The Mask, Egyptian Funerary and Known to Legally Disappear

US v. Mask of Ka-Nefer-Nefer is a case dealing with an Egyptian mask which may or may not have been sold or stolen sometime after it was excavated during a state-sponsored dig in the early 1950s, registered to the Egyptian Antiquities Service and shipped to Cairo for restoration in 1966. It went missing in 1973 and was purchased by an American museum in St. Louis  in 1998. The museum challenged a forfeiture claim and seemed to have won on its motion because the court found that the claim was "devoid of any facts showing that the Mask was 'missing' because it was stolen and then smuggled out of the country." Judge Henry E. Autrey, who signed the opinion, must be an Egyptologist and a believer that sacred burial objects have mystical powers to disappear without human intervention and show up in dealers' shops out of thin air.

According to Patty Gerstenblith, director of Center for Art, Museum & Cultural Heritage Law at DePaul University "This is the first time [she has] seen a public institution like a museum deciding to expend its funds to proactively sue the government." Prof. Gerstenblith wrote one of the leading textbooks on cultural heritage law, so if she says it is the first, we should listen. The decision is surely the first to look at the lack of paper trail to say that the object which is located away from the place where it ought to be should stay where it landed.

For the full story, read The Atlantic.

CA District Court Finds State Resale Royalty Unconstitutional

By Peninah Petruck

Artists vs. Auction Houses. Round one, the winner, the auction houses. In Estate of Robert Graham et al v. Sotheby's, Inc., and Sam Francis Foundation v. Christie's, Inc. (consolidated cases), the California District Court found the 1977 California Resale Royalty Act unconstitutional under the Commerce Clause. The decision stated:

• Under its clear terms, the (Resale Royalties Act) regulates transactions occurring anywhere in the United States, so long as the seller resides in California. Even the artist — the intended beneficiary of the CRRA — does not have to be a citizen of, or reside in, California. For these reasons, the court finds that the (law) has the 'practical effect' of controlling commerce 'occurring wholly outside the boundaries' of California even though it may have some 'effects within the state.' Therefore, the (law) violates the Commerce Clause. 

But plaintiffs, Chuck Close, Laddie John Dill, and the estate of Robert Graham, aren't giving up. They're appealing Judge Jacqueline Nyugen's May 17th decision. They want the same rights that photographers, filmmakers, writers and composers have under U.S. Copyright Act. Every time a photographer's work is sold, she earns royalties, but a painter gets nothing when her work changes hands. The painting belongs wholly to the buyer; no part of the profits from its resale belongs to the painter. So when a painter's work appreciates in value, only its owner benefits. The painter—the creator of the work—is out of luck.

In the class action suit against Christie's and Sotheby's, plaintiffs claimed millions in resale royalties. They argued that California Resale Royalty Act says that an artist is entitled to royalties. Anytime work is resold in California, or is resold by a California resident, even outside California, an artist earns 5% of a sale price over $1000. In Europe, artists collect royalties under droit de suite laws, but in the U.S., California is the only state that has even tried to protect artists.

The California court bought Skadden Arp's Slate Meager Flom's argument. (Skadden represented Christie's; Morrison Forester, and Weil, Gotshal & Manges, for Sotheby's.) For support, the court noted, that when California was drafting CRRA, its counsel advised that it wouldn't pass Constitutional muster; the Commerce Clause prohibited extending resale royalties to sales outside the state. Apparently, California legislators figured limiting royalties to in-state sales would invite dealers and auction house to do business out of state.

As for round two, the appeal, the artists' lawyer, Eric George of Browne George, is confident about a reversal in the Ninth Circuit. He is counting on a separation of power argument:

• The artist protection law was properly enacted by California’s legislative and executive processes, pursuant to powers the U.S. Constitution reserves to the states. For a single federal judge to invalidate the law more than 35 years later... marks a departures from established constitutional law.

That's a hard win. So many advocates think that artists should push for federal legislation. But that's difficult too.  Previous attempts for the U.S. to enact droit de suite laws have failed. In fact since 1978, California Representative Henry Waxman's has tried to pass a bill modeled after CRRA. Then, in 1992 the Copyright's Office 1992 reported that neither economic or copyright policy justified legislation. And last year New York Congressman Jerry Nadler and Wisconsin's Senator Herb Kohl introduced The Equity for Visual Arts Act, that would require royalty payments from bigwig auction houses' reselling of works over $10,000; artists and non-profit art museum would split 7% of the works' price. Galleries, dealers and on-line auction houses, and private auction house sellers sighed with relief because the proposed legislation would apply only to auction houses with revenue over $25 million annually.

Currently the Nadler-Kohl bill is languishing. Maybe the Ninth Circuit's decision will kick- start the fight for artists. Round three is worth fighting.

Borrowing Art Made Easy, Maybe

The new Foreign Cultural Exchange Jurisdictional Immunity Clarification Act clarifying the 1965 Immunity from Seizure Act, 22 USCS § 2459, seems to take the old adage - Beg, borrow or steal - to heart where the interests of American museums, if not necessarily the American public, are concerned. No doubt, lives of curators in American cultural institutions have been complicated by the fears of litigation and hesitance to loan art manifested by government-owned foreign art institutions. Supposedly loans requests have been denied once too often and the Association of American Museum directors lobbied for a new legislation plugging the gaping hole in the iron clad Immunity from Seizure Act, a hole created by the application of the Foreign Sovereign Immunity Act, 28 USCS § 1605, to problematic art loans thanks to the 2005 Malevich decision, 362 F.Supp.2d 298 (2005).

In short "The new bill, sponsored by Senators Dianne Feinstein, Democrat of California, and Orrin Hatch, Republican of Utah, would in effect overturn the judge’s decision and bar lawsuits, except those related to art looted by the Nazis or their agents. The bill would cover loans from the state-owned foreign museums like the Louvre or the Prado, but not private ones."

Perhaps. But the American public should ask, is this in our best interest? Do we want to protect possessors of stolen property and enjoy site of objects taken from their rightful owners under unsavory, how is that for a sanitized word, circumstances? Is there so little other art in the world that can be borrowed without putting our perceptions of right and wrong aside for a temporary show? There are always competing interests and the decision whose interest ought to prevail should not be made lightly.

One one hand there is the 1965 law that protects temporary loans of art works of cultural significance. 22 USCS § 2459 reads in part "[w]henever any work of art or other object of cultural significance is imported into the United States from any foreign country, pursuant to an agreement entered into between the foreign owner or custodian thereof and the United States or one or more cultural or educational institutions within the United States providing for the temporary exhibition or display thereof within the United States at any cultural exhibition, assembly, activity, or festival administered, operated, or sponsored, without profit, by any such cultural or educational institution, no court of the United States, any State, the District of Columbia, or any territory or possession of the United States may issue or enforce any judicial process, or enter any judgment, decree, or order, for the purpose or having the effect of depriving such institution..."

On the other hand Foreign Sovereign Immunity Act limits immunity in cases where any sovereign holds property rights, "in violation of international law ...  and that property or any property exchanged for such property is present in the United States in connection with a commercial activity carried on in the United States by the foreign state..."

A venn diagram of the two laws shows an overlap and thus protection from legal action for privately owned institutions and threat of litigation to government owned institutions. The new Act is clearly sensing a discrepancy in treatment of different categories of lenders. Is the proposed solution fair?

Lady Justice is blind. Let her keep her eyes closed to the magnificent if pirated art works that are on the walls of the institutions outside of the United States and decide which interests outweigh: entertainment and aesthetics of many or rightful property rights of the few. If she does sneak a peek at the contested canvases and sculptures, she too may be seduced and tip the scales in favor of the museums.

For additional commentary read The New York Times.

What is Art Law: Part II

What isn't Art Law? Before The Encyclopedia Britannica went out of book printing business, and long before the field of "art law" crystallized, scholars in different discipline wrote about "the art of [you fill in the blank]." Until New York Public Library on the 42nd Street implements its ambitious yet shortsighted Central Library Plan, you should easily access such titles as The Art of Family Law (Edinburgh, 2011), The Art of War at Sea (London, 1788), The Art of Cookery (Boston, 1798), The Art of Swimming (London, 1699), and hundreds others titles on the subject of specializations that rise to level of art when perfected. Granted, there is no book on the art of art law, yet.

Law and the arts (fine, performing, graphic and everything in between) are ubiquitous, you just have to look and listen. Those who pay attention realize that issues such as copyright of works in public domain that were pulled back under the copyright act in the Supreme Court Decision of Golan v. Holder, 132 S.Ct. 873 (2012)are art law relevant. Those who attended the Cariou v. Prince, 784 F.Supp.2d 337 (2011) appeal hearing at the 2nd Circuit on Monday, May 21, 2012 realized it was a manifestation of art law. There, three presiding judges, having heard cases on sexual abuse, maritime law and arbitration moments earlier, conceded that the decision regarding multi-million dollar art works of Richard Prince derived from photographs of the little-known Patrick Cariou was "very important" and granted as much time to the counsel as was necessary to argue transformative use and the effect of Prince's work on the potential market of Cariou's works. The Order Granting Joint Motion to Dismiss allegations of artists and their heirs against auction houses for failing to comply with California Resale Royalties Act issued on May 17, 2012 fell squarely under the art law umbrella. The Foreign Cultural Exchange Jurisdictional Immunity Clarification Act proposing smooth sailing in borrowing art of dubious provenance from foreign sovereigns currently in review at the Judiciary Committee is ... well you get the picture.

That's four recent examples, of so many more. And yet, somebody is sure to ask about all the examples of cases and transaction that have nothing to do with the arts, a multitude that has nothing may touch on the interests and needs of artists, collectors, dealers, museums, galleries, etc. Well if it is not art law, then clients better hope their counsel is representing their interests at the highest level of artistry. 

Sources: The Chronicle of Higher Education;  The New York Times; and others.

Spring Cleaning -- Free Offprints

In case you missed "Human Rights and Cultural Heritage: from the Holocaust to the Haitian Earthquake" (March 31, 2011) and "Art as Investment: Legal and Business Issues Examined" (April 4, 2012) CLE programs but would like to receive a free copy of the packets distributed at these events, email cardozoartlaw@gmail.com. You will need to pay for postage and the cases and articles dealing with Nazi-era looted art, restitution of cultural heritage, FSIA, and various tax issues are yours as light summer reading.

Unwanted packets will be recycled by June 1st.

Failed-Artist-Turned-Forger Sentenced to Two Years in Prison

William "Billy" Mumford, master counterfeiter extraordinaire, has been found guilty of forging up to 1,000 paintings and was sentenced to two years in jail at Southwark Crown Court for conspiracy to defraud.

Mumford will likely go down as one of Britain's most prolific forgers. Working from a small bedroom in a rented house, Mumford created an average of four paintings a week for a period of five years. His most notable knock-offs included post-independence period painters Sayed Haider Raza and Maqbool Fida Husain ("India's Picasso"), as well as Welsh landscape painter Kyffin Williams and surrealist John Tunnard. His forgeries fooled hundreds of experts and buyers alike, selling on Ebay and reputable auction houses throughout the world for large sums of money. For example, two of his paintings were first authenticated at Bonham's in London and subsequently sold in Dubai for $40,000 USD.

Mumford employed a group of conspirators--including his wife Daphne and other associates Martin and Karen Petrovsky and Anthony Resse--who also received prison sentences for receiving 20% of the proceeds.

The scam was first identified in April, 2009, when Scotland Yard was contacted by an auction house, which found the number of works offered by M.F. Husain unusually high. During a raid in  Mumford's home in West Sussex, police discovered hundreds of paintings, as well as stamps, ink pads, and authentic Victorian paper used to create phony provenance documents.

Perhaps the most poignant twist in this story is that Mumford is, himself, just a frustrated artist. He set out be a painter, but ended up as a chef in a local pub. He told the Independent, "For 40 years, I had painted the same picture, then I put a different name on it and they queued up... I know it sounds a bit stupid but maybe it was my revenge on the art world. But I would have rather remained a failed artist than a successful forger."

Be that as it may, Mumford certainly gained his moment in the art world spotlight. His masterful execution of the paintings, together with his expert counterfeiting skills have earned him widespread notoriety and created a trail of forgeries that will take years to uncover. Police have located 40 fake paintings so far but have yet to track down hundreds more circulating in throughout the international art market.

Q: What do Titanic and Picasso have in common?

A: James Cameron! Last month, The Art Newspaper reported on a letter sent by the Artists Rights Society to James Cameron seeking compensation for the use of a Picasso's image in Cameron's 3D re-released "Titanic." 

The very same image of Picasso's1907 painting "Les Demoiselles d’Avignon" (a work that did not sink with the doomed ship) was used already in the original 1997 version, and another copyright infringement claim was settled at the time of the original release. However, the first settlement did not contemplate the new version of the film and with the new use comes the new claim. After all, the Picasso estate did not give its permission to use the painting in 3D. Spectators can only speculate as to the enhanced qualities of the impending settlement.

Source: The Art Newspaper.

Protect Cultural Heritage This Summer!

One Houston lawyer, Joe Gutheinz, is on a mission. He decided to take up the quest to identify and find the missing moon rocks.

The story goes as following: "Over 500 pieces of moon rocks, meteorites, and other space fragments were either stolen or have been missing since 1970, experts say. Now, a former NASA investigator is on a quest to find them. Joe Gutheinz is on the hunt for rocks brought back to Earth and then subsequently lost after being loaned to scientists, museums and agencies globally." 

Apparently nobody or not everybody who should is keeping track of loaned rocks and they are disappearing. Few private individuals in possession of these rarities care that they may be illegally possessing federal government property.  Gutheinz hopes to increase security in museums and return some of the missing rocks back to the display cases. What is your summer resolution?


Source: Sci-TechToday.com

Houston lawyer Joe Gutheinz on quest to identify and find missing moon rocks

More Information: http://www.artdaily.org/index.asp?int_sec=2&int_new=55363[/url]
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Getty Stands to Lose Not Just Marbles

On May 4, 2012, Jason Felch, one of the co-authors of "Chasing Aphrodite" reported that "An Italian court has upheld an order for the seizure of a masterpiece of the J. Paul Getty Museum's antiquities collection, finding that the bronze statue of a victorious athlete was illegally exported from Italy before the museum purchased it for $4 million in 1976."

Source: LA Times.

Footnote: Supreme Court Declines Review of Black Swan Case

On May 14, 2012, US Supreme Court made known that it had nothing to do about $500 million in silver and gold coins that Odyssey recovered from a Spanish warship in international waters.

For more, if there is any, see: Legal News.

Derivative Work -- Art as Investment Inflation

On May 15, 2012,  Artvest presented a program entitled "Art as an Investment: The Fundamentals." Speakers' list included:

• Michael Plummer, Principal, Artvest Partners LLC 
• Jeff Rabin, Principal, Artvest Partners LLC 
• Thomas Galbraith, artnet, Director of Analytics – Art market analysis & reporting 
• Michelle Bergeron Spell, Herrick, Feinstein LLP, Partner – Trusts & estate planning for art collectors 
• Jodi Kimmel, Frank Crystal & Company, Senior Account Executive – Insurance, appraisals & art collection management 

The program was billed as a "half-day professional level course on navigating art investment, taught by seasoned industry leaders." The program included overview of art lending landscape and sector performance and risk attributes, art exchanges and indexes, strategies for managing risk in various portfolio, analysis of auction house results, guarantees and much more. Imitation is a highest form of flatter, so is emulation. On April 4, 2012, Cardozo hosted a program with a strikingly similar bill -- Art as Investment. The line up was as illustrious albeit smaller and the earlier panel lasted two hours.

The first program was free, including valuable CLE credits, the second came with a price tag of $395 ($350 for early registration). What does that mean? It means that either the next Art as Investment program will be estimated in excess of the latest tag or fail to sell as inauthentic.

Additional information: Artvest.

Court Allows Ai Weiwei Tax Lawsuit

The Associated Press reported that "Chinese artist and dissident Ai Weiwei will challenge the 2.4 million dollar tax bill levied on him by is government. He would put up over half of the total amount (8.5 million Yuan) as collateral to begin legal proceedings, which could drag for a year."

Chinese dissident artist Ai Weiwei says a court in Beijing has accepted a lawsuit his design firm has filed against a tax office for levying a $2.4 million bill on his company.

More Information: http://www.artdaily.org/index.asp?int_sec=2&int_new=55252[/url]
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Chinese dissident artist Ai Weiwei says a court in Beijing has accepted a lawsuit his design firm has filed against a tax office for levying a $2.4 million bill on his company.

More Information: http://www.artdaily.org/index.asp?int_sec=2&int_new=55252[/url]
Copyright © artdaily.org

Chinese dissident artist Ai Weiwei says a court in Beijing has accepted a lawsuit his design firm has filed against a tax office for levying a $2.4 million bill on his company. Ai said Wednesday the court accepted a lawsuit filed by his company, Beijing Fake Cultural Development Ltd., against the No. 2 Inspection Squad of the Beijing tax bureau. Ai says the tax office violated laws in handling witnesses, evidence and company accounts in his case.

More Information: http://www.artdaily.org/index.asp?int_sec=2&int_new=55252[/url]
Copyright © artdaily.org

Chinese dissident artist Ai Weiwei says a court in Beijing has accepted a lawsuit his design firm has filed against a tax office for levying a $2.4 million bill on his company. Ai said Wednesday the court accepted a lawsuit filed by his company, Beijing Fake Cultural Development Ltd., against the No. 2 Inspection Squad of the Beijing tax bureau. Ai says the tax office violated laws in handling witnesses, evidence and company accounts in his case.

More Information: http://www.artdaily.org/index.asp?int_sec=2&int_new=55252[/url]
Copyright © artdaily.org

Source: ArtDaily.com

Derek Fincham interviews Legal Counsel in Ministry of Foreign Affairs of the Kingdom of the Netherlands

Nout van Woudenberg is an author of the newly published volume entitled "State Immunity and Cultural Objects on Loan." He was recently interviewed by Derek Fincham, who reports that  immunizing art from potential suit is an important but criticized step which assures lenders that their property is safe from seizure and will be returned post exhibition. First question:


Setting down to write, what was your aim with ‘State Immunity and Cultural Objects on Loan’?

Some years ago, it occurred to me that it was not clear whether States actually knew what the current state of affairs was with regard to immunity from seizure of cultural objects belonging to foreign States while on loan abroad. In 2004 the convention on jurisdictional immunities of States and their property had been established under auspices of the United Nations, addressing, among other things, immunity for cultural State property on loan. But that convention has not yet entered into force. I thus considered it necessary to investigate whether another rule of international law was already applicable: a rule of customary international law. After all, that rule would be binding upon States, without necessarily becoming a party to a convention.

For the full interview, visit Illicit Cultural Property Blog.

Love goes to War -- Monaco Collector Sues Robert Indiana

Robert Indiana is known for his "Love" sculpture. Now, he is also becoming known as a defendant in a breach of contract case brought by Joao Tovar,  a Monaco collector with sculptures that Indiana renounced. Tovar purchased ten works attributed to Indiana with certificates of authenticity (as every savvy collector should these days collecting works by living and thinking artists) from John Gilbert, Indiana's business associate.  His sculptures were called "Prem" or love in Hindi and were appraised in 2009 at $1.5 million.

Indiana, 83, resident of Maine, having settled another suit with Gilbert regarding their business and artistic relationship, rejected the Tovar sculptures as his own works. According to the settlement terms, Gilbert is prohibited from claiming that Indiana had anything to do with the "Prem" works. In the mean time, Indiana is reported to have said that "Prem" is a monstrosity and that the design resembles a refrigerator.

Source: The New York Times; Chicago Tribune.

Note to self: Make art not war. Make love not war. Make love-inspired art not litigate.

Knoedler Under Attack: The Diebenkorn Chapter

The closing of Knoedler & Company gallery sent a ripple through the art market, which will take years to settle.  One of the players in the fight against the gallery and its former president, Ann Freedman, is the Diebenkorn clan, which is trying to build a case using events dating back to 1993, when the gallery acquired drawings attributed to Richard Diebenkorn. Apparently, Knoedler was the official gallery for Diebenkorn's works for more than 20 years.

According to the Diebenkorn family, authenticity of two works acquired from a Long-Island dealer, Glafira Rosales, was doubted immediately after they arrived at Knoedler. Still they were sold despite their concerns. Attorney representing former president of the gallery, Nicholas Gravante, Jr., of Boies, Schiller & Flexner LLP, avers that there is definitive documentary evidence confirming that works were viewed by the family and deemed authentic.

The gallery is facing suits from collectors who have purchased paintings attributed to Jackson Pollock and Mark Rothko. They are seeking a reported $42 million in damages.

Source: The New York Times.

Image: R. C. Kemper Charitable Trust. One of the drawings said to be by Richard Diebenkorn that is in dispute.

Authentication Committees Disappearing, are Auction Houses Next?

Auction houses are unlikely to go by way of Authentication Boards, after all, selling works of art and valuable cultural objects is on average more lucrative than issuing scholarly opinions.  Still auction houses are often in the center of legal disputes.  For example, last month in New York, Federal agents moved to seize a thousand-year-old Cambodian statue from Sotheby’s, one of two best known art auction houses, alleging that Sotheby’s decided to put up a figure of a 10th-century warrior for auction despite knowing that it had been stolen from a temple during the upheavals of the Cambodian civil war in the 1970s.  As one of its responses, Sotheby’s issued a statement that it had been in discussion with the American and Cambodian governments for a year before Federal Government acted. “Given that Cambodia has always expressed its desire to resolve this situation amicably,” the statement said, “and that we had an understanding with the U.S. attorney’s office that no action would be filed pending further discussion towards a resolution of this matter, we are disappointed that this action has been filed and we intend to defend it vigorously.”

Source: The New York Times.

News of Interest Around the World: Austria, Mexico, UK, Palestine, Egypt

Austria-Mexico Treaty Could Facilitate Loan of Feathered Crown -- "The Austrian government has approved a bilateral pact with Mexico governing the loan of cultural artifacts, an agreement that could pave the way for a headdress believed to have been worn by Aztec ruler Montezuma II to be temporarily brought to the Latin American country.

The treaty, negotiated over nearly two years and approved earlier this week by Austria’s Cabinet, is aimed at resolving a decades-long dispute over the spectacular feather-work crown, a spokesman for Austria’s Culture and Education Ministry told Efe Thursday."

Source: Latin American Herald Tribune.


Tax-relief cap will curtail major gifts -- "Major projects planned by the UK’s leading arts organisations and museums are threatened by tax changes that the British government is proposing in an attempt to close loopholes enjoyed by the super-rich. In his March budget, the chancellor of the exchequer George Osborne announced a tax-relief cap on annual donations to charity above £50,000 or a quarter of an individual’s income, whichever is greater. Critics argue that this will discourage very large charitable gifts, and pressure to force a U-turn was mounting as we went to press."


Source: The Art Newspaper.


Palestine Ratifies the Convention on the Means of Prohibiting and Preventing the Illicit Import, Export and Transfer of Ownership of Cultural Property -- "On 22 March 2012, Palestine deposited with the Director-General its instrument of ratification of the Convention on the Means of Prohibiting and Preventing the Illicit Import, Export and Transfer of Ownership of Cultural Property."

Source: UNESCO.


Dealer Admits to Smuggling from Egypt -- "An antiques dealer pleaded guilty ... to smuggling ancient Egyptian treasures, including a coffin, to the United States.

Mousa Khouli, also known as Morris Khouli, aged 38, faces up to 20 years of prison for “smuggling Egyptian cultural property into the United States and making a false statement to law enforcement authorities,” the federal prosecutor's office in New York said."

Source: Independent Online.