Bloomberg News

Koch Asks Appeals Court to Toss Christie’s Wine Ruling

May 02, 2012

Billionaire William Koch asked a U.S. appeals court to revive a lawsuit in which he claimed that the auction house Christie’s International Plc induced him to buy counterfeit wine.

U.S. District Judge Barbara Jones threw out Koch’s suit in March 2011, saying that he knew the bottle of 1870 Lafite wine he bought for $4,200 was counterfeit before he made the purchase. Koch’s lawyer today urged three judges of the appeals court in Manhattan to reverse that ruling and restore the case. The judges made no decision.

Edward Spiro, Koch’s lawyer, told the judges that Jones applied an incorrect legal standard in reaching her decision. He said Koch was aware that the wine auctioned by Christie’s was “possibly” counterfeit, though not “probable.” He said Jones relied on a report that was “inconclusive.”

“Did it rise to the level of probable?” Spiro said in court. “The evidence was all over the place.”

Koch sued Christie’s in 2010 claiming he bought the Lafite to prove that the auction house was selling counterfeit wine. He previously acquired from a dealer some 1787 wine that President Thomas Jefferson was said to have owned, which Christie’s had vouched for and turned out to be counterfeit.

‘Textbook Case’

The judges today repeatedly questioned the lawyers about when Koch knew that the wines might be counterfeit. An attorney for Christie’s argued that Koch had enough information to sue the auction house in 1993, or 17 years before he eventually did.

“This is a textbook case application of the statute of limitations,” Jonathan Lerner, Christie’s lawyer, told the judges. “By 1993, he could have sprung into action.”

Spiro said Koch hired a lawyer in 1993 to monitor cases involving the sale of counterfeit wine. He said the Jefferson Foundation conducted a worldwide investigation and discovered fraud no earlier than 2005.

“He did not sit on his rights,” Spiro said. “Christie’s involvement in this fraud was not easily detected.”

The case is Koch v. Christie’s International, 10-02804, U.S. District Court, Southern District of New York (Manhattan).

To contact the reporter on this story: Don Jeffrey in New York at djeffrey1@bloomberg.net.

To contact the editor responsible for this story: Michael Hytha at mhytha@bloomberg.net


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