We recently reported on the denial by the U.S. District Court for the Southern District of New York of an art seller’s motion to dismiss a buyer’s claim for breach of contract arising out of the seller’s alleged failure to comply with resale restrictions contained in a contract governing the
Continue Reading Another Dip into Resale Restrictions: When Are Restraints on Alienation Unreasonable?
On April 22, 2024, U.S. District Judge J. Paul Oetken of the Southern District of New York denied an art seller’s motion to dismiss a buyer’s claim for breach of contract arising out of the seller’s alleged failure to comply with resale restrictions contained in a contract governing the seller’s
Continue Reading Cloudy with a Chance of Liability: Art Seller Must Face Suit for Breach of Warranty of Good TitleArt may be in the eye of the beholder, but art valuation for tax purposes is in the eye of the IRS.
Improper deductions based on inflated art valuations are now in the agency’s crosshairs, part of an ongoing expansion of audit and investigations into charitable deductions for art
Continue Reading Avoiding IRS Art Donation Audits Requires an Up‑Front Checklist
The sudden emergence of the COVID-19 pandemic in the U.S. in March 2020 forced performance venues, auction houses and event spaces to cancel events, depriving artists and venues of thousands, and in some cases, millions of dollars. When the inevitable lawsuits ensued, and plaintiffs demanded compensation for non-performance of their
Continue Reading Courts on Both Coasts Find that the COVID-19 Pandemic Falls Within “Force Majeure” Clauses
On February 4, 2022, the Treasury Department published its Study on the Facilitation of Money Laundering and Terror Finance Through the Trade in Works of Art (the “Report”).[1] To the surprise of many and the relief of the U.S. art market, the Report concluded that there was no immediate
Continue Reading U.S. Treasury Study Rejects Immediate Need for New Regulation of Art Market
On January 1, 2021, Congress voted to override President Trump’s veto of the National Defense Authorization Act for Fiscal Year 2021,[1] which includes provisions that will have significant implications for the antiquities market, and could eventually impact the art market as well.
The New Legislation Extends Bank Regulations to
Continue Reading National Defense Authorization Act Imposes Anti-Money Laundering Regulations on Antiquities Market and Calls For Study on Role of Art Market in Money Laundering
On December 16, 2020, Judge Denise L. Cote of the U.S. District Court for the Southern District of New York found that London-based auction house Phillips Auctioneers (“Phillips”) properly terminated its agreement governing the auctioning of a Rudolf Stingel painting for force majeure after postponing its spring auctions in the
Continue Reading Southern District of New York Finds that Phillips Auction House Properly Invoked Force Majeure Clause to Terminate Consignment and Guarantee Agreement in the Midst of the COVID-19 Pandemic
On October 30, 2020, the U.S. Department of the Treasury, Office of Foreign Assets Control (“OFAC”), which administers and enforces American economic sanctions, issued an advisory titled “Advisory and Guidance on Potential Sanctions Risks Arising from Dealings in High-Value Artwork” (the “Advisory”). OFAC considers “high-value” any artwork valued at over
Continue Reading OFAC Issues Advisory on Sanctions Risks in Dealing with High-Value Artwork
On July 29, 2020, the Senate Committee on Homeland Security and Governmental Affairs issued a 150-page bipartisan report that identifies the art market both as the “largest legal, unregulated market in the United States” and a significant weakness in the nation’s sanctions and anti-money laundering regimes.[1] The Senate Report
Continue Reading Senate Report Documents Russian Oligarchs’ Use of the U.S. Art Market to Launder Money
On June 9, 2020, the Second Circuit effectively terminated Sotheby’s efforts to bring suit against a foreign nation for interference with one of its auctions, reversing and remanding Barnet v. Ministry of Culture and Sports of the Hellenic Republic to the Southern District of New York with instructions to dismiss
Continue Reading Second Circuit Holds that FSIA Bars Suit Against Sovereign Asserting Cultural Patrimony Claim