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Teri Franks and team at the Art Auction jury trial.

Judge Reverses Art Auction Jury

By Paul Motter

Last April Park West Gallery, the purveyor of "Fine Art Auctions" aboard several cruise ships, brought a defamation lawsuit against Fine Art Registry, a Phoenix-based company that registers works of art in order to establish its history. In the art world, the history of a work of art is known as its "provenance."

Fine Art Registry is not in the business if authenticating art; That is done by legal art appraisers. But Fine Art Registry knows the accepted methods of authenticating and appraising art, and they have claimed that Park West Gallery, especially in its cruise ship art auctions, does not follow those guidelines.

Park West objected to the allegations by Fine Art Registry and filed a defamation lawsuit asking for $46 million dollars in damages. The case was eventually heard by a jury trial in Michigan, the home state of Park West.

A jury of eight Michigan citizens took five and a half weeks to finally render an opinion - presumably based upon the evidence and according to the orders given by the judge. In the end the jury ruled that Fine Art Registry had not committed defamation and awarded Park West nothing. In a counterclaim filed by Fine Art Registry, alleging trademark violation under the Lanham Act by Park West Gallery, the jury agreed that Park West had created a web site that infringed on the trademark of Fine Art Registry. The jury awarded Fine Art Registry a judgment of $500,000 to be paid by Park West.

But last week, August 17, a Michigan judge, Lawrence Zatkoff, threw out that jury decision. Park West put out a press release saying "The U.S. District Court of the Eastern District of Michigan granted Park West Gallery a new trial in its defamation case against Fine Art Registry (FAR).

"We are pleased with the judge's ruling," the attorney Rodger Young, lead counsel for Park West Gallery is quoted as saying in the Park West press release. "These types of decisions are extremely rare, and the Court's decision sends a clear message about the severity of the actions of the Defendants and their Counsel."

Yes, it is extremely rare - especially in a case where the defendant is acquitted of the charges brought by the plaintiff. In a criminal case a judge is not allowed to set aside an acquittal verdict by a jury, because that would constitute double jeopardy, forbidden in our system of jurisprudence.

But this is a civil case. The judge issued a 55-page order for a new trial in which he basically nullified the entire original trial. He vacated the jury's verdict with respect to the nine claims asserted by Park West against the Fine Art Registry; essentially saying that the jury's finding that Fine Art had NOT committed defamation is no longer valid. He also threw out the $500,000 judgment in favor of Fine Art Registry in the Lanham Act counter-claim. Finally, the judge ordered a new trial on all of these claims.

Here is the odd thing about this turn of events. This judge, Lawrence Zatkoff, who just overturned every judgment the jury made was the same judge who presided over the trial. Even worse astounding; he will also be the judge on the NEW trial. The only thing different will be the jury, and you can be sure they will know nothing about the previous case.

If Lawrence Zatkoff felt the behavior of Ms. Franks was so egregious wasn't it his duty and obligation to deal with that during the trial? He does claim he tried. The press release quotes his order, " ... the misconduct of Franks and counsel for the FAR defendants was egregious, frequent and ongoing ... permeated the entire trial ... (a)nd unfortunately occurred with regularity during trial, including on both occasions that Franks testified ... Franks and counsel for the FAR Defendants not only continued to engage in such deliberate, intentional and highly and unfairly prejudicial conduct, the severity of their transgressions actually increased following the Court's March 30, 2010 comments and admonitions."

Okay, so the judge felt the defendants conduct was egregious. But he still let the trial go forward and allowed the jury to render a verdict.

Teri Franks, owner of Fine Art Registry, felt she was facing a handicap because the case was to be heard in the home district of Park West Gallery. She had to uproot and relocate to Michigan for the six-week duration. But at the same time she was glad for a jury trial. I am guessing the idea of a local judge hearing a case brought against her by such a rich and powerful local business put some fear into her. I know it would for me.

But in the end the judge got the final word anyway. The jury ruling was ignored - a waste of time and money.

At the Fine Art Registry web site Teri Franks, the owner and lead witness for Fine Art Registry says, "All we did was tell the truth. In a defamation lawsuit, the truth is the defense." That certainly makes sense to me. According to the legal statutes for defamation in Michigan Park West not only had to prove that the statements made by the Fine Art Registry were false, but that Fine Art knew the statements were false.

You can discuss this article in our CruiseMates Forums: Park West Gallery

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