Canadian art gallery Equinox Gallery Limited (“Equinox”) will be allowed to move forward with its lawsuit against art dealer Fred Dorfman following a favorable decision from a federal judge this week.  Grossman LLP is representing Equinox in the case.
 

A lawsuit filed in Manhattan federal district court last week reveals how Bernard Madoff’s nearly decade-old Ponzi scheme continues to reverberate, even in the art world.

Famed artist Richard Prince is no stranger to litigation; over the years, he’s been sued by multiple plaintiffs whose art he has incorporated into his own “appropriation art” works.  A few years ago, he was the defendant in the Cariou v. Prince case, which resulted in an important Second Circuit Opinion about the fair-use defense to copyright infringement.

We have continuously followed stories in the news and in the courts about the continuing efforts of the art market to deal with the problem of forgeries.  From the Knoedler scandal to the concerns about counterfeit Old Masters being peddled on the European market, this issue is clearly not going away anytime soon.  Today, we take note of developments in three more cases that shine a spotlight on this ongoing challenge.

New York gallery owner Alex Komolov has emerged victorious in litigation against antiques dealer Jack Shaoul arising out of the sale of a fake Renoir. Komolov, owner of the Alskom Gallery, sued Shaoul in 2013 for unjust enrichment, conversion, and fraudulent misrepresentation, claiming that the dealer sold him a forged Renoir painting for $1.1million in 2010. After trial, a jury awarded Komolov the full purchase price plus interest. According to Komolov’s attorney, Shaoul previously served 40 months in prison for mail and wire fraud and conspiracy, including misattribution of a painting.

A recent conference in Geneva reflects an attempt by private art-market actors to raise awareness and address the problems of illicit trafficking of art and antiquities.  While such illegal activity in the art market is hardly limited to Switzerland, the nation’s freeports and custom-free zones make it particularly vulnerable to attempts to circumvent international laws.  And the Geneva Freeport specifically is reeling from recent negative publicity—including the feud between Yves Bouvier and Dmitry Rybolovlev, the discovery of an allegedly Nazi-looted Modigliani painting, and the seizure of looted Syrian antiquities. 

Andrew Hall, a hedge-fund manager and art collector, filed suit against Lorettann Gascard, a former art-history professor at Franklin Pierce University, and her son, Nikolas, alleging that the Gascards sold him twenty-four artworks by the famed artist Leon Golub that actually were forgeries. The Gascards are now firing back that Hall alone should be held responsible for his failure to conduct adequate pre-sale diligence; a common refrain among accused fraudsters looking to cast blame back on sophisticated art collectors, like Hall.

Richard Prince is no stranger to controversy; indeed, it’s arguably an essential element of his art.  We’ve written in recent years about several copyright infringement cases against Prince involving his practice of “appropriation” of others’ artworks as part of his own.

Richard Prince has had a busy year on the litigation front. We’ve previously written about the copyright claims photographer Donald Graham filed last winter against Prince and the Gagosian Gallery over Prince’s use of Instagram images in his 2014-15 “New Portraits” exhibition. A motion to dismiss that case on fair use grounds is currently pending.

Over the summer, we reported on a lawsuit against the David Zwirner Gallery filed by a disgruntled collector who had paid $2 million for a Jeff Koons sculpture that the gallery never delivered.  This week, a New York state court rejected Zwirner’s attempt to dismiss the suit; allowing several of the claims against Zwirner to proceed.

This blog—like the rest of the art world—has closely followed the legal developments that continue to unfold in the wake of the Knoedler scandal, which exploded in 2011 when one of New York’s oldest art galleries closed following revelations that it had sold dozens of artworks (over the course more than a decade, in deals totaling about $60 million)—purported to be by Rothko, Pollock, Motherwell, and other famed Abstract Expressionists—that later turned out to be forgeries.

An art investor has initiated legal proceedings in New York state court against a Manhattan gallery she says she “trusted and relied upon” to select artworks as investments, claiming that she now has reason to question key details (like authenticity and purchase price) of several transactions with the gallery.  As is all too common, the parties apparently engaged in multiple art deals—here, involving over a hundred works, over the course of several years—with minimal documentation.  And now that their relationship has deteriorated, a court may have the difficult task of adjudicating the dispute without a written contract in place to guide its analysis.

Spanish pop artist Antonio De Felipe, sometimes referred to as the “Spanish Andy Warhol,” is under fire due to accusations by his former studio assistant that he is selling her works as his own.  Fumiko Negishi, an artist who worked as De Felipe’s studio assistant from 2006 to February of this year, has brought a lawsuit against him claiming that she painted 221 canvases signed by De Felipe.

A disgruntled client’s claims against the Elliot Stevens Gallery and its executive are headed to trial this fall in a dispute involving the client’s purchase of a group of sculptures.

Earlier this summer, a heated dispute erupted between a Manhattan gallerist and a private art advisory business, in a case that raises issues regarding the roles of galleries and advisors at the high end of the art market.

Back in August, the New York Times ran a story about a heated dispute between actor Alec Baldwin and gallerist Mary Boone over a painting by Ross Bleckner.  Baldwin has now commenced a lawsuit in New York state court against Boone and her eponymous gallery, claiming that she defrauded him into buying a different version of the painting he wanted.  See Docket No. 654807/2016 (Sup. Ct. N.Y. Co.).

The spotlight once again is focused on questions concerning the appropriate level of pre-sale diligence in art transactions, this time with allegations against the National Gallery in London.  On Tuesday, the heirs of Margarete “Greta” Moll brought suit against The National Gallery of Art seeking to recover a painting by Henri Matisse, Portrait of Greta Moll, allegedly lost in the aftermath of World War II.  Williams v. The National Gallery of Art, London, et al., Case No. 16-cv-06978.

Real-estate developer and art collector Michael Shvo has been indicted in an alleged tax-evasion scheme relating to fine-art purchases. Shvo allegedly participated in a scheme to evade over $1 million in state and local sales tax associated with the purchase of fine art and other luxury items, according to a press release from the Manhattan District Attorney’s Office, by falsely representing to art galleries and auction houses that his purchases would be shipped out of state, when they were actually shipped to his New York addresses.

An amended complaint has been filed in a case against art dealer David Zwirner, adding claims for violation of New York’s Arts and Cultural Affairs Law.  As we recently discussed, Zwirner has been sued by UK entity Blue Art Limited (headed by dealer Fabrizio Moretti) over a $2 million deal gone bad.   The initial complaint concealed the description of the artwork to avoid “possible further damage to the Work’s value,” but the amended complaint clarifies that the sculpture at the center of the dispute is Gazing Ball (Centaur and Lapith Maiden), by Jeff Koons.

Prominent art dealer David Zwirner and his eponymous gallery have been sued by a buyer over a $ 2million deal gone bad, in a case that should serve as a reminder about the importance of clear contracting regarding the timing of art transactions.

Two pending cases present opposite but equally curious issues of art authentication by a living artist.  In one, the artist Peter Doig is being sued because he disavowed authorship of a work that a collector says is by Doig; in the other, an artist claims authorship over works that another man claims to have forged.  Both cases pose interesting questions about who, if not the artist, is the final say on whether an artwork is by the artist’s hand.

A recent settlement involving several major art-world players raises some important points about contracting in art transactions.

A dispute between two powerful figures in the international art world has been playing out on a global stage for months.  Now, a major auction house has been dragged into the fray, sparking even more debate about the role of confidentiality in a market that often operates with minimal transparency and places a premium on secrecy.

Appropriation art is back in the news, as two of the biggest names in the field navigate the latest legal claims filed against them.
A few months ago, we wrote about a new lawsuit filed against Jeff Koons over his appropriation of a photograph from a 1980s liquor advertisement.  The defendants in the case (Koons and auction house Phillips) filed answers to the complaint, but in mid-April, the parties informed the court that they had reached a settlement, and the case is now closed.  But shortly after the Koons complaint was filed, another giant of appropriation art, Richard Prince, was haled into court for his latest dance on the line between fair use and copyright infringement. 

After much legal wrangling, a jury heard testimony last month in the first civil trial arising out of the art forgery scandal that took down one of New York’s most prominent galleries.  The story began in 2011 when word spread that, over the course of more than a decade, the once-venerable Knoedler Gallery had sold about $60 million worth of artworks—purported to be by Pollock, Motherwell, Rothko, de Kooning, and other giants of the Abstract Expressionist movement—that later turned out to be forgeries.  Since then, more details have emerged.

This blog has written often about the Knoedler scandal, which exploded in 2011 when a once-venerable art gallery closed following revelations that, over the course of more than a decade, it had sold about $60 million worth of artworks—purported to be by Pollock, Motherwell, Rothko, de Kooning, and other giants of the Abstract Expressionist movement—that later turned out to be forgeries.  Our previous posts contain more detail, but in short, the works all came to Knoedler through a Long Island art dealer, Glafira Rosales, who claimed to represent an anonymous collector liquidating a collection of previously-unknown masterworks.  It turned out that the seller was a fiction, and the works were actually created by a little-known artist in Queens at the behest of Rosales (who in 2013 pled guilty to a litany of federal crimes).

Conceptual sculptor and artist Cady Noland’s works have garnered international acclaim and set records at auction.  She has also, however, received attention for her complex and sometimes-fraught relationship with her past works.  Last fall, she pointedly refused to endorse a show containing some of her work, and she has in the past expressed her concerns with how her creations are installed, maintained, exhibited, and sold on the secondary market.  Her vigorous oversight of works has even resulted in litigation.  Last week, her purported disavowal of one of her works that had been restored without her permission sparked a new lawsuit, and raised more questions about the scope of an artist’s right to disclaim authorship of her own works.

Famed “appropriation artist” Richard Prince has spent much of his career testing the boundaries of fair use.  He was the defendant in the high-profile case of Cariou v. Prince, which revolved around a 2008 exhibit at the Gagosian Gallery called “Canal Zone,” in which Prince extensively appropriated works from Yes Rasta, a book of works by photographer Patrick Cariou.  Cariou’s ensuing copyright-infringement lawsuit culminated in a 2013 Second Circuit opinion, which held that the majority of Prince’s works constituted fair use of Cariou’s photographs under federal copyright law. 

Beginning in the 1990s, art collector Richard McKenzie, Jr. frequently turned to Manhattan’s Forum Gallery and its director Robert Fishko for assistance in purchasing artwork, both for McKenzie’s own collection and for the Seven Bridges Foundation, which McKenzie founded to support emerging artists.  But when McKenzie’s and Fishko’s longstanding relationship went sour and accusations began flying, the result was years of public acrimony and protracted litigation in two different states.  The basic message to have emerged from this bitter legal battle is that clear contracting at the outset any art-related course of dealing often will head off problems before they arise.

For much of the last decade, the art world has been riveted by the story of infamous art dealer Larry Salander.  Around 2007, civil suits and allegations of fraud began to dog the prominent dealer, ultimately leading to Salander’s bankruptcy and the shuttering of the once-great Salander-O’Reilly Galleries.  By 2009, a lengthy criminal investigation revealed that Salander had been bilking customers, artists, and investors for years.  Today, Salander assets are still being sold off to satisfy creditors, and Salander himself is in prison after pleading guilty to charges including grand larceny.  But those who did business with him are still trying to sort out the tangled mess he left behind.   This month, an appeals court has weighed in on one of the cases that arose out of Salander’s complex double-dealing—or in this case, triple-dealing.  This case is yet another example of a recent trend of courts closely scrutinizing buyers’ pre-sale due diligence.

In the fall of 2012, the MacAndrews & Forbes Group, LLC and MAFG Art Fund, LLC, two holding companies controlled by business mogul Ronald Perelman sued legendary art dealer Larry Gagosian and his Gagosian Gallery over a complex series of transactions involving works by, among others, Cy Twombly and Jeff Koons.  Last week, the case ended with a defeat for Perelman—and a reminder to art buyers that courts are increasingly scrutinizing their pre-sale diligence almost as closely at times as the dealer’s alleged wrongdoing.

This blog has previously covered the strange ongoing saga of the “Gurlitt Collection”—a spectacular trove of well over 1,000 artworks amassed by German art dealer, Hildebrand Gurlitt, during the Nazi era.  Gurlitt was one of only a few dealers authorized by Nazi leaders to trade in “degenerate” works of art that had been confiscated or looted by the Nazis.  After World War II, the Gurlitt family claimed that their artworks had been destroyed during the bombing of the German city of Dresden.

In the last few months, three different lawsuits have been filed that highlight some of the legal complications involved in seeking, offering, or relying upon authentication of works of art.  We intend to follow closely each of these cases, and other important legal developments concerning art authentication.

Last year, this blog covered a federal court’s decision involving New York-based ACA Galleries, Inc.’s purchase of a painting purportedly created by artist Milton Avery.  In a recent decision affirming that opinion, the Second Circuit reiterated the warning to galleries and collectors about the importance of completing comprehensive due diligence before purchasing any work of art.

This firm’s attorneys were involved in the very first suit arising out of the infamous forgery scandal against the now-defunct Knoedler Gallery. Since then, this blog has covered ongoing developments in the strange story of a once-venerable art gallery’s involvement in the sale of dozens of paintings masquerading as works by twentieth-century masters like Pollock, Rothko, and de Kooning.  The works were in fact created by a little-known artist working in Queens, and marketed by Long Island art dealer Glafira Rosales, who has since pleaded guilty to multiple federal charges arising out of the scheme.

From 1954 until his death in 1976, famed sculptor Alexander Calder was represented by Manhattan dealer Klaus Perls.  Over the course of more than two decades, the pair forged a close friendship as well.  Their contributions to the art world are formidable; Calder’s groundbreaking mobile works sell for millions of dollars, while Perls was a highly respected dealer and collector who donated more than $60 million worth of masterworks to the Metropolitan Museum of Art prior to his death in 2008.  Now, both men are gone, and their families are in court amid allegations that Perls defrauded Calder’s estate and sold dozens of fake Calder works.

Our attorneys were involved in the very first suit arising out of the infamous forgery scandal against the now-shuttered Knoedler Gallery. And this blog has covered multiple chapters since, detailing along the way the remarkable twists and turns in the dramatic tale of Knoedler’s involvement in the sales of dozens of works purportedly created by some of the top artists of the twentieth century—including Jackson Pollock, Mark Rothko, Robert Motherwell, and Willem de Kooning—that have since been revealed as fakes.

The art world remains riveted by the still-unfolding scandal involving the once-renowned Knoedler Gallery.  To recap, over the course of more than a decade, Knoedler solddozens of works of art purportedly created by some of the most sought-after artists of the twentieth century—works that have since been widely discredited as fakes.  A Long Island art dealer named Glafira Rosales—who has now pleaded guilty, among other things, to charges of wire fraud, filing false tax returns and money laundering—allegedly told the Knoedler Gallery at the time that she represented an anonymous collector who was gradually liquidating his late father’s remarkable art collection.

The once-renowned Salander-O’Reilly Galleries imploded around 2007 after a number of customers and business partners sued owner and art dealer Lawrence B. Salander for allegedly defrauding them.  By the end of 2007, Salander had filed for bankruptcy; by 2010, he was serving a prison term for grand larceny.  The legal fallout from his story, however, continues today—as illustrated by a recent court decision. This case reminds those who buy and sell art that diligence is paramount—no matter how trusted the seller, and no matter how savvy the buyer.

James Meyer worked as an assistant to famed contemporary artist Jasper Johns for a quarter of a century.  Meyer, himself an artist, observed Johns at work, learned about his techniques, and witnessed the trajectory of a remarkable artistic career as Johns became one of the most well-known and sought-after artists of our time.  Johns, now 83, was awarded the Medal of Honor by President Obama in 2011, and his works have commanded stratospheric prices (one work, Flag, sold at Christie’s in 2010 for $28.6 million).

A recent appellate decision upheld Sotheby’s right to withdraw a work from auction based on contemporary artist Cady Noland’s disclaimer of authorship of a work under the Visual Artists Rights Act of 1990 (17 U.S.C. § 106A) (“VARA”). While the court resolved questions of Sotheby’s rights to withdraw the work under its standard-form consignment agreement, the court did not have the occasion to examine the contours of the artist’s disclaimer rights under VARA. In the meantime, though, VARA continues to be an effective weapon to be used by artists to protect their moral rights.

On April 25, the United States Court of Appeals for the Second Circuit issued an important decision about the “fair use” defense in copyright infringement cases.  The court’s ruling will have implications for artists and galleries, especially those who create or deal in artwork that incorporates or builds off the work of others.

Charleston-born, New York-based artist Merton D. Simpson passed away recently at the age of 84.  As a recent New York Times article reports, he left behind a formidable collection of art, a legacy of mastery as a painter—and a tangle of legal issues.