Readers will no doubt be puzzled by the news this week that the Detroit Institute of Arts—fresh off of the Grand Bargain, in which an infusion of donations and fundraising led to the transfer of the collection’s ownership back to the museum and off the table in the context of the Detroit Bankruptcy—is moving ahead with plans to deaccession works of art in its collection, a Van Gogh in particular. There are a number of things going on in this latest development, which need to be distinguished.
Topics: Graham Beal, Deaccession, Delaware Museum of Art, American Alliance of Museums, Donn Zaretzky, Deaccessioning, AAM, Van Gogh, Detroit, Detroit Institute of Arts, Association of Art Museum Directors, Museums, Detroit Bankruptcy, AAMD, grand bargain
Last year’s biggest art law story was, in our view the Detroit bankruptcy. Nathan Bomey, who along with Mark Stryker formed the essential reporter team on up-to-the-minute updates on the proceedings, interviewed Bankruptcy Judge Steven Rhodes in the Detroit Free Press. The interview speaks for itself, but the highlights to me were:
Topics: Judge Rosen, Mark Stryker, Chapter 9, Syncora Capital, Financial Guaranty Insurance Co., Judge Rhodes, Christie's, valuation, Detroit, Detroit Institute of Arts, Bankruptcy, Nathan Bomey, Detroit Free Press, Museums, Detroit Bankruptcy, grand bargain
Throughout the Detroit bankruptcy and the attendant speculation about what role, if any, the collection at the Detroit Institute of Arts that is owned by the city should play, a parallel parlor game has been to try to guess what Emergency Manager Kevyn Orr’s endgame and motivation really was. He has dropped hints about the importance of the collection in helping the city emerge from bankruptcy, but his plan of adjustment did not include any sales or loans with the collection as art. Rather, it included what has come to be called the “Grand Bargain,” under which several foundations will pledge hundreds of millions of dollars (as will the State of Michigan) to keep the art safe from liquidation.
Topics: Financial Guaranty Insurance Corporation, Chapter 9, Syncora Capital, FGIC, Judge Steven Rhodes, Detroit, Detroit Institute of Arts, Bankruptcy, Nathan Bomey, Kevyn Orr, Litigation, Detroit Free Press, Museums, Detroit Bankruptcy, grand bargain
After Syncora Capital settled its objections to the Detroit bankruptcy plan of adjustment, it looked like the battle over the Detroit Institute of Arts collection would subside. Not so fast, it turns out. A major contest looms next week with a remaining creditor, Financial Guaranty Insurance Corporation, over the valuation of the collection. Just to recap, the creditors (including both Syncora and FGIC) submitted a valuation of the entire DIA collection that put the value between $8 billion, performed by Victor Wiener Associates, while DIA and the city advanced an appraisal by Artvest Partners and Michael Plummer (who testified last week) putting it at closer to $2.4 billion (after an initial appraisal by Christie's of only part of the collection).
Topics: Chapter 9, Syncora Capital, Financial Guaranty Insurance Co., Judge Rhodes, Christie's, valuation, Appraisal, Detroit, Detroit Institute of Arts, Bankruptcy, Detroit Free Press, Museums, Detroit Bankruptcy, grand bargain
After months of bitter fighting over the so-called Grand Bargain to infuse the Detroit bankruptcy with hundreds of millions of dollars from (among others) the State of Michigan, the Community Foundation for Southeast Michigan, the Kresge Foundation, the Ford Foundation, the John S. and James L. Knight Foundation, the William Davidson Foundation, the Fred A. and Barbara M. Erb Family Foundation, the Hudson-Webber Foundation, the McGregor Fund, and the Charles Stewart Mott Foundation to keep the collection of the Detroit Institute of Arts out of discussion for any sale or use as collateral, the Grand Bargain’s fiercest opponent has announced an agreement with the city and the withdrawal of its opposition to the plan of adjustment. This does not completely put an end to discussion about the role of the DIA collection, but for all intents and purposes it will likely be the last of any proposal to collateralize or sell the artwork. The episode also provides a lesson to practitioners about the cost of overzealousness.
Topics: the Ford Foundation, Chapter 9, the Fred A. and Barbara M. Erb Family Foundation, Syncora Capital, the Hudson-Webber Foundation, the John S. and James L. Knight Foundation, the William Davidson Foundation, Financial Guaranty Insurance Co., Judge Rhodes, Christie's, valuation, Appraisal, Detroit, the McGregor Fund, Eugene Driker, Detroit Institute of Arts, Bankruptcy, Gerald Rosen, the Kresge Foundation, the Charles Stewart Mott Foundation, eligibility, Detroit Bankruptcy, the Community Foundation for Southeast Michigan, grand bargain
Opening statements concluded in the Detroit Bankruptcy trial yesterday, and as expected, the role of the art at the Detroit Institute of Arts played a central role. Although opening statements constitute nothing of evidentiary value, they obviously show the road map that the various sides intend to follow. Thanks to courtroom reporting, we have a number of clues about the themes that the lawyers intend to develop.
Weeks after the city of Detroit released its valuation expert report on the value of the full collection of the Detroit Institute of Arts by Artvest Partners, creditors opposed to the city’s plan of adjustment and the “Grand Bargain” within it have released their own appraisal. Not surprisingly, it asserts a significantly higher value of roughly $8.5 billion, more than double the estimate in the city’s report. New York’s Victor Wiener Associates (VWA) has apparently compiled a 50-page appraisal on behalf of Financial Guaranty Insurance Company (the Detroit News and Detroit Free Press have received copies, none are publicly available of which I’m aware).
A report by an expert witness designated by the City of Detroit for the upcoming bankruptcy trial has been released concerning the value of the full collection of the Detroit Institute of Arts. The report puts the full collection value at $2.7 to $4.6 billion, but estimates that the price it would fetch if the collection were actually liquidated in the real world would be closer to $1.1 to $1.8 billon, and possibly as little as $850 because of the notoriety that would accompany such a sale. It also supplements an earlier appraisal performed by Christie’s of the most significant objects in the collection.
Topics: Artvest Partners LLC, Mark Stryker, State of Michigan, Michael Plummer, Judge Rhodes, Christie's, Detroit Institute of Arts, City of Detroit, Detroit Free Press, Detroit Bankruptcy, grand bargain
Reflecting on the recent argument by the Detroit Institute of Arts that the city of Detroit cannot legally sell, let alone be forced to sell, the artwork in the museum to satisfy creditor, some overlapping terminology creates the possibility of an important confusion. Particularly in the realm of deaccessioning, this distinctions are quite important. Meanwhile, the state of Michigan today approved its part of the “Grand Bargain” to subsidize the bankruptcy to avoid sale or encumbrance of the artwork.
Topics: Donn Zaretsky, Roberta Smith, Rose Art Museum, Lee Rosenbaum, Columbia University, Deaccessioning, Detroit Institute of Arts, Isabella Stewart Gardner Museum, Association of Art Museum Directors, Michigan, Albright-Knox Gallery, New York Times, Detroit Bankruptcy, AAMD, Edward Hopper, Pennsylvania Academy of Fine Arts, grand bargain, Brandeis University, Barnes Foundation