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Friday, September 5, 2008

The Not So Peaceable Art Kingdom With The Lawsuit of Sotheby's

PkThe NY Times reports that Sotheby’s has filed a $16.8 million lawsuit against Hasley Minor, an art collector and Internet entrepreneur. (By the way, The Newsday headline: "Sotheby's Art Attack on Tycoon").

The lawsuit alleges that Minor has refused to pay for three paintings he purchased in May. The complaint states a cause of action for breach of contract and seeks the $13.8 million cost of the paintings, plus late fees, interest and damages.

Minor apparently agreed to purchase three paintings: (1) Edward Hicks' "The Peaceable Kingdom With the Leopard of Serenity" for $9.6 million [pictured above], (2) Andy Warhol’s “Diamond Dust Shoes” for about $300,000, (3) and Childe Hassam’s “Paris, Winter Days” for $3.9 million.

The NY Times Reports:

The auction [of the Hicks painting] attracted considerable interest because of the financial drama surrounding the painting’s seller, the jeweler Ralph O. Esmerian, who owed some $11.5 million to Sotheby’s in addition to $187 million to Merrill Lynch and $7.5 million to Christie’s.

Reached by phone, Diana Phillips, a spokeswoman for Sotheby’s, said that Mr. Minor had told the auction house that he had not paid for the works because he was owed money by other parties and could not afford to.

But Mr. Minor said in an interview on Thursday that he had not paid for the purchases because Sotheby’s had not disclosed its financial stake in the sale of “Peaceable Kingdom.”

Asked if he had the money to pay for the paintings, he said: “My net worth exceeds what’s owed by an order of magnitude. Their claim is preposterous.”

Mr. Minor said that Sotheby’s filed the suit only after he asked it to send him papers documenting its precise economic interest in the sale of the work.

But Ms. Phillips said the auction house had fully complied with all consumer regulations involving such disclosures. “We’ve been talking with him for some time about trying to resolve this,” she said. “He told us that the sole reason he had not paid was because others had failed to meet their financial obligations to him.”

“It was only a few days ago that he brought up this issue of financial disclosure,” Ms. Phillips added. “His explanation is just not credible.”

Minor told Newsday, "Their descriptions [of the painting's value] could have been embellished, They're doing it for the house account. The process is now tainted."

The $9.6 million tag on the Hicks painting was a record-breaking price for American folk art.

[Meredith R. Miller]

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