MANHATTAN (CN) – A Russian billionaire who allegedly overpaid to the tune of $1 billion for his collection of Picassos, da Vincis, Rothkos and Modiglianis ramped up his litigation efforts Tuesday with a suit against Sotheby’s.
Represented by the Fifth Avenue firm Emery Celli, Dmitry Rybolovlev filed the new action via two offshore companies owned by his family trust.
The suit against Sotheby’s is in Manhattan, where Sotheby’s is headquartered, but Rybolovlev has over the years instituted civil and criminal proceedings around the world related to what he calls “the largest art fraud in history.”
Rybolovlev, who sold two Russian fertilizer producers for almost $7.5 billion in 2010 and 2011, claims that Swiss art dealer Yves Bouvier overcharged him on 38 artworks that he purchased for $2 billion between 2003 and 2015. A dozen of these masterpieces were sold through the Sotheby’s, and Rybolovlev says the auction house “was uniquely positioned to understand — and to facilitate — Bouvier’s breathtaking fraud. “
“Sotheby’s actions instilled Plaintiffs’ trust and confidence in Bouvier and rendered the whole edifice of fraud plausible and credible,” the complaint states.
Rybolovlev seeks $380 million in damages from Sotheby’s, saying it “affirmatively assisted Bouvier by arranging for him to acquire artworks at certain prices that the sellers were willing to accept, and by sending him emails intended to help him convince plaintiffs to pay Bouvier fraudulently inflated prices.”
Also by providing Bouvier with inflated appraisals on demand, according to the complaint, Sotheby’s “lent a veneer of legitimacy and expertise” to Bouvier’s machinations.
Artwork named in the suit include Magritte’s “The Domain of Arnheim,” Mark Rothko’s “No. 6 (Violet, Green and Red),” Gustav Klimt’s “Wasserschlangen II” and Amedeo Modigliani’s “Tête” sculpture.
In 2016, Sotheby’s filed a pre-emptive lawsuit seeking to absolve itself from a potential RICO lawsuit arising from Rybolovlev and Bouvier’s feud over the $80 million sale of Leonardo Da Vinci’s “Salvator Mundi.”
Sotheby’s and Bouvier also sued Rybolovlev jointly in Geneva in 2017 to block the Rybolovlev’s planned lawsuit in the U.K.
Rybolovlev claims their coordination underscores their common interests.
In response to Tuesday’s lawsuit, Sotheby’s said it will be moving to dismiss the action in New York and while continuing the litigation in Switzerland.
“Mr. Rybolovlev’s latest desperate lawsuit is entirely without merit, and we will vigorously defend the company and our employees against these baseless claims,” Sotheby’s said in a statement Wednesday. “The false allegations that Mr. Rybolovlev is making are already being litigated in the Swiss courts, which is the appropriate venue for this case.”
Bouvier, who is linked to infamous high-profile forgers and also faces accusations of stealing famous paintings, was arrested in early 2015 in Monaco.
Rybolovlev, who resides in Monaco, filed a criminal lawsuit against Bouvier there for fraud and money laundering. He also joined similar lawsuits against Bouvier in France and Singapore, where Bouvier’s assets are now subject to a freeze by Singapore’s high court. The judge in the Singapore case has stayed that litigation, however, leaving only the criminal lawsuits in France and Monaco active. Rybolovlev has also petitioned the U.S. District Court for the Southern District of New York for discovery of documents from Sotheby’s for use in the lawsuits.
A federal judge ruled in favor of Rybolovlev in October 2016, writing that as long as the art collector could show the documents sought were used at one point, discovery should be allowed even if damages are not sought.
The Second Circuit signed off on the discovery order in August 2017.