Earlier this summer, a heated dispute erupted between a Manhattan gallerist and a private art advisory business, in a case that raises issues regarding the roles of galleries and advisors at the high end of the art market.

In a complaint filed July 27, the Mary Boone Gallery in Chelsea sued art advisor Vanessa Buia and her eponymous LLC over the sale of a work by contemporary artist KAWS.  See Docket No. 653902/2016 (Sup. Ct. N.Y. Co.).  Boone, who represents KAWS, alleges that a gallery’s role is not simply to sell works, but to strategically “place” the artist’s work in “important private or museum-based collections,” with the overarching goal of ensuring that works end up with “collectors whose ownership of the artist’s work elevates the artist’s career” and bolsters the market for the artist’s work—and conversely, to “keep them from being sold into collections of lesser importance and prestige” and prevent works from being placed in “a location that might interfere with an artist’s relationship with other galleries.”  Boone further alleges that Buia, a former Gagosian employee who now acts as an agent and advisor for art collectors, “plainly understands that galleries will want to know whom she is representing in order to assure” that a work is ending up in an “appropriate” collection.

Against this backdrop, Boone alleges that in April, Buia sought to buy two KAWS works, and in negotiating the sale, she “represented and warranted that she was acting for an important collector of contemporary art whom she identified,” someone she knew would “please” the gallery and the artist.  Indeed, the complaint alleges that the gallery, anxious to ensure this desirable placement for KAWS’s works, gave Buia a sizeable discount it would not otherwise have given her, letting the two pieces go for a total of $290,000.

However, the gallery alleges that it was induced to sell the works under false pretenses; in fact, the works were not going to the buyer Buia had named, and instead passed rapidly through multiple intermediaries and ended up in the Galerie Laurent Strouk in Paris.  Boone’s complaint presents a claim for “fraudulent inducement and fraud,” urging that Buia, through her misrepresentations, obtained works (at a discount) that the gallery would not have otherwise agreed to sell her; and moreover, that their ultimate destination in Paris “interfered with the artist’s separate relationship with a different Paris art gallery.”  The complaint seeks damages at least in the amount of the discount ($60,000).

Buia, for her part, struck back almost immediately.  Hours after Boone’s complaint was filed in New York County, Buia filed a separate suit in Richmond County.  See Docket No. 150921/2016 (Sup. Ct. Richmond Co.).  Buia’s complaint is rife with personal jabs at Boone, suggesting that Boone’s suit was motivated by “malice, hatred, and jealousy,” “exacerbated by . . . Boone’s fragile mental state and temperament and the fact that nearly all of her good artists have left her” and that Mary Boone is “mercurial,” “imbalanced,” and “hat[es] women.”  But sifting through the complaint’s ad hominem attacks (as well as odd missteps such as repeatedly misspelling the name of prominent artist Julian Schnabel), Buia’s version of the events surrounding the KAWS deal appears to be that she “never” reveals the identity of her clients, and in fact promises to keep their identities confidential, an arrangement that is “standard” in the industry; accordingly, she alleges, in buying the two KAWS works at issue, she never named any collector, nor did her discussions with Boone’s gallery involve “anything beyond price and payment schedule.”  She further states that she herself had no idea that the “end client” who purchased the KAWS works planned to show them in Paris; indeed, she claims she did not even know who the “end client” was.  She also notes that, while some galleries draft their sales documents to “stipulate that works must be offered back to [the selling gallery] before resale,” nothing in Boone’s sale invoice limited Buia’s ability to resell the KAWS works at issue here.  Buia alleges that, since the KAWS deal, Boone has defamed Buia to many art industry players, including the artist, as well as the “end client,” who she characterizes as a “VERY big and important client.”  As a result, Buia claims, her reputation has been damaged and she was unable to consummate a later deal with the “end client,” costing Buia a hefty commission.  She asserts claims for slander, tortious interference with business relationships, and trade libel.

In late August, Boone moved to dismiss Buia’s Richmond County suit, arguing primarily that Buia’s pleading failed to provide adequate information regarding any of the allegedly defamatory statements on which her claims are based, noting that there is no detail about exactly what was said (or when, where, or to whom).  Boone further argues that the claims should also be dismissed because any statements Boone made were simply “hyperbole, opinion, or statements of personal feelings” of dissatisfaction with Buia’s professional services, and as such cannot form the basis for an actionable claim.  As to the tortious-interference claim, Boone argues it should be dismissed because the complaint fails to explain how Buia’s injury would not have occurred “but for” Boone’s “barely described” conduct, which, she urges, was not unlawful.

We’ll continue to monitor developments in this dispute, but for now, the case is noteworthy for a couple reasons.  First, the two sides give markedly different accounts of what is “standard” in the art industry.  Buia asserts that, when negotiating with a gallery regarding a work, she (like most art advisors) does not disclose the identity of the buyer she represents.  Boone, on the other hand, emphasizes that an integral part of a gallery’s role is ensure that an artist’s work will end up in an “appropriate” collection, a task which presumably requires knowledge of the buyer’s identity.  If the case proceeds to discovery and beyond, it will be interesting to see how the parties (perhaps with the aid of expert witnesses) present to a court their divergent views of the industry “norms” governing such rarefied art transactions, particularly given that it is not uncommon for art deals to involve multiple intermediaries and agents acting for undisclosed principals.  Second, the case represents yet another example (see other recent ones here and here) of a dispute arising out of purported terms, assumptions, or representations which a party claims were integral to an art deal—yet were never reduced to writing.  Boone’s suit is, at its core, based on her assertion that her gallery sold the KAWS works to Buia—and gave a discount—in reliance on Buia’s alleged representation about the identity of the collector who would receive the works.  Yet the sale was consummated with only a one-page bare-bones invoice that contains no official representations or warranties, nor (as Buia points out) any restriction on Buia’s (or her buyer’s) ability to resell the pieces.  Seeking legal guidance before a sale is consummated may be able to help parties negotiate and draft a sale agreement that accounts for and protects parties’ expectations.