Bill to Protect Art Authenticators Passes in NY

The New York State Senate has passed legislation which amends the New York Art and Cultural Affairs Law to limit the liability of art authenticators and appraisers. The bill needs to be voted on by the State Assembly before it passes into law. The legislation attempts to address the chilling effect of recent high cost litigation and encourage experts to authenticate artworks.  Experts and boards created to authenticate art have been sued not only for pronouncing art inauthentic, thereby radically devaluing it in the market, but also for expressing an attribution which is later questioned, for refusing to voice an opinion as to its authenticity, for omitting a work from a catalogue raisonné, and for determining that it is unclear whether a work is authentic or not.  These lawsuits, often brought by very wealthy collectors or dealers in the art market, intimidate experts and scholars, compelling them to withhold valuable information from the art market and art scholarship in general by refusing to offer opinions.

The new legislation attempts to incentivize these experts by protecting them from such suits and the accompanying astronomical legal fees. The bill broadly defines “authenticators” protected under the amendment, though it specifically excludes those who authenticate art in which they have a financial interest. Additionally, the bill heightens the pleading requirement for plaintiffs bringing actions against authenticators, making it more difficult to bring a claim into court. A discretionary fee shifting provision authorizes the court to grant legal costs to prevailing authenticators and also precludes prevailing plaintiffs from recovering legal costs. However, the passed legislation does not include a heightened pleading “with particularity” requirement which was included in a previous version of the bill. Even in its previous form, legal scholars questioned the effect the legislation would have on the art market.  It is doubtful the amendment in its current form will convince experts to return to the market.

More via The National Law Review.

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