A Nov. 17 ruling by the New York State Supreme Court has allowed Italian collector Guido Orsi to proceed with a pared-down version of the lawsuit he filed jointly with Manhattan art dealer Tony Shafrazi against auction house Christie's, alleging fraud related to a 1990 sale of a painting by Jean-Michel Basquiat (1960–88).
NEW YORK—A Nov. 17 ruling by the New York State Supreme Court has allowed Italian collector Guido Orsi to proceed with a pared-down version of the lawsuit he filed jointly with Manhattan art dealer Tony Shafrazi against auction house Christie’s, alleging fraud related to a 1990 sale of a painting by Jean-Michel Basquiat (1960–88).
A separate lawsuit, brought last April by Swedish collector Gerard De Geer against the New York–based Basquiat Authentication Committee and art dealers Carl Flach and Stellan Holm, was settled earlier this month.
In the Christie’s case, the auctioneer had filed a motion asking the court to dismiss the case, claiming that no fraud had been shown in the legal complaint. In his ruling, Justice Herman Cahn dismissed four of the six causes of action (negligent misrepresentation, deceptive business practices, breach of contract and breach of express or implied warranty). He let stand the first two causes, fraud and fraudulent inducement, for Orsi but dismissed them for Shafrazi, and ruled that Orsi may be entitled to pursue punitive damages if his suit is ultimately successful, writing that whether Christie’s conduct “was so reprehensible as to warrant damages is a question … to be determined at trial.”
In September of last year, Shafrazi and Orsi filed a $7million lawsuit (ANL, 10/2/07) claiming that in a February 1990 auction, Christie’s had sold Shafrazi an untitled 1982 acrylic-and-colored-oilstick on canvas, which the auctioneer warranted in its catalogue was an authentic Basquiat, for $242,000. According to the complaint, days before the sale, Christie’s staff had been told by Basquiat’s father, Gerard Jean-Baptiste Basquiat, and New York gallery owner John Cheim—both of whom later became members of the Basquiat Authentication Committee—that the unframed 49-by-50-inch painting was inauthentic. The members of the Committee include a core group—Gerard Jean-Baptiste Basquiat, John Cheim, Jeffrey Deitch and Larry Warsh. According to a source, gallerist Annina Nosei, who at one time was Basquiat’s dealer, is occasionally called in to help make authentication decisions.
Shafrazi resold the work to Orsi the following year. In 2006, in preparation for “The Jean-Michel Basquiat Show,” an exhibition at the Milan Triennial which ran from September 2006 through January 2007, Orsi submitted his painting to the Basquiat Authentication Committee to have it authenticated, only to be told that the work was a fake. Orsi first brought an action against Shafrazi in Italy, but then dropped it and joined the dealer in a suit against Christie’s.
The next phase in the lawsuit, a hearing on Christie’s appeal claiming that the court overlooked important facts in not dismissing the entire case, is scheduled for Jan. 16. According to a Christie’s spokesperson, the auctioneer will make the argument that Orsi cannot be a party to the lawsuit, because he “did not purchase from Christie’s; he bought from Tony Shafrazi Gallery more than a year after Christie’s sold the painting to Tony Shafrazi Gallery.”
“We won the right to go forward on the basis of fraud,” Aaron Richard Golub, Orsi and Shafrazi’s lawyer, told ARTnewsletter. “Our thesis is, anyone who buys anything from anyone who bought from Christie’s is protected by law.”
Meanwhile, last April De Geer sued the Basquiat Authentication Committee in New York State Supreme Court for its “refusal to authenticate the painting Fuego Flores,” which De Geer had purchased in 1987 from dealer Carl Flach, who is now based in Hong Kong. According to the suit, which sought up to $10million in damages, Flach had acquired the painting in 1984 from New York dealer Stellan Holm.
According to De Geer’s complaint, in March 2005 he entered into a binding contract under which the committee “agreed to review [De Geer’s] application that the Committee authenticate the painting … However, the Committee and its members ignored and failed to review the information presented … Instead the Committee arbitrarily refused to express an opinion on the authenticity of the painting,” an action which De Geer said cost him millions of dollars. “Without a certificate of authenticity from the Committee,” the complaint states, “no major auction house is willing to sell the Painting thus making it impossible for Plaintiffs to realize on their investment.”
Flach and Holm were also named as defendants in the suit. “Should the Court or the Committee determine that the painting is not authentic,” the suit says, De Geer sought damages from Flach and Holm for “making false representations” that the painting was an authentic Basquiat.
The Basquiat Authentication Committee has since declared the work genuine on the basis of additional materials that De Geer submitted for review. Chaya Weinberg-Brodt, an attorney for the committee, declined to comment.
De Geer’s lawyer, Stephen Younger, of Patterson Belknap Webb & Tyler, New York, said, “I have no comment on the settlement other than that our client is quite pleased with the resolution.”
Ted Poretz, of Ellenoff Grossman & Schole, the attorney who represented Holm, commended the committee for its “openness and willingness to look at the evidence.”