Thompson v Andy Warhol Found. for the Visual Arts, Inc.

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[*1] Thompson v Andy Warhol Found. for the Visual Arts, Inc. 2011 NY Slip Op 52046(U) Decided on November 14, 2011 Supreme Court, New York County Edmead, J. Published by New York State Law Reporting Bureau pursuant to Judiciary Law § 431. This opinion is uncorrected and will not be published in the printed Official Reports.

Decided on November 14, 2011
Supreme Court, New York County

Addison Thompson, Plaintiff,

against

The Andy Warhol Foundation for the Visual Arts, Inc.; THE ANDY WARHOL ART AUTHENTICATION BOARD, INC.; THE ANDY WARHOL MUSEUM; JOHN DOES 1-20; JANE DOES 1-20; and RICHARD DOES 1-20, Defendants.



104819/11



Plaintiff Pro Se ADDISON THOMPSON

255 East 7 Street #2F

New York, NY 10009

212-475-0010

addthomp@nyc.rr.com

Defendants ANDY WARHOL FOUNDATION and ANDY WARHOL AUTHENTICATION

BOIES SCHILLER & FLEXNER LLP By Philip J. Lovieno

10 N. Pearl St., 4th Floor

Albany, NY 12207

518-434-0600

piovieno@bsfllp.com

aweber@bsfllp.com

Defendant ANDY WARHOL MUSEUM

REED SMITH LLP By JOSEPH B TEIG

599 Lexington Avenue 28th Fl.

New York, NY 10022

212-521-5413

jteig@reedsmith.com jbteig@aol.com

and

GEOFFREY G YOUNG

212-521-5400

gyoung@reedsmith.com

Carol R. Edmead, J.



Motion sequence nos. 001, 002, and 005 are consolidated for disposition.[FN1] In motion sequence no. 001, defendants The Andy Warhol Foundation for the Visual Arts, Inc. [*2](Foundation) and The Andy Warhol Authentication Board, Inc. (Board) move, pursuant to CPLR 3211 (a) (7), for an order dismissing the first amended complaint (Complaint), as to them. In motion sequence no. 002, plaintiff Addison Thompson, pro se, seeks leave to file a second amended complaint. In motion sequence no. 005, defendant The Andy Warhol Museum (Museum) moves, pursuant to CPLR 3211 (a) (8), to dismiss the Complaint, as to it. That motion is unopposed.

The Complaint alleges breach of contract against the Board; negligent misrepresentation against the Board, the Foundation, and the Museum, and gross negligence against the Board, the Foundation, and the Museum.

Plaintiff, a photographer and a photographic art dealer, purchased a drawing (Drawing), which he believes to be a self-portrait by Andy Warhol. In March 2008, January 2009, and November 2009, he submitted the Drawing to the Board for authentication. The Board, a private corporation, which the Complaint alleges to be funded by the Foundation, certifies, or refuses to certify, works of art as having been made by the late Andy Warhol. It appears that such certification is necessary in order for a work purported to be by Warhol to be sold at a price that would be expected to be paid for a work by that artist. See Sands v Bernstein, 2009 WL 151729, 2009 U.S. Dist.Lexis 54605 (SD NY 2009). Each time that plaintiff submitted the Drawing, he included additional information that, he believed, bolstered his claim that the Drawing had been made by Warhol. After each such submission, the Board sent plaintiff a letter of opinion, stating that the Drawing was not by Warhol.On January 25, 2008, October 9, 2008, and October 8, 2009, plaintiff and the Board entered into a form agreement that provides, among other things, that: "The Authentication Board will endeavor to form an opinion as to the authenticity of the Work as a work created by Andy Warhol. Upon completion of its examination, it may cause an identification number and a stamped or written legend ... to be affixed ... on the Work ...; alternatively, it may deliver to you a photograph of the Work with such legend or other endorsement affixed to it. The legend will indicate the [Board's] opinion, or that the [Board] can form no opinion, as to the authenticity of the Work.

... Attached hereto as Exhibits A, B and C, respectively, are three forms of letters. A letter substantially in the form of one of these letters ... will be delivered to you following completion of the [Board's] examination of the Work. ... [A] letter such as the one attached as Exhibit B will be delivered if the opinion of the [Board] is that the Work is not a genuine work created by Warhol."

Gravante Affirm., Exh. A, at 2; see also id., Exh. B, at 2; proposed second amended complaint (denominated "First Amended Complaint"), Exh. B, at 2.

The first cause of action alleges that the Board violated these agreements by failing to stamp or otherwise mark the Drawing, or a photograph thereof. As quoted above, the agreements provide that the Board "may cause ... a stamped or written legend ... to be affixed ... on the Work," or "it may deliver to you a photograph of the Work with such legend or other endorsement affixed." The repeated use of the permissive word "may" refutes the argument that the Board was required to affix a legend to either the Drawing, or a photograph thereof. See Matter of Woods v New York City Dept. of Citywide Servs., 16 NY3d 505 (2011) ("may" allows use of discretion; "shall" does not). Plaintiff's argument, that the sentence beginning "[t]he legend will indicate," shows that the Board is required to affix a legend, fails because the description of the legend is only applicable in the event that the Board affixes a legend. The description does not require the Board to do so. The Complaint also alleges that the Board violated the agreements by failing to "endeavor to form an opinion as to the authenticity" of the Drawing. That argument is refuted by the fact, acknowledged by plaintiff, that the Board did form such an opinion, and that it expressed that opinion in the three "Exhibit B" letters that it [*3]sent to plaintiff.

Plaintiff's tort claims are barred by the form agreement, which provides, in relevant part, that plaintiff agrees to indemnify the Board, the Foundation, and other indemnitees, and that he "releases, waives and covenants not to sue any Indemnitee, based on any claim or liability asserted ... which is based directly or indirectly on ... any letter herein referred to, or any other action by the [Board] or any other indemnitee in connection herewith, including without limitation any claim that the opinion expressed therein is not correct."

Gravante Affirm., Exh. A, at 3; see also id., Exh. B, at 3; proposed second amended complaint (denominated "First Amended Complaint"), Exh. B, at 3. For the reasons that follow, plaintiff's tort claims would fail, even were they not barred by the form agreements.

A party alleging negligent misrepresentation must show: "(1) the existence of a special or privity-like relationship imposing a duty on the defendant to impart correct information to the plaintiff; (2) that the information was incorrect; and (3) reasonable reliance on the information." MalinPatterson ATA Holdings LLC v Federal Express Corp., 87 AD3d 836, 840 (1st Dept 2011), quoting JAO Acquisition Corp. v Stavitsky, 8 NY3d 144, 148 (2007). The second cause of action must be dismissed because the Complaint fails to allege any fact showing that plaintiff relied upon any misrepresentation, by either the Board, or the Foundation. Nor does the Complaint allege any fact to support a claim that plaintiff had a special relationship with any of the defendants. Plaintiff entered into arms' length contracts with the Board, and while he alleges in a conclusory manner that the Board owed him a duty by virtue of its special expertise (see Kimmell v Schaefer, 89 NY2d 257 [1996]), in the form agreements, which plaintiff signed, he acknowledged that: "forming an opinion as to the authenticity of a work purported to be by Andy Warhol is often very difficult and will in most cases depend upon subjective criteria which are not capable of proof or certainty, and that the conclusion, if any, reached by the [Board] ... is in the absolute discretion of the [Board]."

Gravante Affirm., Exh. A, at 3; see also id., Exh. B, at 3; proposed second amended complaint (denominated "First Amended Complaint"), Exh. B, at 3. A clearer disclaimer of an assumption of a special duty on the basis of special knowledge is hard to envisage. To repeat, however, even were such a duty attributed to the Board by virtue of its role in the market for Warhol art works, plaintiff does not allege that he relied upon any misrepresentation by the Board.

Although the second cause of action is denominated as a claim for negligent misrepresentation, the gravamen of the claim appears to be that defendants defamed the Drawing by sharing their opinion, that it had not been made by Warhol, with others. Unlike a pure opinion, which cannot support a claim for defamation, an opinion that implies that it is supported by unstated defamatory facts may be actionable. Steinhilber v Alphonse, 68 NY2d 283 (1986). However, the Complaint does not allege that, in expressing its opinion to others, the Board failed to give its reasons for its opinion. Accordingly, a claim of defamation does not lie.

Gross negligence is "conduct that evinces a reckless disregard for the rights of others or `smacks' of intentional wrongdoing." Assured Guar. (UK) Ltd. v J.P. Morgan Inv. Mgt. Inc., 80 AD3d 293, 305 (1st Dept 2010), quoting Colnaghi, U.S.A. v Jewelers Protection Servs., 81 NY2d 821, 823-824 (1993). Attempting to show intentional wrongdoing on the part of the Board, plaintiff alleges that Thomas Sokolowski, the former director of the Museum, told plaintiff that if the Board did not like him, it would not authenticate the Drawing. That reported statement does not support the converse allegation: that the Board's refusal to authenticate the Drawing was the result of malice. The complaint fails to allege any fact showing malice on the part of the Board, or that the Board acted recklessly in sending plaintiff the three "Exhibit B" letters rejecting his attribution of the Drawing to Warhol.

Plaintiff's proposed second amended complaint recasts his claims as gross negligence and constructive fraud. Plaintiff's proposed tort claims, no less than his current tort claims, are barred by the form agreements that he signed. Plaintiff does not allege that he was fraudulently induced [*4]to sign those agreements, but rather, that the Board "operates as a façade of public corporate credibility obscuring a deeply corrupt enterprise that enables the Defendants to profit from Warhol works of art that they have a financial interest in"

and that the Board "attempts to shield itself from ... scrutiny ... by requiring the Plaintiff and anyone else who wishes to submit an attributed Warhol piece of art work to the Board to sign a non-negotiable submission agreement that contains a sweeping indemnity clause ... ."

Proposed Second Amended Complaint (denominated First Amended Complaint), at 3. While leave to amend a pleading is to be freely given (CPLR 3025 [b]), leave should be denied where, as here, the proposed amendment is legally insufficient. Fidelity & Deposit Co. of Md. v Levine, Levine & Meyrowitz, CPAs, P.C., 66 AD3d 514 (1st Dept 2009); Heller v Louis Provenzano, Inc., 303 AD2d 20 (1st Dept 2003). Plaintiff's remedy, if any, may be found in the art world, not in this court.

Accordingly, it is hereby

ORDERED that, in motion sequence no. 001, the motion of defendants The Andy Warhol Foundation for the Visual Arts, Inc. and The Andy Warhol Authentication Board, Inc. is granted and the complaint is dismissed as against those defendants with costs and disbursements as calculated by the Clerk of Court upon the submission of an appropriate bill of costs; and it is further

ORDERED that, in motion sequence no. 002, plaintiff's motion for leave to file a second amended complaint is denied; and it is further

ORDERED that, in motion sequence no. 005, the motion of defendant The Andy Warhol Museum is granted and the complaint is dismissed as against that defendant with costs and disbursements as calculated by the Clerk of Court upon the submission of an appropriate bill of costs; and it is further

ORDERED that the Clerk is directed to enter judgment accordingly.

Dated:November 14, 2011

ENTER:

____________________

J.S.C. Footnotes

Footnote 1: Motion sequence no. 004, a motion for admission pro hac vice, was granted by order entered on August 9, 2011. There is no motion sequence no. 003.