Source: https://news.artnet.com/market/the-liability-of-art-experts-27666
Timestamp: 2019-04-20 23:14:47+00:00

Document:
Art experts shouldn't be forced to keep quiet on issues of authenticity.
This essay examines recent court decisions precluding lawsuits under the federal Lanham Act about whether or not a named artist created a work of visual art.
There has recently been much attention devoted to the potential liability of art experts who are asked for opinions about the authenticity of artwork, and the resulting impact on the market if experts refuse to express their views openly. Experts have been sued for expressing negative opinions that make artwork unmarketable, for expressing positive opinions that are relied on by purchasers but later called into question, for omitting a work from a catalogue raisonné, and even for declining to express an opinion or finding that it cannot determine whether a work is authentic or not. In addition, a number of artist-established foundations have closed down their authentication boards, citing fear of litigation.
The claims against experts have been varied product disparagement, negligence, negligent misrepresentation, breach of contract, fraud, and more recently under the federal Lanham Act.
However, there may be one less weapon for disappointed owners who would sue those experts, based on the recent application of the U.S. Supreme Court’s decision in Dastar Corp. v. Twentieth Century Fox Film Corp.1 to disputes relating to authorship of art by a federal court in New York.
Earlier this year, in the case of Gilbert v. Indiana, Judge Katherine B. Forrest of the U.S. District Court for the Southern District of New York found that the federal Lanham Act should not be regarded as authorizing a federal cause of action for a statement of whether a work of visual art is or is not by a named artist.2 This is significant because the federal Lanham Act allows the prevailing party to recover up to three times’ its actual damages and its attorneys’ fees, and therefore posed a particularly intimidating threat when asserted by angry owners of art. In the U.S. system, parties can usually recover only their actual damages but typically cannot recover attorneys’ fees. In addition, lawsuits asserting violations of federal law are sometimes viewed by the public and the media as more substantial, more legitimate and more worrisome than lawsuits asserting common-law claims filed in state court.
Gilbert v. Indiana involved a statement by the artist Robert Indiana about his own work, in a dispute with someone who claimed a contractual right to pass off his own art as Indiana’s. The significance of the decision in Gilbert v. Indiana and the U.S. Supreme Court case that it applies is important for scholars concerned about expressing opinions about art.
However, in 2003, the U.S. Supreme Court held that “origin” does not mean “authorship,” and seems to eliminate such claims. In Dastar, the Supreme Court held that the Lanham Act provision applicable to claims made outside the context of commercial advertising4 applies only to claims relating to the producer or physical source of goods and not to claims concerning authorship.
Finally, the decision in Gilbert v. Indiana confirms that Dastar should result in dismissal of a Lanham Act lawsuit regarding the accuracy of a statement about the creator of works of visual art. Because Gilbert v. Indiana involved an artist who disclaimed authorship and was sued for it, the decision confirms that Dastar does more than eliminate lawsuits that attempt to do an end run around the limitations of copyright law by raising a claim under the Lanham Act. Dastar forecloses any claim under the Lanham Act regarding the authorship of art.
It is important to anyone who cares about accuracy in art historical scholarship, and the security of art market transactions, to ensure that experts ”including both scholars and artist-established foundations” are not inhibited from expressing opinions about authorship of art. While historical practice may have been different, present-day scholars, to avoid the appearance of impropriety, generally accept at most a modest fee for reviewing artwork (some accept no fee at all), and their fees are not typically based on either the value of the artwork as they value it or a percentage of the ultimate sale price.
Experts also have the benefit of legal defenses. Under the New York state constitution, there is a qualified privilege for statements made where one has a legal or moral duty to speak, or in a communication from one person to another upon a subject in which both have an interest.13 For example, an artist and the author of the artist’s catalogue raisonné would have a shared interest in having the catalogue raisonné accurately describe the artist’s work. Moreover, even when a statement about a work of art is regarded as a contractual warranty, New York state and federal courts have applied a forgiving standard set forth in a federal district court opinion, Dawson v. Malina,14 which found that the standard for evaluating a breach of warranty is whether there was a reasonable basis in fact for an attribution of a work of art at the time the warranty was made, not whether the attribution can be proven to be true or false based on information that came to light after the sale.
Nevertheless, despite some strong legal defenses, experts have little interest in litigating these issues at their own expense, and sellers, auction houses and dealers that benefit financially from art sales have thus far been unwilling to make it a general practice to fully indemnify experts they consult against any claims. Therefore, although experts may care passionately about the accuracy of the record regarding an artist, and their reputations as experts on particular artists, they are reluctant to opine openly and on the record if they stand to gain little and risk litigation from deep-pocketed owners seeking damages or a humiliating retraction of the expert’s opinion. Another unfortunate side-effect of the fear of litigation is the potential that some experts will speak only off the record or in coded comments to the effect that they “like” or “don’t like” a picture, a situation that is rife with potential for ambiguity and misunderstanding. Thus, while there is still a long way to go toward resolving these issues, the elimination of Lanham Act claims is a step in the right direction toward protecting independent scholarship’s role in the art world.
1 539 U.S. 23 (2003).
2 See Gilbert v. Indiana, No. 09-CV-6352, 2012 WL 688811 (S.D.N.Y. March 2, 2012). The author, with Gary D. Sesser and Ronald D. Spencer of Carter Ledyard & Milburn LLP, was counsel for defendant Robert Indiana.
3 Under U.S. law, the copyright in a work of art does not belong to the owner of the physical artwork unless copyright has been explicitly transferred by the holder of the copyright in a signed writing. See 17 U.S.C. Â§ 204.
4 Section 43(a)(1)(A). This provision governs statements made outside the context of commercial advertising.
5 See Dastar, 539 U.S. at 26.
6 Dastar, 539 U.S. at 32.
7 Dastar, 539 U.S. at 33.
8 Dastar, 539 U.S. at 29 (quoting Alfred Dunhill, Ltd. v. Interstate Cigar Co., 499 F.2d 232, 237 (2d Cir. 1974)).
9 See Atrium Group de Ediciones y Publicaciones, S.L., v. Harry N. Abrams, Inc., 565 F. Supp.2d 505, 512 (S.D.N.Y. 2008) (Dastar not limited to claims concerning works in the public domain) (collecting authorities from other courts and circuits).
10 Zyla v. Wadsworth, 360 F.3d 243, 252 (1st Cir. 2004).
11 Antidote International Films, Inc. v. Bloomsbury Publishing, PLC, 467 F. Supp.2d 394, 400 (S.D.N.Y. 2006).
13 See, e.g., Chandok v. Kleissig, 632 F.3d 803 (2d Cir. 2011). A living artist also has the right of attribution and right of integrity under the federal Visual Artists Rights Act, 17 U.S.C. 106A, which allow the artist to prevent the use of his or her name with a work the artist did not create or that is a distortion or modification of the artist’s work that is prejudicial to the artist’s reputation.
14 Dawson v. G. Malina, Inc., 463 F. Supp. 461 (S.D.N.Y. 1978).
Can an Owner Keep Himself and His Art Out of Bankruptcy Court When the Gallery Goes Bankrupt?

References: v. 
 v. 
 v. 
 v. 
 v. 
 v. 
 v. 
 v. 
 v. 
 v. 
 v. 
 v. 
 v. 
 v.