What to do if a referee plagiarises the result after rejecting a paper? I find myself in an awkward situation. Nearly two years ago I submitted a paper to a reputable mathematics journal. After 15 months it was rejected with the rationale that there had been papers published (most since the submission date) that contained results that I should have referenced. I found that a little spurious, but moved on and put my work together with some colleagues and got our new paper accepted (pending some language issues) by a different journal.

However, one of my co-authors has found that my exact result (barring some small notational changes, but with the exact same language; I can recognise it as mine, I slaved over finding just the right words!) from my original paper has had the proof published in a book by one author of the references that caused the paper to get originally rejected!

My assumption is thus that the paper was sent to this person to referee and they liked the result so much that they kept it for themselves, which also explains the delay in refereeing... I believe that this author has also presented this result at a conference as their own work. They have a number of papers published on the topic in question from their doctoral thesis.

My question is what steps can I take now to re-assert my authorship?

I believe that it would have been simpler if I had also submitted it to the arXiv, but I wasn't sure (at that time) how that would be seen by the journal. I did give a presentation of my results at a local conference, so I would be able to produce credible witnesses to back up my claim, if necessary. The book published containing my work is largely the doctoral thesis of the author, so I am attempting to find a copy of the thesis since it was deposited before I submitted my paper to the journal. Can anyone suggest any other recourse?

My co-authors would prefer to err on the side of caution and include a reference to the result in our revised paper, but I would really like to reclaim my work...
I suggest that you write a formal letter to the journal editor who handled your submission.  (Make sure it is the same editor.)  Give all the relevant details, including dated copies of all correspondence (whether electronic or printed).

The editor should know who refereed your paper, and although the editor will not reveal their names to you (I assume that blind refereeing was done), he or she would be in the best position to act on the matter.

Perhaps the best thing that could happen is the editor agrees that some unethical behavior occurred, the editor helps you file a case against the erring referee, the erring referee gets penalized, and proper attribution is given to you.

Perhaps the worst thing that could happen is the editor does not believe your story, thinks you are just looking for trouble, and tells other editors and referees that you are a "bad, crazy person."  Or the editor does believe your story but is a close friend of the erring referee and so acts as if he or she does not believe your story.

Either way, at least they know that you are aware of this unethical behavior and this will perhaps discourage the erring referee to continue with the unethical behavior in the future.