Bloomberg News

Christie’s, Sotheby’s Accused of Cheating Artists on Royalties

October 19, 2011

Oct. 19 (Bloomberg) -- Christie’s Inc. and Sotheby’s were accused in a lawsuit of failing to pay artists royalties for works either sold in California or at auction by California sellers.

The Sam Francis Foundation, the estate of Robert Graham, and artists Chuck Close and Laddie John Dill said in complaints filed yesterday in Los Angeles federal court that the auctioneers violated California’s Resale Royalties Act by failing to pay them 5 percent of the sales price for their works.

Court-stamped copies of the complaints were provided by the lawyer for the artists and weren’t immediately available from the courthouse.

The two auction houses don’t disclose whether a seller resides in California or whether a non-auction sale took place in California, which would entitle the artist or the artist’s estate to the royalty, according to the complaints. The plaintiffs seek to represent other artists in class-action cases and they seek unspecified damages.

“Although Christie’s has yet to be served with the complaint, it views the California Resale Royalties Act as subject to serious legal challenges,” Sara Fox, a spokeswoman for Christie’s in New York, said in an e-mailed statement. “Christie’s looks forward to addressing these issues in court.”

“We believe the claim is meritless and it will be vigorously defended,” Diane Phillips, a spokeswoman for New York-based Sotheby’s, said in an e-mailed statement.

In a separate complaint, the artists also accuse EBay Inc., the world's biggest online marketplace, of failing to pay the royalties they say they are due under the California law. Representatives of San Jose, California-based EBay didn't immediately respond to an e-mail seeking comment on the lawsuit after regular business hours yesterday.

The cases are Estate of Robert Graham v. Sotheby’s, 11- 8604, and Sam Francis Foundation v. Christie’s, 11-08605, U.S. District Court, Central District of California (Los Angeles).

--With assistance from Katya Kaazakina in New York. Editors: Peter Blumberg, Steve Farr

To contact the reporter on this story: Edvard Pettersson in Los Angeles at

To contact the editor responsible for this story: Michael Hytha at

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