As the Los Angeles Times and other news outlets have recently reported, the Sam Francis Foundation and other artists or their estates are suing for repeat sale royalties under the California Resale Royalties Act. This legislation, apparently honored more in the breach than in actuality, returns a 5% royalty to artists upon profitable reselling of works at values above $1000. The California law applies to artists living in the state, estates of artists going back 20 years, and/or to sales taking place in the state.

Galleries, major auction houses, and even Ebay are being targeted in lawsuits seeking payment of royalties by well known artists such as Chuck Close, Laddie John Dill and Robert Graham Estate . Similar to “droit de suite” resale royalties laws on the books in many European countries, artists are hopeful that such suits, if successful, will lead to adoption of a national law. The royalty is based on the retail sale price of the artwork, less whatever was originally paid for the work by the current seller. So works purchased years ago and held during decades of appreciation, as often occurred with the top tier of artists, can result in some whopping assessments.

The royalty can apply even if the artist lived in California for as little as two years, and also applies to barter or exchange of works as well as outright sale. Yikes. The fine print can be found in the California Commercial Code, section 986, always our first stop for a rousing read.

Betsy Dorfman

Photo courtesy of the FBI

The FBI has announced recovery and return to Iraq of a variety of pots, terracotta plaques, oil lamps, and other artifacts illegally seized by Department of Defense contractors in 2004. The full article can be found here:

http://www.fbi.gov/news/stories/2011/july/artifacts_070711/artifacts_070711

Estimated at 2,500 to 4,000 years old, the looted goodies were used by the contractors as gifts and bribes, or sold to other contractors who smuggled them into the U.S.  Two of the contractors were prosecuted and are serving prison terms as a result.

Tens of thousands of such artifacts are thought to be circulating in the netherworld of black markets, with the UAE being a major hub of such activity. More than 15.000 items were taken from the National Museum in Iraq alone. Destined for purchase by European and other collectors, smugglers have proven adept at avoiding customs regulations and exporting such goods either deliberately mis-identified as modern pieces or by essentially hiding them in containers and other bulk shipments of legal commodities.

As any shipping professional can attest, there simply isn’t an affordable or rational way for every shipment to be inspected by customs officials. And with terrorism the main focus of interdiction efforts worldwide, who is going to unpack and investigate the provenance of every souvenir pot, fossil, sculpture and ceramic that travels through the worldwide freight system? Unguarded borders also exacerbate the problem, although to a lesser extent. While this latest recovery by the FBI is good news, the problem isn’t going away anytime soon.

Overseas travelers should be aware that most countries have strict laws prohibiting export of  items deemed to be part of their cultural heritage. That cute little clay vase the guy on the corner sold you cheap could get you into big trouble, and as an airline passenger your personal baggage is inevitably screened and inspected. While the law may allow for leniency where the possessor had no way of knowing the item was illegal, items purchased on the street or in a “flea market” setting, and without accompanying paperwork (provenance) may be enough to suggest that you knew, or should have known, that the artifact was possibly, or even likely, illegal. Instead of adding to your knick-knack shelf, you could end up collecting time off for good behavior.

Betsy Dorfman

Our sympathies, guys.

Betsy Dorfman

As a fine art storage facility, we do on occasion become involved in holding art assets on a fiduciary basis for estates or attorneys while various legal entanglements are sorted out. In other words, while people fight over who gets what. The recent court action filed by Victoria Duffy to forestall auction of specified artworks from the estate of her late husband Dennis Hopper is unfortunately typical of the process.

 On more than one occasion we have been asked to remove artworks from a residence in a hurry – on a weekend or late at night – by one spouse or another. Where this was recognizable as a questionable tactic or even admitted as an attempt to shield assets from a pending divorce action, we have declined to become involved. But often we have no idea who the legal owner of items might be. If someone engages us to move artworks to storage or to a third party location we will do so. Galleries often store paintings which they don’t own, and traveling exhibitions consisting of many loaned works are also routinely stored and transported between venues. In these circumstances it is the depositor of the goods who has the right of access to them – at least until proven otherwise.

Record keeping is generally the crux of the disposition matter. For serious collectors as well as the more amateur variety, being able to demonstrate the provenance of an artwork – who acquired it when, and from who, in what order – often settles the issue of legal title. If an artwork is stored by someone who is proven not to have legal title, it can be returned to the rightful owner. As the result of a proper legal action, and once the bills are paid, of course.

Companies like ours keep accurate records, and keep them long term, showing where artworks have been picked up, stored, and delivered. We do this for tax reasons, but such records are also useful to demonstrate chain of custody. Unlike self storage where there is no record of what is stored, we keep itemized inventories of everything on hand, dates in and dates out, and to whom items were released or delivered. If you are trying to hide assets, you’ll probably want to set up a nice web of cardboard holding companies before you call us. On the other hand if you’re looking to have careful inventory documentation, confidentiality, and assurance that proper procedures for access and information control are in place, then a fine art storage provider is your best bet. We’ve got your back. At least until the lawyers get to work.

Betsy Dorfman

Any item stolen in the U.S. and valued at $2000 or over can be listed. The goal, in addition to recovery, is to provide a forum that will help keep “hot” items off the market in the first place. Collectors and galleries can and should search here if any red flags are raised in the course of their due diligence before acquiring or representing works. The listings cover a variety of works including paintings, sculpture, stamps, pottery, tapestries, books and other cultural heritage artifacts.

The database currently has a library of some 7000 images, and items can be searched by keyword and category, as well as by artist, title, and date range. The FBI website also features stories of both solved and unsolved art thefts — pretty interesting reading from an unlikely source of, albeit cautionary,  entertainment.

Weve had only one encounter over the years with law enforcement seeking information on a possibly forged painting we shipped for a client. Such cases can take years to unfold and prosecute; just discovering the  principal parties to a transaction can be tricky where layers of contacts are deliberately put in place to conceal buyer and/or seller identities. Such concealment isn’t always nefarious — galleries and dealers sometimes have quite Byzantine arrangements involving loans and multipart ownership of pieces which may not be made transparent to the buyer. And which, so long as the artwork and provenance are genuine, will not be made famous online by the FBI.

It remains to be seen if the Internet will prove useful in curbing at least some of the trafficking in stolen art, which the FBI acknowledges to be an age old problem. Time to turn in that Monet you found in the dumpster — everyone is going to recognize it now.

Betsy Dorfman

In addition to describing how some of us feel after a long work week, “antique condition” is a phrase which art and antique handlers use, in my opinion, too frequently. The term comes into play when an item is being picked up and notes made as to its existing condition. In this context “antique condition” is designed to cover a multitude of sins, and save the handler the bother of noting down every scratch, ding, smudge and coffee ring. Hey, the thing has been around the block for fifty years, we can all see that, right? That’s why they call it an antique! Basically a more refined way of saying “used”, this remains however a shortcut that opens the door to problems down the line.

In conjunction with record photography of the piece, noting “antique condition” and leaving it at that, admittedly, does the job much of the time. Despite my managerial grumbling. But not always. Every once in awhile a situation arises where a client will see what they believe is fresh damage, or a compromised area which they maintain has appeared since the piece was last seen  in the showroom or vendor’s shop. So out come the condition notes and photos. The photos may or may not show the exception in question, depending upon the type of mark or loss, and its location. If it then comes down to the handler’s notes made at pickup, and all we have is “antique condition” – basically we have come to a dead end in our ability to firmly establish the problem as preexisting or not. If insured through the art handler, a claim could go either way – but the whole idea of condition reports and notes is to establish condition and avoid gray areas and claims.

Digital photography has helped with this issue, to be sure, and many exceptions do show up in a set of carefully taken photos. But written reports, together with diagrams where precise locations of exceptions are shown, remain the gold standard. Nothing replaces good old descriptive language, and a clear statement of what type of problem is seen – scratch, stain, paint loss, tear in fabric, etc.- together with a note as to its location. These notes are, as attorneys like to say, dispositive ; in the event of a claim they will likely dispose of any question and settle the matter.

Condition notes, prepared by professionals, are meant to be detailed and focused in their findings. You wouldn’t want to see “antique condition” in your medical chart; you shouldn’t see it on a bill of lading, for the same reason –just plain not enough information.

Betsy Dorfman

What has dozens of steel quills and makes a  surprisingly lovely sound as you walk toward it?   It’s an elegant steel sculpture by Italian artist and furniture designer Harry Bertoia (1915-1978), and it was my distinct pleasure as the new crating manager to pack it this week. As a recovering sculptor myself, I take particular delight in Bertoia’s lively, indeed musical, use of industrial materials and their properties.

This piece, an assortment of slender steel rods welded to a rectangular plate in a somewhat pitched “V” formation, was certainly handsome enough to look at, but the real surprise revealed itself as I stepped closer and heard the rustle of the steel rods, making a sound like brushes on a cymbal; sizzle, sizzle, sizzle… 

From a crating perspective, the fragility of the piece posed certain challenges.  The sculpture had come to us with an extant injury (one of the rods had fallen loose from the plate), and I wanted to ensure that the packing put only minimal stress on the welds.  This meant no compression – nothing on top to flex the rods.  Capturing the base was therefore the way to go, so I devised a system of padded yokes which fit together like a 3D puzzle, grasping the piece from its sturdiest point.  To keep the rods from trembling in transit, I gently bundled them together and grasped with a sliding foam collar.

Packing of complex sculpture has always been one of my favorite aspects of this job.  It offers the art enthusiast in me a chance to commune with works of sculpture in a very tactile way, and allows me to show of my own chops as a craftsman.  The little rustling Bertoia was my favorite kind of project… pretty good day at the office!

Ian Patrick for FINE ART SHIPPING

Artwork from the collection of David K. Pressman

As the article notes, the recent brazen thefts from the Museum of Modern Art in Paris, where paintings were apparently wrenched from the wall during an ongoing security system outage, has had the blogosphere all atwitter for weeks. Not to mention the offices of art handling companies such as ourselves around the world.  A security system lapse, with no backup? No Rfid tags on paintings of that value? Not even a guy watching them?

Many hospitals today affix Rfid tags to newborns via leg bracelets or similar, and warn new parents not to stray from a designated area in the nursery zone lest alarms sound, exit doors close and lock, and gendarmes come running.  For babies, yes, but not for Matisse and Picasso? Incroyable!

I suppose there will always be ingenious theives who will find their way around whatever technologies are deployed against them, but we should at least give them a run for their money. Or I should say, for our money. Make it too easy and even the art theives turned bloggers may think again and go back into the trade.

Or maybe this is one of those tricky film plots where the good guys let the bad guys take the loot in order to trace the thieves back to their den of filched old masters, hidden in hollowed out loaves of,  but of course, french bread. Which are then recovered by Peter Sellers but left in the police van while he updates his blog, only to be, heartbreakingly, stolen from the unlocked van and and eaten by hungry college students incapable of discerning between aged canvas and charcuterie.

We wish the pros success in restoring these works to public view. And for all you art thieves who apparently spend a lot of time reading blogs like this, please know that you can drop off hot artworks at our dock any weekday by 5 PM. I’m not saying that we’re affiliated in any way with the Los Angeles Police Department Art Theft Detail, or have actually helped them solve any cases, but but let’s just say we know how to open a crate and look inside, if you catch my drift.

BetsyDorfman

Seeing is believing
Like a barcode, the Rfid is a machine readable tag that, in concert with a database, identifies a specific object. Unlike a barcode, the Rfid reader does not require direct line of sight to the label or tag. The transponder tag emits a radio signal that is picked up by the reader and instantly identifies the item as present or “seen.” The beauty of this is that multiple items within a crate, bin, or on a shelf, or even in a truck, can be scanned at once, without moving them around to expose the tag. There are some limitations — metal may block the transmission, and there are limits to the “reach” of the signal –but for the majority of daily inventory tasks an art handler performs the system is ideal.

What, where, how
In a working warehouse knowing what is where and finding it quickly is critical. Every art handler has experienced the frustration of counting and recounting inventories, and unpacking packed crates to re-verify contents, not to mention the “all hands on deck” call to find an item temporarily mislaid. Eliminating this wasted time and effort directly feeds the bottom line. Items coming or going from storage can be scanned in using either a handheld device or put through a “portal” which reads the tags as the artworks are carried by. Because the tags are discrete, there is no confusing one Hockney or similar size with another, or transposing an inventory number when a an art handler is reading from paper labels. And no physical moving of objects to read paper labels on the far side or uncover a barcode. The system will also question any duplicates and, if an expected inventory is uploaded into the system ahead of the shipment’s arrival, will compare what is actually received to what was expected and display any extra or missing items.

Is that crate really empty?
Was any art left in the truck?
How many pieces are in that bin?
Did we deliver at stop 2 everything we picked up at stop 1, as requested?
Did we “pull” all 83 items accurately from the client’s storage?
What’s the package count for this shipment?

These are the types of everyday issues that the Rfid system addresses, and solves.

Where’s my stuff?
The other major benefit is the inventory management system it enables: we call ours SMI (storage maintenance inventory) for short. Using portable computers in the warehouse and in the field, each RFID tag is read and then related information identifying that item – artist, title, art dims, package dims, client name, job number, date in or out, warehouse location, and, yes even photos — is keyed into the database and saved. The database is accessible from any computer, which means our customer service reps and our warehouse crew can access inventories instantly to answer questions, locate items, or process delivery requests.

Show me the money
Billing is also streamlined, as SMI shows volume on hand in real time and does all the computing of cubic and square feet occupied by any inventory. It can further compute the storage charges for a given month, assuming a rate per CF or SF is entered for that client. The time saved by this application alone would likely pay for the system. Storage is the backbone of most art handling operations; having the billing done quickly and accurately is money in the bank.

Send in the clouds
Storing the SMI system data “in the clouds”, i.e. on a third party maintained internet-based bulk server, offers striking cost and efficiency benefits. First and foremost, we access our data in real time from virtually any computer anywhere, with security, backup solutions, and privacy issues all managed by the host. Information entered into a remote computer on a jobsite or secondary warehouse can be seen virtually in real time back at the office by a manager or client representative who can provide feedback as needed. And soon we’ll be offering clients the ability to log in under a private ID and view their storage or exhibition inventories online at their convenience.

And the future goes to….
Building and managing inventories using barcodes was a major advance over paper only labeling and manual input inventory systems. Rfid technology builds on that model and is a tested technology. Aside from use by major “big box” retailers, Rfids are already implanted in numerous products and medical devices. The basic technology is poised to take off with prices sure to drop for equipment and supplies as usage increases. Always a technology leader, FINE ART SHIPPING is pleased to offer the benefits of Rfid inventory management to our clients, not because it is the latest thing, but because it is the latest, and now affordable, best thing.

Betsy Dorfman

In case you missed it, Weekend Edition Sunday with Margo Adler showcased the upcoming sale of Michael Crichton artworks at Christie’s this week. As previous blogs have noted, Crichton was a lifelong collector of modern artworks, and we have had the privilege of moving and installing — and installing and reinstalling and reinstalling again — these works for the last decade and beyond.

Our art handler Owen Casey Rothstein is interviewed in the piece, and further details the fun and challenge of handling and relocating art for this client.

Here is a link to story – our ten seconds of fame!

http://www.npr.org/templates/story/story.php?storyId=126608315

Thanks to Brett Gorvy of Christie’s and to the Crichton family for their inclusive spirit which allowed us to be a part of this program and the larger undertaking of handling and preparation of these artworks for sale.

Betsy Dorfman