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DUBAI (Reuters) - The Islamic State militant group released a video purporting to show the beheading of U.S. hostage Steven Sotloff, the SITE monitoring service reported on Tuesday. A masked figure in the video also issued a threat against a British hostage, a man the group named as David Haines, and warned governments to back off "this evil alliance of America against the Islamic State", the monitoring service said. (Reporting by William Maclean, Editing by Angus MacSwan)

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Paris Hilton won't return borrowed jewels: lawsuit

By Ben Berkowitz and Jonathan Stempel

NEW YORK (Reuters) - Paris Hilton is holding $60,000 of jewelry that does not belong to her and should give it back, a new lawsuit contends.

A German insurer, Allianz SE, has sued the celebrity socialite and heiress to the Hilton Hotels fortune, saying she has ignored several attempts to recover the borrowed jewels.

According to an April 6 complaint filed in a New York state court, Hilton borrowed the jewelry in 2007 from the Manhattan jeweler Damiani, promising to store it in a safe or vault when she was not using it.

But Allianz said the gems sat unguarded on a closet shelf in Hilton's unlocked Los Angeles mansion when they and some $2.7 million worth of other jewelry were stolen in a December 19, 2008, burglary while Hilton attended a Hollywood party.

Allianz said Los Angeles police found and returned the jewelry to Hilton after it had already paid Damiani's claim under an insurance policy.

It said it began asking Hilton and two eponymously named companies she controls to return the jewelry, but that phone calls and email messages have been ignored.

Allianz's lawsuit accuses Hilton of negligence and breach of contract.

A Hilton spokeswoman said the lawsuit was "not based on fact," and that none of Hilton's representatives ever told Allianz that the stolen Damiani jewelry had been returned. "Only costume jewelry was recovered," she said.

The dispute is the latest involving a celebrity and jewelry. Actress Lindsay Lohan is expected to make a court appearance later this month on a charge that she stole a gold necklace from a Los Angeles store in January.

The Hilton case is Allianz Global Corporate & Specialty AG et al vs. Hilton et al, New York State Supreme Court, New York County, No. 104169/2011.

(Reporting by Ben Berkowitz and Jonathan Stempel; Editing by Maureen Bavdek and Carol Bishopric)

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