Brussels Advocates for Stricter Money-laundering Rules

Art Market is notoriously opaque. Only the tip of the iceberg is visible as far as transactions and deals are concerned.  In an effort to regulate the art market, Belgium is considering changes to money-laundering legislation, which could mean that art galleries will need to register as “high-value dealers” and comply with stricter guidelines when accepting cash from buyers. "At the moment, galleries and auction houses must register as high-value dealers if they accept cash transactions of €15,000 or more." Apparently, the European Commission recommended lowering this threshold. One of the leading art attorneys with Withers, was quoted as saying “Lowering the threshold will not make life more difficult for money launderers... It will, however, make business more difficult for the art trade. It is the smaller dealers in antiques and lower-end fine art who accept cash: and they’re the ones suffering most in this economic climate.”

For the full article, visit The Art Newspaper.

Dewey and LaBoeuf Rejects Leases, but What Will Become of its Art?

As fallen law firm Dewey and LaBoeuf LLP considers measures to satisfy creditors in the wake of recently filing for bankruptcy, the question presents itself: what will happen to the firm's "stuff"--namely, the firm's collection of art? The firm's restructuring officer explained: "With the exception of a sublease in the Debtor's former New York City offices (currently being utilized for wind down purposes), the Debtor no longer has a continuing use for the Leases associated with those offices. Additionally, except for certain Artwork in its Houston, Texas, and Los Angeles, California offices, the Debtor no longer requires the Non-Essential Owned Property contained in its Closed Offices."

One measure the firm has taken is attempting to reject its leases for its offices. Dewey wants to reject leases at least 14 U.S. properties, including the one covering the executive floor of its Manhattan headquarters at 1301 Avenue of the Americas, as well as leases for offices in London, Beijing, and Sao Paulo. According to a motion filed in bankruptcy court on Wednesday afternoon, the firm explained that keeping the leases will not benefit the estate and "is not necessary in the wind down of operations." The law permits such lease rejections, but court approval is required. 


Less certain is what will happen to the firm's collections of art at these locations worldwide. Recently, Above the Law reported that, "Dewey is quietly removing the art from the walls. Perhaps it belongs to the creditors?" There are varying opinions on what will become of the artwork. Since the artwork ostensibly belongs to the firm, creditors should be able to reach the firm's pieces in the event of bankruptcy. However, not all firms keep strict records of its acquisitions and artworks that were received as client gifts and through other less traditional means may be difficult to track down. As the defunct firm scrambles to pay off its debts, it is unclear whether the artwork that used to adorn its walls will remain in the firm's possession or serve to pay off bills.

Sources: Dewey Docket: Dump the Leases, Keep the Art, "Take My Firm, But Leave the Art": Bankrupt Law Firm Tries to Retain Artwork

Censorship and Taxes: The Latest Developments in Ai Weiwei's Legal Battles with the Chinese Authorities

China's most infamous dissident artist, Ai Weiwei, claims that he was barred from attending his court hearing yesterday, June 21, in his lawsuit against a governmental tax agency due to police warnings and intimidation. Chinese courts, which are controlled by the ruling communist party, rarely accept lawsuits filed by dissidents or their relatives. However, last month, Beijing's Chaoyang district court agreed to hear the artist's claim that his company, Fake Cultural Development Ltd, was illegally fined 15 million yuan--or $2.38 million--in back taxes last year.

However, the court's decision appears to have been been accompanied by efforts to keep the artist from actually attending trial. Ai's legal consultant, Liu Xiaoyuan, has been missing since he was told to meet state security officers last Tuesday. The artist also told CNN that the police started calling him repeatedly, warning him not to come to court. He also said that an unprecedented thirty police cars were parked outside his house yesterday. 


Infamous for his widespread use of Twitter to communicate with the public, Ai remained true to form. He continually tweeted updates on the police barricade outside his studio and sarcastically thanked the Chinese authorities for protecting the artist's Caochangdi studio and "preventing unknown forces from interfering with judicial order." He also tweeted a picture of himself in a police uniform.

This lawsuit is the most recent development in a series of run-ins with the Chinese authorities. In April of 2011, he was detained for 81 days without charge and ordered to pay 15 million yuan in back taxes, which officials said he owed through his company. Ai and his supporters have said that these allegations are a cover for accusations that he is trying to overthrow the state. The artist was held mainly in solitary confinement until he was released in June. 


However, governmental efforts to silence Ai have consistently failed, as overwhelming public support and donations were sent to the artist in response to the tax penalty. Roughly 30,000 people donated money to help Ai cover the bond required to contest the tax charges.He paid 8.45 million yuan late last year in order to contest the charges. The artist also stated that his wife would have been jailed if he had not paid the sum at that time.

In response, a Chinese foreign ministry spokesman declined to comment directly on Ai's allegations. Hong Lei told international journalists on Wednesday that "China is a country of laws... China's constitution and laws protect citizens' legal rights." Ai said that the police actions are contradictory and "really harming the legal process."

Ultimately, the artist chose not to attend trial, but did send his wife, Lu Qing, to court in his place. Supporters, critics, and the international community await developments in the struggles between the artist and the authorities as they unfold.

Sources: China Dissident Ai Weiwei Harassed by Police, He Says, Ai Weiwei's Lawyer Missing as Artist is Warned Away from Tax Hearing

WikiLoot: Crowdsourcing to ID and Recover Cultural Heritage

WikiLoot.com is a blank page. But there is a buzz on the nets about the idea that Jason Felch, co-author of "Chasing Aphrodite" is pitching to the academic and law-enforcement community. He wants to put information about stolen artifacts: police reports, unpublished photos, and research documents into a crowdsourcing data base. In an article by the Guardian, Felch was quoted as saying "It's all raw, unprocessed data. Researchers can use it, but we also hope the public can use it to find out a bit more about what is on display at their local museum." The database would contain information about objects looted from Europe as well as South-East Asia and South America.

Felch's first step towards implementing the bold idea is fundraising. He is currently applying for grants and speaking to all who would find this resource of help. Some investigators are cautiously optimistic about WikiLoot, while this resource may help track down hundreds of artifacts it could also force collectors to hide their collections. 

Source: The Guardian.

Censorship at the Kiev Biennale: "Apocalypse and Renaissance at the Chocolate House" Closes Its Doors

Rumors have circulated that one of the current Kiev Biennale's events, "Apocalypse and Renaissance at the Chocolate House," was torn down on government orders. Officially, the decision to close the exhibition came from the Chocolate House--which is owned by the Kiev National Museum of Russian Art. However, it is believed that the Ukrainian National Expert Committee for the Protection of Social Morality forced the museum to close its doors.

The project was to take place as part of ARSENALE 2012, the first Kiev international biennale of contemporary art. The project was conceived by renowned contemporary artist Oleg Kulik, which turned a prominent turn of the century estate into a gallery space for the work of 43 Ukrainian and Russian artists, whose often politically and socially subversive work presented "a vision of a rebellious world in a state of transient calmness."

It appears to have been Andrey Kuzkin's video installation "Natural Phenomemon"--widely considered to be the best work in the show--that sealed the fate for the exhibition. The work presented naked figures with their upper bodies buried in various landscapes. It was also seen at last year's Venice Biennale. Other acts of censorship at the exhibit included the removal of protest figures from an installation by Aleksey Knedlyakovsky and Lusine Janyan before the exhibition opened, and the removal of portions of an audio track for Dmitry Gutov's installation "I'm Stepping on Concealed Spots."

Tatyana Syrda, Chocolate House directors, and Yuiry Vakulenko, director of the Kiev National Museum of Russian Art released a statement that the National Expert Committee concluded that the exhibition's pornographic material would "cause harm to the physical health and emotional well-being of visitors and museum staff." The exhibition's curators, Konstantin Doroshenko and Anastasia Shavlohova, wryly pointed out that the process of closing the exhibit down was carried out through covert methods in the "best Soviet traditions."

Decision Announced in Diamantides Suit Against Sotheby's

Earlier this week, Sotheby's and one of its specialists were found guilty of selling a fake painting by Greek artist Constantin Parthenis. As we reported earlier in Disputed Greek Art: First Water Diamonds or Forgeries, Greek shipping tycoon Diamantis Diamantides filed this lawsuit against Sotheby's in January, alleging that the auction house fraudulently convinced him to buy two forgeries, one of which set a record for Parthenis in 2007, with the artist's "The Virgin and Child" selling for $843,600. This week, the court ruled that the painting was a forgery and ordered that Sotheby's and its specialist pay Diamantides $1.16 million.

Sotheby's spokesperson Diana Phillips told ARTINFO that the auction house plans to appeal the decision. She said, "It stands to reason that an auction house which sells art worth billions of dollars per year and relies on its reputation to secure consignments and purchasers would not put its business at risk by knowingly selling forged works."


The timing was bad for Sotheby's, which was in the middle of its European Paintings sale in London. The auction featured work by Greek artists such as Constantinos Volanakis and Nikos Hadjikiriakos-Ghika, but failed to sell most of its Greek works.

Ever since the Greek art market began to take off in 2001, collectors have been reluctant to voice concerns that purchased art may be forgeries. Experts say that there is a general lack of trust in the justice system and novice buyers do not want to draw attention to their mistakes. These concerns clearly did not keep Diamantides from bringing his claim. Perhaps this lawsuit will lead others to come forward about allegedly fraudulent sales.

"Legal Basics for Artists" In Brooklyn

On June 1, 2012, New York State Bar Associations Entertainment Arts and Sports Law Section (EASL) presented an art law panel at the Bushwick's Open Studio in Brooklyn. Carol Steinberg, member of the EASL's Pro Bono Steering Committee, participated and wrote about the event. Her post is found on EASL's website and is reprinted here in parts.




"...The event was a great success, with much appreciation expressed by the artists and attorneys who attended. Judith Prowda, Immediate Past Chair of the Section, conceived the idea for a panel when she took her students from Sotheby's Institute of Art out to Bushwick earlier in the year. Judith moderated the panel, which consisted of "Copyright Basics", presented by Carol Steinberg, one of EASL's Pro Bono Steering Committee members, "Moral Rights", with Richard Altman, and "Artist-Gallery Agreements", with Megan Maxwell, EASL's Co-Chair of the Digital Media Committee. Innes Smolansky, EASL's Second Judicial District Representative organized the wonderful reception both before and after the panel discussion, which was enjoyed by all.

About 80 artists and a few lawyers attended the event, which consisted of a reception, panel discussion and Q&A. The program was held at the Diana H. Jones Senior Center in the heart of Bushwick, where photographer Daryl-Ann Saunders, curated a wonderful exhibit at the center itself.

... Each panelist spoke for 20 minutes, and Carol covered the basics of copyright and fair use, by focusing on how copyright is created, the exclusive rights of the copyright owner, work for hire, and the importance of registration. She showed images of Patrick Cariou's photographs from Yes Rasta and the appropriated images in Richard Prince' paintings, the subject of the Cariou v. Prince lawsuit, to illustrate the application of the fair use factors. Then she applied the legal basics to the BAM hypothetical and advised as to how the basic deal should be revised.

Richard Altman, who litigated at least two of the landmark Visual Artists Rights Act (VARA) cases, told the stories of important moral rights cases and showed a wonderful clip of the sculptural installation which was the subject of the Carter v. Helmsley-Spear litigation. (Carter v. Helmsley-Spear 71 F.3d 77 (2d Cir.1995), cert.den. 517 U.S. 1208 (1996)). He shared the story of the Soho Wall case, where artist Forrest Myers had been commissioned to erect projections on the wall of a building at Houston and Broadway. (Board of Managers of Soho Int'l Arts Condominium v. City of New York, 2005 U.S. Dist. LEXIS 9139 (S.D.N.Y. May 13, 2005)(decision after bench trial), 2004 U.S. Dist. LEXIS 17807 (S.D.N.Y. Sept. 8, 2004)(summary judgment decision) and 2003 U.S. Dist. LEXIS 13201 (S.D.N.Y., July 29, 2003). Subsequently, when the owner of the landmarked building wanted to remove the sculpture to use the wall for advertising, the City Landmarks Preservation Commission refused to permit it. Three-way litigation then ensued among the City, the owner and Myers, who engaged Richard to defend his rights under VARA. ...

Megan Maxwell then talked about contracts in general, typical agreements or lack thereof in the art world, and the artist consignment statute, which benefits artists by protecting the proceeds of sales of art and protects the art from the claws of creditors. Megan pointed out that contracts express the understanding of the parties and that many artists and galleries do not have written agreements. She discussed the basic provisions that should be included in artist gallery agreements and further described a gallery's fiduciary obligations to the artist. ..."

Source: EASL Blog.

Sotheby's Takes Action Against Cambodian Property Claim

United States Attorney's office is seeking forfeiture of a 10th-century Cambodian statute consigned to Sotheby's for auction by Mrs. Ruspoli di Poggio Suasa of Belgium.  Auction house intended to sell the work in March 2012, but the lot was pulled from the sale following Cambodian complaint regarding its provenance. The sandstone statue valued between $2 and $3 million was impounded from Sotheby's by the US Department of Homeland Security agents in April. It filed a complaint on behalf of Cambodia, as the rightful owner of the antiquity based on French colonial laws from the early 1900s.

On June 5, 2012, the auction house filed court papers to defeat the Government's actions challenging arguments that the statute was stolen and remained stolen when imported into the United States. Pursuant to Belgian law, bona fide purchasers gains ownership rights after six years of ownership and the statue was purchased by the consignor and her late husband in 1975.

Source: New York Times.

Disputed Greek Art: First Water Diamonds or Forgeries

In March 2011, when the Greek economic situation was emerging as an everyday topic and concern for the European Union, the Art Newspaper reported on a legal case filed in Athens by a Greek collector alleging paintings he purchased from Sotheby's were fakes. The collector, Diamantis Diamantides, purchased works by Constantin Parthenis in 2006 and 2007, during the boom for the Greek art market.   At the time, Diamantides' winning bids set records for Parthenis works; the paintings he purchased were consigned by the same party.  

Sotheby's was able to capitalize on the temporary boom in the art market by selling 15.6 million worth of Greek art in 2007. Reacting to the market trends, Sotheby's organized its first Greek specialty sale in 2008; and its last in 2011.  Sotheby's was not the only entity to react to the interest in Greek art.  Rumors of Greek forgeries penetrating the market began in 2008.  Diamntides' case is considered the first to bring a claim in court. One collector was reported as saying that Greek buyers tend to avoid talking about their mistakes so as not to "highlight their naivete and mistakes."

In the early 20002, the process of authenticating of works by Greek artists was made difficult by lack of scholars studying Greek artist, shortage of catalogues raisonnes and general inexperience with provenance research.  Even the practice of assessing works for national significance for the purposes of issuing export licenses did not include authentication work.  In light of the current economic conditions, authentication of art works is probably not a priority either, but then again, there are probably fewer Greek collectors looking to invest in art.

Source: Riah Pryor, "Fears grow that Greek art market is riddled with forgeries," The Art Newspaper, No. 233 (March 2012) 65.

Family of Holocaust Survivor Ordered to Return Artifact Taken from German Museum

In a reversal of the typical story involving looted art and the Holocaust, a state appellate court in Brooklyn, New York has ordered the family of a Holocaust survivor to return an ancient gold tablet to a German museum.

The artifact at the heart of the controversy is a 3,200-year-old Assyrian artifact, about the size of a passport photograph. It was taken from the Vorderasiatisches Museum in Berlin shortly after the end of World War II. The tablet was originally discovered by a team of German archaeologists in Iraq in 1913 and was acquired by the museum in 1926. When the war broke out in 1939, it was placed in storage for safekeeping with other antiquities. The tablet was missing when inventory was conducted after the end of the war.

The details of how Riven Flamenbaum came to possess the artifact are less certain, but the Auschwitz survivor acquired the object when he was sent to a displaced persons camp in southeastern Germany. Four years later, he brought his new wife and the artifact to New York City. The story was only unearthed after Flamenbaum's death in 2003, when his children discovered that the thin gold square had been stolen from the museum.

The museum brought suit, and in 2010, a Nassau County Surrogate Court judge ruled in favor of the Flamenbaum family, citing the failure of the museum to report the tablet as stolen and the lack of detail regarding Flamenbaum's acquisition of the tablet.

The appellate ruling reversed that decision.

Raymond J. Dowd, the lawyer who represented the museum and who has also represented Holocaust victims recovering stolen art in the past, called the decision historically significant. Dowd thinks that the precedent will aid other museums in the United States and in Europe to recover stolen property.

Conversely, the lawyer for the family, Seth A. Presser, called the decision a "remarkably inequitable result" and stated that the court "misapprehended certain facts." As for the family, Presser said that Flamenbaum's daughter explained that the family had no wish to sell the relic, but only wanted to pass it down through future generations as a reminder of the savagery of the Holocaust.

For more information: Nazi Victim's Family Told to Return Artifact

O'Keeffe Collection Sale Approved

The Tennessee Supreme Court upheld the decision allowing Fisk University to sell a stake in their 101-piece art collection donated by Georgia O'Keeffe. The lucky buyer-to-be is the Crystal Bridges Museum in Bentonville, Ark.

How did a historically black institution in Nashville obtain the $60 million collection? The story dates back to 1949, when O'Keefe donated 97 pieces from the estate of her husband, the photographer Alfred Stieglitz, which included works by Picasso, Renoir and Cezanne to Fisk. She died in 1986 and willed a few of her own paintings with a stipulation that the collection may not be sold or broken up. The University used to spend over $100,000 annually on displaying the collection and alleged that it could not afford to keep the collection according to the terms of the gift.


Following a protracted legal fight with the state attorney general, Fisk's plans to sell some of the works in the collection were granted and an innovative solution included shared custody of the works, which would move between Arkansas and Tennessee every two years.

Source: NYT.

Job Posting: Attorney-Advisor at the Smithsonian Institution

Job Title:Attorney-Advisor (General)

Agency:Smithsonian Institution

Job Announcement Number:12A-CR-297813-OTH-OGC

JOB SUMMARY:

This position is located in Office of General Counsel, OGC, Smithsonian Institution, which provides legal advice to the Smithsonian Board of Regents, the Secretary, and other executive and program officers on matters involving the administration of the Smithsonian's nine research centers, 19 museums and the National Zoological Park.  The incumbent of this position is responsible for providing legal advice in a fast-paced environment under the supervision of the General Counsel and the Deputy General Counsel.

• KEY REQUIREMENTS

  
  
• Pass Pre-employment Background Investigation
• Completion a Probationary Period
• Maintain a Bank Account for Direct Deposit/Electronic Transfer
• Males born after 12/31/59 must be registered with Selective Service.
• Submission of a Cover Letter

DUTIES:

Provides legal oversight for the planning, initiation, and direction of Smithsonian programs, including the impact of legal issues on Institutional policy.

• Provides guidance to Smithsonian officials and external organizations seeking assistance from the Office of General Counsel. 
• Drafts, reviews, and negotiates a broad range of contracts and other transactional documents, both federal and non-federal, with an emphasis on all aspects of procurement, construction contracts, and real estate transactions.
• Advises Smithsonian officials on matters related to privacy; represents the Smithsonian Institution in legal matters and administrative proceedings pending before a variety of agencies and administrative forums.

QUALIFICATIONS REQUIRED:

There is no OPM qualification standard established for positions in the Attorney-Advisor 0905 series, and agencies may establish their own standards for these Excepted Service positions. The Office of Human Resources, Office of General Counsel, Office of the Inspector General, and Office of Contracting and Personal Property Management established the following qualifications criteria for Smithsonian attorney positions:

A. Qualified candidates must (1) possess a Juris Doctor (J.D.) or equivalent degree from a law school accredited by the American Association of Law Schools, and (2) be a member in good standing of the Bar of a State or the District of Columbia.

To learn more, visit http://www.usajobs.gov/GetJob/ViewDetails/317779800.

Job Posting: Preservation Specialist in Cultural Heritage at the Smithsonian

Position:Preservation Specialist in Cultural Heritage

Agency:Smithsonian Institution

Job Announcement Number:12R-JC-297755-MPA-OUSHAC

This position is located in the Office of the Under Secretary for History, Art, and Culture. The employee coordinates the Smithsonian’s role in the preservation of cultural heritage materials in international and domestic museums, galleries, archives, libraries, and at archaeological and historic sites threatened by natural disasters, human conflict, and other challenges.

• KEY REQUIREMENTS

  
  
• Pass Pre-employment Background Investigation
• May need to complete a Probationary Period
• Maintain a Bank Account for Direct Deposit/Electronic Transfer
• Males born after 12/31/59 must be registered with Selective Service.
• Requires short-notice travel.
• Irregular tour-of-duty that may include weekends and nights in emergencies.

DUTIES:

• Develops a cultural heritage recovery strategy by coming up with a long-term role in preserving cultural heritage endangered by natural disasters and human conflict.
• Manages governmental and non-governmental partnerships by devising means of securing arrangement, permissions, and appropriate legal authority to operate within the jurisdictions of various cultural crises, domestically and internationally.
• Produces cultural heritage plans and program implementation by providing professional expertise and consultative advice, as well as establishing standards that enable cultural organizations to develop plans to avoid damage, rescue, recover, safe guard, and restore artwork, artifacts, documents, and media.
• Develops training by developing curricula, bibliographies, and resources for training courses, workshops, internships, simulations, and field experiences.
• Manages emergency response and cultural crises by coordinating the Smithsonian’s response to emergency and cultural crises in the U.S. and abroad.  Works closely with Smithsonian units and staff to develop and implement a plan of action, and coordinates such an effort with U.S. government, state, local, and foreign governments, as required.

FOR MORE INFORMATION

http://www.usajobs.gov/GetJob/ViewDetails/317429500