Heritage Auctions - Boston Garters

[oldjudge]

Originally Posted by felada

Presumably the way this should have worked was the aggregate of the individual lots should have been a ‘bidder’ in the software. That way the high bid for the lot would have always been displayed and the lot would have remained open every time a bid was placed on an individual lots since it would have increased the bid of the set lot.

Hi David! What you are proposing solves only half of the problem, and the easier half at that. What happens when the aggregate bidder exceeds the individual bidders? At some point all of them will be closed out with no way to bid with the aggregate lot now ahead. How do you allocate this differential back to the individual lots if more than one bidder wants to continue? The system is flawed on an individual lot closing basis. I think the only way to handle this type of bidding is under a format where the full auction closes at once and where bidders can raise their own bids. You need a Memory Lane/ REA type auction for this to work. On a HA individual lot closing format I don't think it works. I also don't think it works on the LOTG format unless all the lots involved go into extended bidding.

[Mattymc727]

I’m no lawyer, so I’ll refrain from fancy terms, but I side with Powell. This is BS. An auction house should have more competence than this for items this large. I think it’s worth a lawsuit if HA doesn’t redo the auction.

What if HA doesn’t even correct this behavior/error after this debacle? Make them.

[oldjudge]

I agree with Jeff that given the flawed auction process the only fair solution is to redo the auction of these cards. The question now becomes who is eligible to bid on the aggregate lot? Is it only those bidders who bid on the aggregate previously (that would represent a larger universe than just Powell) or can any prior individual lot bidders also bid on the aggregate? These questions would have to be resolved before any redo could take place.

[mrreality68]

From my reading (unless I misread) based on the email Powell said he got it looks like HA already made up their mind and giving the winnings to the individual lots and as a result not compensating or re-doing the auction on those items as still discussed.
Further I have not heard or read anywhere about a statement from HA or anything by googling it (Except this forum pops up)
Apparently they are treating it as business as usually and sticking to their terms and conditions and disclaimers and moving forward.
It is a sad situation with the way it all played out can only hope moving forward they improve their software to better handle/link the lots etc or they do not do this type of auction individual vs set.

[Centauri]

It seems pretty clear to me that this was set up from the start to be 2 separate, unrelated auctions. Both auctions were subject of the standard auction rules - if no bids after 30 mins, the auction is closed. Once both auctions were complete, the higher number would get the cards. At least one individual card bidder recognized that during the auction, so it was possible to understand the arrangement. (Someone said they texted their friend at 11:26 that the set bidder was going to lose to the individual).

The only way to ensure ownership of the cards was to bid both ways. As weird as that is, that was clearly the rules at the start.

[insidethewrapper]

If you can't outbid yourself, then I don't see how redoing the auction will change anything. the individual cards will be higher than the set. The rules were clear, the higher between individual and set wins. Also the rules are you can't outbid yourself, these are not new rules. Seems clear to me .

[gunboat82]

Originally Posted by insidethewrapper

If you can't outbid yourself, then I don't see how redoing the auction will change anything. the individual cards will be higher than the set. The rules were clear, the higher between individual and set wins. Also the rules are you can't outbid yourself, these are not new rules. Seems clear to me .

If I'm understanding correctly, your take is that the individual cards will be higher than the set because Heritage intended it from the outset, knowing full well that (1) extended bidding on individual lots would continue after the complete set closed, and (2) competition on the complete set would be limited to one deep-pocketed bidder, so it was always guaranteed to close sooner.

That approach doesn't make sense for a business where the goal is to promote competition and maximize the sale price. The rules are that "you can't outbid yourself," but surely the auction format is meant to leave room for the complete-set bidder to outbid the individual lots as the price increases. No?

[insidethewrapper]

When this format has been used by other auction houses, were you able to outbid yourself on set or individual cards ?

[molenick]

Originally Posted by gunboat82

The rules are that "you can't outbid yourself," but surely the auction format is meant to leave room for the complete-set bidder to outbid the individual lots as the price increases. No?

That would have made sense but Heritage did not put in place any special rules for this auction. On their site, you can put in a maximum bid but that bid is only used if your current bid is topped on that lot. The set bidding was not connected to the individual lot bidding. Not only that, the set closed before all the lots did. So even if Powell could "bid against himself", the lot was already closed.

The problem is that everyone involved played by the rules but the rules did not anticipate this situation (which, in retrospect, they should have).

[molenick]

While I agree that a redo would be fair, I don't see how this can happen.

Not everyone who won a lot is on Net54. As far as they are concerned, they got an invoice and paid for their card, and expect to get that card. They may have no idea about the controversy and don't care that the process was unfair to one of the bidders.

Heritage can withhold the cards but I have no idea what that would mean legally. If Powell believes he has a legal claim to the set because at one point he was told he won on the screen (which later said he lost), the other bidders have a stronger claim because not only were they told they won, it never switched to telling them they lost, and they were invoiced when the auction ended.

And, no, I did not win any of the lots.

Also, I think it is a little unfair to make Aaron feel bad because he won a lot in an auction.

[gunboat82]

Originally Posted by molenick

While I agree that a redo would be fair, I don't see how this can happen.

Not everyone who won a lot is on Net54. As far as they are concerned, they got an invoice and paid for their card, and expect to get that card. They may have no idea about the controversy and don't care that the process was unfair to one of the bidders.

Heritage can withhold the cards but I have no idea what that would mean legally. If Powell believes he has a legal claim to the set because at one point he was told he won on the screen (which later said he lost), the other bidders have a stronger claim because not only were they told they won, it never switched to telling them they lost, and they were invoiced when the auction ended.

And, no, I did not win any of the lots.

Also, I think it is a little unfair to make Aaron feel bad because he won a lot in an auction.

From a legal standpoint, until someone actually takes possession of the cards, it would be difficult for any bidder to prove actual damages (beyond wasting their time). Paying an invoice -- whether it's the individual bidders or the complete set bidder -- changes little in this regard, because Heritage could simply refund the money and mitigate the damages.

Getting a court to order specific performance as an equitable remedy (requiring Heritage to accept payment and turn over the cards) is very difficult, even when the dispute is over something as unique as this set.

[felada]

Originally Posted by oldjudge

Hi David! What you are proposing solves only half of the problem, and the easier half at that. What happens when the aggregate bidder exceeds the individual bidders? At some point all of them will be closed out with no way to bid with the aggregate lot now ahead. How do you allocate this differential back to the individual lots if more than one bidder wants to continue? The system is flawed on an individual lot closing basis. I think the only way to handle this type of bidding is under a format where the full auction closes at once and where bidders can raise their own bids. You need a Memory Lane/ REA type auction for this to work. On a HA individual lot closing format I don't think it works. I also don't think it works on the LOTG format unless all the lots involved go into extended bidding.

Jay I think the way it would work is the aggregate lot remains open until all the individual lots are closed.the individual bidders really bid independent of the aggregate lot but there is at least a link that shows if the bidder is high bidder in the lot and if the individual lots are outbidding the aggregate. Then it is clear to everyone what they really are or are not winning. This way the aggregate bidder always a chance to top the bid and then presumably a remaining bidder on an individual lot go go back and up their bid if desired. Then it becomes the back and forth that makes auctions last until 4am

[jayshum]

Originally Posted by felada

Jay I think the way it would work is the aggregate lot remains open until all the individual lots are closed.the individual bidders really bid independent of the aggregate lot but there is at least a link that shows if the bidder is high bidder in the lot and if the individual lots are outbidding the aggregate. Then it is clear to everyone what they really are or are not winning. This way the aggregate bidder always a chance to top the bid and then presumably a remaining bidder on an individual lot go go back and up their bid if desired. Then it becomes the back and forth that makes auctions last until 4am

You said the aggregate lot should stay open until all the individual lots close and then the aggregate bidder could have a chance to top the bid, but then you say a remaining bidder could go back and increase an individual lot if desired. However, you already said that the individual lots were closed.

The only way for it to work is for all lots related to these cards (set and individual) to close at the same time after some period of time when none of them had any bids. Also, bidders need to be able to increase their own bid if it is already the highest one for a lot so they can change whether the complete set or the individual lots are winning depending on what they are trying to win.

[felada]

Becaue it would essentially come down to two bidders. The one for the aggregate lot and the one individual lot. Both are open until one stops bidding. The other individual lots are closed. The aggregate lot bidder is bidding against someone upping a bid against the individual lot. As soon as that bidder stops both the individual lot and the aggregate lot would close because neither are bidding. Even if the aggregate bidde upped his bid it would be a change to a ceiling bid.

[felada]

The other consideration is the bidding increments. The aggregate lot bidder has a much larger bidding increment. If I was bidding on one of the lower value BG lots the next level aggregate bid would be almost over a 100% increase in the bid of the lot. Am I really going to bid another 2-3x the current bid to out bid the aggregate bidder to win the individual card?