Purchase Story

Judge Tosses Art Defamation Lawsuit

On August 9 United States District Judge Miranda M. Du ruled in favor of Peter Stremmel, Stremmel Galleries, Mike Overby, and Coeur D’Alene Art Auction of Nevada, LLC, granting their request for summary judgment in a defamation lawsuit filed by Gerald Peters and Gerald Peters Gallery.

Peters had filed the suit on April 28, alleging defamation and business disparagement. The suit revolved around a $1 million painting by Frank Tenney Johnson, called The Rain and the Sun in the original suit but referred to as The Sun and the Rain in the judge’s ruling.

According to the court filing, “Gerald Peters Gallery purchased The Sun and the Rain from the Kodner Gallery in St. Louis, Missouri, for $265,000 on September 12, 2012” and sold it for $750,000 to R.D. Hubbard, the principal of a museum in New Mexico called the Hubbard Museum of the American West. Peters warranted the painting, agreeing that Hubbard could return it for a refund if the warranty failed.

In 2015 Stremmel was asked about his opinion of the painting, for possible inclusion in an auction. Stremmel responded in an e-mail, “Mike Overby [principal of the Coeur d’Alene Art Auction] and I have blown up this painting and examined it carefully, and have concluded that it is not in fact by Frank Tenney Johnson. We have sold over fifty of his paintings over the years, and hold every sales record for his works at auction, and are absolutely certain about this determination. I’m sorry to give [Mr. Hubbard] this news, but at least now he knows.”

After getting a photo with a higher resolution, Stremmel e-mailed again. “I sent the image to Mike Overby, and we both agreed—we wouldn’t touch it for our auction [referring to the Coeur d’Alene Art Auction]. Nothing about it says Frank Tenney Johnson, even the signature looks labored. In fact, minus the signature, if you asked us to identify the artist we honestly wouldn’t have a clue. I hope it wasn’t represented to [Hubbard] as an FTJ—and I really hope he didn’t pay a lot for it. Let us know if we can help.”

The Hubbard Museum and Gerald Peters Gallery came to an agreement, honoring the warranty. Peters traded Navajos by Edgar Alwin Payne for The Sun and the Rain. Peters then filed suit, alleging defamation, business disparagement, and deceptive trade practices.

The judge ruled against Peters, rejecting the charges. As the prevailing party, Stremmel and Overby have filed for court costs, asking the court to award them $49,200.20.

Originally published in the October 2018 issue of Maine Antique Digest. © 2018 Maine Antique Digest

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