A federal appeals court restored lawsuits against Christie’s and Sotheby’s auction houses on Wednesday, saying customers who lost money at foreign auctions because of price fixing can sue for damages, The Associated Press (AP) reported.
The ruling by the 2nd Circuit Court of Appeals in Manhattan could force the auction houses to pay out millions of dollars more than the $537 million settlement reached with customers who lost money in U.S. auctions, the AP reported.
The court said lawbreakers have greater incentive to try to break the law in foreign countries as well as in the United States if they know that anyone harmed overseas cannot sue in the United States, the AP reported.
“This decision vindicates the right of people who engage in transactions outside the United States to bring a case under United States law,” J. Douglas Richards, a lawyer for an undetermined number of plaintiffs in the class action lawsuit, reportedly said.
He said the size of the class was comparable to the size of the class of those who settled for $537 million, suggesting that a just payout could be similar, thee AP reported.
The government has said the companies colluded in 1993 to end a costly rivalry by eliminating discounts and charging identical, nonnegotiable commissions, costing sellers as much as $400 million in commissions from 1993 to 1999.
Sotheby’s pleaded guilty to price-fixing charges and was sentenced to pay $45 million. Christie’s was granted amnesty by the government for its cooperation.
Former Sotheby’s Chairman A. Alfred Taubman was convicted in December of conspiring with former Christie’s Chairman Anthony Tennant to fix the prices. Taubman, 76, awaits sentencing.
Tennant, 71, of Andover, England, has said he will not come to the United States to face trial. He cannot be extradited on antitrust charges.
The auction houses agreed to share the cost of the $537 million settlement of lawsuits brought by customers.
The foreign lawsuits were thrown out of U.S. District Court in Manhattan in January 2001.