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Bombshell in Price-Fixing Case by Giovanni Garcia-Fenech |
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| The art-world was abuzz with the latest bombshell in the price-fixing scandal that has hit Sotheby's and Christie's, dropped by a New York Times report jointly written by Carol Vogel and Ralph Blumenthal and published today, Mar. 17. Citing five anonymous sources with ties to both houses, the story outlines how the auction giants swapped lists of top clients as part of a secret scheme to retain control of fees charged to consignors. The arrangement involved approximately 50 big clients who presumably were able to negotiate better deals because of the amount of auction business they did. Under the alleged price-fixing arrangement, the two houses agreed not to undercut each other's fees for this group of clients. The article cites an account of a seller who, after failing to negotiate a lower fee with one house, threatened to go to the rival house, only to be told, "you can go but you won't get anything better."
The New York Times went on to outline several other areas that presumably are the subject of the federal anti-trust investigation. A class action suit filed against the auctioneers on Mar. 15 contends that Sotheby's chairman Alfred Taubman sought to extend the price-fixing scheme to sellers' fees as well, via secret meetings with Christie's chairman Anthony Tennant and Christie's chief executive Christopher Davidge. The lawsuit also alleges that Sotheby's president Diana Brooks was involved in secret meetings with Christie's officials, and that employees from both houses regularly met to coordinate their sales schedules. What's more, Davidge is said to have had a secret filing system for his notes regarding the alleged collusion. Officials of both houses are also said to have met to discuss ways of getting around the French ban on foreign auctioneers holding auctions in Paris. Neither Sotheby's nor Christie's had any comment, citing the ongoing U.S. Justice Department investigation. GIOVANNI GARCIA-FENECH compiles the Artnet News column for Artnet Magazine. |
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