A New York judge ruled against billionaire art collector Ron Perelman on Friday (26 September) and his claims that a 2018 fire at his East Hampton home damaged part of his collection, an event that, in Perelman’s view, should have warranted an insurance payout of $410m. A lawsuit, filed through one of Perelman’s holding companies, claims five works lost their “oomph” in the fire as a result of exposure to smoke and water from a sprinkler system, causing a loss of value. The insurance underwriters from multiple companies, however, disputed his claim and maintained the works by Andy Warhol, Ed Ruscha and Cy Twombly did not sustain damage.
The trial, which began in July, shed light on the imperfect process of art valuation. Perelman claimed in the original complaint that the works “lost their luster, lost their depth, lost some of their definition and lost a lot of their character”, all important aspects of a work but difficult to quantify or assign monetary value to. While Perelman’s team believed the insurance policy justified a $410m payout for the five works, insurers claimed the works were only worth around $100m.
Andy Warhol’s Elvis (21 Times) is one of five artworks that a lawsuit claimed were badly damaged during a fire at Ron Perelman’s estate in the Hamptons, New York. New York State Supreme Court filing
New York State Supreme Court Justice Joel M. Cohen sided with the insurers on Friday, writing that “there was no visible damage to the five paintings”. However, Cohen did not agree with the defendant’s allegations that Perelman knowingly provided “false testimony” in July 2021, when he said he did not intend to sell the works.
Insurers’ lawyers allege the dealer Larry Gagosian and the billionaire collector Ken Griffin were invited to view the Twombly in 2020 before the claim was filed later that year. They further asserted Perelman only filed his lawsuit after he failed to sell the works, and noted the timing coincided with financial troubles at Revlon, which Perelman owned a majority stake in until the cosmetic company exited from bankruptcy in 2023. Unsealed court documents revealed Perelman sold more than 71 works between 10 March 2020 and 10 January 2022, fetching $963.3m collectively. Around $910.3m of that sum went toward paying creditors.
A lawyer for the holding companies acting on Perelman’s behalf did not say whether or not they will appeal the judge’s decision, according to The New York Times.
