On November 15 in New York City, Leonardo da Vinci’s Salvator Mundi sold for a record-breaking price of $400 million to an anonymous buyer, becoming the most expensive painting sold in world history.
It is a price tag that would thrill just about any seller. But for this particular seller, Russian billionaire Dmitry Rybolovlev, it was also another chapter in a nasty legal battle against Swiss art dealer Yves Bouvier.
“The sale of Leonardo da Vinci’s Salvator Mundi, for a record amount, cannot make us forget the scheme to defraud, implemented by Mr. Bouvier,” Hervé Temime, a lawyer for the Rybolovlev family, wrote in a statement shortly after the da Vinci sale. “In these circumstances, the companies of the Rybolovlev family will relentlessly continue to sue for this very serious scheme to defraud of which they have suffered and which is neither proved nor disproved by the resale price of the collected pieces of art.”
Bouvier declined to comment, but his lawyer, Daniel Levy, directed me to documents filed on November 20 to the U.S. District Court Southern District of New York for Bouvier’s official stance.
Bouvier has argued that he is not guilty of wrongdoing, saying in court documents that he was not “an agent of Rybolovlev or Rybolovlev’s entities” but was an independent seller, transacting “at arm’s length with Rybolovlev and his entities… As such, Bouvier was entitled to buy the Works himself and to … sell them at any price that Rybolovlev and his entities agreed to pay.”
Bouvier’s November 20 filing is a direct response to a request from the Rybolovlev team to use certain documents in a different action in the United Kingdom.
The Rybolovlev family trust argues that the documents contain information that implicate auction house Sotheby’s which brokered the sale of the da Vinci painting to Bouvier before he sold it to Rybolovlev. Rybolovlev aims to bring a new case against Sotheby’s and Bouvier for fraud. In response, both Sotheby’s and Bouvier filed motions to block the use of these documents, saying there is no fraud and these documents should not be used in court.
The saga began back in May 2013 when Bouvier told Rybolovlev he bought the Salvator Mundi for $127.5 million. It was one of 38 paintings, including works by Picasso, Van Gogh, Rothko and Modigliana as well as the da Vinci, that Rybolovlev purchased for a reported $2 billion, with Bouvier acting as broker. About a year after he purchased the painting, Rybolovlev read in a March 2014 New York Times story that a three-person consortium had sold the Salvator Mundi to Bouvier for somewhere between $75 million and $80 million.
Courtesy of Christie’s
Upon learning about the alleged mark-up, Rybolovlev, according to court filings, began to investigate. Rybolovlev’s legal team alleges that Bouvier received a 2% commission for the art transactions, which means he would have pocketed $1.6 million from an $80 million sale. Bouvier, however, flipped the painting to Rybolovlev for a $127.5 million, earning himself over $50 million in profits from Salvator Mundi alone.
Ryboloblev estimated that the collection he’d purchased for $2 billion was actually worth closer to $1 billion. The Rybolovlev family trust filed its first criminal lawsuit against Bouvier in January 2015 in Monaco. The family trust has since filed civil proceedings against Bouvier in Singapore and Hong Kong, as well as joined a criminal lawsuit against the dealer brought by Catherine Hutin-Blay, stepdaughter of Pablo Picasso, in France. Together, these events have been dubbed the Bouvier Affair in the art world.
The Singapore civil proceeding was dismissed because the court concluded the dispute should be resolved in Switzerland, where the alleged oral agreement between Rybolovlev and Bouvier initially took place. All the other cases are still ongoing with Bouvier denying wrongdoing.
Rybolovlev and the Swiss art broker had a relationship stretching back over a dozen years, to 2002 or 2003. But even that relationship may not have been as straightforward as it appeared. Rybolovlev’s family trust has alleged in court filings that Tania Rappo, godmother to one of Rybolovlev’s daughters, introduced Rybolovlev to Bouvier and received payoffs as a result, totaling approximately $100 million.
Rappo disputes that there was anything illegal about the payments, calling them a “finder’s fee” for introducing business to Bouvier.
While Salvator Mundi ended up selling for more than double the amount that Rybolovlev purchased it for from Bouvier, and helped make up some of the $1 billion he claims he got cheated out of, it may be that Rybolovlev — whose net worth Forbes estimates at $7.4 billion after selling his fertilizer business in 2010 for billions — is suing the Swiss art dealer for more than just monetary reasons.
More Info: www.forbes.com
Categories: Money Matters