Battle of Titans - Perelman vs Gagosian

Bloomberg is reporting that billionaire investor Ron Perelman and gallery owner Larry Gagosian regarding the purchase and guarantee of sculpture.  Gagosian is claiming Perelman did not make the agreed upon payments on the sculpture in addition to another contemporary piece which was delivered to his home, while Perelman states Gagosian used his influence in the art market to increase prices.

Bloomberg reports

The gallery said in its complaint that on Jan. 6, it entered into a contract that was personally guaranteed by Perelman for a sculpture by an unidentified living artist for $12.6 million that was delivered on June 8 to Perelman’s home in East Hampton, New York. Perelman offered a “much lower sum” than was agreed upon in addition to pieces of art from his collection, the gallery said in the complaint.

Perelman also refused to pay for a $10.5 million painting by another contemporary artist that he had asked the gallery to acquire and that was delivered to his home, according to the gallery’s complaint. He also refused to return the artwork, again offering pieces from his collection in exchange, according to the complaint.

One of the works offered by Perelman for credit was a contract for an unfinished sculpture that hadn’t been delivered, for which he owed the gallery $1.6 million, according to the complaint.

The gallery said in its complaint it agreed to give Perelman about $18 million in credits for the art from his collection to “mitigate damages.”

‘Sham Settlements’

Perelman’s actions have cost the gallery millions of dollars, forced it to pay the artists out of its own capital and forgo commissions, the gallery said in its complaint. Gagosian is seeking the original purchase price of the sculpture and the painting, minus the net sales price of any of the bartered pieces from Perelman’s collection that were sold, and to return the works that haven’t been sold.

“Following the non-payment, defendants engaged in a series of sham settlements and deceptive maneuvers designed to force the gallery into spending tremendous capital to cover shortfalls, to cloud the title of artworks defendants forced the gallery into accepting as barter, and to otherwise render impossible the gallery’s ability to mitigate damages including continual threats of baseless lawsuits,” the gallery said in its suit.

Source: Bloomberg