Heritage Live Auction -- Black Swamp debacle

[benjulmag]

Originally Posted by David R

Agreed. And I don't think there would be anything fraudulent about that approach Glyn. And I do think an auction house could auction the cards without misleading hyperbole that might be considered fraudulent. Barry Sloate's descriptions when he did his auction were a good example - he showed a picture of the card with an accurate description of the condition and perhaps a few adjectives without a lot of superfluous BS. You don't need a lot of hyperbole and puffery to sell a PSA 10 Wagner or a PSA 9 Cobb. Perhaps any other approach than the one used by Heritage was out of the question once all the news reports about the details of the find hit the press, but it certainly affected the prices in a negative fashion IMHO.

IMO, Heritage had a legal duty to disclose all information in its exclusive possession that a reasonably prudent bidder would regard as material when evaluating whether and how high to bid. Accordingly, after further reflection I believe it would have been fraudulent for Heritage to have concealed the extent of the find REGARDLESS WHAT IT CHOSE TO SAY OR NOT SAY WHEN MARKETING THE FIND AND WRITING THE CATALOG DESCRIPTION. Any reasonable bidder would have regarded as critically important information when bidding on say, the PSA 10 Wagner, that there were 22 other examples graded 8 or higher that would soon hit the market, a number of them being 9's (not to mention another 15 graded as 7s). Or that when deciding what to pay for a PSA 9 Cobb that there were 14 more 9's to be soon released to the market. The final impact upon market value of the great majority of "find" cards once the find was fully absorbed by the hobby arguably would ten-fold. If this is not material information to a prospective bidder I'm struggling to know what is. In saying this I recognize others may disagree, and I respect that, but these are my views.

EDITED TO ADD in response to a subsequent point that I do not believe Heritage could have avoided this legal obligation by putting its head in the sand once it opened the box and saw the 700 E98s, and choosing to submit for grading only a select few. In this instance they would still be in exclusive possession that there were hundreds and hundreds more, many being superstars, that to the eye looked to be extremely high grade. I know if I was thinking on bidding on one of the select few that they had graded in this instance that I sure would want to know about the existence of these many other ungraded hundreds.