In this week's edition, The Economist writes that fear of litigation is crippling the art market. Specifically, the article (titled "Collectors, artists, and lawyers: Fear of litigation is hobbling the art market") focuses on lawsuits against experts such as authentication boards and producers of catalogues raisonnés. A work by a given artist will be worth substantially more on the market if it has been certified as an authentic work by an authentication board, which serves as the generally recognized authority on that artist's works. Similarly, a work's value will increase if it is included in the catalogue raisonné, a comprehensive catalogue of an artist's works.
The article from The Economist expresses concern about the growing trend of lawsuits against these gatekeepers of authenticity by art owners who claim that a board wrongfully denied certification of their work or that their work was wrongfully excluded from the catalogue raisonné. As a result of such suits, some authentication boards have closed shop and stopped certifying new works as authentic. Also, experts have halted work on the catalogues raisonnés for some artists or moved the compilations to an online version, which can be more easily updated to add or remove a work. According to The Economist, this trend is bad news for the art market because artworks, which would likely have been certified as authentic or included in a catalogue raisonné, will now sell for less without the certainty that comes from such "official" approval. Even if an artwork is included in an online catalogue raisonné, its value on the market will be lower because there is always the risk that it could readily be removed.
The Economist raises significant and troubling concerns, but its analysis fails to address the full picture. Current litigious trends raise insurance costs for authentication experts, lower market value for many works, and make experts hesitant to even express an opinion about a work's authenticity. This is a problem that needs to be addressed. However, the existence of authoritative authentication experts also produces distortions in the art market that need to be addressed. The Economist takes lightly the claim made by a plaintiff against the Warhol Foundation that the authentication board engaged in monopolistic behavior. Nonetheless, it is a serious issue that authentication boards and makers of the catalogue raisonné do, effectively, have a monopoly over an artist's works. The art market tends to treat an authentication board's determination as the last word, making or breaking a work's value on the market. However, authentication boards do not always provide the reasoning on which their certification decisions are based. More importantly, the standards on which a work's "authenticity" should be determined are not always clear. For artists who often work with a workshop or involve other individuals in the execution of their artistic visions, the lines of authenticity are not always clear. Where should we draw the line? At works the artist personally designed and executed himself? At works the artist designed, even if someone else executed them entirely? At works an artist designed and at least oversaw the implementation of the final product? In light of this ambiguity in the understanding of "authenticity," authenticity gatekeepers have a great deal of discretion in making decisions that have momentous impact on the market for an artist's work.
A recent case against the Alexander & Louisa Calder Foundation highlights the other side of concerns about authenticity gatekeepers. In Thome v. Alexander & Louisa Calder Foundation, the plaintiff requested that the Foundation authenticate two stage sets that he claimed had been designed by artist Alexander Calder. In 1975, the plaintiff had contacted the artist about recreating the stage set for the revival of a play for which Calder had originally designed the stage set in 1936. Calder reviewed and approved the plans for the revival stage set and had an art professor appointed to carry out the construction of his design but died before the final completion of the set. In 1997, the plaintiff sought authentication of the recreated stage sets from the Foundation, but the Foundation took no action for ten years and did not include the sets in the catalogue raisonné for Calder's works. The plaintiff sued the Foundation seeking an injunction requiring the Foundation to certify the works as authentic.
In the Calder case, a New York court ultimately ruled against the plaintiff and found that the Foundation had no "duty" to authenticate works. Although the court rejected the plaintiff's claim of product disparagement as time-barred by the statute of limitations, it suggested in non-binding dicta that a recognized authentication board's refusal to respond to an authentication request was effectively a statement that the works were false, which might amount to product disparagement. The court also discussed the non-justiciability of a cause of action that seeks to require a board to authenticate a work. According to the court, the art market recognized the opinion of the Foundation, not of the court, on the authenticity of the work, and consequently a court determination would likely have little effect on market value (i.e., there was nothing the court could do given the power of the authentication board's monopoly in the art market).
The Calder case raised all of the important issues that The Economist seems to have brushed over with regards to authenticity gatekeepers. They hold much if not all of the power over an artist's works, and yet saying "yes" or "no" to the authenticity of a work is not always a matter of black and white. The rising tide of lawsuits against authenticity gatekeepers is not just itself a problem for the art market, it is a symptom of an underlying problem with the way authentication currently takes place in the art market. These lawsuits demonstrates the need for broader reform in the way participants in the art market think about and recognize authenticity. Finding solutions for reform will be difficult in a market that currently relies so heavily on these institutions.
For the article from this week in The Economist:
For more on the Calder case:
The case - Thome v. Alexander & Louisa Calder Foundation
From IFAR - summary of the case
From ARTnews - discussion prior to the court's decision