The artist resale royalty right, what in Europe is often called the droit de suite, is a form of intellectual property right that allows primarily visual artists (who produce work in single objects or limited editions) with a right to receive a percentage of the purchase price when their works are resold. The resale royalty’s purpose is to allow artists to share in the increased value of their work over time. Each time a work is sold for a higher price than was originally paid for the work, a percentage of that sale price is required to be paid to the artist or the artist’s estate or heirs. Typically, the resale royalty falls within copyright law (and is provided for in the Berne Convention, Art. 14ter), and attempts to bring the visual artist’s rights into closer alignment with the rights of authors and recording artists, where the right to receive royalties is not cut off at the time of the original sale of a work or a copy. Although the droit de suite originated in France, it has been widely incorporated into copyright law in Europe and elsewhere. Currently, more than seventy countries provide in some measure for a resale royalty.1 However, it is not currently incorporated into U.S. copyright law. That may be changing.    
Continue Reading Droit de Suite: California Resale Royalty Revisited

“Art” is famously difficult to define. To many artists, a definition is either a challenge or an offense. For the art trade, the working definition is pragmatic and fluid – art is a tangible object embodying the creative efforts of one or more individuals, generally in certain traditionally recognized media such as painting and sculpture, but also ceramics, textiles, and, increasingly, conceptual art and art in new media. The term “cultural property” developed from a need to recognize a broader body of objects, which includes artworks, but is not limited to artworks. Cultural property also includes antiquities, books, manuscripts, scientific collections, collections of books or archives, monuments of architecture, groups of buildings, and archeological sites.  It has further expanded to include ethnological and paleontological objects.

The term “cultural property” was first used in an international instrument in the 1954 Convention for the Protection of Cultural Property in the Event of Armed Conflict.1 The 1970 UNESCO Convention on the Means of Prohibiting and Preventing the Illicit Import, Export and Transfer of Ownership of Cultural Property2 expanded the protection afforded to cultural property to include peacetime, and identified cultural property as “property which, on religious or secular grounds, is…of importance for archaeology, prehistory, history, literature, art or science.”     
Continue Reading The Future of History – Repatriation of Cultural Property

As the City of Detroit’s (the City) bankruptcy case enters its final phase, and confirmation of its plan of adjustment seems all but certain, the future of the Detroit Institute of Arts (DIA) appears assured. This has not always been the case, since how the DIA’s valuable art collection would be handled was a key point of contention between the City and several of its creditors. In retrospect, the struggle for the future of the DIA is interesting for several reasons. The first of those reasons is now likely to remain an unanswered question: Had the City wished to sell all or part of the DIA’s collection, could it have done so, or was the collection (or certain parts of it) held in charitable trust or otherwise subject to enforceable donor restrictions? It is an important question, not least because the law addressing the question of enforceability of donor restrictions (particularly in bankruptcy) is sparse and inconclusive. The second reason the DIA discussion continues to be interesting is for the light that it sheds on how art is valued. Art appraisals are seldom public documents, and competing appraisals that include critiques of the other’s assumptions, methodologies, and conclusions, are rarer still. The third reason the DIA discussion has been important is for its focus on the role of art (specifically, publicly-available art) in a city’s self-image and life. This part of the discussion has played a small role in the case directly, but has played a much larger role in the public discussion surrounding the DIA.
Continue Reading Art Valuation: The Detroit Institute of Arts

Photographer Vivian Maier posthumously emerged as an important and previously unknown American street photographer after the contents of her storage lockers were sold at auction in 2007.  The storage lockers contained negatives – many negatives.  But the identity of the photographer was not immediately known.  Maier was identified as the photographer shortly before she died in 2009, but it was only after her death, as prints of her photographs were published, exhibited and sold, did she receive acclaim.

But now, the question of who has the right to control her legacy is in dispute.  In August, Julia Gray wrote:

Today, the majority of Maier’s work — prints, Super-8 films and thousands of negatives — is owned by three men: Jeffrey Goldstein, John Maloof and Ron Slattery. Both Goldstein and Maloof have sold prints in limited editions through galleries.

Slattery only has the original prints and some negatives that he bought at the 2007 auction. Goldstein and Maloof have obtained a great deal more of Maier’s artistic output, as well as cameras and other personal items, from her estate. They both sell limited edition prints through galleries. Goldstein has also published a book of Maier’s photos, and Maloof is working on a documentary about her discovery and legacy, which will debut at the Toronto International Film Festival in September.
Continue Reading The Rights of Images: Vivian Maier – The Battle for a Photographer’s Legacy

We typically believe that if we entrust our property to someone else to sell it, the property remains ours until it is sold. However, this may not always be true. If the party into whose hands property has been entrusted files for bankruptcy, the entrusted property may be deemed to be property of the debtor’s bankruptcy estate and the bankruptcy trustee may have the right to sell the property and the debtor’s secured creditors and judgment creditors may even have a higher priority to receive distribution of proceeds from the property’s sale.     

This type of transaction is a “consignment,” which the Uniform Commercial Code (UCC) defines as “a transaction. . . in which a person delivers goods to a merchant for the purpose of sale.” UCC § 9-102(a)(20). To qualify as a consignment, the consigned artwork must have a value of not less than $1,000 and must not be “consumer goods.” UCC § 9-102(a)(20)(B). “Consumer goods” are those which are “used or bought for use primarily for personal, family, or household purposes.” UCC § 9-102(a)(23). Although many artworks will be considered consumer goods, particularly those consigned by art collectors, artworks that are held for investment purposes or which are consigned by art dealers, corporate entities (i.e., corporate collections), or museums are not consumer goods. Also, the party to whom the artwork is consigned (the consignee) must deal in artwork of that kind, must not be an auctioneer, and must not be generally known to sell artworks owned by others. UCC § 9-102(a)(20)(A).     
Continue Reading Art Consignment

At the recent Frieze art fair in London, Italian mid-twentieth century work moved briskly. Sotheby’s Italian and Contemporary sales broke records, including the highest price ever paid for the work of Piero Manzoni, whose “Achrome” sold for £12.6 million. Several galleries focusing on Italian art of the 1950s and 1960s recently opened in London and Paris. Some have suggested that the rising amount of sales activity in Italian mid-century work is driven, at least in part, by pressure exerted by Italian laws restricting the export of art. The Art Newspaper recently reported that “[d]ealers and collectors are rushing to export works from Italy before they fall under the restrictions. . . . The number of works by Arte Povera artists (such as Alberto Burri, Alighiero Boetti, Mario Merz and Michelangelo Pistoletto) sold at auction has grown from 35 in 1997 to nearly 300 in 2013.” Of course, increased auction sales reflect changing tastes and collector interests, but the looming effect of export restriction casts a long shadow over the Arte Povera works held in both public and private collections in Italy.     
Continue Reading Export Restrictions: Italian Mid-Twentieth Century Art

In the United States, with a few exceptions, museums are organized as private charitable trusts or charitable corporations. They derive their purpose from their founders’ charitable purposes. When a museum falters (normally when endowment and other income is insufficient to fund the museum’s operations), options may be limited. In the case of the Fresno Metropolitan Museum of Art, the result was closure and sale of the museum’s assets.

However, as The Barnes Foundation and, more recently, the Corcoran Gallery of Art, have shown, when foundations or other charitable institutions are available as partners, complete dissolution of the museum may be avoided. The question remains: How to accomplish the needed change.
Continue Reading When a Museum Falters: The Corcoran Gallery of Art

The Third Reich’s policy of seizing works of art to build the collection of a planned Fuhrermuseum to be constructed in Linz, Austria, or (for the modern works the regime deemed “entartete Kunst” (degenerate art)) is, by now, well-known. The Rape of Europa (Lynn H. Nicholas, 1994), The Lost Museum (Hector Feliciano, 1995), and The Monuments Men (Robert M. Edsel, 2009) have given detailed accounts of Nazi art looting for a popular audience.

Although the Nazis formal cultural plunder program carried out by the Einsatzstab Reichsleiter Rosenberg (the ERR), was not established until 1940, forced sales and outright theft of works began much earlier. “Forced sales” are transactions in which works were “purchased” from their owners for a fraction of their market price (or for no payment) in circumstances where the owners, frequently but not exclusively Jews, were desperate to secure exit visas or to raise funds for travel costs to escape Nazi-controlled territories. At times such forced sales were given the formal appearance of licit transactions. Before the war’s end, the Allies and the governments-in-exile issued the London Declaration, invalidating “any transfers of, or dealings with, property, rights and interests of any description whatsoever which are, or have been, situated in the territories which have come under the occupation or control” of the Axis power. The policy articulated in the London Declaration applied “whether such transfers of dealings have taken the form of open looting or plunder, or of transactions apparently legal in form, even when they purport to be voluntarily effected.”     
Continue Reading Nazi-Looted Art: Cornelius Gurlitt and Toren v. Federal Republic of Germany and Free State of Bavaria