"Seung's blind reliance on Dinaburg's alleged statements of the painting's value is not reasonable as a matter of law"

I've been meaning to mention the recent NY state court decision dismissing a claim by a collector who bought a Julian Schnabel painting for $380,000 from a dealer who allegedly said it was worth "at least $500,000" when its true market value "was no more than $110,000." (Among other things, it had sold "months earlier" at Philips for $156,000 (against an estimate of $60-80,000).)

The decision proceeded on basic caveat emptor grounds. "A party is not justified in relying on any alleged misrepresentations if the facts were not peculiarly within the other party's knowledge and the party had the means to discover the truth by the exercise of ordinary intelligence." "Seung does not allege that she made any effort to ascertain the value of the painting prior to its sale." "Seung alleges nothing more than a relationship of art buyer and art seller, which does not rise to the level of a special realtionship [required for a negligent misrepresentation claim]." "Seung could not have reasonably relied on statements regarding the painting's value when she made no effort to independently ascertain its value."

Greg Allen comments: "if Seung's case is meaningful, it's only as a reminder to collectors to do their own damn homework; the NY Supreme Court determined that art advisors and even dealers are not 'experts,' and their opinions are just sales patter which constitutes, at best, 'non-actionable 'puffery'...on which a sophisticated commercial entity could not reasonably rely."

"People disagree vigorously over whether a photo of a copyrighted work is a derivative work. The court refused to resolve the issue"

Rebecca Tushnet: "Seventh Circuit rejects Gracen, tries again."

The decision is here. For background, see here.

"There is no logical connection between Sotheby's failure to disclose a security interest and any actual or potential injury to … Minor"

Though it comes in the fairly narrow context of a motion for leave to amend his counterclaims, there is some language in a recent decision in the lawsuit that would seem to be pretty devastating to Halsey Minor's overall case against Sotheby's. First, the court rejected the idea that the alleged non-disclosure could have injured Minor in any way:

"Minor does not allege that ... the paintings were auctioned at an inflated price because of the failure to disclose the security interest. To the contrary, because the paintings were sold [to him] at auction, Minor set the price for the paintings. . . . As explained above, the allegations in the proposed counterclaim do not support an inference of any connection between Sotheby's conduct and any actual or potential damage to … Minor… [B]ecause Minor pleads no facts to support an inference that Sotheby's security interest affected the value of the paintings, he fails to identify how Sotheby's failure to disclose this interest was material."

The court also rejected the notion that Sotheby's had fiduciary duties to Minor in connection with the sale:

"In arms length commercial transactions, 'no relation of confidence or trust sufficient to find the existence of a fiduciary relationship will arise absent extraordinary circumstances'" (quoting DeBlasion v. Merrill Lynch & Co., Inc., 2009 WL 2242605).

I believe Sotheby's own motion for summary judgment is still pending.

More Minor legal news here.

Art Theft by Country

Judith Dobrzynski breaks it down.

More on Moore

Rebecca Tushnet has a good summary of the district court decision (mentioned earlier here) in favor of Daniel Moore in his lawsuit with the University of Alabama. She says "the Tiger Woods case is so on point that quoting big chunks of it got the court basically where it needed to go."

Meanwhile, the Tuscaloosa News says "UA needs to walk away from Moore lawsuit."

8-0 Alabama hosts No. 9 LSU this weekend.

"How can cultural heritage institutions legally use the Internet to improve public access to the rich collections they hold?"

I've linked on a number of occasions to Peter Hirtle's thoughtful commentary on the Brodsky bill and related issues. Peter's now co-authored a new book entitled Copyright and Cultural Institutions: Guidelines for Digitization for U.S. Libraries, Archives, and Museums, which I'm sure is well worth checking out. Read more about it (and download a PDF copy if you want) here.

"School, sculptor in battle over art"

From the Detroit Free Press: "A renowned sculptor and Holocaust survivor who spent the last 37 years as artist-in-residence at Orchard Lake St. Mary's prep school is engaged in a bitter feud with school officials over who owns more than $2 million in artwork at the campus. Marian Owczarski, 76, said in a lawsuit filed Oct. 29 in Oakland County Circuit Court that many of the 1,800 pieces of sculpture, paintings, metalwork and stained glass on display at the campus' Galeria are from his private collection."

Moore to Come

In my initial post on the University of Alabama's lawsuit against sports artist Daniel Moore, I said: "I make Moore a two-touchdown favorite to win." Well, three years (and several judges) later, Moore has won at the district court level. In granting his motion for summary judgment, however, the court made it very clear that "this court is a way station on the route to appellate court(s)" and said it would certify its rulings for immediate appeal under Rule 54(b).

Mo(o)re from the Tuscaloosa News here.

Deaccessioning Quote of the Day

From Crispin Sartwell (reacting to this piece by Peter Brooks in the NYRB):

"for example, the metropolitan museum says that it possesses 5 million objects. now how many of these are on display? 20,000? so in what sense is the work 'viewable'? it's like - correction: it is - a massive bunker of art, a miser with a stashed hoard of useless gold. the point isn't to display the art; it's to segregate it or insulate it, to assert its priceless uniqueness by, um, burying it forever etc."

"We can all be fooled, and this man fooled me"

"The FBI is investigating allegations that William Toye, 78, and his wife Beryl Ann, 68, have been selling forged paintings to unsuspecting art collectors and dealers since the 1970s."

The investigation concerns the work of outsider artist Clementine Hunter.

"Heiress fights dad's bequest to the arts"

From the UPI: "The daughter of a late Texas oil pioneer claims lawyers coerced her father into cutting her share of his estate and convinced him to give it to charity instead. Curry Glassell ... claims in a lawsuit her father, Transcontinental Gas Pipe Line Corp. founder Alfred C. Glassell -- who died at age 95 in 2008 -- was sick and possibly demented when he changed his will at age 87 to give more to Houston arts. She alleges lawyers for the Museum of Fine Arts, Houston, pushed him to make the change."

More from the Houston Chronicle here.

Latest from the Art Loss Register

Here.

Fairey's New Lawyers

Shepard Fairey has a new legal team in place for his lawsuit with the AP. (The change was occasioned by this.)

Bailed Out Art

One of the strange features of the strict anti-deaccessioning position, it seems to me, is the whole notion of the "public trust." How is it, exactly, that works owned by museums comes to be "held in the public trust" such that they can never be sold (except to buy other art)? What is the mechanism? It is sometimes suggested that this is a function of the favorable tax treatment museums receive: because museums are exempt from property and income taxes, and donors get tax deductions for contributing to them, the "public" therefore is the true owner of the art. I've never really understood that argument. There are lots of other entities that get the same tax benefits -- churches. private schools and universities, hospitals, etc. Does the public own the MRI machines at the hospital? If a university decides to shut down the sociology department, should we step in and say, "Hey, wait a minute. That department was held in trust for us. You can't just get rid of it like that"? Does every asset ostensibly held by every non-profit really belong to us? And if not, what makes art different? How does it come to be "held in trust" when other, similarly-owned assets are not?

But if tax benefits are not enough, what about a bailout? The New York Times ran a little piece earlier this week that began:

"Many of the world’s biggest banks — and biggest recipients of government bailouts — have some of the largest collections of art. Some of the works, including abstract pieces and old masters, are hanging in hallways or boardrooms. But much of it is packed away in storage. The art owned by financial institutions should get out more — at the least to give the taxpayers, who have been so generous with the financial sector, an aesthetic return."

Here's the Rub

Lee Rosenbaum asks former Cleveland Museum director Timothy Rub about the decision to use (with court permission) certain acquisition-specific funds to help complete the museum's expansion project. He says:

"There are legal means that have been in place for a long time to ask courts to determine whether or not funds that have been contributed for one purpose can be utilized ... for another purpose. There are legal mechanisms and a significant body of law that leads to this.

"Secondly, I should say that the board of the Cleveland Museum of Art is a tremendously responsible and resourceful group of people who are fiduciaries for the institution. And it's their responsibility to make thoughtful and prudent fiscal decisions on behalf of the institution. I think the trustees discharged their responsibilities extremely well. I really do."

"I don’t regard copyright as a property right, but rather as a government program, a social program"

An interesting conversation between Clancco's Sergio Muñoz Sarmiento and copyright scholar William Patry.

Much Better Than The Old Criminologist

The New Crimonologist takes a look at art crime.

More on the Rose Lawsuit

I mentioned, after the probate court hearing earlier this month, that it was a little unclear where things stood in the Rose Museum lawsuit. It seemed, at the time, that it was being reported as something of a victory for the plaintiffs. ARTINFO.com, for example, headlined their piece: "Judge Lets Rose Museum Suit Stand."

But now comes a story in the Brandeis Justice that suggests that the only part of the suit the judge let stand is the part that Brandeis agreed could stand -- i.e., the plaintiffs could sue over their own donations to the museum, but they have no standing to challenge the university's decision to sell art generally, or to close the museum. The university's lawyer says "the case is now limited to the plaintiffs' ability to control their own donations or those of their ancestors to the Rose. 'The court ruled that the plaintiffs have no right and standing to represent any donors other than themselves or their ancestors, and that is all that's left now for the plaintiffs,' he said." He added that "Brandeis never had any intention of selling any artwork donated by any of the plaintiffs or the estates that they represent."

"Brandeis Wasn't Wrong"

An interesting piece inside Inside Higher Ed by former Northwestern dean Rudolph Weingartner, who describes himself as "a lifetime 'consumer' and supporter of the arts." He acknowledges "a significant role for art museums on higher education campuses," but says:

"[W]ith quite special exceptions, I see a very small pedagogic function for colleges and universities to own works of art, especially given the current cost and value of so many of them. ... To be sure, the provisions of deeds of gift must be scrupulously observed; but assuming that to be the case, let them sell their works of art if the funds thus gained will better serve the institutions’ educational mission."

Referring to the "task force formed by arts groups to figure out ways to avoid the next Brandeis," he also notes that such studies tend to turn into preaching-to-the-converted affairs:

"Members of the task force, make sure, ... that you are not just talking to yourselves. You are looking for ways to relate A to B; there must thus be strong representation from both poles. As announced, the organizations participating in the task force are mostly from the Category A: the art museum community. I strongly recommend that it also include not only representation from the art history and studio art departments, but knowledgeable people who have thoughts about how to involve art museums in educating students who are not primarily concerned with the arts."