The intensifying debate over artist resale rights in the U.S. just moved up a notch.
Many art world observers were surprised to learn that high-profile, Los Angeles art collector Dean Valentine agreed to pay resale royalties to artist Mark Grotjahn in order to settle a lawsuit.
Grotjahn, whose paintings have brought upwards of $1 million at auction, sued Valentine in early 2010, after the collector resold several of Grotjahn’s works at a profit without remitting California’s state-mandated five percent royalty, according to court papers.
Under the terms of the California Resale Royalty Act (CRRA), an artist is entitled to five percent of the amount of a sale whenever a work of fine art is resold and either the seller resides in California or the sale takes place in California.
After months of legal wrangling, during which the case was shifted from state to federal court, and then ultimately remanded back to state court, Valentine agreed to pay the royalties, plus interest, as well as a portion of the attorney fees incurred by Grotjahn. The settlement amount totaled just over $150,000. Of this, roughly $70,000 was allocated to address royalty fees while approximately $85,000 was for Grotjahn’s legal fees.
The settlement marks a major development in the long running debate over artist resale rights in the U.S., particularly since Sotheby’s and Christie’s are currently defending class action suits brought against them in California for the same issue.
Last month, the auction houses responded to the suits by filing a joint motion to dismiss the cases. They outline—at length—the reasons why they view the application of the CRRA as interfering with United States interstate and foreign commerce regulations.
