Opinion ID: 683513
Heading Depth: 2
Heading Rank: 2

Heading: The Bogus Water Damage Scheme

Text: 11 Shaoul's second allegedly fraudulent scheme arose in February 1991, just one month after the alleged theft of art works from his car. This second scheme stemmed from a water leak in Shaoul's antique shop in downtown Manhattan, which had been caused by a contractor. 12 Ralph Loffredo, Shaoul's neighbor, twice noticed water in and around Shaoul's shop on a Sunday morning in February 1991. Loffredo contacted Shaoul in Long Island, who, in turn, called Purcell, who lived near the shop. On Purcell's arrival, he, Loffredo and another neighbor entered the shop and turned off the water, which had been leaking from a sprinkler head. Loffredo testified that he noticed one wet painting but saw no broken or damaged vases, lamps, or glassware. Purcell and the other neighbor corroborated Loffredo's testimony. Shaoul arrived about a half-hour later, accompanied by his brother-in-law. 13 Purcell testified that after the two neighbors left the shop, Shaoul instructed his brother-in-law and Purcell to carry out from the back of the shop numerous broken glass vases and lamps, and to spread these items around the damp part of the shop. This glassware allegedly had been broken over time in the shop--before the leak occurred. Nonetheless, Shaoul allegedly had the broken items moved to the wet part of the shop in order to claim that they were damaged by the water leak. 14 The wet painting observed by Loffredo and Purcell was a watercolor, bearing the purported signature of Winslow Homer, which Shaoul had obtained from Liskin approximately three years before. The leading expert on Winslow Homer told Liskin in 1987 that the work was not a genuine Winslow Homer, however, and Liskin testified that he had related the expert's opinion to Shaoul prior to selling the work to him in 1988 for $1,000. Purcell also testified that, based on his discussions with Shaoul, he believed that Shaoul knew that the watercolor was not a genuine Homer, and that Shaoul had this fact in mind when he doused the already-damaged watercolor after Loffredo and the other neighbor left the shop. Shaoul subsequently claimed that the Homer--whose value he placed at $125,000--had been completely destroyed by the water damage. Ultimately, Shaoul's damage claim for the water leak rose to more than $400,000. He submitted these claims to Greater New York Insurance Company, the insurer of the contractor that caused the initial water damage. 15 Shaoul caused to be mailed to Greater New York appraisals and invoices for the damaged glass and paintings. One of the invoices purported to show that Shaoul had purchased the putative Winslow Homer work from Leah's Gallery in November 1990 for $34,500. Leah Kleman, the owner of Leah's Gallery, testified that she had known Shaoul for ten years as both a friend and a business associate, but that she had never owned or sold any watercolor by Winslow Homer. Kleman further testified that she had never sold any watercolor to Shaoul. According to Kleman's testimony, in February 1991, several months after she had sold Shaoul three porcelain plaques, Shaoul asked her for an invoice reflecting a sale of a Winslow Homer watercolor. Even though no such sale had ever been made, Kleman prepared an invoice as requested by Shaoul. Both Liskin and Purcell testified that Shaoul obtained the purported Winslow Homer watercolor directly from Liskin. 16