Update, 7:40 a.m. Monday, Dec. 23: A U.S. District Court jury on Friday awarded $500,000 to Marguerite Hoffman, a prominent Dallas art collector, over the sale of a Mark Rothko painting. It’s the latest twist in a lengthy fight between Hoffman and David Martinez, a Mexican financier who bought from her an untitled 8-foot-tall 1961 painting by Rothko that features two red rectangles.
Later, the painting was sold at auction by Sotheby’s for $31 million. In 2010, Hoffman sued Martinez for failing to keep the sale secret. By selling the painting at auction, the confidential sale became public, Hoffman says. The Dallas Morning News reports that a Hoffman attorney had suggested she get as much as $22.4 million during closing arguments. (Hoffman serves on the board of Public Radio International, which is a supplier of programming to public radio stations.) Hoffman told the newspaper she had earned a “moral, ethical, spiritual” victory. Martinez was a defendant, as were L&M Arts and Studio Capital. Martinez lawyer Gordon Shapiro declared: “From my perspective, she got a lump of coal for Christmas.”
Update, 10:30 a.m. Wednesday: Final arguments were expected to take place today in the Rothko art matter, according to representatives for the defendants.
Original post, Dec. 11: A trial was scheduled to start today in federal court involving a lengthy fight between Marguerite Hoffman, a prominent Dallas art collector, and David Martinez, a Mexican financier who bought a piece of art from her.
The art: An untitled 8-foot-tall 1961 painting by Mark Rothko that features two red rectangles.
In 2007, Hoffman sold the painting. Later, the painting was sold at auction by Sotheby’s for $31 million.
In 2010, Hoffman sued Martinez for failing to keep the sale secret. By selling the painting at auction, the confidential sale became public, Hoffman says.
The defendants violated their agreement, Hoffman contends, by having Sotheby’s sell the Rothko at auction, thus making public what she maintains was always a confidential transaction. … The defendants have always maintained that they violated no agreements.
The Rothko was once part of a bequest made to the [Dallas Museum of Art] by Hoffman and her late husband, Robert. The Hoffmans, Howard and Cindy Rachofsky and Rusty and Deedie Rose announced in 2005 that they would donate their extensive contemporary art collections to the DMA upon their deaths, a gift of $215 million.
The untitled Rothko was among the pieces that lined the walls in the “Fast Forward” exhibition in 2007 that showcased the three couples’ bequest. Soon after, the painting was sold. Since word of the court action broke in 2010, the DMA has strongly supported Hoffman, who in March contributed $17 million to the DMA to establish an endowment to enhance its collections of European art from before 1700.
(Update, 11 a.m. Dec. 11): A representative for Martinez and Studio Capital sent along this statement to KERA:
After the death of her husband, Robert Hoffman in 2006, Marguerite Hoffman, with the advice and counsel of her art advisors, sold the Mark Rothko painting, Untitled, 1961 to Studio Capital. The sale occurred in 2007; it was part of the Hoffmans’ much acclaimed art collection which, in fact, had been pledged to the Dallas Museum of Art upon their deaths. She received the second highest price (at that time) for a Rothko.
As part of the contract, Mrs. Hoffman asked for the transaction to be confidential; the buyer abided by the terms of the contract. Studio Capital even allowed her to display the painting, while the company paid the insurance costs, at her home for six months after the sale. In addition, the company agreed to not display or exhibit the painting anywhere until 12 months after the sale.
In 2009-2010, Studio Capital, decided to sell the Rothko. First, it sought to enter into a negotiated sale through selected art dealers, and the painting eventually was sold at a Sotheby’s auction.
Six years later after the original sale, Mrs. Hoffman claims she has been damaged because the sale of the Rothko in 2010 exposed the transaction for the sale of the painting in 2007 to Studio Capital. The defendants will prove that to be untrue.
Bloomberg reported on the lawsuit back in 2010.