much as the TPG? Do I think the submitter thought, 'Wow, a cameo MS'?. No. --- So, the escallation of the mistake can stop anywhere along the line and minimize the cost of the mistake.

PCGS could have caught it
Submitter could have sent in for correction
Teletrade listed the coin as a proof but was clearly mislabelled
I could resubmit for correction, but I am not passing the coin on or using in a registry or claiming a penalty

We just don't need to be profiting from mistakes. Similarly for the coins you mention. Didn't the owner know that a MS cameo is possibly a contradiction.

I think the guarantees were more clear cut for counterfeits.
Badger

MrEureka

Different conclusion if the sale was $10,000?

Probably. If I were PCGS, I would need to be convinced that the buyer acted in good faith and exercised due diligence. At 10K, this is unlikely. In other words, anyone smart enough to know that the coin could be worth 10K is smart enough to figure out that the designation was a mechanical error.

mas3387

Ok I'll share


A Pop 1 coin



A VG coin stright out of a 2004 mint set and the only 2004 D penny graded under MS60.

This coin is in my collection of problem Cert. tags too be returned to PCGS for correction.

wondercoin

Mas: FYI - I have the matching GA(d) state quarter in VG-10. I cracked it from an MS66 holder shooting for MS67. First time ever I got a 56 point downgrade! I keep it around because one day, I plan on making a 57 point upgrade!

Badger: How true. Did you know that PCGS can and does hold it member dealers responsible for peddling mechanical errors and other clearly bogus coins, but, really has no reasonable recourse against regular collector submittors, which is why often these "bad" coins are peddled by collectors I believe.

Wondercoin

kranky

I suppose it's possible that "mechanical error" could be used as an excuse for a service to weasel out of a guarantee, but only if the service wants to acquire a reputation for not standing behind its product.

Mechanical error should be limited to things which can be immediately recognized - a wrong date, for example. It certainly should not be an excuse for an incorrect designation in a case like this, regardless of value. The service ought to buy it back and make the owner whole.

It comes down to standing behind your product in order to maintain confidence in it.

Datentype

It depends upon if it was a PCGS authorized dealer that had the coin graded. They have a contractual obligation to be responsible for selling coins that are incorect and if they sent it in they would know where they got it. If it was not an authorized dealer and there is no contract PCGS should cover the buyer for there sloppy work.

They are so dang sloppy over there. i sent in 2 coins in 4 months ago with a note that one came to me cracked and the other was listed as a D mint when it was a P mint coin. i forgot about them and then they shipped them back to me unchanged after the note directly on the invoice. Blew it off! Sloppy cheapskates or what is it?

wondercoin

"Sloppy cheapskates or what is it?"

Maybe they saw you "cleaning up" on the NGC-PR70UC Silver Eagles and got jealous.

Only kidding my man.

Wondercoin

Datentype

It must be my Henry Kissenger image!

onlyroosies

"However, in practice, PCGS judges each potential claim on a case by case basis."

Andy is right on with the above statement. Based on the facts that Mitch presents I say PCGS is responsible.
I also believe PCGS will use value in their decision making. If this was a $100 purchase I bet they would
right the check. I had a 1966 MS67 Roosie I sent in for designation review, the coin clearly had full bands.
PCGS called me and said the coin was SMS, but was not labeled SMS.. Thus mechanical error. PCGS sent me
a check for $85 and the coin back in an MS67 SMS holder. They made me whole on a mechanical error and this
was not the last time PCGS made good on a mechanical error for me. Both times it was for low value coins.

I also believe PCGS should make orville whole for his Morgan that says trade and badger for his MS67RDCAM
cent. But I would bet that neither of you want to return your coin to PCGS for what you paid for it. Its probably
worth more to each of you as a novelty item. So that brings us back to How Much is it going to cost PCGS.

The PCGS guarantee is there to protect the collector no mater how naive he/she may be..... Its PCGS's responsibility
to track down the submitter once they buy back the mistake as long as there is proof of the purchase by the
collector.

RegistryNut

<< <i><STRONG>"...Grading service takes position that the mechanical error was obvious and they are not responsible for this $1,000..."

</STRONG>Obvious to who? Does the grade guarantee now <STRONG>SUBJECTIVELY</STRONG> select to cover only those that have achieved a certain level of knowledge over an imaginary (not to mention a moving) target/threshold? >>



I must agree with RBinTex. I do not collect Kennedy halves and the mechanical error would not be obvious
to me. I collect PCGS coins because I feel secure about the opinions on their slabs. Those little inserts may
only be a small piece of paper but, as we all know, they control the value of what we collect. If PCGS wants
to remain #1, then it seems to me, their inserts and/or opinions should be held accountable.

RegistryNut

STEWARTBLAYNUMIS

Before there was a Collectors Club PCGS had their authorized dealers srceen coins before and after they were submitted for such things as cleaned coins and mechanical errors.Noone has yet said who submitted this coin and whether they were a dealer or collector ?

Stewart

IrishMike

The question should be is why let this happen in the first place. All of us who have owned businesses realize that when you make a mistake learn from it and take appropriate steps to see that it doesn't happen again or lessen the likelihood it will. There are ways to fix this issue. Cross reference the grade with pop reports and any coin that shows up in finalization has to be looked at again if a low pop was made or a large dollar value is created.

You could also mandate that any coin that has a date included in SMS minting or SF minting that suddenly pops up as a low pop, an automatic review is required. In this day and age of putting your reputation on the line for all to see there is no excuse not to find a way.

Dan50

<< <i>The PCGS guarantee is there to protect the collector no mater how naive he/she may be..... Its PCGS's responsibility >>

wondercoin

Thanks to everyone for the great replies. Here is my personal take on the situation:

1. Grading companies simply can not take on liability PER SE for mechanical errors. I once had a Roosie dime graded as an 1804 $5 Gold Piece in PCGS-MS66. It went back to the grading company for correction. But, what if a collector got the coin graded and simply decided to run it on ebay for $50,000 buy it now? And, what if a "newbie" to coin collecting simply decided to buy it, relying on the holder? I know a great many of you commenting on this thread might believe the grading company should write the $50,000 check to the collector under these circumstances. I totally disagree.

Could you imagine the "cottage industry" that would develop almost overnight if collectors could offer their mechanical errors on ebay or elsewhere at any price, have their buddies buy them and set up an instant claim for the "unsuspecting buyer". Heck, I read that here in CA some sleazy doctors, lawyers, etc a few years ago were arranging staged car accidents to set up insurance claims, which can often be as little as $5,000 or $10,000 cases. Could you imagine if filing a $50,000 claim with a grading service could be this simple! And, of course, we all agree that there is a difference between the staged unsuspecting buyer and the true unsuspecting buyer - but, their are plenty of great actors out there as well. The grading services need to be very careful not to open the door and avoid the slippery slope that would develop if they started "feeling sorry" for every little old lady from Pasadena, etc.

And, while my example of the Roosie Dime in the 1804 $5 Gold holder is different than the business strike Kennedy designated as an exceedingly rare cameo (i.e. easier to spot so a higher threshold of good faith needed on the buyer's part) - it is not different from the standpoint that many commenting to this thread would hold the grading company liable for WHATEVER the coin sold for on the open market - $10,000 or even $100,000 or $1,000,000. Again, I totally disagree.

2. There are certain situations where the grading company may decide to compensate the complaining party simply as a gesture of good will, but, not out of any legally binding obligation to do so. Whether my hypothetical here would qualify as one of those examples would depend upon the facts surrounding the buyer's purchase. Good faith and fair dealing on the buyer's part would be the first threshold the buyer would have to get past for the grading company to consider such a gesture of good will. I agree with Andy and others that the next factor would be an evaulation of the price actually paid for the coin as a further indication of good faith (and due diligence) on the buyer's part. Also, the sophistication level of the buyer and the complexity of the mechanical error will also be keys to the decision to compensate.

Since grading companies do slab mint state coins with cameo designations (ex: Morgan Dollars), if the facts showed that the buyer was acting totally in good faith and fair dealing in the purchase of the cameo Kennedy, I would provide him a refund in full for his purchase price at the $1,000 level presented in the hypothetical.

Wondercoin

TAClough

<< <i>Thanks to everyone for the great replies. Here is my personal take on the situation: >>



Dear Wondercoin,

I have read your review of your "personal take on the situation" of the hypothetical case you used. I would like to draw your attention to the link labled About PCGS on their own home page. Would you please read the link, About PCGS, and then comment back? After reading, About PCGS, does your "personal take" differ from your earlier statement? The following titled sections of the link (About PCGS) are what I would like to particularly have you comment on plus the totality of the link in general. Would you also please point out to me where the Mechanical Error Exception is stated or implied in PCGS's Guarantee?

1. The PCGS Solution
2. The Highest Standard For Your Coin
3. Encapsulation & Long Term Storage
4. Behind the Scenes at PCGS (Final Verification)
5. Trading Networks

Thank you,
Tim

wondercoin

Tim: I am doing coin "work" all day, but tonight I can take a look at your section. If Oreville is around today - perhaps he can comment first on your section, as I know he took the position that the grading company would not have to pay and I am always interested in his take on a hypothetical.

Wondercoin