Tag: Art

A Simple Solution for Your Stuff: The Use of a Separate Writing for the Disposition of Tangible Personal Property

If you have a Will (and you should!), part of your Will gives away your tangible personal property, your stuff, as George Carlin would call it. Tangible personal property is all your household goods, furniture, furnishings, clothing, boats, automobiles, books, art, jewelry, club memberships and articles of personal adornment or household use. It is anything that is not real property, like your house, and not intangible property, like stocks or bank accounts. It is your grandmother’s silver tea service, your favorite set of golf clubs, and all that other stuff you love, and which may become the stuff of heated family discussions after you are gone. Who gets it? You can and should decide now. After all, it’s your stuff.

In your Will, you can give all your tangible personal property to one person or another, or you can give particular items to particular people.  The problem is that if you change your mind about an item or a person after you sign your Will, you have to either completely re-do your Will or prepare a special amendment to your Will called a “codicil.” Both alternatives require not only the input of an attorney but also the presence of two witnesses and a notary public.

Fortunately, several states, such as Florida and South Carolina, offer a simple solution for your stuff. According to Florida Statute 732.515 and South Carolina Probate Code Section 62-2-512, you may dispose of any item of tangible personal property by a memo prepared by you, separate from your Will. The memo can be done without witnesses or notarization. And you can change it as often as you like, without changing your Will.

For the memo to be valid, your Will must refer to it and may provide that the most recent version of the memo supersedes any prior version. The memo must describe each item and the identity of its recipient with reasonable certainty and you must sign and date the memo or, alternatively, in SC, the memo must be in your handwriting. If you revise the memo or prepare a new one, it is important to sign and date it (or, in SC, make sure the revised memo is in your handwriting).

There are limitations on the types of tangible personal property you can list in the memo. It cannot be used to dispose of property used in your trade or business, cash money or books, paper, or documents whose chief value is evidence of intangible property rights, such as bank books, stock certificates, promissory notes, insurance policies, and items like that. In Florida, the memo should also not be used to give away a coin collection, because the law governing that is not yet settled.

Finally, you should treat the memo as though it is your Will. It should be kept with your Will because the assets listed in the memo will be administered as though actually set forth in your Will. If your Will is in your attorney’s vault, send the original memo to your attorney for safekeeping in the attorney’s vault and keep a copy of the memo with the copy of your Will.

For those who have a revocable trust, there is currently no statute in Florida or South Carolina concerning separate writings for tangible personal property applicable to revocable trusts. So, a reference to a memo in your trust may not work. A better move is to have such a reference in your Will.

The disposition of tangible personal property is often an afterthought.  It shouldn’t be. A close, loving family can be torn apart by arguments over family heirlooms, even those of little monetary value. Talk to your loved ones now about which items of yours they want, and then prepare a separate writing for the disposition of your tangible personal property. Do a memo for your stuff.

Copyright ©2021 Nelson Mullins Riley & Scarborough LLP

U.S. Senate Subcommittee on Investigations Recommends Regulation of the Art Market & Other Headlines

U.S. Senate Subcommittee’s Report Recommends Art Market Regulations

As part of its investigation into the effectiveness of sanctions against foreign persons and entities, the Permanent Subcommittee on Investigations of the United States Senate issued a report focused on lack of regulation and pervasive secrecy in the art market. Specifically, the report notes that the art industry is considered the largest legal industry in the United States that is not subject to the requirements of the Bank Secrecy Act, which mandates detailed procedures aimed at preventing money laundering and requires businesses to know their customers’ identity. The report further observes that under the unwritten rules of the art market, a large number of art sales happen through intermediaries, with purchasers and sellers frequently not inquiring into each other’s identities and sellers not asking about the origin of the purchase money. Art advisers are frequently reluctant to reveal the identity of their clients for fear of losing the business.

The 147-page report sets forth a case study of how the art market was used to evade sanctions imposed on Russia. Brothers Arkady and Boris Rotenberg, billionaire business tycoons and long-time friends of Vladimir Putin, were among a number of Russians placed under U.S. sanctions in 2014 as part of an effort to punish Putin and his associates for the annexation of Crimea. It is illegal for U.S. companies to do business with sanctioned persons, but there are no specific laws in place obliging a buyer or seller in a transaction for the sale of art to identify themselves. The Subcommittee’s report concludes that the Rotenbergs took advantage of the lack of transparency required in art transactions, successfully evading the sanctions imposed on them. It is alleged that through the use of shell companies and a Moscow-based art adviser and dealer, they hid their identities and purchased more than $18 million in art from U.S. dealers and auction houses while under sanction.

Of significance to all art market participants, the Senate Subcommittee’s report recommends, among other things, that Congress should amend the Bank Secrecy Act to add businesses handling transactions involving high-value art. While the term “high-value” is not defined, the report cites the recent European Anti–Money Laundering (AML) legislation, which requires businesses handling art transactions valued at €10,000 to comply with AML laws, including the Know Your Customer rule. The report further recommends that the Office of Foreign Assets Control (OFAC) of the U.S. Department of the Treasury issue a comprehensive guide on the steps auction houses and art dealers should take to ensure that they are not doing business with sanctioned individuals or entities.

Legislation will be necessary to amend the Bank Secrecy Act to apply to the art market. In fact, a bill proposing to do exactly that was previously introduced and is presently pending, proposing to regulate antiques dealers only in connection with transactions over $10,000.

White Supremacist Scientist’s Skull Collection to Be Reexamined by University

Last year, a group of students at the University of Pennsylvania presented findings that a collection of skulls kept by the university include crania from at least 55 enslaved individuals. The collection was the work of Samuel George Morton, a now-discredited physician, who used the skulls to come up with pseudoscientific justifications for slavery. Discovery Magazine has touted him as the “founding father of scientific racism.” After facing calls for the skulls to be repatriated or buried, the university moved the collection to storage. Repatriation may be difficult since little is known about the skulls’ origin other than that Morton obtained them from Cuba.

Outdoor Art Serves the Public until New York’s Museums Reopen

New York Governor Andrew Cuomo announced that New York City’s museums can reopen beginning August 24. In the meanwhile, New York City’s tourism and marketing division has put together a list of outdoor and open-air art available for viewing by the public throughout all five boroughs.

Two Museums Fear Their Gauguins May Be Fakes

Fabrice Fourmanoir, a Gauguin enthusiast, investigator and collector who exposed the J. Paul Getty Museum’s Gauguin sculpture as a fake has now set his astute gaze on paintings at the National Gallery of Art in Washington D.C. and the Museum of Fine Arts in Boston. Fourmanoir has alleged that both paintings are not Gauguins and were instead commissioned and sold by a Parisian art dealer. The museums are considering a scientific examination of the paintings to confirm their origin and authenticity.

EUROPE

Raphael’s True Cause of Death Revealed

Scientists have dispelled the myth that Renaissance painter Raphael, noted by historians as having had many trysts, died of the sexually transmitted disease syphilis. A new study conducted at the University of Milan Bicocca has concluded that the artist likely died instead from a pulmonary disease similar to pneumonia. Raphael’s physicians subjected him to bloodletting, a process wherein blood is drawn from a patient to rid the body of disease. As physicians of that period did not typically practice bloodletting for lung ailments, it is suspected that Raphael’s doctors failed to properly diagnose his symptoms. Moreover, it has been determined that rather than aiding in his recovery, the bloodletting likely contributed to and quickened his death. Raphael died in 1520 in Rome at the age of 37.

Selfie Menace Continues

Security camera footage has confirmed that an Austrian tourist broke two toes off of a sculpture by famed neoclassical sculptor Antonio Canova. The damage occurred at the Gipsoteca Museum in Possagno, when the tourist sat on a sculpture of Paolina (Pauline) Bonaparte, Napoleon’s sister, to take a selfie. The perpetrator surrendered to authorities. The work damaged was an original plaster cast model dating back to 1804, the marble version of which is kept at the Galleria Borghese in Rome. Artnet previously assembled a round-up of tragic cases of art being damaged by tourists angling for better selfies.

Building Decorated by Picasso Demolished, Triggering Protests

Despite ongoing protests, the Norwegian government has begun tearing down the Y-block office building in Oslo, part of its governmental headquarters in the city damaged in the 2011 terrorist attack by Anders Breivik, who detonated a car bomb. Prior to any demolition of the Y-block building, Picasso’s The Fishermen, a sand-blasted 250-ton section of the building’s facade, and The Seagull, a 60-ton floor-to-ceiling drawing in the building’s lobby, were removed and relocated. Opponents of the demolition argue that the Y-block building’s brutalist architecture should be preserved, and that Picasso’s works and the building “belong together.” They also argue that the demolition is, in essence, a symbolic completion of what Breivik wanted, to erase the symbols of democracy. Construction of the new governmental headquarters is expected to be completed in 2025.

Ancient Greek Architecture Likely Catered to the Handicapped

New research conducted at California State University suggests that the stone ramps featured on many ancient Greek temples were primarily built to accommodate the disabled and mobility impaired. While these ramps may have served other purposes, such as enabling transportation of materials, they were featured most prominently in quantity and size at temples dedicated to Asclepius, the Greek god of healing. As these sites drew in many visitors with disabilities, illnesses and ailments, who would have had difficulty navigating stairs, it is now thought that the ramps were specifically crafted to assist these guests.

Croatian Museums and Historic Sites Can’t Catch a Break

After the coronavirus forced churches, galleries and museums throughout Croatia to close, in March 2020, a 5.3 magnitude earthquake rocked the country, damaging its largest Gothic-style cathedral and many other landmarks, including the Archaeological Museum in Zagreb. The strongest earthquake recorded in the country in almost 150 years made many buildings structurally unsound, and museum owners began storing works in their facility basements. On July 24, 2020, that was no longer an option when a severe storm hit Zagreb, leading to massive flooding. As water surged into their basements, The Archaeological Museum and Museum of Decorative Arts, among others, struggled to protect their collections. The full extent of the damage from the storm is not yet known, but expected to be significant.

Restoration Plans for Notre Dame by Traditional Methods Finalized

After discussing the issue for more than a year, the decision was made to reconstruct the roof and spires of the renowned Notre-Dame de Paris cathedral to resemble their appearance prior to the April 2019 fire. Despite calls from French President Emmanuel Macron to rebuild these features in a contemporary style, they will be constructed using the original material and traditional methods to the extent possible. In addition to the roof and spires, the vault will need to be repaired and three of the cathedral’s gables will have to be dismantled and rebuilt. After this work is completed, the building’s statues, which fortunately were removed just days prior to the fire, will be returned. The reconstruction of Notre Dame is scheduled to be completed in 2024.

© 2020 Wilson Elser

For more art world news, see the National Law Review Entertainment, Art & Sports law section.

Hirst Spot Print Turned into Spots by MSCHF, Courtroom Artists Face New Challenge, Banksy Pays Homage to Hospital Workers

Still No LOVE in Robert Indiana’s Estate Battle

In the ongoing suit over the rights to Robert Indiana’s artworks, defendant Michael McKenzie, the founder of American Image Art, filed new counterclaims against the Morgan Art Foundation alleging that Morgan orchestrated “one of the most massive art frauds in history.” McKenzie argues that intellectual property rights were abandoned by Indiana decades ago and that the artist’s famous LOVE artwork is in the public domain. McKenzie further alleges that Morgan “fraudulently affixed” copyright to more than 1,000 sculptures worth more than $100 million and an additional million items valued at least $50 million in retail sales – Indiana did not affix a copyright symbol to his work when it was first published. McKenzie also seeks to invalidate two federal trademarks that Morgan registered for the design and reproduction of LOVE. Notably, several other counterclaims made by McKenzie and Indiana’s estate were dismissed in 2019. Morgan maintains that it has the rights to all images and sculptures that Indiana produced between 1960 and 2004, as well as the exclusive right to fabricate and sell certain sculptures, including LOVE, pursuant to agreements dating back to 1999. Morgan’s direct claim against McKenzie is over the sale of works it alleges were falsely attributed to Indiana.

As SCOTUS Moves Oral Arguments Online, Courtroom Artists Forced to Use Their Ears – and Imaginations – for Illustrations of Oral Arguments

The U.S. Supreme Court’s justices and their staffs are not the only people in the courtroom having to adapt. Court-appointed artists still capture the oral arguments, but must now rely on their ears and imaginations rather than their eyes to create the illustrations. The inability to be inside the courtroom during the arguments not only makes it difficult to paint a picture but also leaves lawyers in the dark as to the justices’ reactions to their arguments.

The Most Expensive Game of (Dis)Connect the Dots: A $30,000 Hirst Print Sold Off Spot by Spot

Damien Hirst created a spot print titled L-Isoleucine T-Butyl Ester. Now, MSCHF, a Brooklyn-based art collective, cut out each of the print’s 88 spots as part of the project called Severed Spots, created in protest against the practice of fractionizing the ownership of artworks. MSCHF sold off each of the spots for $480, generating a profit of about $12,000 over the $30,000 purchase price; in yet another example of an artwork’s value apparently growing as a result of its destruction (think Banksy’s Love Is in the Bin), they stand to gain even more as bidders line up to purchase leftover white paper. Our readers will remember MSCHF for auctioning off The Persistence of Chaos, a computer with the world’s most malicious viruses last year, among other news-making stunts/artworks. MSCHF also sold Jesus Shoes, custom Nike Air Max 97s with holy water from the River Jordan in the soles. Damien Hirst’s studio has not yet responded to this latest stunt by the collective.

Founder of Napster Involved in Suit Over Ownership of an Old Master Painting

Auction house Christie’s recent court filings to enforce an arbitration award reveal that art collector Sean Parker, founder of Napster and first president of Facebook, was embroiled in a dispute over a sale of Peter Paul Rubens’s A Satyr Holding a Basket of Grapes and Quinces with a Nymph (1620). In 2018, Parker acquired the artwork at a Christie’s auction for his foundation, after which the consignor of the artwork inexplicably sought to cancel the sale, despite making more than $1 million in profit. The consignor claimed that she tried to withdraw the painting before the auction took place. When the parties were unable to amicably resolve the dispute, it was submitted to arbitration. The arbitrator ruled that Christie’s complied with its contractual obligations and that Parker lawfully acquired the painting. The case highlights the legal and financial responsibilities of the parties involved in consigning an artwork to an auction house.

Former Paddle8 CEO Sued for Alleged Misappropriation of Funds

A group of creditors brought suit in the Southern District of New York, accusing former Paddle8 CEO Valentine Uhovski of engaging in acts of gross mismanagement and disloyalty, including alleged misappropriation of funds from the auctions to pay the company’s operating expenses. Uhovski has denied the allegations. Paddle8 filed for bankruptcy in March, following a separate suit by a nonprofit cinema group that alleged misappropriation of funds from a charity auction.

Mail Art Experiencing Revitalization

In recent months, Mail Art – a 1950s art movement centered around sending small-scale artworks via the postal service – has regained popularity. Artists have been reaching out via social media for submissions, and to date, hundreds of individuals have answered the call. The original idea was to create a form of artistic production that bypasses the traditional channels of art dissemination. The reborn interest in Mail Art is “creating a sense of connectivity” while allowing for people stuck in their homes to take a break from their screens.

EUROPE

INTERPOL Recovers 19,000+ Artifacts in a Massive Operation Spanning 103 Countries

More than 300 INTERPOL investigations coordinated between 103 countries resulted in recovery of more than 19,000 artifacts. Recalling the work of the Monuments Men – unlikely World War II heroes who saved many of Europe’s art treasures – the investigations were focused on criminal networks that deal in artworks looted from war-torn countries as well as artifacts stolen from archeological excavations and museums. The success of the mission highlights the need for global cooperation in fighting the trafficking of cultural goods.

MoMA Voices Concerns Over Norway’s Handling of Picasso Murals

The Norwegian government is in the process of demolishing a government building in Oslo that features Pablo Picasso’s murals sandblasted onto the concrete walls. While plans have been made to relocate the artworks, many are concerned that once moved, the murals will crack. The MoMA letter, published in the Norwegian press, expresses grave concerns over the preservation of the murals and emphasizes their significance to the art community. In addition, the petition to preserve the building holding the murals has garnered more than 47,000 signatures.

Van Eyck Exhibition Organizers Argue Coronavirus Triggers Cancellation Policy

Organizers of the largest exhibition ever dedicated to the Flemish Old Master Jan Van Eyck will distribute refunds to 144,000 ticket holders who were unable to attend due to early closure following the coronavirus outbreak. The organizers are seeking coverage from their cancellation insurer for the refunds of more than €3.5 million.

Counterfeit Artwork Seized at Heathrow Airport Part of a Larger Problem

The British Museum’s inspection revealed that hundreds of what looked to be Middle Eastern artifacts intercepted last July by an officer at Heathrow Airport were fakes. While the items were discovered to be counterfeit, they had the potential to be sold for thousands of dollars to unsuspecting buyers.

Croatia Rushes to Save Valuable Pieces of Art

While the world deals with the ongoing coronavirus pandemic, Croatia experienced a 5.4 magnitude earthquake in its capital, Zagreb. The earthquake damaged some 26,000 buildings, palaces, university buildings and hospitals. The Museum of Decorative Arts, which planned on celebrating its 140th anniversary, suffered a roof collapse during the earthquake. While the building has been classified as unsafe for use, the Museum has been expeditiously removing many fragile objects, even while the aftershocks continued. Many other pre–20th century buildings also sustained damage.

Banksy Pays Homage to Hospital Workers

As a tribute to the National Health Service and health care workers during this pandemic, renowned street artist Banksy created an artwork titled Game Changer (2020), which he donated to England’s Southampton General Hospital. The piece came with a note to the health care workers that read: “Thanks for all you’re doing. I hope this brightens the place up a bit, even if it’s only black and white.” Just days after the artwork was installed, an opportunistic thief wearing a hazmat suit and armed with a drill was caught attempting to steal it.

ASIA

Archaeologists Uncover Further Evidence of Vital Role of Women in Ancient Mongolian Society

Archaeologists discovered 1,500-year-old skeletons of women warriors in northern Mongolia, near China – recalling the story of Hua Mulan, originally described in the Ballad (Ode) of Mulan composed in the fifth or sixth century CE, and appearing as the main character in the 1998 animated Disney film. A study of the skeletons revealed the two women to be skilled in archery and horseback riding. The skeletons were found in a cemetery at the Airagiin Gozgor archeological site. Disney has been planning to release a live-action adaptation of Mulan, currently scheduled for July 24, social distancing guidelines permitting.

 

© 2020 Wilson Elser

No Copyright Case Too Small: Content Creators Rejoice or Casual Infringers Beware?

An office jokester emails a funny meme she copied off Google to a colleague. A tourist snaps a picture of a painting in an art gallery and posts it to his travel blog. A teacher prints copies of a recently published Internet article and distributes to his class. A teen reposts his friend’s Instagram picture on his own social media page. To these casual infringers, no harm has been done and there’s certainly no reason to “make a federal case out of it.” But to the copyright owners, these small acts of infringement mean something. Perhaps not enough to justify the expense and time required for a federal claim, but action may be worth pursuing on a smaller scale.

Enter the pending CASE Act, intended to protect the “creative middle class,” and a potential boon to small businesses and individual content creators, while simultaneously presenting a threat to the “micro-infringements” committed by the ordinary person throughout the day. Last week, the US House of Representatives approved the Copyright Alternative in Small-Claims Enforcement Act of 2019 (CASE Act) by a landslide 410-6 vote. The bill is intended to create a Copyright Claims Board within the US Copyright Office that would hear copyright claims of up to $15,000 per work infringed, with statutory damages capped at a total of $30,000.

If passed by the Senate, the CASE Act is likely to be a welcome avenue for graphic designers, bloggers, photographers, authors, vloggers, and other individual and small business copyright owners to protect their works. Currently, pursuing copyright infringement litigation is limited to filing suit in federal courts, the cost of which can be prohibitive for many small businesses. The proposed Copyright Claims Board provides a more affordable avenue—effectively, a copyright small claims court—to enforce copyright ownership.

Supporters say that small businesses have long needed a more efficient and affordable means to enforce their copyrights. To this point, much of the unauthorized exchange and use of Internet-based works or smaller-scale copyrighted works has been difficult to police. In fact, June Besek, the executive director of the Kernochan Center for Law, Media and the Arts at Columbia Law School, recently told the ABA Journal that many infringers knowingly exploit copyrighted material because they are confident they will never be challenged. (Anyone remember the flagrant use of Napster and LimeWire by teens in the late 1990s and early 2000s to illegally download music—excuse me, “file share”—with little fear of repercussions for their “small-scale” acts of infringement?). A number of organizations, including the American Bar Association, have expressed support for the CASE Act.

But that support, while widespread, is not universal. The American Civil Liberties Union opposes the proposed CASE Act on the grounds that it will stifle free speech and the open sharing of information. Other critics say that by lowering the threshold for infringement claims, lawmakers also are opening the door for “copyright trolls” to file nuisance infringement claims with the Copyright Claims Board. And many are less than keen on the idea that inadvertently unanswered copyright infringement complaints could cost ordinary Americans up to $30,000 in default judgments per proceeding—perhaps a small sum to a business, but potentially life-changing to many individuals—with very limited ability to appeal, under the currently proposed language of the Act.

Notably, as currently written, the small-claims tribunal established under CASE will be entirely voluntary, meaning the complaining party can elect to use the Copyright Claims Board, and the defending party may choose to opt out. But critics point out that the opt-out window is only 60 days long, and easily could be missed by an unwitting defendant.

Next, the Senate will consider the CASE Act, but observers believe it will pass with bipartisan support. The final language of the Act may be somewhat different from its current form, so stay tuned for more updates as the CASE Act makes its way through the legislature.

What the proposed CASE Act could mean for you:

Would-be plaintiffs (or defendants) appearing before the proposed Copyright Claims Board are encouraged to do so with licensed legal representation. Some have suggested that this small claims court format will allow parties to represent themselves without needing to incur the fees of legal representation. However, it is important to remember that, though the monetary stakes may be lower than in federal court, the complex legal nuances of copyright law, not to mention jurisdiction, service, discovery, evidence, joinder of parties, and expert testimony, remain the same and are best addressed by experienced legal counsel.

Owners of large copyright portfolios may find the CASE Act to allow greater leeway in defending their works against smaller-player infringers. Businesses with larger portfolios may wish to take stock of their protected works and develop an enforcement strategy, taking into account this more accessible avenue for enforcement.

Smaller companies or individual content creators, too, may find the proposed CASE Act to provide the freedom to assert their copyrights more aggressively than they have done previously. These companies and individuals also are encouraged to take stock of their copyright portfolios, and consider setting up infringement alerts through their legal representatives or third party vendors in order to take a more offensive stance.

On the opposite side of the court room, copyrighted work users are cautioned to think carefully about their use of protected works. Businesses and schools may want to consider updating policies on use and distribution of protected works, with a more conservative mindset. The relative ease of filing suit with the Copyright Claims Board may give rise to a more litigious “creative middle class.” And while the damages may be smaller-scale, the attendant legal costs may not be, and damages from multiple suits may add up quickly.

 

Copyright © 2019 Womble Bond Dickinson (US) LLP All Rights Reserved.

ARTICLE BY Kristin Lamb of  Womble Bond Dickinson (US) LLP.
For more copyright infringement regulation, see the National Law Review Intellectual Property law page.

A Week of Surreal Headlines: A Charging Bull Smashed by Man Wielding Banjo, A Stolen 18-Karat Gold Toilet, and a $20 Million Consignment Decided by a Game of Rock, Paper, Scissors

UNITED STATES

Mercedes-Benz Suit Against Street Artists Allowed to Proceed

Mercedes-Benz brought a declaratory judgment action against four street artists who saw their work prominently displayed on social media as background for the automaker’s G-Class track ads. Mercedes is seeking a declaration that its use of the artworks was not a copyright infringement as it was either fair use or because the claim is precluded by the Architectural Works Copyright Protection Act (1990).

After a hearing last week, a Detroit court denied the artists’ motions to dismiss Mercedes’s claims. The artists contended, among other things, that Mercedes’s claim was not ripe as the artists have not yet registered their copyrights. Distinguishing the U.S. Supreme Court’s recent decision in Fourth Estate v. Wall-Street.com, this court concluded that copyright registration is not a prerequisite for an action seeking a declaration of non-infringement.

Los Angeles Police Department Seeks to Reunite Recently Discovered Artworks with Their Owners

The LAPD has uncovered a trove of more than 100 antiques and artworks that have been missing since a spree of thefts in 1993, including works by Pablo Picasso and Joan Miró. Two individuals involved in the thefts were captured in 1993, but it was not until this summer that an auctioneer’s tip led to the discoveries.

Charging Bull, a Symbol of Wall Street Power, Damaged by a Man with a Banjo

A man armed with a metal banjo bashed the famous Charging Bull on Wall Street, leaving it with a six-inch gash and several scratches. The attacker, who was arraigned and released without bail, gave no motive for his actions. He is due back in court on October 16. The artwork was installed in December 1989 by sculptor Arturo Di Modica, intended as a symbol of optimism after the Black Monday stock market crash in 1987.

EUROPE

Works of Art from the Collection of Nazi Collaborator Hildebrand Gurlitt to Be Exhibited in Israeli Museum

Artworks amassed by Hildebrand Gurlitt, noted Nazi collaborator, will go on view for the first time at the Israel Museum later this month. The collection includes works by Pierre-Auguste Renoir, Édouard Manet, Otto Dix and Max Ernst, among others. The show will include works declared “degenerate” by the Nazis and acquired by Gurlitt during the war, as well as works that have no red flags that might indicate ties to the Nazis. The exhibition, called “Fateful Choices: Art from the Gurlitt Trove,” reveals the historical circumstances behind the fate of art during the Third Reich and is intended to generate discussion about art and ethics.

Extreme Weather Leads to the Reemergence of a “Spanish Stonehenge”

This summer, an extreme drought in the Extremadura area of Spain has revealed the “Dolmen de Guadalperal,” a series of megalithic stones that were previously submerged. The Dolmen are 7,000 years old and are located in the Valdecañas Reservoir. They were last seen in 1963. A local group is working to move the Dolmen before they submerge again.

Police on the Hunt for Maurizio Cattelan’s 18-Carat Gold Toilet

Maurizio Cattelan’s America (2016), a fully functioning 18-carat gold toilet, was stolen from an exhibition at Blenheim Palace in Oxfordshire, UK. Blenheim Palace is the 18th Century home and ancestral seat of the Duke of Marlborough. The burglars caused significant damage and flooding while removing the toilet.

Gagosian Gallery Adds Estate of Simon Hantaï to Its Roster

Gagosian Gallery added the estate of postwar abstractionist Simon Hantaï. Gagosian will host its first Hantaï show in October at its gallery in France. Hantaï, who is well known for his surrealist and abstract expressionist works, died in 2008. He is beloved in France and represented the country at the Venice Biennale in 1982.

Arrests Made in Connection with a String of Forgeries of High-Profile Old Master Paintings

An arrest was made and an additional warrant issued in connection with a high-profile string of suspected forgeries of Old Master paintings uncovered in 2016. The scandal has involved such institutions at the Louvre, London’s National Gallery and the Metropolitan Museum. The forgery ring may have been involved in as much as $255 million in sales of fake Old Masters.

Banksy Gallerist Calls It Quits

Steve Lazarides, who started out as the driver, photographer and later dealer for street artist Banksy, is leaving gallery life. Lazarides said that he entered the art world to “promote a subculture that was being overlooked, and that’s gone now.” His first project post-gallery life is to sort through the 12,000 photographs he took over 11 years with Banksy and publishing a book titled Banksy Captured.

ASIA

Art Recovery International Calls for the Return of a Painting They Allege Was Stolen from a UK Residence in 1984

Art Recovery International seeks intervention from the International Council of Museums (ICOM) in the return on a painting, The Portrait of Miss Mathew, later Lady Elizabeth Mathew, sitting with her dog before a landscape, which was allegedly stolen from the home of Sir Henry and Lady Price in East Sussex in 1984. The painting is currently located at Tokyo’s Fuji Art Museum, an ICOM member. The museum is contesting the claim.

The Pushkin State Museum of Fine Arts Will Soon Take Over Russia’s National Centre for Contemporary Arts

Russia’s National Centre for Contemporary Arts (NCCA), which consists of nine branches, has begun merging with the Pushkin State Museum of Fine Arts in Moscow as part of Pushkin’s ambition to open a “Pushkin Modern.” Vladimir Medinsky, Russia’s minister of culture, announced the merger in July, saying that NCCA staff had requested the merger after a series of ideological and financial scandals.

How a $20 Million Consignment Was Decided by a Game of Rock, Paper, Scissors

In the spring of 2005, a Japanese electronics giant decided to auction off works from its art collection worth about $20 million. The collection included works by Paul Cézanne, Camille Picasso, Vincent Van Gogh, Paul Gauguin and others. Unable to choose whether to consign with Sotheby’s or Christie’s, the company president decided that representatives from each company would meet at the Tokyo office and compete in a game of rock, paper, scissors. Christie’s chose scissors and Sotheby’s chose paper, and we all know scissors cut paper

© 2019 Wilson Elser

“Bank For Your Buck” – The Legal Implications of Banksy’s Destruction of “Girl with Balloon”

For centuries, artists have been celebrated for pushing boundaries and shaping how society should view art. As members of the audience, we rely on artists to expose us to these unique dimensions of thought and we return the favor by placing value on their creations. For the past twenty years, one anonymous artist has continuously thrilled his audience by publicly displaying his work throughout the streets of major cities. Banksy, as the public knows him, has once again shocked his audience, this time at the Sotheby’s auction of one of his most famous graffiti pieces, “Girl with Balloon.”

However, the $1,037,000 record breaking bid price was not the cause for headlines after the sale. In pure avant-garde fashion, immediately upon the sounding of the auctioneer’s hammer, the frame securing the piece proceeded to shred the bottom half of, “Girl with Balloon.” The bidder, who remains anonymous, said that she is planning to keep the shredded piece, and “realized that [she] would end up with [her] own piece of art history.”[1] However, what if the owner had not had such an optimistic outlook on the prank, could she have legally deemed the sale void?

Under the Uniform Commercial Code (“UCC”), “a sale by auction is complete when the auctioneer so announces by the fall of the hammer or in other customary manner.”[2] While the sounding of the hammer indicates the transfer of ownership, this does not necessarily also indicate a transfer of liability. The UCC and Sotheby’s terms of sales state that the “risk of loss passes to the buyer upon her receipt of the property or on tender of delivery.”[3] In sum, liability is imposed on the party who has physical possession of the artwork. If the buyer receives the goods in a condition that does not conform to the condition the buyer reasonably believed the goods to be in at the time of the sale, under the UCC, a buyer may revoke her acceptance of the goods.[4]

As applied to, “Girl with Balloon” once the hammer struck, the ownership of the piece transferred from the hands of Banksy’s agent, Sotheby’s, to the anonymous bidder. However, since the piece immediately shred upon finalization of the sale, there was no actual physical transfer of the artwork. Between the time of the sale and the shredding, the piece was still mounted at the Sotheby’s auction house, therefore under the company’s liability. Since the art work was damaged while under the possession of Sotheby’s, under the UCC, it is likely that the anonymous buyer could have canceled the sale.

Moreover, there is also the issue of the price appraisal of the artwork. Buyers rely on auction houses like Sotheby’s to provide them with a guideline of establishing the value of pieces of art, in particular their reserve price (the minimum bid price for a piece). Sotheby’s set the reserve price for “Girl with Balloon” to reflect the piece in its original creation and it is unclear how the piece will be valuated post alteration. However, members of the art world seem to believe that this was not a destruction but rather a reincarnation of the piece. One art broker, Joey Syer, believes that Banksy’s prank contributed to art history, adding a “minimum 50% to its value.”[5]

If Syer’s estimates are true, could Sotheby’s in return bring a claim against Banksy for transforming his piece without their knowledge, thus manipulating the reserve price? Banksy admits to orchestrating the prank, and even recently revealed that his initial intention was to shred the whole work, but a mechanical error stopped the shredder at the bottom half of the piece.[6] It is unclear if, when Sotheby’s inspected the piece, they were aware of the shredder within the frame and if that was incorporated in their valuation of the piece. It is quite likely that Banksy did not disclose the shredder to Sotheby’s, who could potentially bring an action against Banksy for fraudulent concealment. Sotheby’s could make the claim that, by not disclosing the shredder, they misevaluated the piece and set the reserve price lower than its worth. Thus, had they set the reserve price higher, the piece could have sold for more, guaranteeing a greater commission for the auction house.

As of now, the parties and fans around the world view this as a positive occurrence. Sotheby’s head of contemporary art, Alex Branczik does not seem worried about the trick and views this as, “the first artwork in history to have been created live during an auction.”[7] Once again, Banksy has played with his audience’s conception of art, and the future valuation of the newly named, “Love in in the Bin,” will reveal whether the joke is actually on us.

[1] https://www.bbc.com/news/uk-england-bristol-45829853

[2] Uniform Commercial Code § 2-328

[3] Uniform Commercial Code § 2-509

[4] Uniform Commercial Code § 2-512

[5] https://www.telegraph.co.uk/news/2018/10/06/banksy-shreds-girl-balloon-p…

[6] https://www.cnn.com/style/article/banksy-video-girl-with-balloon/index.html

[7] https://www.bbc.com/news/uk-england-bristol-45829853

Copyright © 2018, Sheppard Mullin Richter & Hampton LLP.

Crime Doesn’t Pay (as much as it used to) – FBI Cracks Down on Trade of Looted Syrian and Iraqi Cultural Artifacts

In support of the international crackdown on the black market trade of looted cultural artifacts, the FBI recently announced that art dealers may be prosecuted for engaging in the trade of stolen Iraqi and Syrian antiquities. Terrorist organizations such as Islamic State in Iraq and the Levant (“ISIL”) have pillaged these countries of their cultural relics for sale on the black market. Many find their way into the hands of art dealers and collectors in the Europe or even United States. In response, the FBI released an alert titled “ISIL Antiquities Trafficking” on August 25, 2015. Perhaps most strikingly, this alert warns that engaging in the purchase of these looted artifacts may constitute a violation of 18 U.S. Code § 2339A[1] for providing financial support to terrorist organizations.

ISIL has done much to publicize its demolition of artifacts and archaeological sites in Syria and Iraq that it has condemned as un-Islamic.[2] However, behind the cameras, many of these cultural artifacts are being smuggled out of these countries and sold by ISIL on the underground market and finally reach the dealers and collectors in Europe and North America. The profits from the sale of these precious antiquities are then used by the organization to fund its operations. George Papagiannis, spokesman of UN Educational, Scientific and Cultural Organization, described the artifact trafficking as “a threat to the memory of humankind and a threat to the identities of people in these communities who are tied to these sites.”[3] Facilitating this illicit trade are the smugglers and gallery owners who provide forged documentation to allow the artifacts to enter European and American markets.[4]

Before the FBI’s issuance of the alert, United Nations and Europe had already taken steps to prevent and eliminate the trafficking of these Syrian and Iraqi cultural objects. On February 10, 2015, United Nations Security Council passed Resolution 2199 that requires all Member States to take efforts to prevent the trade of artifacts illegally removed from Syria after 2011 and from Iraq after 1990. In December 2013, the European Union Council Regulation (EU) No 1332/2013 prohibited the trade of Syrian cultural property where there are reasonable grounds to suspect that the goods were removed from Syria without the consent of their legitimate owner or in breach of Syrian law or international law.

The FBI alert follows in the footsteps of these efforts to stop the illegal trade of Syrian and Iraqi artifacts. The alert warns art dealers and collectors that they should be careful in purchasing objects from these regions and asks them for help and cooperation to spread this message out and prevent further trade. In addition, the FBI states that purchasing stolen items from these regions may result in prosecution under 18 U.S. Code § 2339A because the proceeds from such sales may provide financial support to terrorist organizations.

18 U.S.C. § 2339A was enacted to charge those who provided material support to terrorists. It provides that “whoever provides material support or resources…knowing or intending that they are to be used in preparation for, or in carrying out, a violation of [various criminal statutes related to terrorist activities]” may be charged with providing material support to terrorists. Penalties for violating 18 U.S. Code § 2339A are significant and range from a fine to life imprisonment. However, in Holder v. Humanitarian Law Project, 130 S. Ct. 2705 (2010), the Supreme Court clarified that a violation of 18 U.S.C. § 2339A requires that the donor must intend to further terrorist activity, rather than simply know that the donee is a terrorist organization. According to this holding, it seems that even if an art dealer or collector was prosecuted under 18 U.S.C. § 2339A, there would need to be a showing that the dealer or collector intended to support terrorist activity by purchasing the stolen artifacts, which in most cases, is highly unlikely.

It is unclear from FBI’s alert whether 18 U.S.C. § 2339B will be used to pursue dealers and collectors found to have bought Syrian and Iraqi stolen artifacts. Section 2339B penalizes anyone who “knowingly provides material support or resources to a foreign terrorist organization, or attempts or conspires to do so.” Unlike 18 U.S.C. § 2339A, the required mental state for a violation of § 2339B is only knowledge that the receiving organization is a designated terrorist organization, not specific intent to further the terrorist activities. In Weiss v. National Westminster Bank PLC, 768 F.3d 202, the Second Circuit Court of Appeals held that for the purposes of 18 U.S.C. § 2339B, a defendant has knowledge that an organization engages in terrorist activity if it “knows there is a substantial probability that the organization engages in terrorism but…does not care.” If the FBI elects to prosecute under 18 U.S. Code § 2339B, art market practitioners may have more cause concern. Admittedly several intermediary middle-men often separate the original terrorist looters and the final buyers, but the intermediate art dealer or the buyer might still be charged with violating 18 U.S.C. § 2339B if it should be aware of a substantial probability that the prior seller may have engaged with terrorism but takes no action.

18 U.S.C. § 2339B has been the most frequently cited statute for the government to pursue sponsors of terrorism. If the government is determined to use § 2339B to attack the trafficking of cultural property, the innocent buyer may face real legal risks if the acquired objects are proven to be looted from Iraq or Syria by ISIL. As the FBI warns in its alert, art dealers and collectors alike should do their due diligence and “check and verify provenance, importation and other documents” and report any suspicious items to the FBI.

Article By Robert A. Darwell of Sheppard, Mullin, Richter & Hampton LLP & Justin Xu
Copyright © 2015, Sheppard Mullin Richter & Hampton LLP.

[1] The statute quoted in the alert is 18 U.S. Code § 233A. However, we understand the cited statute here should be 18 U.S. Code § 2339A.

[2] Matthew Hall, How We Can Prevent ISIS From Pillaging Palmyra, the Newsweek, (June 14, 2015), available here.

[3] Julian Pecquet, Congress Deals Blow to ISIS Looting in Syria, the U.S. News (June 2, 2015), available here.

[4] CBS News, Following the trail of Syria’s looted history, (September 9, 2015), available here.