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Auction house follies

Art in America, Dec, 2004 by David Ebony

The Art of the Steal: Inside the Sotheby's-Christie's Auction House Scandal by Christopher Mason, New York, G.P. Putnam's Sons, 2004; 406 pages, $26.95 hardcover.

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I recall sitting with a group of journalists at a Sotheby's post-evening-auction press conference in the late 1990s, squirming in my seat as we were being harangued by the company's then CEO, Diana (Dede) Brooks. Tall, blonde and vivacious, Brooks was trying to put a positive spin on the results of a mediocre sale. "Just because we didn't sell a few lots tonight is no reason to report that the auction was a total failure, as some of you have done in the past," she scolded. I was flabbergasted that Brooks, whose striking countenance exuded the authority of a powerful no-nonsense businesswoman in charge of her domain, would even bother to lecture a bunch of miserable scribes. It was amazing to me that the first woman ever to run an international art auction firm, the world's largest, and one who apparently shouldered great responsibilities, could be so detail-oriented as to fret about a few disparaging press reports. In Christopher Mason's fascinating book The Art of the Steal: Inside the Sotheby's-Christie's Auction House Scandal, one discovers just how "hands on" her micromanagement style was, and how important the press was to her. The book explores the course of her actions and those of some colleagues and competitors, which nearly brought down the world's two biggest auction houses in 2000.

At the core of Mason's well-researched report is a headline-grabbing tale of price-fixing. The antitrust division of the U.S. Justice Department found that secret meetings held between the top executives of Sotheby's and Christie's were intended to eliminate competition and increase profits by agreeing to raise buyers' commissions and establish nonnegotiable terms for sellers wishing to bring items to auction.

The main characters involved in this complicated scheme are named and identified by Mason in a "Dramatis Personae" preface. Aside from Brooks, the primary co-conspirators were Sotheby's former chairman and principal stockholder, A. Alfred Taubman (his mysterious first initial, we learn, stands for Adolph), Christie's former chairman, Sir Anthony Tennant, and its former CEO, Christopher Davidge.

For the most part, Mason paints a rather sympathetic portrait of Taubman, a self-made mega-millionaire from Detroit, who garnered his fortune by developing shopping malls. The author emphasizes Taubman's philanthropic activities as well as the loyalty and respect that he consistently won from employees and friends. Taubman's devotion to his wife, Judy, a former Miss Israel, is also noted, as is his concern for the rest of his family. However, despite Taubman's apparent Midas touch, evidence of his business savvy is all but absent in Mason's account. Instead, we find a somewhat vulgar, vain and doltish character, who is bad with numbers, could not remember the names of the artists whose multimillion-dollar works hung on his walls, and lied about his age among other things.

Brooks, Taubman's onetime protegee, claimed he instructed her to meet with Davidge to fix prices in April 1993. One stunning revelation in the book is that Brooks brazenly began her part of the conspiracy the day after her brother, Andy Dwyer, was forced to resign as head of a large family-run company under allegations of illegal accounting practices. Brooks pleaded guilty to her crimes in the fall of 2000. During the sensational trial the following year, her testimony was instrumental in convicting Taubman. He was fined $7.5 million and jailed for a year and a day. Due to her cooperation, Brooks received a relatively light sentence of six months of home detention, 1,000 hours of community service and a $350,000 fine.

Tennant, a British aristocrat who helped raise the fortunes of the Guinness company before becoming Christie's chairman, was accused by Davidge in court of instigating the price-fixing conspiracy. According to Davidge, Tennant, after at least a dozen meetings with Taubman, instructed him to collude with Brooks. Davidge is portrayed here as another serf-made millionaire, who, like Taubman, was desperately struggling to overcome his working-class roots and find a place in high society.

Anticipating that the conspiracy would eventually come to light, Christie's had decided early on to cooperate with the authorities and provide the antitrust lawyers with evidence of misconduct in exchange for guarantees that the company would be exempt from certain penalties resulting from the case. Nevertheless, the UK-based company sustained serious damage. Since collusion was at the time regarded as a civil rather than a criminal offense in Britain (UK anti-trust statutes have since been changed to conform more closely to those in the U.S.), no one went to jail. But Christie's, like Sotheby's, was forced to pay hundreds of millions of dollars to settle a class-action suit stemming from the case. In the aftermath of the conspiracy, many employees at both houses lost their jobs, and, at Sotheby's, numerous employees' stock-based retirement funds were wiped out as public shares in the company plummeted.

Auction house follies

Art in America, Dec, 2004 by David Ebony

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