Platt et al v. Michaan et al, No. 1:2019cv04234 - Document 38 (S.D.N.Y. 2020)
Court Description: AMENDED OPINION AND ORDER: For the reasons set forth above, Michaan's motion to dismiss is DENIED. The Clerk of Court is respectfully directed to terminate the motion, Doc. 20. (Signed by Judge Edgardo Ramos on 5/8/2020) (mro)
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Platt et al v. Michaan et al Doc. 38 Case 1:19-cv-04234-ER Document 38 Filed 05/08/20 Page 1 of 11 UNITED STATES DISTRICT COURT SOUTHERN DISTRICT OF NEW YORK , as cotrustees of the Platt Family Artwork Trust, AMENDED Plaintiffs, OPINION AND ORDER against 19 Civ. 4234 (ER) , Defendant. I. 1 Fields of Id. ¶ 1. They were created more than a hundred years ago by the renowned artist Louis Tiffany. Id. ¶ 9. granddaughter of the artist, held the two paintings at the time of her death in 1992. Id. Prior to her taking possession, the paintings had been held in the Platt Family for two generations. Id. When Louise died in 1992, she left the Nuremberg Paintings, along with other paintings created by her grandfather, to be divided among her three sons Henry, Thomas, and Graham 1 Dockets.Justia.com Case 1:19-cv-04234-ER Document 38 Filed 05/08/20 Page 2 of 11 ( , allegedly for their lifetimes. Id. ¶ 10. The division was Id. According to plaintiffs, the Platt brothers understood that their right to the paintings was none of the paintings would be sold or otherwise transferred outside the Family. Id. ¶ 11. The Platt brothers also understood that their life estates in the paintings would end upon their death, after which the paintings in their custody Id. These understandings and an anti-alienation restriction were set forth in a letter2 from Thomas to Henry and Graham: Under equally to the three of us to be divided among us as we shall agree or, should we fail to agree upon such division, then such division shall be made as her Executor Notwithstanding any tentative allocations which may have been made over twenty years ago or any processes enabling Mother to start making gifts to us and to the children to remove items from her estate, the fact is that no such gifts or allocations were made by her and the discussions with respect to the same are not legally or morally binding on anybody now. The tangible personal property was hers to bequeath then, was hers at the time she made her Will in 1982 and was hers at the time of her death and her Will governs the division. Harry has expressed to me a preference for at least two, if not more, Tiffany paintings (the Nuremberg and the Algiers). I think if we are going to agree upon preferences of this sort, we are going to have to make the preferences, 2 2 Case 1:19-cv-04234-ER Document 38 Filed 05/08/20 Page 3 of 11 subject to anti-alienation agreements to any person outside of an immediate family member both during life and at death, i.e. restrict them to life estates with the redivision being made to present members of the class surviving at the termination of the life estate. Absent such agreements discretion, determine the division. I think this is the only fair way for everybody, particularly those who may survive for the next 50 years or so, and I think we have to proceed on this basis. Hoping you agree. Doc. 22, Ex. B.3 Furthermore, the Platt brothers acknowledged these understandings and anti-alienation restriction when they took the paintings into their custody, and divided them amongst themselves. Id. ¶ 12. These understandings were conditions on which they received custody of the paintings. Id. The Platt brothers also acknowledged these understandings and anti-alienation restriction with respect to the Family paintings in conversations over the years with family members and third parties. Id. ¶ 13. The three Platt brothers are now deceased. Id. ¶ 15. On March 21, 2018, after the death of the three Platt brothers, members of the Platt Family created the Trust to provide for the continued enjoyment of the paintings by members of the Platt Family. Id. ¶¶ 4, 17. The estates of Thomas and Graham arranged for custody of the paintings in their possession to be divided among members of the Platt Family. Id. ¶ 15. When Henry died in 2015, the Nuremberg Paintings were not accounted for. Id. In February 2019, after its establishment, the Trust learned that a New York gallery was exhibiting and offering for sale one of the Nuremberg Paintings at the Park Avenue Armory in New York City. Id. ¶ 18. Upon learning of this information, the 3 3 Case 1:19-cv-04234-ER Document 38 Filed 05/08/20 Page 4 of 11 Trust contacted the gallery, which in turn referred the Trust to Michaan, who had possession of the paintings and had put them up for sale. Id. ¶ 19. On April 22, 2019, the Trust received an advising that Michaan purchased the Nuremberg Paintings. Id. ¶ purchased the Nuremberg Paintings for one million dollars from an agent purporting to represent Henry Platt on April 29, 2011. Id. ¶ lawyer attached to the email a bill of sale Company, 145 East 57th Street, New York, NY 10022, Id. ¶ 22. The bill of sale des of the artist and holds clear title to these works. These paintings have remained in the [Family] Id. According to the complaint, while the bill of sale was correct in noting noting that Henry held clear title to them. Id. ¶ 22. The email further advised that Michaan was in the process of bringing the Nuremberg Paintings to the market. Id. ¶ 24. Thereafter, the Trust made a demand that Michaan immediately return the Nuremberg Paintings, but the demand was rejected. On May 9, 2019, plaintiffs filed the instant complaint, asserting two claims for replevin, one claim for conversion and a claim for declaratory judgment. Doc. 1. On August 30, 2019, Michaan moved to dismiss all claims. Doc. 20. II. motion to dismiss, a complaint must contain sufficient factual matter, Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007)). A claim is fa 4 Case 1:19-cv-04234-ER Document 38 Filed 05/08/20 Page 5 of 11 Id. (citing Twombly, 550 U.S. at 556). The plaintiff must allege sufficient facts Id. (citing Twombly, 550 U.S. at 556). In re Elevator Antitrust Litig., 502 F.3d 47, 50 n.3 (2d Cir. 2007) (quotation marks and citation ... motion to dismiss, Twombly, 550 U.S. at 555. The question on a motion to dismiss ltimately prevail but Sikhs for Justice v. Nath, 893 F. Supp. 2d 598, 615 (S.D.N.Y. 2012) (quoting Villager Pond, Inc. v. Town of Darien, purpose of Federal Rule of Civil Procedure 12(b)(6) is th Halebian v. Berv, 644 F.3d 122, 130 (2d Cir. 2011) (internal quotation marks and citations omitted). Accordingly, when ruling on a motion to dismiss pursuant to Rule 12(b)(6), the Court accepts all factual allegations in the complaint as true and Nielsen v. Rabin, 746 F.3d 58, 62 (2d Cir. 2014); see also Twombly -pleaded complaint may proceed even if it strikes a savvy judge that actual proof of those facts is improbable . . . . this rule, the complaint is deemed to include any written instrument attached to it as an exhibit or Chambers v. Time Warner, Inc., 282 F.3d 147, 152 (2d Cir. 2002) (internal quotation marks and citations omitted). 5 Case 1:19-cv-04234-ER Document 38 Filed 05/08/20 Page 6 of 11 III. DISCUSSION 6 Case 1:19-cv-04234-ER Document 38 Filed 05/08/20 Page 7 of 11 A. Provenance of the Nuremberg Paintings primary argument for a claim of ownership or a superior right to the Nuremberg Paintings is that the Platt Family, and subsequently the Trust, have always owned the Nuremberg paintings. Therefore, the Trust contends, the purported sale of the Nuremberg Paintings by Henry to Michaan was wrongful because Henry never owned them. In response, , and that both Louise and Henry had ownership of the Nuremberg Paintings. The Court finds that the allegations do support a claim of ownership by the Platt Family, and that they are not contradicted by the Letter. T are more than sufficient to support a claim of ownership by the Platt Family. Indeed, the Trust alleges that the Platt Family has always owned the Nuremberg Paintings and that Louise left them to be held by the family. The Trust further alleges that there is an agreement and understanding among members of the Platt Family that ownership of the paintings stay in the family, and that Henry received custody of the Nuremberg Paintings subject to those understandings and agreements. These factual allegations, accepted as true, support an inference that the Platt Family owned the Nuremberg Paintings at the time of the sale. In addition, the Court disagrees with that are directly contradicted by the Letter. The cases cited by Michaan are based on documents that unambiguously and clearly contradict the allegations in the complaint. See e.g. Matusovsky v. Merrill Lynch, 186 F.Supp.2d 397 (S.D.N.Y. 2002). Here, nothing in the Letter plainly Contrary in favor of the Trust, the Court finds that the Letter, at the very least, supports an inference that Henry obtained custody of the Nuremberg 7 Case 1:19-cv-04234-ER Document 38 Filed 05/08/20 Page 8 of 11 Paintings subject to an understanding that they would stay within the family. Specifically in the Letter, Thomas -alienation See Doc. 22 Ex. B. Moreover, the complaint alleges that the estates of two of the three brothers, Thomas and Graham, arranged for the paintings in their possession to be divided among members of the Platt Family, consistent with the Tru any event In is based on his own alternative interpretation of the Letter that, at best, creates issues of fact that cannot be resolved at the motion to dismiss stage. B. New York Statute of Frauds and EPTL Michaan also attempts to invoke the defense of the New York Statute of Frauds to the , arguing that any alleged of those paintings fails to satisfy the New York General Obligations Law § 5-701, § 5-703 and the New York Estates, Powers & Trusts As one New York State Appellate Court recently explained, certain types of agreements must be in writing and signed by the party to be charged therewith, pursuant to the New York Statute of Frauds. See Massias v. Goldberg to, inter alia, New York General Obligations Law §§ 5-701, 5-703 and EPTL 13-2.1). Specifically, section 5-701 of the New York General Obligations Law s subscribed by the party to be charg performed within one year from the making thereof or the performance of which is not to be 8 Case 1:19-cv-04234-ER Document 38 Filed 05/08/20 Page 9 of 11 -701(a)(1).4 In addition, section 13-2.1 of the New York EPTL imposes a similar requirement for a signed writing for any contract to make a testamentary provision.5 Here, any agreement among the Platt brothers to limit to lifetime custody, subject to anti- alienation restrictions, could not be completed within one year from its making or before the death of Henry. Arguably therefore, any such agreement among the Platt Brothers would be subject to the New York Statute of Frauds. However, Michaan, as a stranger to any agreement among the Platt brothers, cannot interpose the New York Statute of Frauds defense. Darby Trading Inc. v. , 568 F.Supp. 2d 329 (S.D.N.Y. 2008) is inapposite. Contrary , the Darby Court reaffirmed the well settled law that the New York Statute of Frauds is a personal defense that cannot be availed of by a third party. See id at 347 (collecting cases); see also Raoul v. Olde Vill. Hall, Inc. Darby a defendant in the action and interposed the statute of frauds defense. See generally id. Michaan, as a third party, cannot avail himself of the statute of frauds defense. ly alleged ownership or a superior right to the Nuremberg Paintings is denied. 4 5 9 Case 1:19-cv-04234-ER Document 38 Filed 05/08/20 Page 10 of 11 C. The Trust also asserts a second replevin claim on the basis that Henry lacked the mental capacity to even enter into the sale of the Nuremberg Paintings in the instant action. Michaan correctly points out that a person is presumed competent to enter into a binding agreement, thus the burden of proving a lack of mental competency is on the party asserting incapacity. See Feiden v. Feiden, 151 A.D.2d 889, 890 (N.Y. 3rd Various New York state courts him wholly and absolutely incompetent to comprehend and understand the nature of the tra See id (collecting cases). Here, capacity to sell or other transfer the [Nuremberg] Paintings. In addition, as the Trust points out, f the paintings is also inconsistent with his prior conduct, i.e., his conversations that none of the paintings would be transferred or sold outside of the family. Under Restatement See RESTATEMENT (SECOND) OF CONTRACTS § 15 cmt. C (Proof of sufficiently plausible to entitle the Trust to offer evidence supporting the claim. s are inapposite, as they all involve different stages of litigation. See id (appeal after trial); see also Smith v. Comas, 173 A.D.2d 535 In re Kotick, No. 2005-1202, 2014 WL 11456092 (N.Y. Sur. Ct. 2014) (motion for summary judgment); Blatt 10 Case 1:19-cv-04234-ER Document 38 Filed 05/08/20 Page 11 of 11 v. Manhattan Med. Grp., P.C., 131 A.D.2d 48 (N.Y. 1st judgment). Accor denied. D. Standing Lastly, Michaan contends that this action should also be dismissed for lack of standing because the Trust has not shown any ownership interest in the Nuremberg Paintings to establish Again, this contention must fail for the simple reason that the Trust has alleged that the Platt Family has always owned the Nuremberg Paintings; that the Trust was formed by members of the Platt Family to hold those paintings, among others held by Louise during her lifetime; that the Trust has asserted its ownership rights; and that Michaan has denied those ownership rights. Those allegations are suff See Mahon v. Ticor Title Ins. Co., 683 F.3d 59, 62 (2d Cir. 2012). IV. CONCLUSION For the reasons set forth above, motion to dismiss is DENIED. The Clerk of Court is respectfully directed to terminate the motion, Doc. 20. SO ORDERED. Dated: May 8, 2020 New York, New York _______________________ Edgardo Ramos, U.S.D.J. 11
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