We’ve previously posted about how litigation is causing art foundations to reconsider authenticating art.  Recently, a court provided support for these foundations by upholding the covenant not to sue clause found in the agreement signed by the art owner that was required by a foundation in support of the authentication services.

In Thompson v. Andy Warhol Foundation, on three different occasions, the plaintiff submitted a drawing to the Foundation that he claimed was an Andy Warhol self-portrait.   The Foundation each time sent plaintiff an opinion that the drawing was not made by Andy Warhol.  Plaintiff filed suit, but summary judgment was awarded in favor of the Foundation.

On appeal, the First Department found that the covenant not to sue barred most of plaintiff’s claims.  The Court also found that there was no special relationship between the parties that imposed any greater duty on the Foundation than those set forth in their written agreement.  The Court also notably again held that “the market place is the appropriate place to resolve authentication disputes”  and was not going to second-guess the decision made by the Foundation.

If you would like more information, please write to Mike Bono.