[Peter_Spaeth]

My name appears on the list of "shill bidders" on one transaction where my friend, Ron Goldberg, was the consignor. I don't view myself as a shill bidder, nor do I believe Ron did anything inappropriate. I have no doubt that some of you will disagree, and candidly I have shared this with a few people I respect a lot and they come out different ways. In any event, these are the facts.

In 2007, Ron had a valuable but relatively low demand oddball set (one of the Red Men sets). At some point he was talking to Doug and Doug asked if he would consider consigning the set. Ron said that he would but that because it was an oddball set, he was reluctant to do so unless a reserve could be placed on the auction, particularly since one of Ron's lots had sold well below his expectations in a previous auction. Doug said that he would not place a formal reserve, but instructed Ron that he could achieve the same result if he had a friend bid the reserve amount. Doug insisted, however, that if the friend won the auction, Ron would have to pay the buyer's premium.

Ron then asked me if I would let him bid using my ID. After thinking it over, I agreed. My thinking at the time was that Ron was not going to consign the set anyhow without a de facto reserve (so that there really was no scenario of a no reserve auction where someone could have won the set for a pittance), and that because Ron was going to have to pay the buyer's premium if the bid from my account won, the result would be the same as if I paid for the set and then flipped it back to Ron.

As it turned out, Ron's fear was correct and the bid from my account was high bid, even though Ron had hoped the set might go much higher and in fact sold it for 20k more eventually. So he paid the premium and the set was returned to him. It worked out exactly the same as if there had been a reserve, or higher opening bid. No victim. Nobody "run up." To be clear, Ron had no idea who else had bid or whether they had placed a top all. I am pretty sure, by the way, that many of the lots identified by the government as allegedly involving shill bidding (including multiple lots consigned by other Net 54 board members whose names have not been mentioned yet) are of the same character. Some, on the other hand, doubtless are lots where Mastro and Allen knew the top alls and bid them up themselves, or told the consignor.

I understand there are different ways to view the transaction. We have, in fact, debated this issue before at least in the abstract. I understand the other side, and have no doubt many of you folks will vilify Ron and me. So be it. I have nothing to hide. And apologies for the delay in posting, but I needed to verify the facts with the consignor.

If you are going to vilify Ron, by the way, please be sure to include the other board members identified as consignors on multiple lots, it would be very unfair to single him out.