News About Auctions That Will Affect All Of Us

[RichardSimon]

Star Trek Fan Bought Memorabilia 'As Is,' Panel Says in Rejecting Claim Against Christie's
By Noeleen G. Walder
December 23, 2009

A Star Trek fan who claims he was humiliated after spending more than $24,000 on fake props at a Christie's auction has had his $7 million suit against the auction house zapped by an appellate court.
Among the items Ted Moustakis bought at the 2006 auction to commemorate the 40th anniversary of the Star Trek franchise was a visor he believed was worn by "Data," an android character played by actor Brent Spiner in "Star Trek: The Next Generation," a sequel to the original TV show.
But when Mr. Moustakis attended a Star Trek convention and asked Mr. Spiner to autograph the visor, the actor allegedly told him the visor was not real. Mr. Spiner then warned other fans to be careful not to purchase fake memorabilia, "like the guy who paid 12 Grand for a phony visor from Christie's."
Calling the entire experience "embarrassing and emotionally disturbing," Mr. Moustakis sued Christie's Inc. and CBS Paramount Television, producers of the show, for more than $7 million and accused the auction house of "willfully and in bad faith" failing to deliver authentic merchandise.
Yesterday, a unanimous panel of the Appellate Division, First Department, dismissed the fan's suit, holding in the unsigned ruling of Moustakis v. Christie's Inc., 1847, that the conditions of sale, which described the merchandise as "as is," precluded Mr. Moustakis from recovering damages.

The First Department decision will be published Thursday.
Mr. Moustakis bid for and won three items at the October 2006 auction, which according to his papers, Christie's billed as a "historic pop culture event" featuring a "rare and unique collection" of Star Trek memorabilia.
In addition to the visor, which he bought for $6,000, Mr. Moustakis spent $11,400 on a Data Starfleet Uniform and $6,600 for a poker table that he claims was identified by Christie's as having been "used in the Ten Forward lounge of the Starship Enterprise."
The character Lieutenant Commander Data was portrayed as a sentient android born in the Ornicron Theta science colony with advanced mathematical and programming abilities. He served as the second officer and chief operations officer aboard the starships USS Enterprise-D and USS Enterprise-E.
In 2007, Mr. Moustakis traveled to a Las Vegas Star Trek convention where he asked Mr. Spiner to autograph the visor. It was then that Richard Arnold, a Star Trek expert, told Mr. Moustakis the visor was not the real thing.
Mr. Spiner confirmed this. Later, Mr. Moustakis allegedly found out that a uniform identical to the one he had purchased at the auction was available on eBay for less than half of what he paid and noticed the poker table did not have a distinctive black border like the one on the Enterprise.
Claiming Christie's and Paramount had misled him about the authenticity of the items, Mr. Moustakis sued for negligent misrepresentation, fraud and violations of the General Business Law and demanded millions of dollars in punitive damages.
According to Mr. Moustakis, Christie's "had knowledge of hundreds, if not thousands of character duplicate uniforms that Paramount was warehousing."
He claimed the art house's promotional statements, along with the description of the uniform in the catalogue, led him to reasonably believe that the item was one of a kind.
And Mr. Moustakis alleged that Mr. Spiner had informed Christie's the visor was not authentic before the auction.
Items Sold 'As Is'
In October 2008, Manhattan Supreme Court Justice Joan A. Madden (See Profile) dismissed Mr. Moustakis' complaint.
Yesterday, in a four-paragraph ruling, the First Department affirmed Justice Madden's ruling.
"Contrary to plaintiff's contention that defendant Christie's had represented the Commander Data uniform to be one of a kind, no such representation was ever made in the auction catalog," the panel wrote.
Moreover, the conditions of sale, which Mr. Moustakis accepted, expressly stated that "all property is sold 'as is' without any representation or warranty of any kind by Christie's or the seller," the court noted.
The panel held that the fraud and negligent misrepresentation claims were duplicative of the breach of contract claims and concluded that Mr. Moustakis had not sufficiently stated a violation of General Business Law §§349 or 350.
"Finally, the misconduct alleged here, which arises out of a private contract, does not resemble the egregious wrongdoing that could be considered part of a pattern directed at the public generally, so as to warrant the imposition of punitive damages," the panel held.


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[RichardSimon]

Plaintiff had $24,000 in damages and was suing for 7 million.


Court below said:


The only remedy available to him thereunder would be a refund of the sale price(s) upon return of the item(s), a limitation generally permissible in contracts for the sale of goods (see UCC 2-719[1][a]).

[Leon]

Originally Posted by RichardSimon

Plaintiff had $24,000 in damages and was suing for 7 million.


Court below said:


The only remedy available to him thereunder would be a refund of the sale price(s) upon return of the item(s), a limitation generally permissible in contracts for the sale of goods (see UCC 2-719[1][a]).

He should have only asked for 6 million . Seriously, I could see a refund, and a little bit for your troubles, but it's probably a good thing this guy didn't win 7 million. Just my opinion....

[Rob D.]

Unless sometime in the future I plan to sue for punitive damages that are nearly 300 times the amount of money I feel I was cheated out of, I'm not sure how this affects me.

[D. Bergin]

I wouldn't mind being emotionally disturbed and embarrassed by Bret Spiner for a cool $7 Mill.

[mr2686]

Doesn't this end up being a wording issue? I mean, if the auction house says that they believe this was used in the show but is being sold as is, well then the buyer beware. But if they say it was used on the show and is being sold as is, doesn't the as is indicate the condition of the item?

[drc]

'Sold as is' typically applies to condition and working order, not overall identity/authenticity. If a car dealer sells you a used Volkswagon 'as is' and ships you a tricycle, obviously you are legally entitled to your money back. The phrase 'Sold as is' does legally cover some things, but doesn't allow a seller or auctioneer to perform false or deceptive advertising. Tacking the phrase at the bottom of your descriptions won't allow you tell sell forged Babe Ruth baseballs on eBay.

A good example of memorabilia 'as is' is an advertised original antique poster that is still sealed in the original frame and glass. The seller may say he hasn't removed the poster from the frame so he doesn't know and can't guarantee the condition of the edges and back. The 'as is'applies to the unknown condition. If the poster itself turned out to be a modern reprint, the seller would have to give a refund as he advertised it as original.

[Abravefan11]

Over the years I've seen several listings outed on this board as not being what the auction house represented them to be. If this case had gone the other way, some of you could have been on easy street in the near future.

[slidekellyslide]

I'd buy a Babe Ruth autograph from Coach's Corner before I'd ever buy any movie prop.

[william_9]

Now he can wear that visor to the beach! Hope he bought a phaser too, he's gonna need it to keep the ladies off of him.

[Bosox Blair]

Originally Posted by william_9

Hope he bought a phaser too, he's gonna need it to keep the ladies off of him.

Hahahahaha! Set only to "stun" though...

Thanks for the laugh.

[jbsports33]

a movie prop is way different then our market, it's all word of month because many items will look the same or was used in some cases for multiple movies. I have an uncle that rents out props and movie furniture, does that mean his items are worth any more when they come back to the warehouse

yes a refund should have been issued and maybe a bit more for the trouble, but please 7m

not something I ever thought about investing in

Jimmy

[JoeTheBoss]

Originally Posted by william_9

Now he can wear that visor to the beach! Hope he bought a phaser too, he's gonna need it to keep the ladies off of him.

Beam me up Scotty!!!

[barrysloate]

It's apparent that even prestigious auction houses are not doing their due diligence to determine whether or not certain items are real. There are so many knock off and downright counterfeit items in the marketplace that something like this doesn't surprise me. Of course, all he is entitled to is a refund, and maybe if he's lucky an apology. Suing for $7 million is ridiculous. I too am glad he lost.

[hcv123]

Originally Posted by barrysloate

It's apparent that even prestigious auction houses are not doing their due diligence to determine whether or not certain items are real. There are so many knock off and downright counterfeit items in the marketplace that something like this doesn't surprise me. Of course, all he is entitled to is a refund, and maybe if he's lucky an apology. Suing for $7 million is ridiculous. I too am glad he lost.

While I agree that it was WAY over the top to sue for 7m, I also think it lets the auction house off the hook a little too easily regarding the due diligence issue - There needs to be some level of responsibility greater than simply giving a refund when a buyer happens to find out an item is not what they bought it as - IF an auction house wanted to take the "risk" of misrepresenting items and only have to refund the buyers that find out, it seems that the "reward" would far outweigh the "risk". I think some type of standard should be set - 1.5x the final bid refund? - that would act as some level of true "risk" for misrepresented items.

my 2 cents.

[calvindog]

Due diligence? Comeon. If annyone has been keeping score lately, auction houses basically get away with whatever they can -- until they're caught. Even when the auction houses are caught they don't 'fess up. I remember earlier this year in Goodwin's auction he had a Cobb card listed as the only one graded by SGC. I proceeded to post my own, identical, SGC-graded card on the board. Slippery Bill immediately banned me from his auction -- but never changed the false 1 of 1 population claim in his listing.

Has anyone ever seen an industry in which such a large percentage of the population has either: been in prison, are about to be in prison or belong in prison? Auction house principals rest comfortably with the understanding that there are simply not enough prosecutorial resources to indict all of the bad guys in the hobby.

[hcv123]

Originally Posted by calvindog

Due diligence? Comeon. If annyone has been keeping score lately, auction houses basically get away with whatever they can -- until they're caught. Even when the auction houses are caught they don't 'fess up. I remember earlier this year in Goodwin's auction he had a Cobb card listed as the only one graded by SGC. I proceeded to post my own, identical, SGC-graded card on the board. Slippery Bill immediately banned me from his auction -- but never changed the false 1 of 1 population claim in his listing.

Has anyone ever seen an industry in which such a large percentage of the population has either: been in prison, are about to be in prison or belong in prison? Auction house principals rest comfortably with the understanding that there are simply not enough prosecutorial resources to indict all of the bad guys in the hobby.

In principal - agreed. So how do we "out" these guys that take advantage of all the unwilling victims? Does this need to be brought up with the FBI investigators looking at Mastro? Would it be safe to presume that they are looking at other auction houses as well? I know I ended up with a refund check a few years ago from Sotheby's who along with a couple of other VERY high profile auction houses were accused of unfair trade practices when there was apparent collusion in setting their buyer's premium. I also know there have been a couple of times with major houses where I am 98% certain in hindsight I was "bidding against myself".

[Leon]

Originally Posted by hcv123

In principal - agreed. So how do we "out" these guys that take advantage of all the unwilling victims? Does this need to be brought up with the FBI investigators looking at Mastro? Would it be safe to presume that they are looking at other auction houses as well? I know I ended up with a refund check a few years ago from Sotheby's who along with a couple of other VERY high profile auction houses were accused of unfair trade practices when there was apparent collusion in setting their buyer's premium. I also know there have been a couple of times with major houses where I am 98% certain in hindsight I was "bidding against myself".

I have a feeling the FBI investigates whomever they think is committing fraud. I think it's safe to say ALL auction houses get looked at. I also think it's safe to say that what gets put on this board probably gets read by an investigator or two.... regards

[abrahamrudy]

This is not nearly the first instance of an auction house knowingly auctioning off forgeries. But he's silly for thinking he can sue for $7 million bucks and have a realistic chance of recovering from anyone but his family doctor

[Rob D.]

Originally Posted by hcv123

In principal - agreed. So how do we "out" these guys that take advantage of all the unwilling victims?

Whatever you do, don't point it out here (unless it's a small-timer on eBay or the B/S/T, then it's OK to go after them with both barrels blazing). But if it's a major auction house that's guilty of questionable practices, you'll find a parade of board members ready to march in defense whenever questions are raised.

[calvindog]

Obviously Rob is right. The ones that defend the certain auction house crooks can be divided into two categories: a) the hobbyists who are co-conspirators; or b) those too dopey to recognize the most obvious of frauds. I had an email exchange with a hobbyist the other night who in the most vociferous manner was certain that some of the most obvious fraud ever seen in an auction was just not that statistically significant. Of course, that I deal with fraudsters and fraud every day of my career was lost on this imbecile. But of course if an ebayer rips off a board member for $20 we'll get a three page thread with everyone in agreement as to how bad that fraud was.

[drc]

What has struck me in the past are collectors who complain about a fraudulent auction house then bid or consign in their auctions.

[calvindog]

Exhibit A: collectors who are only struck by the fact that collectors still bid in crooked auctions despite the fact that most if not all auctions are crooked. Why be struck by the fact that fraud is rampant when you can furrow your brow and deeply contemplate (in the most scholarly manner, of course) why people would choose to add to their collections with no alternative in sight? Blaming the victim is a convenient way to avoid discussing the bigger problem.

[Leon]

I just don't buy the sentiment that ONLY our BST fraudsters get berated. Those aren't the facts but I guess anyone can believe what they want to. For the record I think all fraud should be exposed but certain individuals on this board go way overboard on conspiracy theories. That being said anyone, auction house or otherwise, that commits fraud should be outed, punished and taken to task....and this board is a fine place to do it. We really need, and for the most part (imo) have, equal rights on the board.

BTW, I am guilty of bidding in almost all auctions....so let the accusations and sarcasm continue.

[Rob D.]

Originally Posted by Leon

I just don't buy the sentiment that ONLY our BST fraudsters get berated. Those aren't the facts but I guess anyone can believe what they want to. For the record I think all fraud should be exposed but certain individuals on this board go way overboard on conspiracy theories. That being said anyone, auction house or otherwise, that commits fraud should be outed, punished and taken to task....and this board is a fine place to do it. We really need, and for the most part (imo) have, equal rights on the board.

BTW, I am guilty of bidding in almost all auctions....so let the accusations and sarcasm continue.

Leon,

I didn't say only B/S/T and eBay sellers get berated. Jeff has done a pretty fine job calling out the big boys. That indeed is quite factual.

My point is that quite often there are a ton of folks ready to pounce when the guilty party is a small-timer. For gosh sakes, a seller had his personal information posted at the top of a thread on the main board, where it remained for days after the transaction in question had been completed. A transaction, by the way, that was for less than $200.

However, when the party in question is a big auction house, the tendency is for the masses to either clam up or rush to the big boys' defense.

If you want to debate that point, feel free. A quick search of previous threads might cause you not to. I'm not sure you should take it personally — it's not like the discussion is about overprints on the backs of candy cards — but that's certainly your right.

Happy holidays.

[slidekellyslide]

Originally Posted by Rob D.

However, when the party in question is a big auction house, the tendency is for the masses to either clam up or rush to the big boys' defense.

Of course...and the reasons why should be obvious. Many here are still bidding/buying and consigning to those auction houses in question. The only time a line is drawn is when the items are just plain fake (ie Coach's Corner). Some (I won't say all) auction houses have figured out that collectors will put up with a certain amount of fraud in order to obtain the "golden ring".

[drc]

Duly note that I said I was struck not only struck. I can have been struck by multiple things (no pun please, I bruise easily), including dubious auction house practices.

[Leon]

never mind