Mapplethorpe’s Man Sues Christie’s, Gets Pelted With Legal Mudballs

Michael Stout was a close friend of Robert Mapplethorpe-close enough that the late photographer took his portrait-though, in typical style, he made Mr. Stout pay for the honor. Since then, Mapplethorpe has made up for it: As executor of Mapplethorpe’s estate, Mr. Stout stands to make $3.7 million in fees, not to mention his earnings as a lawyer for the estate and as president of the Mapplethorpe Foundation.

To hear Mr. Stout tell it, those earnings have no place in a $200 million defamation lawsuit he has brought against Christie’s Inc. over comments made in 1993 by its president, Patricia Hambrecht, concerning an appraisal of Mapplethorpe’s art. But you might not know it from the way the case is currently unfolding in State Supreme Court in Manhattan. In a turnaround strongly backed by Christie’s and its lawyers, Mr. Stout is finding himself in the hot seat over his multiple roles in matters Mapplethorpe. His own lawyers have had to struggle to keep Christie’s alleged wrongdoing front and center in the case, and Mr. Stout is far from having his day in court.

Though he told The Observer he has no intention of dropping his suit, it is hard to imagine that Mr. Stout doesn’t regret, at least a little, bringing it in the first place.

“Defamation cases are fits of pique,” observed Jeremy Epstein, a specialist in art law at Shearman & Sterling. “Generally, I advise clients to let the rage pass.… You’re hanging your reputation out there for everyone to see.”

The latest blow to Mr. Stout was the appointment in May of an independent counsel in the case. The counsel was necessary, according to an order by Stuart Cohen, the acting judge, to protect the interests of the Mapplethorpe Foundation’s charitable beneficiaries, whom he identified primarily as AIDS sufferers. In essence, Mr. Stout would have someone looking over his shoulder, an obviously unappealing prospect that he is now fighting in the state’s Appellate Division. Mr. Stout contends that the foundation’s beneficiaries are being taken care of just fine, and that Christie’s is merely trying to shift attention from its own bad behavior.

“They’re preposterous, they’re irrelevant and they’re insulting, given what I have done,” said Mr. Stout of Christie’s pointed comments about his substantial Mapplethorpe earnings.

The story of Mr. Stout’s lawsuit, complete with accusations of greed, deceit and betrayal, is, on the one hand, about the arcane and inexact science of art appraising. But it is also about the combustibility of relationships when hundreds of millions of dollars’ worth of art are at play.

“They’re each strong-willed and they’re each successful,” said one art-world observer about Mr. Stout and his adversary at Christie’s, Ms. Hambrecht. “Get these two people together with a shrink.”

“The record must be corrected,” said Mr. Stout, who worked for Salvador Dali and has counted among his clients the Keith Haring Estate and Foundation, and the estate of Jean-Michel Basquiat. “What do you have as a lawyer in New York City if you don’t have a reputation?”

‘An Enormous Martini’

Now 54, Mr. Stout said his relationship with Robert Mapplethorpe goes back to the heady days of New York in the 1970’s, when both men were hanging out at Max’s Kansas City. As his lawyer, Mr. Stout helped Mapplethorpe set up his foundation before his death in March 1989. “He was very devoted to me and I to him,” he said.

Mr. Stout’s defamation claims lie in a completely different case. It was late 1993, and well-known New York lawyer and man-about-town Ed Hayes was in Surrogate’s Court in Manhattan, trying a case he had brought against the Andy Warhol Foundation for the Visual Arts. Mr. Hayes, who claimed he was owed a legal fee equal to 2 percent of the value of the art in the Andy Warhol estate, accused the estate of deliberately low-balling its worth. As part of his case, Mr. Hayes introduced the fact that Christie’s had appraised the Warhol and Mapplethorpe art differently.

In the case of Warhol, Christie’s applied what is known as a “blockage” discount, a calculation based on the notion that if a large body of artwork is released on the market at the same time, prices tend to go down. Christie’s did not apply a blockage in its appraisal of the Mapplethorpe art. The auction house appraised Mapplethorpe’s photos and negatives at approximately $228 million-based on that figure, Mr. Stout received an advance on his fee of about $2 million from the estate’s assets. (By comparison, Warhol’s art was appraised at approximately $103 million.)

When Mr. Hayes made an issue of the Mapplethorpe appraisal in court, Christie’s “decided not to defend both appraisals on their merits,” according to Mr. Stout’s complaint, but instead launched “a false and defamatory attack against Stout.” That “attack” was contained initially in an affidavit filed on Nov. 11, 1993, by Ms. Hambrecht, who was then Christie’s general counsel. Perhaps most damning to Mr. Stout was Ms. Hambrecht’s contention that he had explicitly told her he would not be taking a commission based on the Mapplethorpe appraisal. Had the appraisal been done for such a purpose, Ms. Hambrecht would have insisted on a blockage discount, she later told The New York Times . (Ms. Hambrecht, through a spokeswoman, declined to comment for this article.)

When Mr. Stout learned of Ms. Hambrecht’s affidavit, he was “absolutely shocked,” he remembered, and had “an enormous martini.” He disputes ever saying that he would not be taking a commission and said he was stunned that “Patty, a lawyer of some intelligence, could allow herself to take such an untenable position in writing.”

The shock continued as Ms. Hambrecht reiterated her claims in The Times and Art & Auction magazine, Mr. Stout claimed. Court documents show that Christie’s consulted the public relations firm of Hill and Knowlton Inc. about how to deal with the press, at one point learning that “it might be beneficial if Mr. Stout and perhaps others know that we have a supply of mudballs to fling if they want to start that sort of thing.”

One mudball Christie’s may not have seen coming was another affidavit, this time from Andrea Krahmer Cross, a former assistant vice president at Christie’s who oversaw the Mapplethorpe appraisal. Ms. Cross said that the Hambrecht affidavit contained “erroneous statements” that needed to be set straight. According to Ms. Cross, Mr. Stout never said he would not take a commission.

Nonetheless, Ms. Hambrecht’s affidavit prompted the State Attorney General’s office to take an interest in Mr. Stout’s commissions, and eventually he agreed to a total fee of $3.7 million-a 30 percent reduction that Christie’s calls an admission by him that blockage should have been applied.

Mr. Stout made no such concession, according to his lawyer, Michael Spencer. “They are the appraisers, I’m not,” Mr. Stout said. “I don’t have responsibility toward their calculations.”

The Greed Thing

Among Mr. Stout’s claims against Christie’s, Ms. Hambrecht and another senior officer, Stephen Lash, is the charge that Christie’s sold him out to protect its business relationship with the Warhol Foundation. According to an internal memo from Christie’s acquired by The Observer , the auction house had a relationship with the Warhol Foundation. The memo, dated January 1991, referred to future Warhol business as an “annuity.”

Bill Maher, a lawyer for Christie’s, said Mr. Stout’s questioning of the auction house’s motives was unfair. “Christie’s believes it acted properly in both the Warhol and Mapplethorpe matters,” he said.

Mr. Stout claimed that both he and the estate had been harmed, offering one novel theory having to do with his role in signing Mapplethorpe prints. “Because Ms. Hambrecht’s affidavit effectively charged me with being a liar and a fraud,” Mr. Stout explained in an affidavit, “I believed that the photographs I authenticated might depreciate in value significantly.”

His complaint claimed his personal reputation was also harmed. “There were two years when I could barely go to a museum cocktail reception because I could see people talking and whispering about me,” he said.

But Christie’s is using some of Mr. Stout’s own claims to open a door onto his conduct. At a series of meetings last spring before Justice Cohen, Mr. Maher, of Roberts, Sheridan & Kotel, hammered away at the idea that Mr. Stout had a conflict of interest and that he and his “cronies,” as Mr. Maher put it, were receiving “humongous” fees. According to Christie’s, Mr. Stout has already received at least $1.8 million in legal fees from the estate on top of advances on his executor’s fee. They also assert that Mr. Stout received more pay in the five years after Mapplethorpe’s death than the foundation donated to AIDS charities.

In court papers, Mr. Spencer called that comparison “pure demagogy.” Executor’s commissions are set by statute; while Mr. Spencer did not dispute the amount of Mr. Stout’s legal fees, he said they have been “carefully scrutinized” by the Attorney General’s office and were “very reasonable.”

“I felt strongly about promoting the foundation before promoting myself, so it’s quadruply outrageous that they’ve gone after me with this greed thing,” said Mr. Stout.

In court papers, he points out that in addition to donating $5 million in cash and photographs to the Solomon R. Guggenheim Museum, the foundation (which draws its funds from the estate) has helped create the Robert Mapplethorpe Residential Treatment Facility at Beth Israel Hospital, as well as AIDS-related centers at Harvard University and St. Vincent’s Medical Center.

But Christie’s isn’t alone in voicing concern about Mr. Stout’s multiple roles. As Justice Cohen stated in one court session in March, “This makes me feel very, very uncomfortable because … it may be that Mr. Stout cannot wear so many hats.” In his May 12 order appointing an independent counsel-Lesley Ann Skillen of the law firm Getnick & Getnick-the judge said pointedly that the Mapplethorpe Foundation’s beneficiaries “have been given little, if any, consideration or deference by the plaintiffs to this massive, ever-growing and increasingly bitter litigation.” The judge has even touched on whether Mr. Stout should step aside as foundation president. (Pending Mr. Stout’s appeal, Ms. Skillen has been told not to start working.)

“My personal, personal feeling is, I think, ‘Great, let them come in and look at everything,'” Mr. Stout said of the independent counsel. But, he added, “the perception of it is very bad for the Mapplethorpe Foundation.”

The Attorney General’s office, which oversees nonprofit organizations, filed a brief stating that Justice Cohen’s move was “unprecedented and without legal or factual basis,” as well as a “usurpation” of its duties. However, that does not necessarily mean that the Attorney General’s office sees no conflict. At one court session, an attorney from the office suggested that Mr. Stout had a “slight conflict of interest” and should perhaps stop signing Mapplethorpe prints. The other three members of the Mapplethorpe Foundation board-Mr. Stout’s former partner Burt Lipsky, photographer Lynn Davis and photographic stylist Dimitri Levas-back Mr. Stout.

Christie’s, of course, backs the judge. “What Stout really fears” about an independent counsel, it says in court papers, “is a loosening of his iron grip on this charitable foundation (with the prestige and access it provides him to the arts).”

A ‘Campaign of Defamation’?

The two sides’ growing battle over what, exactly, they should be battling over has made for further delays as each resists giving documents to the other. Christie’s, for instance, wants to get its hands on the foundation’s recent tax returns. Mr. Spencer, Mr. Stout’s lawyer, has said in court papers that what Christie’s really wants to do is “carry out a campaign of ongoing defamation.” Last year, Mr. Stout filed a motion for a protective order to keep Christie’s nose out of Mapplethorpe business affairs.

For his part, Mr. Stout wants to see internal Christie’s documents concerning preparation of the Hambrecht affidavit, among other things. Christie’s has objected. Because of all the wrangling, there hasn’t been a deposition in the case for about a year.

To some in the art world, the entire affair seems a waste of money (although, at least in Mr. Stout’s case, his lawyers at Milberg, Weiss, Bershad, Hynes & Lerach, are handling it on contingency). Justice Cohen, for one, does not seem to have much hope that it will be resolved soon. At one court session, he observed: “It’s going to be of infinite fascination for many, many, years to come.”

Mapplethorpe’s Man Sues Christie’s, Gets Pelted With Legal Mudballs