Rybolovlev alleges he was systematically overcharged on a series of multi-million dollar deals by Swiss dealer and ‘freeport’ businessman Yves Bouvier and that Sotheby’s “knowingly and intentionally made the fraud possible”.
The Russian potash magnate and owner of AS Monaco football club has sued Bouvier in various courts throughout the world including Switzerland and Singapore over the last 10 ten years although Bouvier has strenuously denied the allegations.
According to the latest legal papers filed in the New York courts by trusts controlled by the Rybolovlev family, Sotheby’s “materially assisted the largest art fraud in history” and “rendered the whole edifice possible and credible”. The claim is seeking $380m in damages.
Series of deals
Rybolovlev’s case against Bouvier centres over the private sale of 38 works by artists including Pablo Picasso, Gustav Klimt, Amedeo Modigliani and Mark Rothko for a combined $2bn. The transactions, which took place between 2003 and 2015, also include Leonardo’s Salvator Mundi that later sold for $450m at Christie’s New York in November last year – the highest value sale in art market history.
Rybolovlev claims Bouvier was employed to act as his agent in return for a commission but that the Swiss dealer was, in effect, buying works and then selling them on to Rybolovlev for inflated prices.
Around a third of the paintings, including Salvator Mundi, Modigliani’s Nu Couché au Coussin Blue and Gustav Klimt’s Wasserschlangen II, were acquired by Bouvier via private sales brokered by Sotheby’s.
The claim alleges that Rybolovlev believed Bouvier was negotiating with sellers on his behalf in return for a commission for his services, but he “repeatedly and blatantly misrepresented the acquisition prices” and pocketed the difference for himself.
Rybolovlev further alleges that Sotheby’s knew the actual amounts Bouvier paid to the sellers and the prices Rybolovlev paid to him, and “aided and abetted” by giving Bouvier written materials designed to induce Rybolovlev to pay inflated prices.
Sotheby’s said in a statement that it will “vigorously defend the company and our employees against these baseless claims”. Sotheby’s filed a counter-suit against Rybolovlev in the Swiss courts almost a year ago seeking a declaration that the company did not engage in any wrongdoing. It said it will now move to dismiss the court action in New York.
ATG contacted Bouvier’s legal representatives but they said they could not comment on the latest case. However, in a memorandum filed in July they claimed there was no written agreement appointing Bouvier as an agent to Rybolovlev and therefore their client “acted as an independent seller transacting at arm’s length with Rybolovlev”.
It continues: “As such, Bouvier was entitled to buy the works as he saw fit and to sell them at any price that Rybolovlev agreed to pay.”