Update on Christies Being Sued After Reopening Bidding

A few weeks ago I posted on Christie's being sued by the under bidder (shipping magnate Gregory Callimanopulos) for a Sam Franci painting at a Christie's sale, claiming the hammer had struck and the bidding was then reopened (click HERE to read original post). Christie' claims and states it has proof that the winning bidder did bid before or during the hammer strike and therefore had every right to continue bidding.

Philip Boroff of Bloomber is reporting that Christie's now joined in the lawsuit by the winning bidder, billionaire art collector Eli Broad, has won the initial phase of the court dispute. Broad also won the bidding, at $3.2 million for the Sam Francis painting.

It is an interesting situation, and with many state legislatures looking at auction houses and consumer/buyer rights, disclosure and transparency, the suit and outcome should be followed, but my expectations are that Mr. Broad will prevail based upon the agreed bidding contract in the auction catalog.

Boroff states Broad, one of the biggest U.S. art collectors, filed court papers on June 3 claiming he’s entitled to the work because he submitted the highest bid. Callimanopulos sued the auction house on May 15, saying it improperly sold the 1954 painting to Broad for $3.2 million, plus commission, on May 13. Callimanopulos says the auctioneer had already sold the work to him by bringing down the hammer on his $3 million bid.

The suit reflects the competition among collectors for the best works of art even during an economic slump, said art adviser Stefano Basilico. Broad declined to comment, said Karen Denne, a spokeswoman for Broad’s foundations.

Boroff continues The auctioneer, Christopher Burge, said in an affidavit that he resumed bidding because he didn’t initially notice Broad’s bid in the Rockefeller Center saleroom. Christie’s staffers pointed out the oversight as Burge was gaveling the hammer.

Callimanopulos’s lawyers argued that when the hammer fell, that created a contract for Christie’s to sell their client the artwork. The judge ruled on June 2 that Burge “exercised his discretion” in resuming bidding. Pauley said he reviewed a videotape of the sale and Joanne Heyler, director and chief curator of the Broad Art Foundation, “raised her paddle as Burge said ‘fair warning’ and then raised it even higher as he brought down the hammer.”

Right of Refusal

Christie’s catalog said the auction house has the right to “refuse any bid” and to “determine the successful bidder,” according to Burge’s sworn statement.

To read the full Bloomberg report, click HERE.