Mastro and Allen Indicted

[RichardSimon]

Originally Posted by calvindog

Well, they ARE great guys.

And why would anyone think otherwise?

[calvindog]

Has Legendary sent out a mass email addressing the indictment of its top executives? I've been banned from bidding in their auctions for a while so I'm unsure whether they've addressed the events of last week. Considering the angst that would-be consignors and bidders surely must be feeling now, I can't imagine that Doug hasn't at least confirmed that the company is a going concern, that he will not be leading the company until his criminal fraud charges are resolved, etc. Anything?

[Jaybird]

Haven't seen anything. Seems the MO of auction houses that are under fire is to duck and cover.

[Peter_Spaeth]

Originally Posted by calvindog

Has Legendary sent out a mass email addressing the indictment of its top executives? I've been banned from bidding in their auctions for a while so I'm unsure whether they've addressed the events of last week. Considering the angst that would-be consignors and bidders surely must be feeling now, I can't imagine that Doug hasn't at least confirmed that the company is a going concern, that he will not be leading the company until his criminal fraud charges are resolved, etc. Anything?

What happened to the presumption of innoncence?

[Leon]

Originally Posted by Peter_Spaeth

What happened to the presumption of innoncence?

Well Peter, he did say "charges". I was kind of curious of that too. From the few emails and snail mail I have received from Legendary I haven't seen anything to address the issue. That might not be a bad strategy though at this point. I hope this whole mess gets over with quickly and we can move to more positive things in our hobby. I can't be "happy" about the whole situation.

[Peter_Spaeth]

Right, I am just questioning Jeff's suggestion that Doug has an obligation to step down until the charges against him are resolved. That sounds like a presumption of guilt. That said, I am not sure playing ostrich is a great PR strategy with a major auction coming up and others in the pipeline.

[calvindog]

Originally Posted by Peter_Spaeth

What happened to the presumption of innoncence?

Which word did I mention which suggested that there was no presumption of innocence? And does the presumption of innocence prevent the government from freezing the assets of an entity which could be claimed to be proceeds of a crime? Does the presumption of innocence come with a guarantee that all businesses operated by those under indictment are required by law to remain open and not be forced into bankruptcy? Ask Arthur Andersen about the pre-conviction impact of an indictment.

And it's not a presumption of guilt for the top executives of a business to step aside upon being indicted for fraud in the very type of business that they are running. More like common sense.

[Peter_Spaeth]

Jeff, I am not sure Legendary is big enough that its two top executives can simply step aside while the judicial process plays out. It certainly will be interesting to see what impact, if any, this has on the upcoming auctions.

[calvindog]

They're not so big that they can't address the 600 pound gorilla sitting in the corner.

[Peter_Spaeth]

Originally Posted by calvindog

They're not so big that they can't address the 600 pound gorilla sitting in the corner.

Would you feel better if they sent an email saying we deny the charges and intend to vigorously contest them?

[calvindog]

Originally Posted by Peter_Spaeth

Would you feel better if they sent an email saying we deny the charges and intend to vigorously contest them?

No, they've already said that in the papers through their lawyers. I think it prudent that they at least address the impact if any the charges will have on their business, their consignors, their customers, etc. and what, if any, efforts they are making to ensure that Legendary will be a going concern. Don't the people who have spent millions of dollars with Legendary and Mastro at least deserve that?

[Peter_Spaeth]

Originally Posted by calvindog

No, they've already said that in the papers through their lawyers. I think it prudent that they at least address the impact if any the charges will have on their business, their consignors, their customers, etc. and what, if any, efforts they are making to ensure that Legendary will be a going concern. Don't the people who have spent millions of dollars with Legendary and Mastro at least deserve that?

Maybe Leon will get another message on his voice mail.

[Leon]

Originally Posted by Peter_Spaeth

Maybe Leon will get another message on his voice mail.

I doubt it.

And not like I am a pushover but I have to concur with Jeff. They do have at least one executive not indicted, with 30+ yrs in the industry, that could easily temporarily fill in. I think an interim president wouldn't be a bad thing to consider. It's not my company but I do have a small vested interest in the way of some consignments coming up. I had to rob Peter to pay Paul (irony intended) as I am a hopelessly addicted type card collector and had to pay for my last winnings somehow . I will mention that Doug has always helped in some of my collecting endeavors. The rest remains to be seen and of course if I was ever shill bid I won't be the happiest collector, nor would anyone.

[base_ball]

Just a rumor, but I've heard that they are putting the finishing touches on mug shot promo cards for distribution at the National. The cards will feature a "Criminal Code of Conduct" on the verso of the booking photo.

[sago]

Mastro and Legendary Auctions have nothing to do with each other. Just because all 3 people used to work for Mastro Auctions and commited fraud, does not mean that the two that bought out Mastro, sold his collection for him, have all the Mastro auction results on their site, etc., should mean anything to current consignors as they surely have not done anything wrong since. (tongue in cheek smiley)

David davis

[T206DK]

Originally Posted by calvindog

They're not so big that they can't address the 600 pound gorilla sitting in the corner.

Indeed !

[calvindog]

Ok, everyone relax. I saw the email from Legendary. It didn't explain anything regarding the indictments of its top executives for shill bidding -- but it did invite bidders to make maximum, online proxy bids for its live auction this week.

I love America!!!

[base_ball]

Craig "Proxy" Helling?

[T206Collector]

Golden Balls Auction:

http://www.legendaryauctions.com/Lot...px?lotid=34377

What do we make of the red text at the top of the auction description? Does it help their case?

Elvis Hair Auction:

Also, with respect to the Elvis hair, what do we make of the note in the letter of authentication that "it is my opinion that short of comparing mitochondrial DNA with that of known Presley relatives, the hair in the bag is also authentic."

http://www.legendaryauctions.com/Lot...px?lotid=88257


Can Mastro/Legendary successfully shield themselves from liability by putting (albeit weak) disclaimers and conditional lines in their auctions and/or letters of authenticity?

My prediction is pleas of guilty from all involved, but no jail time -- only probation.

[Peter_Spaeth]

Paul, in my judgment if a seller omits material information that casts doubt on an item's authenticity, a disclaimer doesn't protect it against a fraud claim.

[T206Collector]

I think the (albeit weak) conditions and disclaimers will go to whether the auction house made any "false" representations. Here's the lingo for mail fraud. 18 U.S.C. § 1341 provides:

Whoever, having devised or intending to devise any scheme or artifice to defraud, or for obtaining money or property by means of false or fraudulent pretenses, representations, or promises, or to sell, dispose of, loan, exchange, alter, give away, distribute, supply, or furnish or procure for unlawful use any counterfeit or spurious coin, obligation, security, or other article, or anything represented to be or intimated or held out to be such counterfeit or spurious article, for the purpose of executing such scheme or artifice or attempting so to do, places in any post office or authorized depository for mail matter, any matter or thing whatever to be sent or delivered by the Postal Service, or deposits or causes to be deposited any matter or thing whatever to be sent or delivered by any private or commercial interstate carrier, or takes or receives therefrom, any such matter or thing, or knowingly causes to be delivered by mail or such carrier according to the direction thereon, or at the place at which it is directed to be delivered by the person to whom it is addressed, any such matter or thing, shall be fined under this title or imprisoned not more than 20 years, or both. If the violation occurs in relation to, or involving any benefit authorized, transported, transmitted, transferred, disbursed, or paid in connection with, a presidentially declared major disaster or emergency (as those terms are defined in section 102 of the Robert T. Stafford Disaster Relief and Emergency Assistance Act (42 U.S.C. 5122)), or affects a financial institution, such person shall be fined not more than $1,000,000 or imprisoned not more than 30 years, or both.

I'll revise my initial prediction of probation, to include a substantial monetary fine and, of course, restitution. But, I'm still going to say no jail time. I also think Legendary Auctions will survive this particular blow.

[calvindog]

Paul, I'll take that action all day.

[T206Collector]

Even Alfred Taubman, convicted Sotheby's price-fixer, was sentenced to just a year and a day in prison -- though he was fined $7.5 million. And how about Diane "DeDe Brooks" who did 6 months house arrest? Do we think what they did was better or worse? And when did Sotheby's go out of business exactly?





A Taubman's Bidder End. Sotheby's Big Prison-Bound as Appeal is Nixed, John Lehmann, New York Post, 07/26/2002, p. 16.
The Post reported here that "Convicted Sotheby's price-fixer Alfred Taubman has consigned himself to becoming a multimillionaire inmate next week after his appeal was thrown out yesterday."

A three-judge appeals panel in Manhattan heard his appeal and ruled that any errors in his price-fixing trial were "harmless."

Mr. Taubman was sentenced to a year and a day in prison and fined $7.5 million. Apparently the extra day made the sentence just long enough to qualify for early release.

At the hearing before the appeals panel, Mr. Taubman's lawyers brought yet another name to the attention of the public. They accused another ex-Sotheby's board member, Lord Thomas Camoys, of conspiring with Christie's chief Sir Anthony Tennant in April 1995.

Mr. Taubman's lawyers also objected to a quotation used by the prosecution in summing up the case to the jury. The quote was from the economic classic, "The Wealth of Nations" written by the 18th-century economist Adam Smith. The quote said, "People in the same trade seldom meet together even for merriment or diversion, but the conversation ends in a conspiracy against the public and in some contrivance to raise prices."

The Post then reported that in their decision not to grant the appeal, the Court ruled that the government had relied on 'the overwhelming direct evidence of Taubman's knowledge of and participation in the conspiracy."

* * *

Sotheby's Convict is Sprung, Adam Miller, New York Post, 11/10/2002.
Mr. Miller wrote here that "Disgraced auction empress Diana 'DeDe' Brooks laid low yesterday, a day after she completed her six months of house arrest for her role in a price-fixing scheme."

He explained that the former president of Sotheby's was sentenced earlier in the year after pleading guilty to fixing commissions and fees with rival art auction house, Christie's, and testifying against Alfred Taubman, her boss, who was sentenced to a year and a day for his role in the conspiracy.

He also wrote that "the deposed auction queen" also received three years probation, a $350,000 fine and 1,000 hours of community sentence and that the judge called her "a thief and a convict."

[Peter_Spaeth]

Failure to disclose a known material fact is a textbook definition of civil fraud. In the face of that, a disclaimer is useless. Is this somehow different under the criminal mail and wire fraud statutes? I doubt it. It certainly sounds like "false pretenses" to me.

[Peter_Spaeth]

Sotheby's is a bit player compared to Mastro!!!

[steve B]

Originally Posted by Peter_Spaeth

Sotheby's is a bit player compared to Mastro!!!

I'm not seeing this. Sothebys did 5.8 Billion in 2011 with over 1400 employees.

Mastro wasn't even in that league were they?

Steve B

[barrysloate]

Peter was being sarcastic....note the three exclamation points.

[calvindog]

Originally Posted by T206Collector

Even Alfred Taubman, convicted Sotheby's price-fixer, was sentenced to just a year and a day in prison -- though he was fined $7.5 million. And how about Diane "DeDe Brooks" who did 6 months house arrest? Do we think what they did was better or worse? And when did Sotheby's go out of business exactly?





A Taubman's Bidder End. Sotheby's Big Prison-Bound as Appeal is Nixed, John Lehmann, New York Post, 07/26/2002, p. 16.
The Post reported here that "Convicted Sotheby's price-fixer Alfred Taubman has consigned himself to becoming a multimillionaire inmate next week after his appeal was thrown out yesterday."

A three-judge appeals panel in Manhattan heard his appeal and ruled that any errors in his price-fixing trial were "harmless."

Mr. Taubman was sentenced to a year and a day in prison and fined $7.5 million. Apparently the extra day made the sentence just long enough to qualify for early release.

At the hearing before the appeals panel, Mr. Taubman's lawyers brought yet another name to the attention of the public. They accused another ex-Sotheby's board member, Lord Thomas Camoys, of conspiring with Christie's chief Sir Anthony Tennant in April 1995.

Mr. Taubman's lawyers also objected to a quotation used by the prosecution in summing up the case to the jury. The quote was from the economic classic, "The Wealth of Nations" written by the 18th-century economist Adam Smith. The quote said, "People in the same trade seldom meet together even for merriment or diversion, but the conversation ends in a conspiracy against the public and in some contrivance to raise prices."

The Post then reported that in their decision not to grant the appeal, the Court ruled that the government had relied on 'the overwhelming direct evidence of Taubman's knowledge of and participation in the conspiracy."

* * *

Sotheby's Convict is Sprung, Adam Miller, New York Post, 11/10/2002.
Mr. Miller wrote here that "Disgraced auction empress Diana 'DeDe' Brooks laid low yesterday, a day after she completed her six months of house arrest for her role in a price-fixing scheme."

He explained that the former president of Sotheby's was sentenced earlier in the year after pleading guilty to fixing commissions and fees with rival art auction house, Christie's, and testifying against Alfred Taubman, her boss, who was sentenced to a year and a day for his role in the conspiracy.

He also wrote that "the deposed auction queen" also received three years probation, a $350,000 fine and 1,000 hours of community sentence and that the judge called her "a thief and a convict."

Again, I'll take that action all day and night.

[Peter_Spaeth]

Originally Posted by steve B

I'm not seeing this. Sothebys did 5.8 Billion in 2011 with over 1400 employees.

Mastro wasn't even in that league were they?

Steve B

Does size really matter when you are evil incarnate?

[tbob]

Originally Posted by Brian Van Horn

For some (not saying me), the following clip may sum it up:

http://www.youtube.com/watch?v=SjbPi00k_ME

Touche! LOL

[T206Collector]

Originally Posted by calvindog

Again, I'll take that action all day and night.

Then you'd be willing to give me odds?

[tbob]

Interesting to see Mastro's lawyer play the "lifelong religious good deeds doer" card.
I agree with leon's comment about how if he found out he had been shilled in bidding in Mastro auctions in the past, he would be infuriated. I would too, but how in the world will we ever know? We can suspect we were, but realistically we will never know. The mere suspicion of shill bidding lead me to quit making high proxy bids and instead end up staying up in to the wee hours and placing a bid on lots I wanted near the end of the auction.
Personally I know Doug Allen, as many on the board do, and from a personal standpoint I hope Doug comes through this all right, but, again like some on the board, I find all this very troubling and worrisome
I agree with a former poster who alluded to the fact the feds don't normally like to indict unless they believe they have an iron clad case, but they do occasionally make mistakes, usually in conspiracy cases or cases with multiple defendants.
What a mess......

[Copa7]

I picked up the book - THE CARD - in a book store and read the entire thing. It opened my eyes to the grading / auction world.

I would only get cards graded for the purpose of being slabbed for preservation. PSA have been less than consistent in their grading. I cannot say if there is bias to high end customers or preferred clients.

Like any endeavor that makes money, the temptation to fraud is always present. Research, ask questions and go with your gut instincts.

[steve B]

Originally Posted by Peter_Spaeth

Does size really matter when you are evil incarnate?

Missed the exclamation points Maybe the internet has made my mind automatically ignore them.

I suppose size doesn't matter when it comes to people or companies doing bad things. It shouldn't.

But the sothebys guy did 10 months for some anti trust crime
And a bunch of bankers did far less if any for stupid but maybe not criminal stuff and didn't even lose their jobs.

I have no doubts about how much of the 20 years I'd do if I did some sort of postal fraud. (Likely most of it)

I'm not sure where fraud ranks on my mental "evil incarnate " list. Probably not in the top 50. It's bad, but there's lots of worse things.

Steve B

[Matthew H]

Originally Posted by Copa7

I would only get cards graded for the purpose of being slabbed for preservation...

Have you ever heard of a one screw? It has the same level of protection for less then 5% cost. Plus, you can take the card out if you want.

[Peter_Spaeth]

Originally Posted by steve B

Missed the exclamation points Maybe the internet has made my mind automatically ignore them.

I suppose size doesn't matter when it comes to people or companies doing bad things. It shouldn't.

But the sothebys guy did 10 months for some anti trust crime
And a bunch of bankers did far less if any for stupid but maybe not criminal stuff and didn't even lose their jobs.

I have no doubts about how much of the 20 years I'd do if I did some sort of postal fraud. (Likely most of it)

I'm not sure where fraud ranks on my mental "evil incarnate " list. Probably not in the top 50. It's bad, but there's lots of worse things.

Steve B

Steve, I agree. I would place card doctoring much higher on the list of evils than shill bidding, for example. The "evil incarnate" thing was tongue-in-cheek, directed at a certain poster's obsession with Bill and Doug.

[drc]

I ate a neighbor once, but have never bid an a Sotheby's auction. Should even out getting into Heaven-wise.

That's just a joke. I have bid in a Sotheby's auction.

[rdwyer]

I heard MSNBC is gonna change the name of Lockup RAW to Lockup Authentic.

[steve B]

Originally Posted by Peter_Spaeth

Steve, I agree. I would place card doctoring much higher on the list of evils than shill bidding, for example. The "evil incarnate" thing was tongue-in-cheek, directed at a certain poster's obsession with Bill and Doug.

Well then, at least they didn't.....hmmm

Bill and Doug.... somehow when it's first names only it sounds like two guys from Canada.

Now I'm hoping one of the photoshop guys picks up on it.

Steve B

[mark evans]

I believe that the Justice Dep't believes that everyone who is convicted in this case deserves jail time. And, they will probably get it.

As an aside, in the event convictions are obtained, I see this case as a vindication of Jeff (who I don't know) who, far moreso than anyone else, had the chutzpah to call out Mastro for these alleged activities months ago.

[calvindog]

Originally Posted by T206Collector

Then you'd be willing to give me odds?

Yes.

[T206Collector]

Originally Posted by calvindog

yes.

10:1? 50:1?

[calvindog]

Paul, don't be a clown. For once.

[T206Collector]

Originally Posted by calvindog

Again, I'll take that action all day and night.

You said that you'd be willing to give me odds. So give me odds. Or are you too afraid to admit that there is a reasonable chance that the evil Mastro/Legendary folks don't spend any time in prison? Depending on the odds you said you were willing to give me, I may very well be game.

Originally Posted by calvindog

Paul, don't be a clown. For once.

I guess you were joking. I wasn't.

How much is that York Caramel Cobb you're selling worth?

[calvindog]

Paul, in 2005 I stated on this board that Mastro was committing rampant fraud in its business. I'm also a criminal lawyer by trade -- which means I may have some insight here as opposed to a clown talking out of his ass. If you'd like to discuss your proposition further please do so by email or PM.

[T206Collector]

Originally Posted by calvindog

Paul, in 2005 I stated on this board that Mastro was committing rampant fraud in its business.

I know.

Originally Posted by calvindog

I'm also a criminal lawyer by trade.

I know.

Originally Posted by calvindog

If you'd like to discuss your proposition further please do so by email or PM.

PM sent.

[Peter_Spaeth]

No entertainment value for the rest of us in a PM exchange.

[T206Collector]

No entertainment value on my end either. The best odds I was given was 5:1. I was looking for 25:1.

I think the defendants would be thrilled to know that even CalvinDog thinks they have nearly a 20% chance of not doing any time. The way he was talking, I thought he was closer to 5%. I guess we were closer on the likely outcome here than I thought.

[Peter_Spaeth]

In other words, you wanted odds where there was essentially no upside to Jeff, unless you were willing to risk a substantial sum yourself which I doubt. You can't really draw a conclusion from that, can you? I would hardly infer from someone's unwillingnesss to give me 25 to 1 odds that they weren't confident in their position.

[T206Collector]

Correct. I was trying to bargain for that Cobb, but there was no way that the dollars I would be willing to risk for that Cobb were going to make it worthwhile for Jeff. Jeff wanted more upside, but I was not going to bet that there was a more than 20% chance they would all walk free. Frankly, I think that 20% sounds about right.

I do disagree, however, about your point about the confidence of the position. If I'm confident in my position, I'll give you 25:1 odds or better. 5:1 is a real horse race.