MANHATTAN (CN) — As a Russian billionaire's case against the famed British auction house Sotheby’s continues, a senior executive at the famed fine art auction house took the stand Tuesday and denied the institution’s culpability in an art dealer’s price-gouging scheme.
In a 2018 lawsuit, Dmitry Rybolovlev claimed that, from 2003 to 2015, Swiss art dealer Yves Bouvier hiked up prices on 38 artworks he sold to the fertilizer tycoon while collecting a 2% commission fee on the eight- and nine-figure deals. In sum, Rybolovlev spent $2 billion on these deals.
“They were his works, he could do whatever he wanted with them,” Samuel Valette, Sotheby’s vice chairman for private sales worldwide, said in court Tuesday of Bouvier, who has faced criminal fraud charges in France, Monaco and Switzerland over his purported art price markups.
Valette added that Sotheby’s is not responsible for what Bouvier did with the art works after he bought it from them.
Rybolovlev claimed in his suit that Sotheby’s was uniquely positioned to facilitate Bouvier’s fraud since a dozen of the masterpieces were sold through the auction house. In the billionaire’s trial taking place in the Southern District of New York, Rybolovlev is seeking $232.5 million in damages.
Bouvier was not named as a defendant in the lawsuit, filed by Rybolovlev’s offshore family trust Accent Delight International in the Southern District of New York.
The auction house successfully lessened the charges last March on a motion to dismiss, but still faces trial for aiding and abetting Bouvier in inflating the valuation of four pieces of art for sale — Amedeo Modigliani’s limestone sculpture “Tête,” Rene Magritte’s “Le Domaine d’Arnheim,” Gustav Klimt’s “Wasserschlangen II” and, most notably in the case, Leonardo da Vinci’s “Salvator Mundi” painting.
Valette, who Rybolovlev described in court as a “greedy and overly ambitious middle manager at Sotheby’s,” said he worked as a key client manager while the Russian billionaire was a client of Bouvier’s.
A key client manager, who works closely with the client throughout the duration of sales, is typically responsible for regularly checking in with the client.
But Valette said he did not do this when working with Rybolovlev and added he did not engage at all with him.
In fact, Valette said Tuesday, he only met Rybolovlev on three instances — twice to view a painting he was planning to purchase and once at the Freeze Art Fair in London.
According to Rybolovlev, Bouvier claimed da Vinci’s “Salvator Mundi” painting was valued at $127.5 million despite previously agreeing to purchase the famed artwork for $83 million.
In documents shown in court, Sotheby’s valued the price of the da Vinci painting at $100 million. But, according to an expert called by Rybolovlev’s team to testify, that was an overestimation.
Guy Stair Sainty — an art dealer specializing in European painting and sculpture from the Renaissance to the mid-20th century — said the auction house’s valuation failed to effectively address the painting’s condition and relative significance.
According to Sotheby’s valuation, the piece was “radically altered by overpainting which obscured much of its overpainted surface."
Though the auction house noted the piece had been heavily painted over and would need to be restored, Sainty said Tuesday that Sotheby’s did not fully address how the painting’s condition would impact its financial value.
“It doesn’t explain the problem of conditions once restoration has it removed,” Sainty said.
Sainty was also asked about Modigliani’s “Tête,” which Rybolovlev said Bouvier misrepresented as being valued at $83 million.
In emails shown in court between Bouvier and Valette, the executive changed his initial valuation of the sculpture, raising the price by 10 million dollars in a day.
According to Sainty, the email “doesn’t provide any grounds for increasing its value by $10 million in a day.”
Modigliani is known for his head sculptures carved from stone. Unlike other artists, Sainty said, Modigliani was known for only creating one of each of his works and took care to make sure each one was different.
Though Sainty said that is part of what makes Modigliani special as an artist, while other artists made other portayals of their work, he added that the price offered to Rybolovlev in 2013 was overvalued.
“The market at that time did not assess Modigliani’s stone heads above about $43 million,” Sainty said.
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