Some art aficionados in California may have heard about a dispute between companies owned by two prominent art collectors involving a mixed-media work by Frank Stella that has resulted in a lawsuit against another gallery. The lawsuit was filed by Artemus in July in the New York Supreme Court against the Paul Kasmin Gallery. It alleges that the gallery falsified documents related to the Stella work.
According to the lawsuit, in 2016, there was a transaction between dealer Anatole Shagalov and his gallery, Nature Morte, and an art leasing company founded by collector Asher Edelman, Artemus. In all, there was a $3.4 million transaction between the two, and the Stella work was included along with a number of others. However, Artemus alleges that Kasmin still had a 40 percent share in the Stella painting and that this information was not disclosed.
Furthermore, Artemus says Shagalov instructed Kasmin to create false invoices. Artemus cites this as proof that Kasmin knew Shagalov planned to sell the work. Kasmin says it had no intent to defraud and that the portion of the painting that still belonged to the gallery was negligible compared to the overall transaction. It says its stake was irrelevant to Artemus' decision to go ahead with the deal.
As this case demonstrates, there is an enormous scope for the types of cases that may arise in business litigation although they often fall into broad categories such as fraud or contract disputes. Whether the industry is art, construction, retail, technology or something else, companies may want to consult attorneys at various stages in a business transaction to make sure they are protecting themselves legally and are not leaving themselves open to accusations of wrongdoing.Source: ArtNet News, "An Art Leasing Company Is Suing Paul Kasmin Gallery for 'False Invoices' in the Sale of a Pricey Frank Stella," Sarah Cascone, 8/24/2018