The New York Court of Appeals has unanimously affirmed the dismissal of a lawsuit against Guy Wildenstein arising out of the purchase of a Gauguin painting. The decision is here.
I summarized the trial court ruling here:
"The plaintiff was informed by an Amir Cohen that the painting was available and, interested in buying, 'requested Cohen to procure an appraisal.' Cohen recommended Guy Wildenstein, who then provided a written appraisal to Michel Reymondin, 'a non-party to this action whose relationship to plaintiff and the transaction at issue in not disclosed in the complaint.' Wildenstein appraised the painting at $15-17 million, allegedly without disclosing that his gallery once owned the painting. 'The complaint alleges that plaintiff received the Appraisal ..., but does not state how it obtained the Appraisal from Reymondin.' Plaintiff paid $11.3 million for the painting, which it then tried to sell at Christie's, but it failed to reach its $12 million reserve. The lawsuit followed, but the claims all failed because there was no relationship between plaintiff and Wildenstein -- the appraisal was obtained by the mystery middle man, Reymondin."
The Court of Appeals affirmed for largely the same reason, i.e. "the lack of allegations that would indicate a relationship between the parties, or at least an awareness by Wildenstein of Mandarin's existence."
At the intermediate appellate level, one judge thought the unjust enrichment claim should have survived because, on such a claim, "there is no requirement that the aggrieved party be in privity with the party enriched at his or her expense." But the Court of Appeals held that, although it is true that "privity is not required for an unjust enrichment claim," such a claim will nevertheless fail "if the connection between the parties is too attenuated."
