Art Law Year in Review
This past year was an exciting one for Grossman LLP, as we continue to build on more than a decade of groundbreaking litigation in the art-law arena.
Total Victory In Second Circuit Appeal Involving Recovery of Stolen PaintingOur year started with a bang, when the Second Circuit Court of Appeals affirmed our complete victory following a three-day bench trial in a title dispute over a painting that was stolen from a major corporate art collection decades ago and replaced with a skilled forgery. The three-judge panel affirmed the Southern District of New York's holding that our client's title claim was timely and that the corporation had been diligent in investigating the theft.
$8 Million Judgment in Securities Fraud Case Arising from Ticket-Resale Ponzi SchemeIn March, our trial team secured a nearly $8 million securities-fraud judgment in a case arising from a Ponzi scheme built on a false promise to buy and resell tickets to high-profile events like the Broadway musical Hamilton. We filed suit in 2017 in the Southern District of New York against a group of defendants who had raised millions from investors by promising big profits from reselling tickets to A-list events when in reality they were running a Ponzi scheme. After we defeated defendants' summary-judgment motions, we obtained a total win for our clients.
Summary Judgment on Behalf of Lender Against Former Hedge-Fund BillionaireA New York state court entered summary judgment this May in favor of our client, who had extended a short-term loan secured by a 20.45-carat Harry Winston platinum-diamond engagement ring. In early 2022, our client had declared the loan in default, and the ring was sold at auction to satisfy the outstanding loan obligations. The borrower later sued, alleging that the terms of the loan were usurious. After full briefing and oral argument, the Court granted our motion dismissing the borrower’s usury and replevin claims as a matter of law.
Complete Dismissal of Counterclaims in Forgery CaseWe filed suit last year on behalf of a prominent art collector who had purchased two Richard Hambleton paintings that were later discovered to be worthless forgeries. At their deposition, under cross-examination the gallery defendants finally admitted that they had actually sourced the works from a known forger, but had concealed that information from our client, giving rise to an additional fraudulent-concealment claim. Rather than rescind the sales, the defendants tried to question the circumstances surrounding the discovery of the forgeries. But this October, following lengthy oral argument, a New York state court granted our motion dismissing every one of the defendants’ counterclaims.
Negotiated Transactions Involving Art Valued In Excess of $1 BillionThis past year we assisted clients with significant art transactions, involving artwork valuing well in excess of $1 billion. Highlights this year included negotiating major art-backed loans; handling numerous significant consignment and guaranty agreements in connection with the year’s major auctions; and successfully deaccessioning a major artwork by an educational institution.
Other Noteworthy DevelopmentsJudd Grossman was again recognized by Chambers & Partners High Net Worth Guide 2023 as one of the country’s top lawyers in the area of Art and Cultural Property Law. At the same time, Judd was named one of the “75 Top Art World Professionals” by ARTnews.
Grossman associate Maria Angela Brusco spoke on a panel this fall at the Art Law Institute of the New York County Lawyers’ Association, focusing on promises to gift artworks.
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