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	<title>Observer &#187; Ray Dowd</title>
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		<title>Observer &#187; Ray Dowd</title>
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		<title>Lawsuit Over Schiele Drawing Has Legs</title>

		<comments>http://observer.com/2007/02/lawsuit-over-schiele-drawing-has-legs/#comments</comments>
		<pubDate>Mon, 19 Feb 2007 00:00:00 -0400</pubDate>
					<link>http://observer.com/2007/02/lawsuit-over-schiele-drawing-has-legs/</link>
			<dc:creator>Jason Horowitz</dc:creator>
				
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		<description><![CDATA[<p><img class="alignleft" src="http://nyoobserver.files.wordpress.com/2011/06/021907_article_horowitz_2.jpg?w=164&h=300" />On July 20, 1938, an Austrian art historian working for the new Nazi government appraised the collection of the popular Jewish cabaret singer and comedian Fritz Gr&uuml;nbaum at a worth of 5,791 Reichsmark. </p>
<p>A month earlier, the Nazis had deported Gr&uuml;nbaum to Dachau. </p>
<p>In his absence, Gr&uuml;nbaum&rsquo;s wife Lilly kept watch over the hundreds of works of art. In September of 1938, the moving and shipping company Schenker &amp; Co. A.G. requested Nazi permission to export the collection on Lilly Gr&uuml;nbaum&rsquo;s behalf. Stamped with the Schenker insignia and Nazi swastikas, the export license was approved. The receipt for the shipment listed 21 oils, more than a dozen watercolors and nearly 300 drawings.</p>
<p>Gr&uuml;nbaum died in Dachau in 1941. The following year, the Nazis murdered Lilly in Minsk. And Gr&uuml;nbaum&rsquo;s singularly exquisite collection&mdash;including works by Oskar Kokoschka, Max Oppenheimer and Egon Schiele&mdash;vanished.</p>
<p>Among the five oils and more than 70 sheet drawings by Schiele was a gouache-and-black-crayon drawing of a headless woman clutching her knee. It has meandered for decades through art galleries and private collections before ending up in the middle of a pitched legal battle in New York&rsquo;s Southern District court, where two of Gr&uuml;nbaum&rsquo;s heirs&mdash;Leon Fischer, a New York stamp dealer, and Milos Vavra, who lives in Prague&mdash;have bickered for two years with the drawing&rsquo;s owner, David Bakalar.</p>
<p>Now, a key Swiss gallery owner is prepared to give a deposition for the first time about the drawing&rsquo;s provenance, and the presiding judge has expressed his eagerness to resolve the case. </p>
<p>At the same time, the heirs&rsquo; New York lawyer, Ray Dowd, is weighing the potentially momentous step of going after the Viennese company Schenker &amp; Co. A.G. </p>
<p>Schenker&rsquo;s global network of shipping firms amounts to one of the world&rsquo;s largest logistics companies, with more than 40,000 employees in dozens of countries and more than $10 billion in turnover a year. Mr. Dowd contends that the company, which serves as the Olympic Games&rsquo; official movers, stole the drawing and set in motion a litany of fictitious provenances that skip from Vienna to Brussels, from Bern to New York. </p>
<p>In pursuing Schenker, Mr. Dowd has drawn renewed attention to the company&rsquo;s unsavory Nazi-era history. At the same time, he has attempted to vastly broaden the definition of looted art to any work once seized or stored by Schenker. </p>
<p>If Mr. Dowd proves his case&mdash;which recent developments suggest is a long shot&mdash;the result would be a dramatic, even epochal, shift for the collectors of German and Austrian art, including Ronald Lauder, the New York billionaire and avid Schiele collector. </p>
<p>&ldquo;If that receipt from Schenker is valid and nobody is contesting it, then it [the drawing] was stolen and we win,&rdquo; said Mr. Dowd, who argues that the company essentially confiscated Gr&uuml;nbaum&rsquo;s collection. &ldquo;If Mr. Lauder or any of the other collectors take one of Gr&uuml;nbaum&rsquo;s Schieles into their hands, they just stepped into the shoes of a thief.&rdquo;</p>
<p>While the validity of the receipt has gone unchallenged, Mr. Dowd&rsquo;s opponents point out that there is no proof that Schenker ever physically took possession of the collection. They say that the provenance of the Schiele drawing is clear. After the war, they say, the collection ended up in the hands of Gr&uuml;nbaum&rsquo;s sister-in-law, Mathilde Lukacs. How she got her hands on it after the Schenker inventory is a mystery, they concede, but the important thing is that the works stayed in the family and then passed legitimately through the art market and into Mr. Bakalar&rsquo;s hands.</p>
<p>Mr. Dowd, 42, has a history as an agitator. As a Green Party candidate in 2000, he ran an insurgent campaign to remove the all-powerful State Assembly leader, Sheldon Silver, from his downtown district. Mr. Dowd lost, and he has since contented himself with delving into copyright law and representing the likes of Paolo Zampolli, the founder of ID Models and a gossip-page mainstay. </p>
<p>But the case of the allegedly looted Schiele has once again sparked his flammable sense of outrage. This time, Mr. Dowd seems intent on bringing down the firmament of Austrian art collectors and some of the city&rsquo;s most venerable cultural institutions. </p>
<p>&ldquo;Schenker was an instrumentality. It was run by Nazis; it was used to plan the invasion of Austria in 1938. I mean, you had people giving their stuff to Schenker with money for export, and they were taking money and putting them on trains and executing them. This is hand-in-hand, in tandem,&rdquo; said Mr. Dowd, adding: &ldquo;We&rsquo;re up against billionaires here. Not just one&mdash;it&rsquo;s billionaire after billionaire. You&rsquo;ve got major institutions.&rdquo;</p>
<p>Mr. Lauder, a likely candidate to run for president of the World Jewish Congress, is a prominent advocate for the restitution of art looted from Jews during the Holocaust. A chairman emeritus of the Museum of Modern Art and the co-founder of the Neue Galerie on Fifth Avenue, he has been collecting Schieles since his bar mitzvah years. </p>
<p>Mr. Dowd says that those credentials make the opacity of Mr. Lauder&rsquo;s private collection and the shrouded provenance of his present or past Schiele paintings all the more troubling. </p>
<p>Ren&eacute;e Price, the director of the Neue Galerie, pointed out that in 2006, the court rejected Mr. Dowd&rsquo;s attempts to include the museum in his suit.</p>
<p>&ldquo;It has been clearly established that the only works in question with any connection either to Mr. Lauder or to the Neue Galerie&mdash;two drawings by Egon Schiele&mdash;were sold at auction by Mr. Gr&uuml;nbaum&rsquo;s sister-in-law, not looted by Nazis,&rdquo; Ms. Price said in a statement. She added that &ldquo;Ronald Lauder has been an international leader in getting stolen art back to its rightful owners&mdash;doing more, investing more and accomplishing more than nearly anyone else.&rdquo;</p>
<p>Mr. Dowd&rsquo;s other critics&mdash;some of them prominent gallery owners whom he has accused of being fences for the Nazis or exploiters of Holocaust plunder because they bought works from the Gr&uuml;nbaum collection&mdash;have responded with assertions that his case is &ldquo;ludicrous,&rdquo; a &ldquo;smokescreen&rdquo; and &ldquo;irrelevant.&rdquo; </p>
<p>MR. DOWD'S CASE SUFFERED A SETBACK on the afternoon of Friday, Feb. 9, when he appeared with lawyers for Schenker&rsquo;s New York affiliate and for the drawing&rsquo;s owner, Mr. Bakalar, in courtroom 11D of a federal courthouse on Pearl Street. While the two white-haired attorneys representing white-shoe law firms chatted amiably on the soft crimson carpet, Mr. Dowd hunched over documents in his chair. </p>
<p>Immediately after rising to the lectern, Mr. Dowd, dressed in a subtle pinstripe suit and burgundy tie, hammered on the importance of the Schenker receipt.</p>
<p>&ldquo;It sounds wild and preposterous, I admit, but these are Schenker&rsquo;s documents themselves. If there is a thief in the chain of property here, it is stolen,&rdquo; said Mr. Dowd. &ldquo;We have shown that Schenker &amp; Co. received all of these Schieles.&rdquo;</p>
<p>Mr. Dowd offered arguments that Schenker&rsquo;s American affiliate should be held responsible for the theft, despite being formed nearly 10 years after the Austrian company&rsquo;s alleged crime against Fritz Gr&uuml;nbaum. The case&rsquo;s presiding judge, William H. Pauley III, responded with a mocking smirk. </p>
<p>&ldquo;I want to know what Schenker Inc., which was formed and sprang into being in 1947, did,&rdquo; Judge Pauley said deliberately. </p>
<p>He then dismissed all of the claims against the American Schenker affiliate, effectively removing from the case the alleged perpetrator upon which Mr. Dowd has based much of his argument. Mr. Dowd&rsquo;s only recourse now would be going after Schenker&rsquo;s European headquarters, a much more arduous legal challenge involving international diplomacy and painstaking negotiations.</p>
<p>Only minutes after the judge dealt this blow to his case, Mr. Dowd sat in a restaurant a few blocks from the court and pondered the difficulties of holding Schenker &amp; Co. A.G. accountable. </p>
<p>&ldquo;I&rsquo;ll have to now take another look at my options and see whether there is room for us to serve Schenker A.G.,&rdquo; said Mr. Dowd, later adding about the Gr&uuml;nbaum drawing: &ldquo;They have a receipt that they got it. They let it go somewhere. Where is the receipt that shows who they gave it to?&rdquo;</p>
<p>For its part, the company said that if there ever was a receipt, it is long gone.</p>
<p>&ldquo;We do not have the painting, and we do not have any documentation,&rdquo; said Dr. Gerhard Lipowec, the general counsel for Schenker &amp; Co. A.G. &ldquo;The first point is that, according to Austrian law, all Austrians are obliged to keep their records for seven years.&rdquo;</p>
<p>He said that many more years than that had passed, and that Allied bombing raids had destroyed the company&rsquo;s headquarters and warehouses during the war.</p>
<p>&ldquo;We do not have any paper records,&rdquo; he said, adding that if Mr. Dowd attempted to investigate or take legal action against the company, &ldquo;we have to react. We have to defend ourselves.&rdquo; </p>
<p>According to Mr. Lipowec, &ldquo;there has not been&rdquo; a class-action lawsuit or a major settlement with Holocaust survivors or heirs involving the company. In 1999, though, Schenker authorized a group of historians to write an account of the company&rsquo;s activities in the years leading up to and including the Nazi era. </p>
<p>According to that report, the company&rsquo;s namesake, Gottfried Schenker, founded the forwarding firm in Vienna with two Jewish partners in 1872. In 1931, the German National Railway secretly acquired Schenker under the guise of a Zurich holding company in order to avoid paying further World War I reparations to the Allies. As a result of the takeover, central management of the company moved from Vienna to Berlin. Adolf Hitler came to power in 1933, and by 1935 the company was under a new, more sinister management. </p>
<p>The Nazi leadership forced the appointment of Dr. Edmund Veesenmayer to the company&rsquo;s board. A talented economist, he was also an SS member trusted by the German leadership with establishing local Nazi groups in Vienna before the 1938 <i>Anschluss</i>. (Hence Mr. Dowd&rsquo;s claim that Schenker helped plan the German annexation of Austria.) Veesenmayer later went on to greater infamy in the Foreign Service. In 1941, he moved to Zagreb and played a major role in the deportation of Serbian Jews. In 1944, he oversaw the deportation of Hungarian Jews to concentration camps. </p>
<p>&ldquo;He was a behind-the-scenes man,&rdquo; said Efraim Zuroff, a war-crimes expert with the Simon Wiesenthal Center.</p>
<p>Throughout much of his notorious career, Veesenmayer kept his job on Schenker&rsquo;s governing board. In the meantime, all the company&rsquo;s Jewish workers were purged, and Schenker began storing and shipping art looted by Nazis. </p>
<p>&ldquo;Essentially, they were a transport company, and the Nazis used them to transport the stolen art,&rdquo; said Hector Feliciano, author of <i>The Lost Museum: The Nazi Conspiracy to Steal the World&rsquo;s Greatest Works of Art</i>. &ldquo;There was no way that they didn&rsquo;t know.&rdquo; </p>
<p>Schenker is not a new name to historians of art pilfered during the Holocaust. </p>
<p>According to Sarah Jackson, the historic-claims director at the Art Loss Register, a London-based group that tracks lost or stolen works of art, the name Schenker on the back of a picture is a &ldquo;red flag&rdquo; for a collector to question its provenance.</p>
<p>&ldquo;We have certainly heard their name before in relation to works of art put into storage with intended shipment by Jewish families to get out of Austria,&rdquo; Ms. Jackson said. &ldquo;A number of the shipping companies worked with the Gestapo&mdash;a unit called the Vugesta&mdash;to make sure that the works were impounded in Austria and never got to their intended destination.&rdquo; </p>
<p>Greg Bradsher, a senior archivist with the National Archives and Records Administration, who oversaw the agency&rsquo;s Holocaust-assets project, said that he&rsquo;s long considered Schenker the &ldquo;Mayflower Movers&rdquo; of the Nazi regime. </p>
<p>FOR MR. BAKALAR'S LAWYERS, the entire mystery surrounding Schenker amounts to a fanciful distraction.</p>
<p>Jim Janowitz, a partner at Pryor, Cashman, Sherman &amp; Flynn, argues that the Schenker receipt upon which Mr. Dowd has based his accusations never specifically identifies the Schiele drawing in question. </p>
<p>&ldquo;The work of art never fell into the hands of Schenker,&rdquo; said Mr. Janowitz, pointing out that the receipt only lists the works in broad categories such as oil paintings, drawings or prints. &ldquo;You can&rsquo;t assume that our work of art was included in that group, and there is every reason to think that it was not.&rdquo; </p>
<p>Mr. Janowitz asserted that, despite Mr. Dowd&rsquo;s &ldquo;smokescreen,&rdquo; the provenance is readily apparent. </p>
<p>After the appraisal and disappearance of Fritz Gr&uuml;nbaum&rsquo;s collection in 1938, the drawing next appeared in 1956 in Switzerland, in a gallery owned by Eberhard Kornfeld. Mr. Kornfeld has said he bought the drawing, along with many other Schiele works, from a Brussels-based woman named Mathilde Lukacs. Only decades later, he has said, did he discover that Lukacs was the older sister of Gr&uuml;nbaum&rsquo;s wife, Lilly, whose name appears on the Schenker receipt. </p>
<p>Mr. Dowd says that Mr. Kornfeld is a deceitful profiteer of plundered Jewish art who attempted to invent a provenance by forging signatures and otherwise falsifying records, including the purported correspondence with Lukacs. For the first time, Mr. Kornfeld, who is now in his 80&rsquo;s, is prepared to give a deposition for the New York court. Mr. Janowitz expects him to testify as early as April and thinks that the case could be decided within the year. </p>
<p>&ldquo;Here in Switzerland, a deposition will be made, and the originals will be put on the table,&rdquo; said Mr. Kornfeld&rsquo;s lawyer, Dr. Peter Bratschi. &ldquo;It is said that the drawing has not been handed over by Mathilde Lukacs. And Mr. Kornfeld says that it is wrong, that the paintings <i>were</i> given to him by this person.&rdquo;</p>
<p>In 1956, Mr. Kornfeld sold the drawing to the New York collector Otto Kallir. Like Gr&uuml;nbaum, Kallir was an active collector of Schiele who founded, in 1923, Vienna&rsquo;s Neue Galerie (after which Mr. Lauder&rsquo;s New York museum is named). Kallir fled Vienna in 1938 and became one of the many Jewish refugees to set up shop in New York, eventually opening the Galerie St. Etienne in 1939 and mounting the country&rsquo;s first major Schiele exhibits.    </p>
<p>&ldquo;It was like being in Vienna,&rdquo; said Jane Kallir, remembering her grandfather&rsquo;s apartments. &ldquo;You were surrounded by Austrian furniture and art.&rdquo;</p>
<p>Ms. Kallir inherited much of it, as well as the gallery and a library of sensitive information. Mr. Dowd accuses her of withholding the present whereabouts of Schieles connected to the Gr&uuml;nbaum collection. He also alleges that Ms. Kallir&rsquo;s grandfather knew Gr&uuml;nbaum well enough to recognize the pieces from his collection when they came up for sale in the 1950&rsquo;s. </p>
<p>&ldquo;He knew him, but not well,&rdquo; said Ms. Kallir, who literally wrote the book on Schiele, a 719-page <i>catalogue raisonn&eacute;</i> published in 1990. &ldquo;To know someone and to remember exactly what they owned decades later is a different thing.&rdquo;</p>
<p>Her gallery, on 57th street off Fifth Avenue, is just a few blocks from Mr. Lauder&rsquo;s office atop the General Motors building. It is a bright and roomy space showing etchings by Picasso and Kiki Smith and lithographs by Chagall and Kokoschka on display. </p>
<p>But it is Austrian art, and Schiele in particular, for which the gallery is best known. And Mr. Dowd&rsquo;s case has made a committed adversary out of Ms. Kallir, its influential and widely esteemed owner.</p>
<p>On Thursday, Feb. 8, Ms. Kallir, a petite, gray-haired woman dressed in an orange sweater, charcoal skirt and gold-and-pearl necklace, sat in her office in the back of the gallery, surrounded by pencil drawings and bookcases crammed with volumes on Austrian art.  </p>
<p>Ms. Kallir said that she had spent about $100,000 in legal fees in the 10 years since people started questioning the provenance of Schiele works owned and sold by her gallery&mdash;a fact that frustrates her, because of what she said was the role she&rsquo;s played in helping to restore looted paintings to their rightful Jewish owners. She is the expert witness for the government in the case involving the <i>Portrait of Wally</i>, a Schiele painting that was on loan to MoMA and then seized in 1998 by District Attorney Robert Morgenthau&rsquo;s office, after a claim arose from a Jewish family. </p>
<p>&ldquo;I&rsquo;m the farthest thing from an art looter that you can find,&rdquo; said Ms. Kallir, opening a beaten-up copy of her catalog, bound in orange leather, and pointing to drawing No. 1974: the headless female figure dressed in bloomers and clasping a folded leg. </p>
<p>Talking about the present case over this drawing, she added: &ldquo;We are crossing a line now between just restitution and coercion.&rdquo;</p>
<p>She sees Mr. Dowd&rsquo;s attempt to incriminate Schenker &amp; Co. A.G. as both desperate and dangerous, considering how many collectors and institutions possess works that were once potentially stored with or shipped by the company.</p>
<p>&ldquo;That&rsquo;s just way too broad a statement to make,&rdquo; she said. &ldquo;And it&rsquo;s never going to be provable.&rdquo;</p>
<p>That very same conclusion seemed to be nagging at Mr. Dowd after his setback in court on Friday afternoon. He couldn&rsquo;t help but wonder whether his clients would have the necessary patience&mdash;and if even he could sustain the necessary indignation&mdash;to go after a multinational corporation of Schenker&rsquo;s size and scope.</p>
<p>&ldquo;We have to see if we have the will and the resolve and the resources to pursue Schenker,&rdquo; he said, adding: &ldquo;There is a little bit of the tilting at windmills going on.&rdquo;</p>
]]></description>
		<content:encoded><![CDATA[<p><img class="alignleft" src="http://nyoobserver.files.wordpress.com/2011/06/021907_article_horowitz_2.jpg?w=164&h=300" />On July 20, 1938, an Austrian art historian working for the new Nazi government appraised the collection of the popular Jewish cabaret singer and comedian Fritz Gr&uuml;nbaum at a worth of 5,791 Reichsmark. </p>
<p>A month earlier, the Nazis had deported Gr&uuml;nbaum to Dachau. </p>
<p>In his absence, Gr&uuml;nbaum&rsquo;s wife Lilly kept watch over the hundreds of works of art. In September of 1938, the moving and shipping company Schenker &amp; Co. A.G. requested Nazi permission to export the collection on Lilly Gr&uuml;nbaum&rsquo;s behalf. Stamped with the Schenker insignia and Nazi swastikas, the export license was approved. The receipt for the shipment listed 21 oils, more than a dozen watercolors and nearly 300 drawings.</p>
<p>Gr&uuml;nbaum died in Dachau in 1941. The following year, the Nazis murdered Lilly in Minsk. And Gr&uuml;nbaum&rsquo;s singularly exquisite collection&mdash;including works by Oskar Kokoschka, Max Oppenheimer and Egon Schiele&mdash;vanished.</p>
<p>Among the five oils and more than 70 sheet drawings by Schiele was a gouache-and-black-crayon drawing of a headless woman clutching her knee. It has meandered for decades through art galleries and private collections before ending up in the middle of a pitched legal battle in New York&rsquo;s Southern District court, where two of Gr&uuml;nbaum&rsquo;s heirs&mdash;Leon Fischer, a New York stamp dealer, and Milos Vavra, who lives in Prague&mdash;have bickered for two years with the drawing&rsquo;s owner, David Bakalar.</p>
<p>Now, a key Swiss gallery owner is prepared to give a deposition for the first time about the drawing&rsquo;s provenance, and the presiding judge has expressed his eagerness to resolve the case. </p>
<p>At the same time, the heirs&rsquo; New York lawyer, Ray Dowd, is weighing the potentially momentous step of going after the Viennese company Schenker &amp; Co. A.G. </p>
<p>Schenker&rsquo;s global network of shipping firms amounts to one of the world&rsquo;s largest logistics companies, with more than 40,000 employees in dozens of countries and more than $10 billion in turnover a year. Mr. Dowd contends that the company, which serves as the Olympic Games&rsquo; official movers, stole the drawing and set in motion a litany of fictitious provenances that skip from Vienna to Brussels, from Bern to New York. </p>
<p>In pursuing Schenker, Mr. Dowd has drawn renewed attention to the company&rsquo;s unsavory Nazi-era history. At the same time, he has attempted to vastly broaden the definition of looted art to any work once seized or stored by Schenker. </p>
<p>If Mr. Dowd proves his case&mdash;which recent developments suggest is a long shot&mdash;the result would be a dramatic, even epochal, shift for the collectors of German and Austrian art, including Ronald Lauder, the New York billionaire and avid Schiele collector. </p>
<p>&ldquo;If that receipt from Schenker is valid and nobody is contesting it, then it [the drawing] was stolen and we win,&rdquo; said Mr. Dowd, who argues that the company essentially confiscated Gr&uuml;nbaum&rsquo;s collection. &ldquo;If Mr. Lauder or any of the other collectors take one of Gr&uuml;nbaum&rsquo;s Schieles into their hands, they just stepped into the shoes of a thief.&rdquo;</p>
<p>While the validity of the receipt has gone unchallenged, Mr. Dowd&rsquo;s opponents point out that there is no proof that Schenker ever physically took possession of the collection. They say that the provenance of the Schiele drawing is clear. After the war, they say, the collection ended up in the hands of Gr&uuml;nbaum&rsquo;s sister-in-law, Mathilde Lukacs. How she got her hands on it after the Schenker inventory is a mystery, they concede, but the important thing is that the works stayed in the family and then passed legitimately through the art market and into Mr. Bakalar&rsquo;s hands.</p>
<p>Mr. Dowd, 42, has a history as an agitator. As a Green Party candidate in 2000, he ran an insurgent campaign to remove the all-powerful State Assembly leader, Sheldon Silver, from his downtown district. Mr. Dowd lost, and he has since contented himself with delving into copyright law and representing the likes of Paolo Zampolli, the founder of ID Models and a gossip-page mainstay. </p>
<p>But the case of the allegedly looted Schiele has once again sparked his flammable sense of outrage. This time, Mr. Dowd seems intent on bringing down the firmament of Austrian art collectors and some of the city&rsquo;s most venerable cultural institutions. </p>
<p>&ldquo;Schenker was an instrumentality. It was run by Nazis; it was used to plan the invasion of Austria in 1938. I mean, you had people giving their stuff to Schenker with money for export, and they were taking money and putting them on trains and executing them. This is hand-in-hand, in tandem,&rdquo; said Mr. Dowd, adding: &ldquo;We&rsquo;re up against billionaires here. Not just one&mdash;it&rsquo;s billionaire after billionaire. You&rsquo;ve got major institutions.&rdquo;</p>
<p>Mr. Lauder, a likely candidate to run for president of the World Jewish Congress, is a prominent advocate for the restitution of art looted from Jews during the Holocaust. A chairman emeritus of the Museum of Modern Art and the co-founder of the Neue Galerie on Fifth Avenue, he has been collecting Schieles since his bar mitzvah years. </p>
<p>Mr. Dowd says that those credentials make the opacity of Mr. Lauder&rsquo;s private collection and the shrouded provenance of his present or past Schiele paintings all the more troubling. </p>
<p>Ren&eacute;e Price, the director of the Neue Galerie, pointed out that in 2006, the court rejected Mr. Dowd&rsquo;s attempts to include the museum in his suit.</p>
<p>&ldquo;It has been clearly established that the only works in question with any connection either to Mr. Lauder or to the Neue Galerie&mdash;two drawings by Egon Schiele&mdash;were sold at auction by Mr. Gr&uuml;nbaum&rsquo;s sister-in-law, not looted by Nazis,&rdquo; Ms. Price said in a statement. She added that &ldquo;Ronald Lauder has been an international leader in getting stolen art back to its rightful owners&mdash;doing more, investing more and accomplishing more than nearly anyone else.&rdquo;</p>
<p>Mr. Dowd&rsquo;s other critics&mdash;some of them prominent gallery owners whom he has accused of being fences for the Nazis or exploiters of Holocaust plunder because they bought works from the Gr&uuml;nbaum collection&mdash;have responded with assertions that his case is &ldquo;ludicrous,&rdquo; a &ldquo;smokescreen&rdquo; and &ldquo;irrelevant.&rdquo; </p>
<p>MR. DOWD'S CASE SUFFERED A SETBACK on the afternoon of Friday, Feb. 9, when he appeared with lawyers for Schenker&rsquo;s New York affiliate and for the drawing&rsquo;s owner, Mr. Bakalar, in courtroom 11D of a federal courthouse on Pearl Street. While the two white-haired attorneys representing white-shoe law firms chatted amiably on the soft crimson carpet, Mr. Dowd hunched over documents in his chair. </p>
<p>Immediately after rising to the lectern, Mr. Dowd, dressed in a subtle pinstripe suit and burgundy tie, hammered on the importance of the Schenker receipt.</p>
<p>&ldquo;It sounds wild and preposterous, I admit, but these are Schenker&rsquo;s documents themselves. If there is a thief in the chain of property here, it is stolen,&rdquo; said Mr. Dowd. &ldquo;We have shown that Schenker &amp; Co. received all of these Schieles.&rdquo;</p>
<p>Mr. Dowd offered arguments that Schenker&rsquo;s American affiliate should be held responsible for the theft, despite being formed nearly 10 years after the Austrian company&rsquo;s alleged crime against Fritz Gr&uuml;nbaum. The case&rsquo;s presiding judge, William H. Pauley III, responded with a mocking smirk. </p>
<p>&ldquo;I want to know what Schenker Inc., which was formed and sprang into being in 1947, did,&rdquo; Judge Pauley said deliberately. </p>
<p>He then dismissed all of the claims against the American Schenker affiliate, effectively removing from the case the alleged perpetrator upon which Mr. Dowd has based much of his argument. Mr. Dowd&rsquo;s only recourse now would be going after Schenker&rsquo;s European headquarters, a much more arduous legal challenge involving international diplomacy and painstaking negotiations.</p>
<p>Only minutes after the judge dealt this blow to his case, Mr. Dowd sat in a restaurant a few blocks from the court and pondered the difficulties of holding Schenker &amp; Co. A.G. accountable. </p>
<p>&ldquo;I&rsquo;ll have to now take another look at my options and see whether there is room for us to serve Schenker A.G.,&rdquo; said Mr. Dowd, later adding about the Gr&uuml;nbaum drawing: &ldquo;They have a receipt that they got it. They let it go somewhere. Where is the receipt that shows who they gave it to?&rdquo;</p>
<p>For its part, the company said that if there ever was a receipt, it is long gone.</p>
<p>&ldquo;We do not have the painting, and we do not have any documentation,&rdquo; said Dr. Gerhard Lipowec, the general counsel for Schenker &amp; Co. A.G. &ldquo;The first point is that, according to Austrian law, all Austrians are obliged to keep their records for seven years.&rdquo;</p>
<p>He said that many more years than that had passed, and that Allied bombing raids had destroyed the company&rsquo;s headquarters and warehouses during the war.</p>
<p>&ldquo;We do not have any paper records,&rdquo; he said, adding that if Mr. Dowd attempted to investigate or take legal action against the company, &ldquo;we have to react. We have to defend ourselves.&rdquo; </p>
<p>According to Mr. Lipowec, &ldquo;there has not been&rdquo; a class-action lawsuit or a major settlement with Holocaust survivors or heirs involving the company. In 1999, though, Schenker authorized a group of historians to write an account of the company&rsquo;s activities in the years leading up to and including the Nazi era. </p>
<p>According to that report, the company&rsquo;s namesake, Gottfried Schenker, founded the forwarding firm in Vienna with two Jewish partners in 1872. In 1931, the German National Railway secretly acquired Schenker under the guise of a Zurich holding company in order to avoid paying further World War I reparations to the Allies. As a result of the takeover, central management of the company moved from Vienna to Berlin. Adolf Hitler came to power in 1933, and by 1935 the company was under a new, more sinister management. </p>
<p>The Nazi leadership forced the appointment of Dr. Edmund Veesenmayer to the company&rsquo;s board. A talented economist, he was also an SS member trusted by the German leadership with establishing local Nazi groups in Vienna before the 1938 <i>Anschluss</i>. (Hence Mr. Dowd&rsquo;s claim that Schenker helped plan the German annexation of Austria.) Veesenmayer later went on to greater infamy in the Foreign Service. In 1941, he moved to Zagreb and played a major role in the deportation of Serbian Jews. In 1944, he oversaw the deportation of Hungarian Jews to concentration camps. </p>
<p>&ldquo;He was a behind-the-scenes man,&rdquo; said Efraim Zuroff, a war-crimes expert with the Simon Wiesenthal Center.</p>
<p>Throughout much of his notorious career, Veesenmayer kept his job on Schenker&rsquo;s governing board. In the meantime, all the company&rsquo;s Jewish workers were purged, and Schenker began storing and shipping art looted by Nazis. </p>
<p>&ldquo;Essentially, they were a transport company, and the Nazis used them to transport the stolen art,&rdquo; said Hector Feliciano, author of <i>The Lost Museum: The Nazi Conspiracy to Steal the World&rsquo;s Greatest Works of Art</i>. &ldquo;There was no way that they didn&rsquo;t know.&rdquo; </p>
<p>Schenker is not a new name to historians of art pilfered during the Holocaust. </p>
<p>According to Sarah Jackson, the historic-claims director at the Art Loss Register, a London-based group that tracks lost or stolen works of art, the name Schenker on the back of a picture is a &ldquo;red flag&rdquo; for a collector to question its provenance.</p>
<p>&ldquo;We have certainly heard their name before in relation to works of art put into storage with intended shipment by Jewish families to get out of Austria,&rdquo; Ms. Jackson said. &ldquo;A number of the shipping companies worked with the Gestapo&mdash;a unit called the Vugesta&mdash;to make sure that the works were impounded in Austria and never got to their intended destination.&rdquo; </p>
<p>Greg Bradsher, a senior archivist with the National Archives and Records Administration, who oversaw the agency&rsquo;s Holocaust-assets project, said that he&rsquo;s long considered Schenker the &ldquo;Mayflower Movers&rdquo; of the Nazi regime. </p>
<p>FOR MR. BAKALAR'S LAWYERS, the entire mystery surrounding Schenker amounts to a fanciful distraction.</p>
<p>Jim Janowitz, a partner at Pryor, Cashman, Sherman &amp; Flynn, argues that the Schenker receipt upon which Mr. Dowd has based his accusations never specifically identifies the Schiele drawing in question. </p>
<p>&ldquo;The work of art never fell into the hands of Schenker,&rdquo; said Mr. Janowitz, pointing out that the receipt only lists the works in broad categories such as oil paintings, drawings or prints. &ldquo;You can&rsquo;t assume that our work of art was included in that group, and there is every reason to think that it was not.&rdquo; </p>
<p>Mr. Janowitz asserted that, despite Mr. Dowd&rsquo;s &ldquo;smokescreen,&rdquo; the provenance is readily apparent. </p>
<p>After the appraisal and disappearance of Fritz Gr&uuml;nbaum&rsquo;s collection in 1938, the drawing next appeared in 1956 in Switzerland, in a gallery owned by Eberhard Kornfeld. Mr. Kornfeld has said he bought the drawing, along with many other Schiele works, from a Brussels-based woman named Mathilde Lukacs. Only decades later, he has said, did he discover that Lukacs was the older sister of Gr&uuml;nbaum&rsquo;s wife, Lilly, whose name appears on the Schenker receipt. </p>
<p>Mr. Dowd says that Mr. Kornfeld is a deceitful profiteer of plundered Jewish art who attempted to invent a provenance by forging signatures and otherwise falsifying records, including the purported correspondence with Lukacs. For the first time, Mr. Kornfeld, who is now in his 80&rsquo;s, is prepared to give a deposition for the New York court. Mr. Janowitz expects him to testify as early as April and thinks that the case could be decided within the year. </p>
<p>&ldquo;Here in Switzerland, a deposition will be made, and the originals will be put on the table,&rdquo; said Mr. Kornfeld&rsquo;s lawyer, Dr. Peter Bratschi. &ldquo;It is said that the drawing has not been handed over by Mathilde Lukacs. And Mr. Kornfeld says that it is wrong, that the paintings <i>were</i> given to him by this person.&rdquo;</p>
<p>In 1956, Mr. Kornfeld sold the drawing to the New York collector Otto Kallir. Like Gr&uuml;nbaum, Kallir was an active collector of Schiele who founded, in 1923, Vienna&rsquo;s Neue Galerie (after which Mr. Lauder&rsquo;s New York museum is named). Kallir fled Vienna in 1938 and became one of the many Jewish refugees to set up shop in New York, eventually opening the Galerie St. Etienne in 1939 and mounting the country&rsquo;s first major Schiele exhibits.    </p>
<p>&ldquo;It was like being in Vienna,&rdquo; said Jane Kallir, remembering her grandfather&rsquo;s apartments. &ldquo;You were surrounded by Austrian furniture and art.&rdquo;</p>
<p>Ms. Kallir inherited much of it, as well as the gallery and a library of sensitive information. Mr. Dowd accuses her of withholding the present whereabouts of Schieles connected to the Gr&uuml;nbaum collection. He also alleges that Ms. Kallir&rsquo;s grandfather knew Gr&uuml;nbaum well enough to recognize the pieces from his collection when they came up for sale in the 1950&rsquo;s. </p>
<p>&ldquo;He knew him, but not well,&rdquo; said Ms. Kallir, who literally wrote the book on Schiele, a 719-page <i>catalogue raisonn&eacute;</i> published in 1990. &ldquo;To know someone and to remember exactly what they owned decades later is a different thing.&rdquo;</p>
<p>Her gallery, on 57th street off Fifth Avenue, is just a few blocks from Mr. Lauder&rsquo;s office atop the General Motors building. It is a bright and roomy space showing etchings by Picasso and Kiki Smith and lithographs by Chagall and Kokoschka on display. </p>
<p>But it is Austrian art, and Schiele in particular, for which the gallery is best known. And Mr. Dowd&rsquo;s case has made a committed adversary out of Ms. Kallir, its influential and widely esteemed owner.</p>
<p>On Thursday, Feb. 8, Ms. Kallir, a petite, gray-haired woman dressed in an orange sweater, charcoal skirt and gold-and-pearl necklace, sat in her office in the back of the gallery, surrounded by pencil drawings and bookcases crammed with volumes on Austrian art.  </p>
<p>Ms. Kallir said that she had spent about $100,000 in legal fees in the 10 years since people started questioning the provenance of Schiele works owned and sold by her gallery&mdash;a fact that frustrates her, because of what she said was the role she&rsquo;s played in helping to restore looted paintings to their rightful Jewish owners. She is the expert witness for the government in the case involving the <i>Portrait of Wally</i>, a Schiele painting that was on loan to MoMA and then seized in 1998 by District Attorney Robert Morgenthau&rsquo;s office, after a claim arose from a Jewish family. </p>
<p>&ldquo;I&rsquo;m the farthest thing from an art looter that you can find,&rdquo; said Ms. Kallir, opening a beaten-up copy of her catalog, bound in orange leather, and pointing to drawing No. 1974: the headless female figure dressed in bloomers and clasping a folded leg. </p>
<p>Talking about the present case over this drawing, she added: &ldquo;We are crossing a line now between just restitution and coercion.&rdquo;</p>
<p>She sees Mr. Dowd&rsquo;s attempt to incriminate Schenker &amp; Co. A.G. as both desperate and dangerous, considering how many collectors and institutions possess works that were once potentially stored with or shipped by the company.</p>
<p>&ldquo;That&rsquo;s just way too broad a statement to make,&rdquo; she said. &ldquo;And it&rsquo;s never going to be provable.&rdquo;</p>
<p>That very same conclusion seemed to be nagging at Mr. Dowd after his setback in court on Friday afternoon. He couldn&rsquo;t help but wonder whether his clients would have the necessary patience&mdash;and if even he could sustain the necessary indignation&mdash;to go after a multinational corporation of Schenker&rsquo;s size and scope.</p>
<p>&ldquo;We have to see if we have the will and the resolve and the resources to pursue Schenker,&rdquo; he said, adding: &ldquo;There is a little bit of the tilting at windmills going on.&rdquo;</p>
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		<title>A Trove of Salvage Unsalvaged Spawns a Mess of Lawsuits</title>

		<comments>http://observer.com/2004/05/a-trove-of-salvage-unsalvaged-spawns-a-mess-of-lawsuits/#comments</comments>
		<pubDate>Mon, 17 May 2004 00:00:00 -0400</pubDate>
					<link>http://observer.com/2004/05/a-trove-of-salvage-unsalvaged-spawns-a-mess-of-lawsuits/</link>
			<dc:creator>Nina Burleigh</dc:creator>
				
		<guid isPermaLink="false">http://www.observer.com/2004/05/a-trove-of-salvage-unsalvaged-spawns-a-mess-of-lawsuits/</guid>
		<description><![CDATA[<p>When it came crashing down, in late summer of 2000, the fall of the Irreplaceable Artifacts warehouse on Houston was one of the more spectacular building collapses in pre-9/11 New York memory. The four-story 19th-century structure was a downtown landmark, piled to the rafters with monumental friezes, plaster busts, gargoyles and brass doors. The emergency demolition was notable for a spectacular irony: When the building came down, it buried $12 million worth of objects rescued from several decades of New York City building demolitions.</p>
<p>The dust has long settled on the site, but the litigation it spawned continues in Manhattan courtrooms. The various legal fights bring together a motley cast of characters and a bizarre confluence of questions, including these: When, if ever, does a doorknob or a plumbing fixture qualify as art? How does the city divvy up its emergency-demolition contracts? And is the city giving nonprofit status to a cult that uses hypnotized teens as slave labor to enrich the cult's founder, a Palm Beach millionaire with five airplanes?</p>
<p> Evan Blum was one of the pioneers in the architectural-salvage business. The Long Island native started Irreplaceable Artifacts in the 1970's, and has since been profiled in Esquire , Smithsonian magazine and The New York Times . He purchased most of the items in his warehouse from wrecking crews in the New York area.</p>
<p> Mr. Blum and his father, Walter Blum, were in the process of renovating their building to make a restaurant on the premises when a wall started caving in. City inspectors arrived and, fearing a disaster-so much so that the F train underneath was shut down and traffic on Houston diverted-asked for and won an emergency-demolition order.</p>
<p> The building was roped off with police tape, and Mr. Blum was allowed just 10 minutes to go inside and bring out what he could carry. He rescued one box of business documents; he left behind his two cats and what he says were millions of dollars' worth of architectural salvage items. One of the cats survived; the other presumably perished along with most of Mr. Blum's salvaged treasures.</p>
<p> Most … but not all.</p>
<p> During his frantic 10 minutes inside before the wrecking ball landed, Mr. Blum was surprised to notice certain large items already missing from the premises. He didn't have time to look for them or verify his suspicion: The building was demolished within 24 hours.</p>
<p> A month later, Mr. Blum visited the Scranton, Penn., warehouse of his main competitor in the architectural salvage business, Olde Good Things. There, Mr. Blum found some of his missing salvage objects, including 20 seven-foot-high embossed-brass elevator doors, a 10-foot-wide zinc frieze and two brass entry doors from the old Paramount Theater.</p>
<p> Olde Good Things is a phenomenally successful salvage and antiques concern operated by the Church of Bible Understanding, a religious organization that has been called a cult by former members. COBU was founded in the 1970's by a former vacuum-cleaner salesman turned Jesus freak named Stewart Traill. Mr. Traill now lives a decidedly non-ascetic life in Palm Beach, where he allegedly owns five airplanes. His cult continues to recruit mostly troubled teens from inner-city areas in Philadelphia, and, according to Mr. Blum's lawyers, these teens provide Mr. Traill with the free labor that makes his business a success.</p>
<p> Mr. Blum filed a police report in Scranton, estimating the value of the goods at over $200,000 and charging grand larceny. Eventually, a New York City building official pleaded guilty to helping divert the items onto the Olde Good Things trucks.</p>
<p> Adding insult to injury, Mr. Blum and his father had been charged with felonies for allowing their building to become a hazard. A jury cleared them of recklessly endangering lives and lying in paperwork about the extent of the renovations that were under way at the time of the July 2000 collapse. They were convicted of lesser charges of recklessly creating a serious risk of injury to their employees and neighbors.</p>
<p> After his building was demolished, Mr. Blum filed his own lawsuit against the city in October 2001, asking $20 million in damages and alleging that the city ordered the emergency demolition "without justification, without an opportunity for [Mr. Blum] to be heard, without procedures for the preservation of evidence and with intentional malice."</p>
<p> Mr. Blum's lawyer, Ray Dowd of Dowd &amp; Marotta, said the city orders around a dozen emergency demolitions every month and that a small club of favored contractors is paid $300,000 to $400,000 for each one, a practice he said explained some of the "large political contributions" to various political figures. Mr. Dowd said the city is required to give owners hearings before demolitions, but that most owners, like Mr. Blum, rarely get their day in court before the wrecking ball strikes.</p>
<p> Mr. Blum's lawsuit is still pending.</p>
<p> A year after Mr. Blum filed suit against the city, a New York Consumer Affairs inspector walked into his other place of business, Demolition Depot on 125th Street in Harlem, and, pretending to be a consumer, innocently inquired about a non-working stand-up hand-dryer. Told she could have the item, the inspector revealed her identity and cited Mr. Blum for operating as a dealer in secondhand goods without a city license.</p>
<p> Mr. Blum was immediately suspicious about why the inspector visited his store in the first place. His lawyers filed a FOIA motion to find out exactly what inspired the undercover inspection of Demolition Depot on that day. They have received nothing. "I think it was the city's response to his lawsuit," says Mr. Dowd.</p>
<p> Mr. Blum doesn't want to file for a secondhand-dealer license. He says such a filing would require him to perform a Herculean feat of bureaucratic documentation on each and every item in his vast and dusty warehouse.</p>
<p> Mr. Blum is also reluctant to file for a license because his conviction in the downtown building collapse could be reason for the city to deny the license.</p>
<p> But his main argument against licensing, which continues to this day, is that he is not selling secondhand goods but art objects. Mr. Blum claims that he is not just a secondhand-goods dealer, but a purveyor of "sculpture" to Hollywood and some of the city's finest homes.</p>
<p> Among the scores of fabulous who have purchased brass friezes, gargoyles and other monumental tchotchkes from Mr. Blum are Pierre Cardin, Jane Pauley, the Banana Republic stores, Keith McNally, downtown restaurant Il Buco, Woody Allen and Kevin Costner.</p>
<p> With a client list like that, Mr. Blum differentiates himself from other "dealers in secondhand goods" such as one finds behind tables at the Sixth Avenue flea markets. Mr. Blum contends his things are art, worthy of First Amendment protection and by no means liable to city regulation, as are other thrift and antique stores.</p>
<p> In the first hearing on the licensing, the following exchange between Mr. Blum's lawyers and the city's licensing inspector set the tone.</p>
<p> Ray Dowd (Mr. Blum's lawyer): "Did you see objects of art on the premises?"</p>
<p> Administrative law judge Kirk Miller: "Do you understand what he means by 'objects of art'?"</p>
<p> Inspector Vickie Cabble: "Such as this? The, the …. "</p>
<p> Judge Miller: "Why don't we define our terms here?"</p>
<p> Mr. Dowd: "If you went to Home Depot, would you see gates like that?"</p>
<p> During the same hearing, Mr. Blum's wife Leslie, an architect, testified as to how she and her husband transform salvaged objects-functional tools like radiator grills-into works of art.</p>
<p> "We take a look at it and say, 'This is a lovely piece of ornamental grillwork. People don't need grills like this anymore; what can we do with them?' … [A]nd we try to see, in this case, the idea of passing light through it, putting a diffuser behind it and having light come through … because you get to set the tracery of the metalwork."</p>
<p> The Blums have published a lavishly photographed coffee-table book on the many decorative uses for architectural-salvage pieces.</p>
<p> Mr. Blum argued through his lawyers that with his decorative imagination, he has a "transformative" effect on everyday old things like doorknobs, bathtubs and grillwork. In fact, Mr. Blum also sends the original artifacts overseas to craftsmen in Belgium who mold and cast from the originals, making new things that look old, which are then sold to New York's high-end decorators.</p>
<p> The city's response is that in no way are doorknobs and plumbing fixtures-no matter how old or beautiful, and no matter whether they've been transformed into decorative objects-worthy of First Amendment protection against city licensing requirements.</p>
<p> "To suggest that the sale of a plumbing fixture or doorknob, which would otherwise be unprotected by the First Amendment, becomes so protected with the addition of decoration (which in and of itself is not expressive) and thus becomes 'sculpture' is contrary to both common sense and the inherent purpose of the First Amendment," the city's lawyers wrote in a recent brief.</p>
<p> "In any event the analysis … is completely irrelevant to the instant proceeding where [Mr. Blum] offers for sale items previously sold, including doorknobs, mirrors, light fixtures, plumbing fixtures and bathtubs. Clearly such items are not entitled to First Amendment protection regardless of any efforts on behalf of petitioner to restore or refurbish such items."</p>
<p> A judge is expected to rule within a matter of days on the licensing issue, putting to rest-for the moment at least-the question of whether radiator grills can morph into high art. If Mr. Blum is forced to file for a license and is denied one, he's certain to file another lawsuit. As for the $20 million lawsuit Mr. Blum filed against the city in October 2001, it's unlikely to be resolved for years.</p>
]]></description>
		<content:encoded><![CDATA[<p>When it came crashing down, in late summer of 2000, the fall of the Irreplaceable Artifacts warehouse on Houston was one of the more spectacular building collapses in pre-9/11 New York memory. The four-story 19th-century structure was a downtown landmark, piled to the rafters with monumental friezes, plaster busts, gargoyles and brass doors. The emergency demolition was notable for a spectacular irony: When the building came down, it buried $12 million worth of objects rescued from several decades of New York City building demolitions.</p>
<p>The dust has long settled on the site, but the litigation it spawned continues in Manhattan courtrooms. The various legal fights bring together a motley cast of characters and a bizarre confluence of questions, including these: When, if ever, does a doorknob or a plumbing fixture qualify as art? How does the city divvy up its emergency-demolition contracts? And is the city giving nonprofit status to a cult that uses hypnotized teens as slave labor to enrich the cult's founder, a Palm Beach millionaire with five airplanes?</p>
<p> Evan Blum was one of the pioneers in the architectural-salvage business. The Long Island native started Irreplaceable Artifacts in the 1970's, and has since been profiled in Esquire , Smithsonian magazine and The New York Times . He purchased most of the items in his warehouse from wrecking crews in the New York area.</p>
<p> Mr. Blum and his father, Walter Blum, were in the process of renovating their building to make a restaurant on the premises when a wall started caving in. City inspectors arrived and, fearing a disaster-so much so that the F train underneath was shut down and traffic on Houston diverted-asked for and won an emergency-demolition order.</p>
<p> The building was roped off with police tape, and Mr. Blum was allowed just 10 minutes to go inside and bring out what he could carry. He rescued one box of business documents; he left behind his two cats and what he says were millions of dollars' worth of architectural salvage items. One of the cats survived; the other presumably perished along with most of Mr. Blum's salvaged treasures.</p>
<p> Most … but not all.</p>
<p> During his frantic 10 minutes inside before the wrecking ball landed, Mr. Blum was surprised to notice certain large items already missing from the premises. He didn't have time to look for them or verify his suspicion: The building was demolished within 24 hours.</p>
<p> A month later, Mr. Blum visited the Scranton, Penn., warehouse of his main competitor in the architectural salvage business, Olde Good Things. There, Mr. Blum found some of his missing salvage objects, including 20 seven-foot-high embossed-brass elevator doors, a 10-foot-wide zinc frieze and two brass entry doors from the old Paramount Theater.</p>
<p> Olde Good Things is a phenomenally successful salvage and antiques concern operated by the Church of Bible Understanding, a religious organization that has been called a cult by former members. COBU was founded in the 1970's by a former vacuum-cleaner salesman turned Jesus freak named Stewart Traill. Mr. Traill now lives a decidedly non-ascetic life in Palm Beach, where he allegedly owns five airplanes. His cult continues to recruit mostly troubled teens from inner-city areas in Philadelphia, and, according to Mr. Blum's lawyers, these teens provide Mr. Traill with the free labor that makes his business a success.</p>
<p> Mr. Blum filed a police report in Scranton, estimating the value of the goods at over $200,000 and charging grand larceny. Eventually, a New York City building official pleaded guilty to helping divert the items onto the Olde Good Things trucks.</p>
<p> Adding insult to injury, Mr. Blum and his father had been charged with felonies for allowing their building to become a hazard. A jury cleared them of recklessly endangering lives and lying in paperwork about the extent of the renovations that were under way at the time of the July 2000 collapse. They were convicted of lesser charges of recklessly creating a serious risk of injury to their employees and neighbors.</p>
<p> After his building was demolished, Mr. Blum filed his own lawsuit against the city in October 2001, asking $20 million in damages and alleging that the city ordered the emergency demolition "without justification, without an opportunity for [Mr. Blum] to be heard, without procedures for the preservation of evidence and with intentional malice."</p>
<p> Mr. Blum's lawyer, Ray Dowd of Dowd &amp; Marotta, said the city orders around a dozen emergency demolitions every month and that a small club of favored contractors is paid $300,000 to $400,000 for each one, a practice he said explained some of the "large political contributions" to various political figures. Mr. Dowd said the city is required to give owners hearings before demolitions, but that most owners, like Mr. Blum, rarely get their day in court before the wrecking ball strikes.</p>
<p> Mr. Blum's lawsuit is still pending.</p>
<p> A year after Mr. Blum filed suit against the city, a New York Consumer Affairs inspector walked into his other place of business, Demolition Depot on 125th Street in Harlem, and, pretending to be a consumer, innocently inquired about a non-working stand-up hand-dryer. Told she could have the item, the inspector revealed her identity and cited Mr. Blum for operating as a dealer in secondhand goods without a city license.</p>
<p> Mr. Blum was immediately suspicious about why the inspector visited his store in the first place. His lawyers filed a FOIA motion to find out exactly what inspired the undercover inspection of Demolition Depot on that day. They have received nothing. "I think it was the city's response to his lawsuit," says Mr. Dowd.</p>
<p> Mr. Blum doesn't want to file for a secondhand-dealer license. He says such a filing would require him to perform a Herculean feat of bureaucratic documentation on each and every item in his vast and dusty warehouse.</p>
<p> Mr. Blum is also reluctant to file for a license because his conviction in the downtown building collapse could be reason for the city to deny the license.</p>
<p> But his main argument against licensing, which continues to this day, is that he is not selling secondhand goods but art objects. Mr. Blum claims that he is not just a secondhand-goods dealer, but a purveyor of "sculpture" to Hollywood and some of the city's finest homes.</p>
<p> Among the scores of fabulous who have purchased brass friezes, gargoyles and other monumental tchotchkes from Mr. Blum are Pierre Cardin, Jane Pauley, the Banana Republic stores, Keith McNally, downtown restaurant Il Buco, Woody Allen and Kevin Costner.</p>
<p> With a client list like that, Mr. Blum differentiates himself from other "dealers in secondhand goods" such as one finds behind tables at the Sixth Avenue flea markets. Mr. Blum contends his things are art, worthy of First Amendment protection and by no means liable to city regulation, as are other thrift and antique stores.</p>
<p> In the first hearing on the licensing, the following exchange between Mr. Blum's lawyers and the city's licensing inspector set the tone.</p>
<p> Ray Dowd (Mr. Blum's lawyer): "Did you see objects of art on the premises?"</p>
<p> Administrative law judge Kirk Miller: "Do you understand what he means by 'objects of art'?"</p>
<p> Inspector Vickie Cabble: "Such as this? The, the …. "</p>
<p> Judge Miller: "Why don't we define our terms here?"</p>
<p> Mr. Dowd: "If you went to Home Depot, would you see gates like that?"</p>
<p> During the same hearing, Mr. Blum's wife Leslie, an architect, testified as to how she and her husband transform salvaged objects-functional tools like radiator grills-into works of art.</p>
<p> "We take a look at it and say, 'This is a lovely piece of ornamental grillwork. People don't need grills like this anymore; what can we do with them?' … [A]nd we try to see, in this case, the idea of passing light through it, putting a diffuser behind it and having light come through … because you get to set the tracery of the metalwork."</p>
<p> The Blums have published a lavishly photographed coffee-table book on the many decorative uses for architectural-salvage pieces.</p>
<p> Mr. Blum argued through his lawyers that with his decorative imagination, he has a "transformative" effect on everyday old things like doorknobs, bathtubs and grillwork. In fact, Mr. Blum also sends the original artifacts overseas to craftsmen in Belgium who mold and cast from the originals, making new things that look old, which are then sold to New York's high-end decorators.</p>
<p> The city's response is that in no way are doorknobs and plumbing fixtures-no matter how old or beautiful, and no matter whether they've been transformed into decorative objects-worthy of First Amendment protection against city licensing requirements.</p>
<p> "To suggest that the sale of a plumbing fixture or doorknob, which would otherwise be unprotected by the First Amendment, becomes so protected with the addition of decoration (which in and of itself is not expressive) and thus becomes 'sculpture' is contrary to both common sense and the inherent purpose of the First Amendment," the city's lawyers wrote in a recent brief.</p>
<p> "In any event the analysis … is completely irrelevant to the instant proceeding where [Mr. Blum] offers for sale items previously sold, including doorknobs, mirrors, light fixtures, plumbing fixtures and bathtubs. Clearly such items are not entitled to First Amendment protection regardless of any efforts on behalf of petitioner to restore or refurbish such items."</p>
<p> A judge is expected to rule within a matter of days on the licensing issue, putting to rest-for the moment at least-the question of whether radiator grills can morph into high art. If Mr. Blum is forced to file for a license and is denied one, he's certain to file another lawsuit. As for the $20 million lawsuit Mr. Blum filed against the city in October 2001, it's unlikely to be resolved for years.</p>
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		<title>Bark House: Endless Dogsuit Done</title>

		<comments>http://observer.com/2004/03/bark-house-endless-dogsuit-done/#comments</comments>
		<pubDate>Mon, 29 Mar 2004 00:00:00 -0400</pubDate>
					<link>http://observer.com/2004/03/bark-house-endless-dogsuit-done/</link>
			<dc:creator>Nina Burleigh</dc:creator>
				
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		<description><![CDATA[<p>After nearly 10 years of hounding, the bank that serves as executor for tobacco heiress Doris Duke's billion-dollar estate has agreed to compensate the caretakers of her beloved dogs.</p>
<p>The settlement in the long-running dispute over the $100,000 Duke dog trust came in a stipulation filed earlier this month at the New York State Surrogate Court: U.S. Trust agreed to pay two of Duke's former servants who, for the last decade, have been responsible for feeding, medicating and cleaning up after a dwindling number of incontinent, geriatric mutts.</p>
<p> In the stipulated settlement, lawyers from Cravath, Swaine and Moore, representing U.S. Trust, signed off on paying the caretakers $20,000 from the trust, with attorney fees of $7,500 to Ray Dowd, the Manhattan lawyer who has served as the dogs' tireless advocate since 1994.</p>
<p> While the courthouse battle was still raging, two of the dogs died-Minni, a 42-pound red-haired shepherd mutt who was 10 years old in 1997, and her companion Foxy. The sole remaining animal beneficiary of the trust (barring the return of a mysteriously missing shar-pei named Rodeo, who may or may not have been kidnapped) is Robert, an aged shepherd mix.</p>
<p> When Duke died in 1993-deeply sedated, and under circumstances that one bedside nurse later called murder-the eccentric heiress left a will which specified that Mariano DeVelasco, the caretaker at Falcon's Lair, her Beverly Hills pile, would take care of any dogs that survived her. Her will specifically created a $100,000 trust for the sole benefit of her dogs.</p>
<p> The executors of her estate, U.S. Trust, along with its Cravath lawyers, initially resisted setting up the dog trust at all, but did so in 1996. Since then, they have balked at paying vet bills unless provided with kidnapper-style photos of the dogs with that day's L.A. Times . They also refused to pay the caretakers.</p>
<p> Mr. DeVelasco and Ann Bostich, the dogs' primary caretakers, asked in 1998 for $10 a day to walk and care for the mutts, one of whom needed daily insulin shots and was incontinent. Among the documents that Mr. Dowd submitted in support of the caretakers' daily boarding fee was a handwritten letter from them detailing the vicissitudes of caring for the four-legged trust beneficiaries: "Minnie has severe cataracts, and … there seems to be trouble for her at night, and she will relieve herself indoors …. Her urine is so caustic, it has eaten off portions of the cement patio …. We also use our vehicles to transport [her], and Minnie gets nervous and will urinate and defecate in the vehicle …. I do 2-3 loads of laundry per week."</p>
<p> It seems the dogs were allergic to foxtail, a weed on the caretakers' property; it infected their skin and caused abscesses. The caretakers had to rip out their lawn and buy new sod. They tended to the dogs' existing sores and checked them daily for new abscesses.</p>
<p> "It's a massive amount of work to take care of someone else's pet," said Mr. Dowd, who met his client Robert (the shepherd mix) in L.A., but who himself owns only two dying house plants. "And to have a trust go, 'Oh, it's all volunteer work!' That should shock some of Manhattan's wealthier players. They pay dog walkers and pet groomers a lot more than $10 dollars a day here! You leave a trust so your dogs are taken care of, and then U.S. Trust comes around and says, 'Sorry, it's all volunteer work.' It disrespects the grooming professions and is a very snotty and arrogant way of dealing. Anybody who has put their money with U.S. Trust better think twice about whether U.S. Trust knows how to care for their animals."</p>
<p> Doris Duke died childless and left assets of more than $1 billion. Lawyers have feasted off the legal battles over the estate. Katten Muchin Zavis collected nearly $13 million in fees, but was forced to pay back nearly $9 million. Mr. Dowd, who represented the servants, petitioned for a comparatively paltry $548,000. That was for work involving non-canine clients.</p>
<p> At one point, relations between Mr. Dowd and the trustees were so acrimonious that the lawyer accused them in court documents of being "Dangerous to the Duke Estate's Animals." In support of this claim, Mr. Dowd described how the trustees had "killed one of Doris Duke's most beloved pets through outrageous neglect."</p>
<p> In addition to her dogs, Duke owned two camels and kept them at her New Jersey mansion during most of the year. Every summer, however, the camels were transported to her property in Newport, R.I., in specially outfitted trailers, to escape the ravages of a parasite carried by New Jersey's white-tailed deer. But the summer after Duke's death, the trustees "decided that transporting the camels to safety was not necessary," Mr. Dowd wrote. Furthermore, the trustees "let the camels mix with white-tailed deer … as a cost-saving measure." One of the camels died.</p>
<p> Mr. Dowd contended in court documents that the trust might have intentionally neglected the camels so as to spare other, more valuable but inanimate assets: Duke's Southeast Asian art collection. Apparently, the collection-which consists of Asian art and gold and silver treasures-was housed in the carriage barn next to the camels' pen in Newport, and in the summer, Mr. Dowd wrote, the camels routinely ate "copper drainpipes off the house or [reached] into open windows grabbing silverware off the tables and eating it."</p>
<p> Was a camel sacrificed to safeguard Asian treasures? Mr. Dowd can't be sure. But he wrote at the time, "[I]t is clear that a butler and a banker are not capable of making decisions for the proper care of exotic or injured animals."</p>
<p> As for the dog fight, when U.S. Trust eventually agreed to set up the $100,000 trust, it limited distribution of the proceeds. Bills for dog food and veterinary service were paid, but not the caretakers' wages. Mr. Dowd claims that the caretakers were denied payment out of personal animosity, because they had exposed the outrageous behavior of the original executor of the Duke estate, butler Bernard Lafferty.</p>
<p> Lafferty died in 1996, after being removed from his post following allegations of misconduct and murder. The so-called "drunken butler" had had almost exclusive access to Duke in her last days and inherited a hefty sum from her. With the caretakers as witnesses, Lafferty was accused in court documents of influencing her last will, drugging her unnecessarily and spending millions of the Duke dollars shopping for himself on Rodeo Drive.</p>
<p> Lafferty also muddied the waters, as it were, confusing the issue of which dogs should benefit from the dog trust. During Duke's final years and the following year, Lafferty collected at least 10 dogs of his own, and housed them in the garage at Falcon's Lair or on the Duke estate in New Jersey.</p>
<p> One of Mr. Dowd's primary tasks at the outset was to separate the heiress' own mutts from the less-deserving purebred menagerie assembled by Lafferty. Excluded from the dog trust were two Akitas, two Belgian shepherds and one Hungarian wolfhound named Geisha, all of which were living at Duke's New Jersey mansion until just before she died, when Lafferty loaded them onto Duke's jet-a Boeing 737-and transported them across the continent to be near the heiress on her deathbed. Also living at Falcon's Lair when Duke died were Lafferty's three pugs, Valentino, Eva and Bella-gifts that Lafferty claimed were from Michael Jackson.</p>
<p> "Doris Duke, under massive sedation, never saw these dogs," Mr. Dowd wrote in support of his motion to exclude the purebreds from the dog trust. "It is shocking that U.S. Trust is allowing Lafferty to use Estate Funds to care for and maintain dogs he acquired after Doris Duke's death without her knowledge … while U.S. Trust's position is that the very dogs Doris Duke loved should starve and be deprived of medical care."</p>
<p> The dog trust eventually excluded all the Lafferty dogs and provided financial support for the three Duke mutts-without ever agreeing that all three belonged to Doris Duke. In a 1999 letter to Mr. Dowd, a U.S. Trust lawyer, Cravath's Paul Siniawer, wrote: "To be a beneficiary of the Dog Trust, a dog must have been (1) owned by Doris Duke, and (2) residing at Falcon's Lair at the time of her death. At the time of her death … Ms. Duke owned just one (1) dog-Minni (a.k.a. 'Minnie' or 'Mimi') …. Robert and Foxy, who were also residing at Falcon's Lair when Ms. Duke died, were not owned by Ms. Duke." The lawyer wrote that U.S. Trust had agreed to include Robert in the trust because the trust "has been advised that it is important to Minni's well-being that her companion, Robert, be well-fed and in good health."</p>
<p> Mr. Dowd argued that Foxy and Robert were in fact Doris Duke's beloved pets, and that the "Duke pet insurance policies" could prove that.</p>
<p> There remains one unresolved issue: the missing shar-pei, Rodeo, a potential Duke dog-trust beneficiary, should he ever be found. Lafferty bought Rodeo for Mariano DeVelasco during happier days, when the butler and the caretaker were still on good terms, and apparently Doris Duke met and loved the pup. But after Duke's death, when relations deteriorated, Lafferty flew Rodeo to New Jersey and-according to Mr. Dowd-penned the animal up with the Akitas, who had previously "demonstrated a willingness to kill shar-peis." Rodeo was apparently rescued in the nick of time by a servant at the New Jersey estate-and then mysteriously disappeared.</p>
<p> If he were to resurface, the shar-pei would be eligible to fight for his own $100,000 trust. Anyone with knowledge of Rodeo's whereabouts can contact Ray Dowd or U.S. Trust and collect a big bag of doggy treats.</p>
]]></description>
		<content:encoded><![CDATA[<p>After nearly 10 years of hounding, the bank that serves as executor for tobacco heiress Doris Duke's billion-dollar estate has agreed to compensate the caretakers of her beloved dogs.</p>
<p>The settlement in the long-running dispute over the $100,000 Duke dog trust came in a stipulation filed earlier this month at the New York State Surrogate Court: U.S. Trust agreed to pay two of Duke's former servants who, for the last decade, have been responsible for feeding, medicating and cleaning up after a dwindling number of incontinent, geriatric mutts.</p>
<p> In the stipulated settlement, lawyers from Cravath, Swaine and Moore, representing U.S. Trust, signed off on paying the caretakers $20,000 from the trust, with attorney fees of $7,500 to Ray Dowd, the Manhattan lawyer who has served as the dogs' tireless advocate since 1994.</p>
<p> While the courthouse battle was still raging, two of the dogs died-Minni, a 42-pound red-haired shepherd mutt who was 10 years old in 1997, and her companion Foxy. The sole remaining animal beneficiary of the trust (barring the return of a mysteriously missing shar-pei named Rodeo, who may or may not have been kidnapped) is Robert, an aged shepherd mix.</p>
<p> When Duke died in 1993-deeply sedated, and under circumstances that one bedside nurse later called murder-the eccentric heiress left a will which specified that Mariano DeVelasco, the caretaker at Falcon's Lair, her Beverly Hills pile, would take care of any dogs that survived her. Her will specifically created a $100,000 trust for the sole benefit of her dogs.</p>
<p> The executors of her estate, U.S. Trust, along with its Cravath lawyers, initially resisted setting up the dog trust at all, but did so in 1996. Since then, they have balked at paying vet bills unless provided with kidnapper-style photos of the dogs with that day's L.A. Times . They also refused to pay the caretakers.</p>
<p> Mr. DeVelasco and Ann Bostich, the dogs' primary caretakers, asked in 1998 for $10 a day to walk and care for the mutts, one of whom needed daily insulin shots and was incontinent. Among the documents that Mr. Dowd submitted in support of the caretakers' daily boarding fee was a handwritten letter from them detailing the vicissitudes of caring for the four-legged trust beneficiaries: "Minnie has severe cataracts, and … there seems to be trouble for her at night, and she will relieve herself indoors …. Her urine is so caustic, it has eaten off portions of the cement patio …. We also use our vehicles to transport [her], and Minnie gets nervous and will urinate and defecate in the vehicle …. I do 2-3 loads of laundry per week."</p>
<p> It seems the dogs were allergic to foxtail, a weed on the caretakers' property; it infected their skin and caused abscesses. The caretakers had to rip out their lawn and buy new sod. They tended to the dogs' existing sores and checked them daily for new abscesses.</p>
<p> "It's a massive amount of work to take care of someone else's pet," said Mr. Dowd, who met his client Robert (the shepherd mix) in L.A., but who himself owns only two dying house plants. "And to have a trust go, 'Oh, it's all volunteer work!' That should shock some of Manhattan's wealthier players. They pay dog walkers and pet groomers a lot more than $10 dollars a day here! You leave a trust so your dogs are taken care of, and then U.S. Trust comes around and says, 'Sorry, it's all volunteer work.' It disrespects the grooming professions and is a very snotty and arrogant way of dealing. Anybody who has put their money with U.S. Trust better think twice about whether U.S. Trust knows how to care for their animals."</p>
<p> Doris Duke died childless and left assets of more than $1 billion. Lawyers have feasted off the legal battles over the estate. Katten Muchin Zavis collected nearly $13 million in fees, but was forced to pay back nearly $9 million. Mr. Dowd, who represented the servants, petitioned for a comparatively paltry $548,000. That was for work involving non-canine clients.</p>
<p> At one point, relations between Mr. Dowd and the trustees were so acrimonious that the lawyer accused them in court documents of being "Dangerous to the Duke Estate's Animals." In support of this claim, Mr. Dowd described how the trustees had "killed one of Doris Duke's most beloved pets through outrageous neglect."</p>
<p> In addition to her dogs, Duke owned two camels and kept them at her New Jersey mansion during most of the year. Every summer, however, the camels were transported to her property in Newport, R.I., in specially outfitted trailers, to escape the ravages of a parasite carried by New Jersey's white-tailed deer. But the summer after Duke's death, the trustees "decided that transporting the camels to safety was not necessary," Mr. Dowd wrote. Furthermore, the trustees "let the camels mix with white-tailed deer … as a cost-saving measure." One of the camels died.</p>
<p> Mr. Dowd contended in court documents that the trust might have intentionally neglected the camels so as to spare other, more valuable but inanimate assets: Duke's Southeast Asian art collection. Apparently, the collection-which consists of Asian art and gold and silver treasures-was housed in the carriage barn next to the camels' pen in Newport, and in the summer, Mr. Dowd wrote, the camels routinely ate "copper drainpipes off the house or [reached] into open windows grabbing silverware off the tables and eating it."</p>
<p> Was a camel sacrificed to safeguard Asian treasures? Mr. Dowd can't be sure. But he wrote at the time, "[I]t is clear that a butler and a banker are not capable of making decisions for the proper care of exotic or injured animals."</p>
<p> As for the dog fight, when U.S. Trust eventually agreed to set up the $100,000 trust, it limited distribution of the proceeds. Bills for dog food and veterinary service were paid, but not the caretakers' wages. Mr. Dowd claims that the caretakers were denied payment out of personal animosity, because they had exposed the outrageous behavior of the original executor of the Duke estate, butler Bernard Lafferty.</p>
<p> Lafferty died in 1996, after being removed from his post following allegations of misconduct and murder. The so-called "drunken butler" had had almost exclusive access to Duke in her last days and inherited a hefty sum from her. With the caretakers as witnesses, Lafferty was accused in court documents of influencing her last will, drugging her unnecessarily and spending millions of the Duke dollars shopping for himself on Rodeo Drive.</p>
<p> Lafferty also muddied the waters, as it were, confusing the issue of which dogs should benefit from the dog trust. During Duke's final years and the following year, Lafferty collected at least 10 dogs of his own, and housed them in the garage at Falcon's Lair or on the Duke estate in New Jersey.</p>
<p> One of Mr. Dowd's primary tasks at the outset was to separate the heiress' own mutts from the less-deserving purebred menagerie assembled by Lafferty. Excluded from the dog trust were two Akitas, two Belgian shepherds and one Hungarian wolfhound named Geisha, all of which were living at Duke's New Jersey mansion until just before she died, when Lafferty loaded them onto Duke's jet-a Boeing 737-and transported them across the continent to be near the heiress on her deathbed. Also living at Falcon's Lair when Duke died were Lafferty's three pugs, Valentino, Eva and Bella-gifts that Lafferty claimed were from Michael Jackson.</p>
<p> "Doris Duke, under massive sedation, never saw these dogs," Mr. Dowd wrote in support of his motion to exclude the purebreds from the dog trust. "It is shocking that U.S. Trust is allowing Lafferty to use Estate Funds to care for and maintain dogs he acquired after Doris Duke's death without her knowledge … while U.S. Trust's position is that the very dogs Doris Duke loved should starve and be deprived of medical care."</p>
<p> The dog trust eventually excluded all the Lafferty dogs and provided financial support for the three Duke mutts-without ever agreeing that all three belonged to Doris Duke. In a 1999 letter to Mr. Dowd, a U.S. Trust lawyer, Cravath's Paul Siniawer, wrote: "To be a beneficiary of the Dog Trust, a dog must have been (1) owned by Doris Duke, and (2) residing at Falcon's Lair at the time of her death. At the time of her death … Ms. Duke owned just one (1) dog-Minni (a.k.a. 'Minnie' or 'Mimi') …. Robert and Foxy, who were also residing at Falcon's Lair when Ms. Duke died, were not owned by Ms. Duke." The lawyer wrote that U.S. Trust had agreed to include Robert in the trust because the trust "has been advised that it is important to Minni's well-being that her companion, Robert, be well-fed and in good health."</p>
<p> Mr. Dowd argued that Foxy and Robert were in fact Doris Duke's beloved pets, and that the "Duke pet insurance policies" could prove that.</p>
<p> There remains one unresolved issue: the missing shar-pei, Rodeo, a potential Duke dog-trust beneficiary, should he ever be found. Lafferty bought Rodeo for Mariano DeVelasco during happier days, when the butler and the caretaker were still on good terms, and apparently Doris Duke met and loved the pup. But after Duke's death, when relations deteriorated, Lafferty flew Rodeo to New Jersey and-according to Mr. Dowd-penned the animal up with the Akitas, who had previously "demonstrated a willingness to kill shar-peis." Rodeo was apparently rescued in the nick of time by a servant at the New Jersey estate-and then mysteriously disappeared.</p>
<p> If he were to resurface, the shar-pei would be eligible to fight for his own $100,000 trust. Anyone with knowledge of Rodeo's whereabouts can contact Ray Dowd or U.S. Trust and collect a big bag of doggy treats.</p>
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