Friday, September 28, 2012

"Potomack is relieved this came to light in a timely manner as we do not want to sell any item without clear title."

It turns out that a work bought for $7 at a flea market and now believed to be an authentic Renoir may have been stolen from the Baltimore Museum of Art.  Patricia Cohen has the details in the NYT.  Derek Fincham says "the case reveals the importance of reporting a theft, even decades into the future."  Nicholas O'Donnell says sorting it all out "looks to be a complicated question of history, records, legitimacy of sale, and a host of art law issues."

Tell me again about the public trust ("the usual array" edition)

Carol Vogel's Inside Art column today reports that "when the big November auction catalogs begin arriving in the mail next month, they will include the usual array of art being sold by museums."

The Brooklyn Museum is selling one of Yves Klein's "classic painted sponges on board."  Aparently that work, although under the aegis of a museum, is not held in the public trust, to be accessible to present and future generations.  Future generations are on their own when it comes to that work.  Maybe there is a painted sponges on board exception to the "held in trust" rule.

The work was a 1992 bequest to the museum from William K. Jacobs Jr.  But, obviously, no one is going to look at this sale and say, "Why should I give this to you? What guarantee do I have that you're not going to sell this tomorrow?"

The Hirshhorn is selling a Picasso musketeer painting.  That too must be a work that is somehow not held in the public trust, to be accessible to present and future generations.  Perhaps a musketeer exception.  And, again, no one is going to say, Why should I give this to you if there is no guarantee that you're not going to sell it?

Kelly Crow had a similar story in the Wall Street Journal, pointing out that "some of the biggest sellers in the upcoming fall auctions in New York are museums."

The Cleveland Museum of Art is selling a Monet that it received as a gift in 1947.  Gee, you'd think that, seeing this, someone considering making a gift to the museum in the future might say, "Why should I give this to you? What guarantee do I have that you're not going to sell this tomorrow?"  But I guess that's not a legitimate concern.  And future generations in and around Cleveland will have to find other Monets to look at.  What do you think this is, a public trust or something?

Finally, the Virginia Museum of Art is selling a Renoir still life that it received as a gift in 1994.  Come on, that's almost 20 years.  That's almost a full generation.  What do you people want?  Where did you ever get the idea that museums had some kind of obligation to hold onto works so they can be accessible to present and future generations?  Who ever suggested that potential donors will be discouraged from giving without a guarantee that the museum won't sell?

Stop being so touchy.  It's no big deal when museums sell work.

"[T]he news is that it has stayed true to its founder’s intentions and is fulfilling its fiduciary responsibility to optimise assets in support of its charitable purpose"

Christine Vincent tells us what the Warhol Foundation's art sale tells us about artists' foundations.

Lost, Then Found

Lots of art law happened while I was busy atoning for my sins this week.  For starters, "star bond fund manager" Jeffrey Grundlach had a bunch of art (including works by Johns, Mondrian, and Diebenkorn) stolen from his "posh Santa Monica home" ... and then recovered on Wednesday when police cracked the case and made two arrests.  His 2010 Porsche Carrera 4S is still missing.

Friday, September 21, 2012

"The case has attracted attention in part because of e-mails and other documents that have been made public, revealing frank details of how the painting was offered to a collector" (UPDATED)

The NYT's Randy Kennedy reports that Jan Cowles's suit against Gagosian Gallery has survived a motion to dismiss.  More later after I've had a chance to read the decision.

UPDATE:  Okay, I've had a chance to read the decision.  It's a motion to dismiss, so technically all the court decided was that, if you assume everything in the complaint is true, it states a claim for relief.  But you are left with the feeling that Judge Ramos is a little alarmed by the picture the complaint presents.  He let the fraud claim stand because, even though this is a "sophisticated plaintiff" -- the gallery argued that Cowles's son Charles "is himself an art dealer and had access to the same information and resources concerning the condition of the Work" -- whether his reliance on the gallery was reasonable is nevertheless "fact-intensive."  The breach of fiduciary duty claim survived because the gallery "purportedly disclosed to the buyer ... that [Charles] was in 'terrible straights' and invited him to make a 'cruel and offensive offer' in order to ... capitalize on his misfortune, while concealing information that was material to his interests" -- and, if true, that is "conduct that would constitute a breach of fiduciary duty."  He even left in the demand for punitive damages, which are only available "where there is a showing of conduct exhibiting a conscious disregard of rights or a high degree of moral turpitude."

Felix Salmon had some thoughts on the case back when it was first filed here.

The Art Market Monitor responded here:  "Remember that this is January of 2009. The world is in the depths of the credit crisis. The bubble has burst and the entire financial class is bracing for what might be a near collapse. Credit markets remain frozen and equity markets are approaching a bottom. All asset classes have correlated and are falling sharply. This may be the most important point about the entire saga. The art market’s spectacular recovery is still unforeseeable."

Copyright Office Seeking Comments on Possible Resale Royalty Law

"This initial notice of inquiry seeks comments from the public on the means by which visual artists exploit their works under existing law as well as the issues and obstacles that may be encountered when considering a federal resale royalty right in the United States."

Some useful context from Rachel Corbett here.

Wednesday, September 19, 2012

Restitution and Repatriation

A conference at DePaul Law, October 29.  Details here.

Friday, September 14, 2012

Thursday, September 13, 2012

"What responsibility ... do institutions have to hold on to donated works and display them?"

The Evansville Museum's newly-discovered Picasso makes it to the pages of the New York Times.  Patricia Cohen had a story on the front page of today's Arts section.

Notably absent from the story is the usual outrageous outrage -- Lee Rosenbaum hasn't called for the trustees to be taken away in handcuffs, Ford Bell is not on the scene reminding us that the work is held in the public trust, to be accessible to present and future generations, nobody's warning that, if we allow this sale to happen, future donations will dry up because potential donors will worry that, if the value of the works they donate goes up, museums will get rid of them rather than pay the costs of insurance.

I've been assuming the reason for the silence is that the museum (cleverly) has not said what they plan to do with the proceeds (if they spend it on more art, then the Deaccession Police will be perfectly pleased with the sale; if they spend it on anything else, then you can cue up the outrageous outrage -- how dare they sell off this important part of the public trust?!).  But maybe there's an alternative explanation I'm not seeing.

Tuesday, September 11, 2012

If it's not the tax exemptions, what is it?

Speaking of the Warhol Foundation, I thought it was interesting that Juila Halperin's ARTINFO story on last week's big news said that "thousands of works by the Pop icon will hit the market when the artist’s foundation deaccessions its entire collection through a combination of sales and donations" (my emphasis).

I don't mean in any way to criticize Julia, who was using it in its ordinary, dictionary sense ("to sell or otherwise dispose of an item in a collection"), but seeing the word "deaccession" there was, I think, instructive.  No one would suggest that what the Warhol Foundation is doing is "unethical" or "repulsive" or "Stalinist."  Nobody questions the right of artist-endowed foundations to sell work.  Nobody claims those works are held in the public trust, to be accessible to present and future generations.

But why?  Why are works owned by, say, the Warhol Museum held in the public trust, while works owned by, say, the Warhol Foundation are not?  I've mentioned before that Lee Rosenbaum is the one critic of deaccessioning who even attempts to justify the existing rules (the others just cluck their tongues and congratulate each other on how much more ethical and non-repulsive they are than everyone else).  She argues that the public "in essence" has paid for the works:  "The tax exemptions that are granted to nonprofit institutions and the tax deductions allowed to donors are the way by which the American public subsidizes museums and their acquisitions. The objects are [therefore] held in trust for us by these nonprofit institutions."  But that theory can't explain why sales by one kind of nonprofit institution (museums) should be viewed differently than sales by another kind of nonprofit institution (foundations).

This isn't just an academic debate.  There are real-world consequences.  The Detroit Institute of Art just convinced local residents to pay as much as $400 million in property taxes, "in a city so financially troubled that its leaders announced this year that it was at risk of running out of cash entirely."  It did so, in part, by telling voters it could not sell art to raise the money it needed because those works are "held in trust for the benefit of the public." 

If those works are in fact held in the public trust, I still haven't heard a good explanation of how they got there.

Bananas (UPDATED)

There was a decision in the Warhol Foundation-Velvet Underground lawsuit, but the press reports aren't getting it quite right.  Here's Rolling Stone, for example, with the headline "Velvet Underground Lose Andy Warhol Copyright Claim," and the following lead:  "The Velvet Underground do not have a valid copyright claim on the Andy Warhol artwork on the cover of the band's 1967 debut, a federal judge ruled ...."  And in their morning round-up of links, GalleristNY said:  "Judge says the Andy Warhol Foundation does not own rights to banana image, in Velvet Underground suit."

That's actually not what happened.  What happened was the band brought several trademark claims, but also brought a claim seeking a declaration that the Foundation had no copyright in the banana image.  After the action was brought, the Foundation gave the band a covenant not to sue for copyright infringement, "unconditionally and irrevocably" agreeing never to sue them over the banana image.  The court ruled that this "eliminated any justiciable controversy between the parties over copyright" in the image, and so dismissed the claim for declaratory judgment.  The Velvet Underground wasn't claiming any copyright on the image, nor did the court rule that the Foundation "does not own rights" to the image.

UPDATE:  More from Nicholas O'Donnell:  "Reporting of the decision has been spotty at best, however, ranging from declaring a 'win' for the Velvet Underground, to suggestions that the copyright question was decided. In fact, the Court did not reach the copyright issue, and the Velvet Underground still has other trademark-based claims that remain very much alive and unaffected by the decision."

Thursday, September 06, 2012

"Shepard Fairey should face jail time for destroying documents ..."

"... according to the Department of Justice."

Sentencing is tomorrow.

Held in the Public Crust

World’s First Pizza Museum Opening in Philadelphia.

"The sales will take several years to complete and are expected to garner about $100 million."

In today's New York Times, Robin Pogrebin reports that the Warhol Foundation will "disperse its entire collection," through a combination of donations and sales, and "shift[] almost exclusively into a grant-making organization."

Tuesday, September 04, 2012

"Just what will the Evansville museum do with its windfall?"

"There are no plans."

We still don't know whether the museum's sale of a Picasso is repulsive or to be encouraged.

Online Art Sales

Monitoring the New York Times, the Art Market Monitor picks out some interesting data points from Patricia Cohen's front-page story yesterday on the growth in the online art market:

  • One recent study estimated that 91 percent of the Henry Moore drawings and small sculptures sold online were fake.
  • The Giacometti Foundation spent more than 40 percent of its 2011 operating budget on tracking fakes.