Linda Mastro loses appeal on diamond rings worth $1.4 million

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A federal judge has dismissed Linda Mastro’s appeal of a bankruptcy court’s ruling that two giant diamond rings belong to her husband’s numerous creditors.

Linda Mastro lost her right to appeal when she and her husband, former Seattle real-estate magnate Michael Mastro, fled the country in 2011 after they were ordered to turn over the rings, U.S. District Judge Barbara Rothstein said in an order this weekend.

Michael Mastro had been a figure in the ownership changeover and redevelopment plans of Walla Walla’s Blue Mountain Mall. Though listed as an ownership partner when Blue Mountain Plaza LLC purchased the mall, he was not at the forefront of dealings with the city when plans were announced to convert the mall into an open-air shopping destination.

Linda Mastro has maintained the rings, sporting diamonds of 27.8 and 15.93 carats, are not community property but belong to her alone.

The two pieces have been valued at $1.4 million and have played a prominent role in Michael Mastro’s long-running bankruptcy case.

U.S. Bankruptcy Judge Marc Barreca ordered the Mastros to surrender the rings in June 2011 while he decided their ownership. They did not comply, and later fled the country.

In their absence, Barreca ruled in November 2011 that the rings belong to Michael Mastro’s creditors. His wife’s lawyer appealed.

The rings were recovered when the Mastros were arrested in France last October, and now are in the custody of the FBI in Seattle. The Mastros have been indicted by a federal grand jury on 43 counts of bankruptcy fraud and money laundering.

Ten counts involve the rings. The Mastros remain in France, where they are fighting extradition.

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