BY DAVID ROSENSTEIN
In a riveting conclusion to a three-week trial, a federal jury ruled in favor of Sotheby’s on Tuesday, dispelling the accusations of Russian billionaire oligarch Dmitry Rybolovlev, who claimed the prestigious auction house defrauded him of tens of millions of dollars in art sales. The drama unfolded as Rybolovlev accused Sotheby’s of conspiring with Swiss art dealer Yves Bouvier to inflate prices for four significant works, including the famed “Salvator Mundi” attributed to Leonardo da Vinci.
Rybolovlev, valued at $6.4 billion, alleged that Sotheby’s knowingly participated in Bouvier’s deceptive scheme. The oligarch’s art collection, totaling $2 billion, became a centerpiece of the trial, revealing the unexpected origins of his interest in art – sparked by a need to fill empty walls in a Geneva mansion adorned with lighting for showcasing artworks.
The trial unveiled the clandestine world of the art market, where paintings acquire code names for secrecy. Sotheby’s employed code names like “Jack” and “Cottonmouth” for transactions involving masterpieces such as the “Salvator Mundi” and Gustav Klimt’s “Water Serpents II.” The art world’s glamorous settings, including a Vienna warehouse and Rybolovlev’s Central Park West apartment, added a touch of sophistication to the unfolding narrative.
One of the trial’s pivotal moments occurred at the Eden Rock hotel on St. Barts, where Rybolovlev learned he might have overpaid for artworks during a conversation with art adviser Sandy Heller. This revelation triggered a legal battle that spanned multiple jurisdictions, revealing the industry’s lack of transparency.
The core dispute revolved around Rybolovlev’s claim that Bouvier swindled him out of $1 billion in 38 artworks, with the “Salvator Mundi” at the center of the storm. Despite Rybolovlev’s lucrative resale of the da Vinci masterpiece for a record-breaking $450.3 million in 2017, he alleged that Bouvier’s deceptive practices defrauded him. The trial questioned the value of the da Vinci painting, with expert testimony suggesting that Bouvier may have overpaid at $83 million due to “extremely problematic condition issues.” The old master market’s reluctance to support high prices for “Mundi” added a layer of complexity to the case.
Although Bouvier, not a defendant in the trial, consistently denied any wrongdoing, last month, he and Rybolovlev reached a confidential settlement, bringing an end to their protracted legal battles. Bouvier’s lawyers highlighted that the Office of the Attorney General of Geneva closed the investigation, finding no evidence to support suspicions against him.
Sotheby’s celebrated the jury’s unanimous decision, emphasizing its commitment to integrity and professionalism. The trial, characterized by its twists and turns, lifted the veil on the secretive art industry, where wealthy buyers sometimes remain unaware of the true identities behind their acquisitions. As the curtain falls on this high-stakes art drama, the verdict reinforces Sotheby’s position, leaving the art world with a lasting tale of deception, intrigue, and the quest for transparency.
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