In 2011, Knoedler Gallery, New York's oldest gallery, made a sudden decision -- on a Wednesday morning, it permanently closed its doors that had been open for nearly 150 years. Meanwhile, Knoedler Gallery and its former chairman, Freeman, are facing a dozen lawsuits.
These cases allege that over the past two decades, Knoedler Gallery, together with Freeman, sold 60 sky-high fake paintings, making more than $50 million in profits. A series of evidences later also showed that these works were all created by Qian Peichen, a Chinese painter living in Long Island, New York. After the incident, Qian Peichen also flew back to China to avoid subsequent compensation and criminal responsibility. .
What is even more shocking is that many of the victims included De Sol, the former director of Gucci and the current director of Sotheby's auction house. He bought a Rothko for his daughter for $8.3 million from Knoedler Gallery. And seven years after buying the painting, he realized from the FBI's investigation of the Knoedler Gallery and other lawsuits that the Rothko he gave to his daughter was most likely a fake painting.
But how did all this happen?
First of all, we need to know that although galleries and auction houses continue to use professional terminology, exquisite auction and exhibit brochures, and arrogant and indifferent sales staff to create a look that is very high and out of reach for ordinary people, most of the The living conditions of the gallery are very difficult. An artist's departure, a broken capital chain, or a sudden lawsuit may cause a gallery to close down. The Knoedler Gallery in New York is also facing a situation of unprofitability and poor management.
At this time, an art broker from Long Island claimed that his client had a large number of "abstract expressionist works", which is undoubtedly a good thing for any gallery. Because in today's art market, most of the masterpieces of "traditional masters" have been collected by the best museums. For example, you rarely see a Raphael, Leonardo, or Rubens at auction or in a gallery. For collectors who are rich and want to express their artistic taste, Impressionism and Abstract Expressionism are obviously more able to satisfy the two functions of artistry and ornamental value at the same time. Therefore, the prices of these works have been rising steadily in recent years, and they have reached the point where there is no market for them.
The art broker's name is Rosales.
Along with the vast amount of work she has in hand, is a compelling story.
Rosales said her client was a European-Jewish immigrant living in Mexico. From 1940 to 1970, he always traveled to the United States for business reasons, so he met many artists and bought works directly from their studios, including Jackson Pollock, de Kooning, Rothko, etc. people. And when the client died, he left his collection to the children. His children were not interested in these works, so he commissioned Rosal to sell them. At the same time, the children wanted Rosales not to reveal their identities and to keep the transaction anonymous.
When trading in art, in order to prove the "authenticity" of the work, people generally rely on something called "provenance". For example, the following is the "source" of a Monet's work,
Claude Oscar Monet [1840-1926], France, until 1884; (purchased by Durand-Ruel, Paris, France, 1884 until 1891); sold to J. E. Chase, Boston, MA, April 20, 1891 [1]; Higginson, 1891 until 1906; (purchased by Durand-Ruel, Paris, France, April 1907) [2]. (Sam Salz, Inc., New York, NY); purchased by Museum of Art, Carnegie Institute, Pittsburgh, PA, February 1973.
The ideal "attribution" would be to the artist himself, or to his next of kin. Then it will record in detail who has owned the work, and under what circumstances (purchased or gifted) it has been transferred to another person or institution. Every change of hands also requires detailed documentation and certification.
The shrewdness of Rosales is that she made up a story that does not require "attribution". The so-called collector buys directly from the artist, and the collector himself wishes to remain anonymous, so the buyer can only The authenticity of the painting itself is verified.
But why didn't the Knoedler Gallery find the paintings fake? In fact, they found out that at least the then gallery chairman Freeman could not have been ignorant about it, but they chose to conceal and deceive.
So the question is, what role did Knoedler Gallery and its former chairman, Freeman, play in this scam? Are they deceived by Rosales and neglected in a hurry to help clients find their favorite works, or are they an accomplice or even the director of the whole scam?
In fact, Jack Levy, the head of Goldman's mergers and acquisitions group, has seen through everything.
Back in late 2001, Knoedler Gallery and Freeman sold a work called "Green Pollock" to Jack Levy for $2 million. The Knoedler Gallery paid Rosales just $750,000 to store the work in its warehouse and resell it for huge profits. And in Rosales' "Mysterious Mexican Mr. X and His Collection," Freeman added a new character: Ossorio.
Osorio (1916-1990) was also an abstract expressionist artist who was an admirer of Pollock and therefore collected many of his paintings. At the same time, he was also a good friend of Pollock, and the two exchanged creative experiences and works with each other. In this story, Freeman tells Levy that Mr. X's work in Mexico was purchased directly from Osorio's audience - a story that, if proven to be true, as we said last time, It will greatly increase the possibility that the work is genuine. At the same time, with the addition of this "friendship element", the works also have more collection value and additional meaning for collectors.
But as the leader of Goldman Sachs' investment and mergers and acquisitions group, Levico is not so easy to fool. After negotiating so many contracts and doing so much due diligence, how can you not care about what you spent two million on? Therefore, he added a clause to the contract terms for the purchase of the painting: whether the transaction can be successful or not depends on the International Foundation for Art Research (IFAR) on the work itself, all the evidence of the origin of the work (that is, the last time we talked about it). provenance), and the identification of Osorio's notes that appear in the story. That is to say, if the appraisal result is true, Livy will buy the work with peace of mind, otherwise the sale will be void.
The International Art Research Foundation is a non-profit organization dedicated to helping address art-related issues of law, ethics, education, theft, authenticity, and more. It is equivalent to a neutral third-party institution with a great say. They accept a small amount of research work appraisal, as long as the owner of the work applies and pays a $3,000 appraisal fee, if they accept the appraisal application, they will ask the applicant to send the work, and conduct careful research and evaluation of the work. Investigation and give a detailed opinion report.
The wait was long and frustrating, but it was worth it - as the IFAR report suggests the "green Pollock" is most likely a fake.
In October 2003, Levy received a report from IFAR. It reads, "IFAR has reservations about the authenticity of this work, and we are unable to identify whether this painting belongs to Pollock. However, we believe that it is inconceivable that these works were collected by Mr. X through Osorio. ."
In their conclusion, they say, "Given the strong objections of Pollock experts to the authenticity of this work, and the lack of information on the origin and ownership of the work, without the support of other evidence, we cannot support its addition to the existing Pollock catalog of works."
That's pretty much a no-brainer: We think Knoedler is lying and advise you not to buy it. Why does IFAR dare not directly and publicly say "we think this is a fake"? Because in the art market, the legal risks faced by appraisers and such institutions are great, and art appraisal is also a very complicated process.
Unless the material (pigment, canvas, etc.) used in the work is found to be far from the age of creation through scientific means, the appraisal agency will generally say it more euphemistically. For example, in the IFAR report, they stated that "there are disturbing differences between the pigment composition present in this Green Pollock and other known Pollock works". That way, even if they suddenly find out that the work is genuine, they don't have to worry too much about the lawsuits they face. And even if the work turns out to be fake, some rich and powerful galleries can still bring down these appraisal agencies through endless lawsuits, or threaten them - remember, lawyer fees in the United States are very high, and these non- It is difficult for for-profit organizations or small organizations to afford litigation.
So Goldman Sachs bosses are so easy to bully? Of course, Levy immediately canceled the deal and took the money away.
And when this kind of thing happened, the normal course of action must be to go to Rosales with the work in anger and ask him the guilt! But the next wave of operations at Knoedler Gallery is very fascinating - not only did they not send more works purchased from Rosales to any appraisal agency to verify the authenticity, they also followed Rosales to put this The story is "more complete".
Of course, before that, Freeman, the former chairman of Knoedler Gallery, still needed to report the progress of the work to Hamer, the owner of the gallery, so she faxed the IFAR report to Hamer, and on the first page of the fax, there was this notes,
"Don't kill the goose that is laying the golden egg"
"I'm not going to change the way I do things, you can go further if you don't feel comfortable doing this"
And what are they going to do with this "Green Pollock"? After all, it cost 750,000 yuan. Of course, I chose to sell it!
In 2007, Freeman and Knoedler Gallery attempted to re-sell the "Green Pollock" to the Taubman family after relative calm, but never disclosed the IFAR report and the Levy's failed deal. Freeman even promised that "this Pollock will be added to Pollock's anthology in the future" - you know, "to be added to the catalogue" means that Pollock research experts must agree that this is a An authentic Pollock - and the IFAR report says almost directly, it's impossible.
However, the Taubman family is not so easy to deceive. They hope that Freeman can add a clause to the contract. "So far, there has been no challenge or controversy to the authenticity of this Pollock", and Freeman refused. This request just continued to say "you have to believe me, if it's fake, you can always come to our gallery with an invoice" - so the deal didn't work out either.
But at the same time, Freeman and the Knodler Gallery have separated a lot of wool from other art collectors who "have a lot of money and don't do due diligence." In 2002, Hammer put Freeman The commission on profits was raised from 16% to 25%—and that year Freeman got $670,000, or $1 million today.
In 2004, De Sol, who was then president of the Gucci Group, approached Knoedler Gallery, hoping to buy a Sean Scully work. Sean Sturley, born in 1945, is recognized as a "post-war abstract artist", and Arthur Danto described him as "one of the greatest oil painting masters of our time". Prices for Sean Scully's work reached around $1 million in 2016.
This may seem like an exorbitant price to many, but Knoedler Gallery said, "We don't have Scully in stock, but luckily we have Mark Rothko, are you interested?"
Rich or not, owning a pair of Roscoes is the ultimate dream of many art lovers, and De Sol happens to be the one who has the money and can afford the price - he immediately slapped the table and said I want it .
But first of all, it needs to be explained why Rothko is so popular that De Sol's "buy is what you earn" without thinking? Because many art collectors' children are not interested in their collections, and they are not so short of money at the same time, they often donate their art collections to museums for the sake of cultural heritage - for example, when you go shopping When visiting museums and art galleries, you can take a closer look. Many exhibition halls will be named after the donors, or there will be a line of small characters at the bottom of the exhibits that say "Donated by a certain family foundation", etc.
Over time, most of the great art has been collected in museums. However, the area of the museum is only so large, and the placement of the exhibits, the interaction between the audience and the exhibition, the coherence of the exhibition, etc. must also be considered... Some museums adopt a rotation system, changing some exhibits after a while, while some museums Only those famous works are exhibited to attract audiences, which means that many gifts, even if they are created by masters, have high artistic value, they can only be placed in the warehouse and not appreciated by others.
Some people may ask, why don't museums sell some works? That way the museum can have more money, and the people who want to own the works can also have them. For museums in the US at least, it's a matter of "industry ethics" -- museums can't sell a work of art unless it's for the proceeds to buy more works of art. Although many people feel that this standard is purely "unreasonable", such as the "bankrupt and sell painting alternative" situation like the Detroit Museum of Art, this standard will put many museum managers in a dilemma.
But then again, there are fewer and fewer works of well-known artists and masters circulating on the market. As a result, the market economy, which is in short supply, has made the prices of the only "still available" works soar. If you look closely, you'll find that it's hard to see works by pre-Impressionist masters being auctioned in auction houses now, because they all go to museums.
In the end, De Sol's art agent agreed to pay Knoedler Gallery $8.4 million for the Rothko - which Knoedler had previously purchased from the aforementioned Long Island, New York-based art broker Rosal for $950,000. Steve bought the painting.
Interestingly, after the deal went through, the Beyeler Foundation in Basel, Switzerland, lent the painting to De Sol. The Knoedler Gallery paid Beyeler Foundation's renowned abstract art expert, Oli Fowwick, a reported $300,000 to "authenticate" the Rothko.
In court, De Sol presented evidence that Oli Fouwick had doubts about the authenticity of the Rothko painting, but even so, he added the painting to the exhibition catalogue—a kind of The way in which the expert confirms the work as genuine and issues a document confirming it.
In the last article, we said that many experts are afraid to give negative opinions because they are afraid of galleries or buyers suing them; and here we can also boldly speculate that this is the reality of "money can make ghosts run the mill". Reasonable use in the context.
All in all, there is a chest-beating assurance from the chairman of the century-old gallery, a confirmation letter from an industry expert, and a carefully revised "X" by the art middleman Rosales and the chairman of Knoedler Gallery Family" collection story, and De Sol walked away satisfied with the painting - for his daughter as a birthday present. A few years later, De Sole asked Freeman for a new valuation of the painting so he could buy insurance for the painting, and Freeman told him without changing his face, "Congratulations. , A few years later, the price of this painting has risen from 8.3 million to 9 million!"
In an interview in 2012, the reporter asked De Sol: "When did you think this painting was not quite right?" De Sol said, "There were a lot of scandals at the Knoedler Gallery at that time, some Some people sued them that they were selling fake paintings, so I asked them, "I'll return this Rosco to you, will you pay me 8.3 million yuan? They refused."
De Sol laughed angrily, "The price of this painting was almost doubled at the time! They took it back and made no loss, but they rejected my request, so this painting must be fake!!!"
Then some children have to ask: What laws are violated by selling fake paintings?
The first must be a breach of warranty, aka Breach of Warranty . This rule applies to most products. For example, when I was selling a mobile phone, I told you that my Apple mobile phone was very easy to use, so you paid 5,000 yuan to buy a mobile phone. As a result, you go home and open it and find that it is a banana phone, then you can sue the seller for violating the warranty terms - because when you sold it, he guaranteed that it was an iPhone, so you only paid 5,000 yuan to buy it. . The biggest advantage of a breach of a guarantee is that it is easy to prove. Buyers only need to show that their representations are different from the genuine goods they received to bring this to court, and there is no need to prove whether the seller's intent was to deceive or deceive. So what are the limitations of the breach of warranty law - it has a statute of limitations, that is, you have to sue the seller for a number of years after a certain point in time, otherwise your lawsuit will be void. Why is there a statute of limitations in the law? We can discuss this legal limitation in the art transaction.
Many people will ask, does art need the same laws as other commodities? First of all, works of art have no practicality. We feel our conscience and say that at the viewing level, many people cannot see the difference between a well imitated fake and a real one. This has also caused many artworks to be placed in homes for ten or twenty years, and it was not until a certain opportunity appeared that "Oh my God, this is actually fake". Secondly, the price of art is also significantly higher than most of the commodities we usually recognize. Therefore, many buyers will feel that it is unreasonable to use the statute of limitations to restrict themselves to seek justice from the seller.
But is it really so? Here are a few reasons why statutes of limitations apply to art transactions.
- Buyers are expected to do some level of due diligence themselves. As we mentioned in the previous articles, those who have not been deceived, such as Goldman Sachs CEO Levy, the Taubman family, etc., have all kept an eye on them, and have done due diligence before deciding whether to buy paintings - and the most important point is, due diligence Surveys are really cheap! Ask a professional agency to check it, which is a few thousand dollars. Of course, galleries still grasped the mentality of most buyers, "if you buy it, you earn it, if I don't buy someone else this time, I will buy it."
- Too long an effective time limit can deprive the defendant of evidence to defend himself .
- Litigation is actually a very expensive and lose-lose affair, and the gallery may not still have the ability to compensate the original price by then. The cost of litigation is very high, especially in the United States. Plaintiffs need to pay their attorneys several hundred dollars an hour, not even knowing whether the case will survive the first trial. Although buyers who buy sky-high fake paintings are generally not too bad, we have to say that this is not a good way to burn money. Therefore, the law attempts to encourage parties to resolve issues out of court where possible, and the statute of limitations is one way to facilitate this means of resolution. This does not mean that the law does not attempt to provide victims with legal remedies; it simply means that the limitation is a protection that contributes to a fair outcome .
In the Knoedler Gallery case, it took three years for the plaintiffs to hire lawyers to sue before the case was finally settled out of court. Although we don't know the exact terms of the settlement between Dow Saul and Howard, Artnet News reports that the gallery settled with Pierre LaGrange for just $6.4 million, which he earlier settled with Fake Jackson Pollock for $17 million from Conodeler Gallery. Even in the de Sole-Knoedler settlement, it's questionable whether Knoedler and Rosales will pay his legal costs—they don't seem to have much money, after all.
So in addition to the warranty terms, many people will definitely ask, can they sue them for fraud? Yes it can, but in most cases it will require more evidence to support your case - which means it will be more expensive to fight. In contrast to breach of warranty, fraud requires proof that the other party has intent to deceive , or at least knows that the painting is fake. Of course, in the case of Knoedler Gallery, the evidence that has been revealed one after another is easy to prove: the gallery at least knows the authenticity of the works. But this is a very extreme case, and most people who sell fake paintings can pretend to be innocent and escape the charge of "fraud".
To sum up, the biggest controversy related to art law surrounding fake painting lawsuits is "whether we need a legal system to continue to protect the interests of the rich" - because many people feel that these rich people can be more active in the stage of buying paintings The brain protects itself, instead of taking up public legal resources to file lawsuits after more than ten years, and then trying to let the law protect their rights. I think this kind of thinking is rather extreme, and there is even a bit of hatred for the art market and wealth. Of course, I also don’t think it is necessary for the judges to give special legal rules similar to the statute of limitations because the commodities involved are works of art. Tolerance - Treating artworks as ordinary commodities, applying ordinary laws, seems best at the moment.
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