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November 15, 2000


- new: continuous news updates at Museum Security Network site
- Turkish police recover fifth stolen Picasso
- Judge Puts Proposed Deal on Auctions to Plaintiffs
- Museum report 'under wraps'

new: continuous news updates at Museum Security Network site

Turkish police recover fifth stolen Picasso

ISTANBUL, Turkey (AP) -- Police have recovered a painting believed to be a stolen Picasso, raising to five the number of paintings by the artist recovered in Turkey this year, the Anatolia news agency reported Tuesday.
The "Naked Woman" painting was recovered in an operation near the Turkish-Iraqi border in the southeastern province of Mardin, Anatolia said. Four suspects were arrested.
Authorities in Mardin refused to comment on the report and it was unclear when the operation took place.
Police say they have recovered four other paintings of Pablo Picasso since June, including "Ugly Woman," the portrait of the painter's mistress, Dora Maar, and the 1908 painting "La Fermiere," or The Farmer's Wife.
The "Naked women" was apparently smuggled into Turkey from Iraq, Anatolia said.
Police have said the paintings were believed to have been stolen from a Kuwaiti palace during the 1991 Gulf War.

Judge Puts Proposed Deal on Auctions to Plaintiffs

A federal judge in Manhattan ruled yesterday that a proposed $512 million settlement of an antitrust lawsuit against the Sotheby's and Christie's auction houses could be submitted for consideration to more than 100,000 auction buyers and sellers who have asserted that the companies colluded to keep their fees high. Either side could urge the judge to accept or reject the settlement at a hearing on its final approval, which the judge set for Jan. 8 .
The judge, Lewis A. Kaplan of Federal District Court for the Southern District of New York, wrote in another order, however, that he was considering whether the auction houses and the former chairman of Sotheby's had the ability to pay even more than the $512 million, after their guilty pleas last month in a related federal criminal case.
He gave all sides until Monday to object to his plan to appoint an expert witness to report on the economic ability of the two auction giants and the former Sotheby's chairman, A. Alfred Taubman, to pay up to three times the amounts lost by customers as a result of "the admitted and alleged conspiracies." He offered the defendants and the lead counsel for the clients, Boies, Schiller & Flexner, the opportunity also to nominate experts to study the question.
Judge Kaplan did not give figures. But one marketing specialist cited in recent court papers filed by the Boies firm put the amount of the overcharges by the auction houses at $286 million. Treble damages would equal $858 million, or $346 million above the proposed settlement. The judge cannot impose a settlement but can only accept or reject any agreement reached by the parties. If there is no settlement, the case could still go to trial.
The expert, Jeffrey Leitzinger, estimated that Sotheby's overcharged buyers and sellers nearly $162 million, and Christie's nearly $125 million from 1993 through 1999. The $512 million settlement figure is 1.79 times the overcharges.
Lawyers for Christie's and Sotheby's and for Mr. Taubman did not return calls seeking a response.
Judge Kaplan also said he would ask the Justice Department's antitrust division, which has been conducting a three-year criminal investigation into the fixing of client fees and other anticompetitive auction practices, for its views on a feature of the proposed settlement: that $100 million of the $512 million settlement be paid not in cash but in coupons redeemable toward commissions charged to sellers doing new business with Sotheby's or Christie's.
"In view of the highly concentrated nature of this industry, the court has substantial questions whether approval of this term of the proposed settlement is in the public interest," Judge Kaplan said in his orders, which were dated Monday but filed yesterday. He asked the antitrust division to submit its reaction by Dec. 15.
Judge Kaplan did not say what about the coupon arrangement might reduce competition or why he wanted the views of the antitrust authorities.
He also did not explain why he wanted an expert's report on the ability of the defendants to pay up to triple damages, but he may be seeking the information to help him make up his mind on whether to accept the proposed settlement.
In addition to the civil settlement, Sotheby's agreed on Oct. 5 to plead guilty to a federal criminal charge of conspiring to fix prices from 1993 to 1999 and pay a $45 million fine. But Judge Kaplan declined to accept the plea, pending submission of further information on the company's ability to pay.
Also on Oct. 5, the former president and chief executive of Sotheby's, Diana D. Brooks, pleaded guilty to price-fixing charges and agreed to cooperate with the investigation. She will be sentenced later.
Mr. Taubman remains a target of the investigation, government papers have said. He has denied any wrongdoing. He has agreed to pay $156 million of Sotheby's $256 million share of the total $512 million settlement, plus another $30 million to settle a stockholder's suit.
Christie's, which came forward first last January with evidence of collusion, is not facing criminal charges as long as it cooperates with the investigation.
Judge Kaplan ordered that auction house customers who do not wish to be part of the class of plaintiffs exclude themselves from the case in writing by Dec. 15.

Museum report 'under wraps'

by Keith Dovkants
The British Museum is sitting on a damning report that exposes the fiasco surrounding construction of a centrepiece portico in its 100 million Great Court refurbishment.
The report was commissioned more than a year ago after Culture Secretary Chris Smith expressed alarm over disclosures that the portico was being built in a cheaper French limestone rather than the Portland stone approved by the architect and planning authorities.
The accountancy firm PricewaterhouseCoopers was commissioned to investigate on behalf of the museum's trustees and management, and quickly produced a blow-by-blow account of what had gone wrong. When the report was submitted to the museum it was promptly sent back for "further work".
A revised version was sent again last July and this, in turn, was rejected by the trustees' chairman Graham Greene. Now the museum says the report is "a work in progress" and will not be finished until next January.
Inquiries by the Evening Standard reveal the report is in limbo. Although it was supposed to provide transparency and soothe anxieties over the portico affair, informed sources say its disclosures are so embarrassing to the museum that Mr Greene will not countenance its appearance until well after the Queen opens the Great Court on 6 December.
The saga reaches a climax today when the commissioners at English Heritage decide whether to give the portico their approval. They will be making a last inspection before debating what action to take, given that several areas of serious remedial work required by their experts have not been carried out.