"This is how bad things are for museums: They now have a green light to sell off their art"

Sebastian Smee in the Washington Post.

It's a pretty levelheaded piece, as these things go, but it fails to grapple with the fact that (as his references to the MFA and the Baltimore Museum of Art show) museums have always had a green light to sell off their art. The AAMD's recent announcement did not provide a green light that wasn't there before. It only broadened the acceptable criteria for using the proceeds of sale.

"To Keep the Industry Alive, the AAMD Must Permanently Give Museums Freer Rein to Sell Work" (UPDATED)

This guy makes a very compelling case at ARTnews.

UPDATE: Brian Frye: "The jig is up, folks."

Tom Flynn: "[E]ven without the curse of coronavirus, deaccessioning was always going to be an inevitable consequence of the essentially unsustainable nature of many museum collections."

Victoria Reed: "I don't know if the AAMD stance is a turning of the tide as much as it is an acknowledgment that US museums are in really, very dire financial circumstances at the moment."

"Like many crises, it is hard to imagine the old rules sliding neatly into place afterwards."

Nicholas O'Donnell: How far can museums go to stay afloat during the current crisis?

"Does appraising art ... reduce the appraiser’s appreciation for art the way working in a pork factory might reduce a worker’s appetite for bacon?" (UPDATED)

Marginal Revolution: Corrupted by Commerce? (The answer, by the way, seems to be no: "In fact 'a majority of the assessors stated that ascribing values to art actually increased their admiration for paintings, photographs, sculptures, and other creative work.'")

UPDATE: Derek Fincham comments: "The article is well-written and entertaining, but I just don’t think you get a complete picture of the art market by only talking with appraisers. He also ignores large areas of helpful scholarship from criminologists, totally ignores the Knoedler forgery scandal, and does not acknowledge the problems presented by the antiquities trade. But if you want an entertaining read, I can recommend it."

"From Afar, a Fugitive in the Knoedler Art Fraud Gives His Defense"

"[I]n his first in-depth interview, Mr. Bergantiños Diaz, a fugitive living in Spain, has acknowledged to a documentary filmmaker that he discovered Pei-Shen Qian, the painter from Queens whose ability to mimic the work of Modernist masters fooled much of the art world."

"Against Deaccessioning Rules" (UPDATED)

Forthcoming in the Creighton Law Review, from Deaccessioning Hall of Fame Scholar-in-Residence (and conceptual law professor) Brian Frye.

UPDATE: More from Frye here:

"Deaccessioning rules also have the unfortunate consequence of occasionally causing distressed museums to go bankrupt and dissolve, despite sitting on collections of enormously valuable artwork. The deaccessioning police' argue that this is all as it should be, and that museums should go out of business, rather than doing something as 'repulsive' as selling a work of art in order to save the institution. I find their argument ... comically weak. And I am hardly alone. Most notably, Donn Zaretsky of The Art Law Blog has been lampooning it mercilessly for years. To be honest, it's a bit like shooting fish in a barrel, given that the deaccessioning police cannot seem to provide even a colorably coherent explanation of why it is repulsive to sell a work of art for the purpose of saving a museum, but totally fine to sell a work of art because the museum wants to own a different one."

"Artist Howardena Pindell Sues Former Gallery, Claiming ‘Misleading’ Information About Sales"

"By 'operating through a maze of business entities,' the lawsuit claims, G. R. N’Namdi Gallery obfuscated information about the sales of artworks over a years-long period, allegedly offering works at steep discounts and concealing other details about purchases."

So you mean it's not so repulsive after all? (UPDATED 4X)

A couple days ago I quoted Allan Schwartzman as saying ""I can’t imagine that the museum associations will not be obliged to rethink the core requirements of economic survival in relation to some of the assets that they own in their collections."

I added:

"Think of it this way. The Guggenheim (to take one example among many) just announced that it is furloughing 92 employees and reducing pay for another 85. If that could have been avoided by selling one work from its collection, would you do it? And if your answer is no, would you say an opposing view is repulsive?"

Well, now comes news that "the field’s leading professional organization has adopted temporary measures aimed at giving them greater flexibility in how they manage their finances. The Association of Art Museum Directors ... said on Thursday that, for the next two years, it will not censure or sanction museums that engage in some activities typically prohibited by its policies, including using income from restricted funds for general operating expenses."

This is a big deal and strikes me as obviously correct. (Though in typical fashion "the resolutions do not change AAMD’s actual governing standards. They merely lift the possibility of sanctions through April 10, 2022" -- so it's still technically repulsive but there will be no penalty for the repulsiveness, at least for the next two years.) It never made any sense to say there were no possible circumstances in which selling art to generate operating funds could be justified. The pandemic is a very obvious example of such a circumstance, but clearly not the only one. The right approach should always be "to weigh the actual costs and actual benefits and try to determine whether, on balance, all things considered, the [proposed] sale is a good idea."

UPDATE: Some other reactions to the news.

Deaccessioning Hall of Fame Scholar-in-Residence Brian Frye: "OMGOMGOMG. The AAMD is apparently suspending its deaccessioning policies for the next 2 years. So, selling art for capital expenses is still, repulsive, but we'll hold our nose?"

Mark Gold (who as far back as 2010 was asking: "Why not make it ethical for a museum to weigh priorities and make difficult choices without fear of condemnation and ostracism?"): "So the survival of a museum is relevant to the applicability of "ethical rules" of museum associations?  Museums with existential threats have been saying that for years.  Nice to finally have broader recognition of that, but sorry it took a pandemic. ... It's about time that the survival of museums and the support of their staffs get the priority they deserve."

Lee Rosenbaum understands the consequences of the move -- "How will AAMD’s watchdogs ever again be able to censure or sanction individual museums (as happened with the National Academy in New York and the Berkshire Museum in Pittsfield, MA) if they resort to monetizing their art in an attempt to secure their economic futures in future years, after the national emergency has passed?" -- but even she is on board: "For now, I’ll grudgingly concede that AAMD’s current action is a justifiable emergency rescue operation for the entire field, not merely an easy fix for a few poorly managed institutions."

And finally, Jonathan T.D. Neil says the changes actually don't go far enough because they only allow the use of interest (not principal) from acquisition funds: "Using interest rather than principal isn't going to cut it. Museums directors should be set free to sell works and then to use the entirety of that income to support their employees. That's a resolution that would be easy to commit to. ... Prioritizing assets (yes, they are assets) over people in extreme circumstances such as this (22m unemployed) is getting the value system wrong. If you are committed to your audiences, your publics, and to sustainability, it's the right thing to do."

UPDATE 2: Sergio Muñoz Sarmiento: "My more controversial side says that this whole deaccesioning in the time of the pandemic is really just hogwash. I mean, seriously, who cares what the AAMD thinks? At this point art institutions (museums, etc.) are so entrenched in the art stock market–which is to say, commercial viability–that the notion of a 'public good' has become nothing but academic and journalistic fodder."

UPDATE 3: Related: "This crisis has exposed the fragility of how museums do business. Very few have the cash reserves needed to continue operating."

UPDATE 4: Also related: "Still, the ability of arts organizations to weather this storm, while backstopped by state and philanthropic money, is, at best, tenuous. Once we get past the current crisis, arts organizations may need to rethink their funding models."

A documentary about the Knoedler scandal is about to be released

You can watch the trailer here.

"But in reality, the CASE Act will just help predatory law firms extract even more unjustified settlements from unsuspecting businesses and charities."

Conceptual lawprof (and Deaccessioning Hall of Fame Scholar-in-Residence) Brian Frye is not a fan of the proposed copyright small claims court: "The CASE Act will only make it cheaper and easier for copyright troll law firms to pursue meritless claims and enable them to extort settlements from blameless defendants. Trolls won’t even have to file an actual complaint in federal court, just what amounts to an administrative action before an agency appointee. That’s a mighty big stick, compared to a threatening letter."

Background here. More from Daniel Grant in the Art Newspaper here.

"I can’t imagine that the museum associations will not be obliged to rethink the core requirements of economic survival in relation to some of the assets that they own in their collections."

Speaking of deaccessioning ... the above quote is from Allan Schwartzman's latest podcast with Charlotte Burns (it's just a passing thought in a much larger conversation about what a post-Covid art world might look like that's well worth listening to in its entirety).

I think that's his way of saying the museums may need to relax their strict rules regarding "operating cost" deaccessioning. Think of it this way. The Guggenheim (to take one example among many) just announced that it is furloughing 92 employees and reducing pay for another 85. If that could have been avoided by selling one work from its collection, would you do it? And if your answer is no, would you say an opposing view is repulsive?

Tell Steven Miller Again About the Public Trust

All American Museum Collections Are For Sale, Just Make An Offer.

"Thus, the Players, who were neither requested nor agreed to limit the display or depiction of the images tattooed onto their bodies, had implied licenses to use the Tattoos as elements of their likenesses."

I've mentioned before that there have been a series of lawsuits against sports video game makers by tattoo artists (for example, where the LeBron James character in a video game includes LeBron James's actual tattoos). Well, one video game maker has just won a significant victory in the Southern District in one of the cases, including (but not only) on implied license grounds, which should make Christopher Sprigman and Annmarie Bridy happy. Story here. Opinion here.

Art law scams, screw-ups, etc.

Assorted art law (and related) thoughts from Sergio Muñoz Sarmiento, including on the Christie's sales tax story ("During these times when not too many Benjamins are circulating, might be a good idea to play everything smart and maybe a little 'conservative'?), Dave Steiner's piece on the Second Circuit's recent 5Pointz decision ("Steiner’s question on how the developer/defendant in this case could have rebutted the plaintiff’s argument that 5Pointz was NOT a work of recognized stature is exquisite. How would the defendant’s rebut 'recognized stature'? Let me tell you that I cannot find one, not one, person in the art industry that is willing to state that 'something' is not art. Good luck defendants."), and Kenny Schachter on his relationship with The Talented Mr. Philbrick ("You’ll probably wonder, as does yours truly, how a seasoned art dealer like Schachter got played for a million like a tourist in Times Square.").

"Christie’s to Pay Up to $16.7 Million Fine Over Tax Violations"

New York Times story here. Art Newspaper here.