I finally had a chance to read the decision I mentioned last week that dismissed authentication-related claims against the Haring Foundation. You can read it here. If you don't have time to wade through the whole thing, Rebecca Tushnet has a good summary here. Nicholas O'Donnell has his usual valuable commentary here. It's in some ways an odd decision, which I'll explain further below. But the important point, I think, is that if you're an artist foundation looking for a signal that it's safe to get back into the authentication business, this case isn't it. If anything, as O'Donnell points out at the end of his post, it might have the opposite effect. Here's why that might be the case:
1. First off, this was the third motion to dismiss the case. The plaintiffs were allowed to amend their complaint in response to the first two. So even here, where the outcome was as favorable to the foundation as can be imagined, it didn't come cheap.
2. In dismissing the antitrust conspiracy claim, the court distinguishes Warhol/Simon-Whelan (where a similar claim survived a motion to dismiss) in part on the grounds that "the defendants here ceased their authentication activities in 2012 and [therefore] could not be plausibly alleged to control authentication of Haring's work." That's obviously an argument for foundations not getting into the authentication business (or getting out of it if they're currently in it).
3. Similarly, in dismissing the antitrust monopolization claim, the court emphasizes that the authentication committee "was dissolved in 2012 and no longer offers authentication services."
4. The state law defamation claim was dismissed based on the quirky facts of this case, which were that the foundation directed its statements towards an exhibition which included the plaintiffs' works (rather than at the plaintiffs directly): "the plaintiffs have failed to allege sufficient facts that would allow a reasonable jury to conclude that the [foundation-issued] Press Release concerns them." That's not going to be the typical situation in which these cases arise.
5. On the other hand, the court does say that the defamation claim would have failed anyway because you can't base a defamation claim on a statement that "only relates to [the plaintiff's] property," which -- if true -- would be a help to potential defendants in these cases.
6. Another holding that, if it were right, would also be extremely helpful to authentication-minded foundations (and others) had to do with the trade libel (or "product disparagement") claim, which is really the heart of any authentication-related dispute. The court says that, to prevail on such claim, you have to show "special damages" -- i.e., specific, named purchasers that you lost as a result of the defendant's statements. One of the plaintiffs alleged that he lost a sale to a London museum -- but even that wasn't enough because he didn't "name the museum or the sale price." That would, as I say, be a difference-maker ... but is it right? I am minding my own business with what I think is a $50 million painting by Artist X hanging on my wall. Out of nowhere, the Artist X Foundation (or some other well-respected authority on Artist X's work) announces to the world that my painting is not an authentic work by Artist X (and is therefore now worthless) ... and there's nothing I can do about it because I can't point to a specific sale that I lost? I'm curious to see whether other courts will line up behind that reasoning.
