Risky Business: Fraud, Authenticity, and Limited Legal Protections in the High Art Market

10 N.Y.U. J. Intell. Prop. & Ent. L. 246 (2021)

51 Pages Posted: 9 Nov 2020 Last revised: 22 Jun 2021

See all articles by Katie Dixon

Katie Dixon

University of North Carolina (UNC) at Chapel Hill - University of North Carolina School of Law

Zachary Shufro

NYU School of Law

Date Written: August 24, 2020

Abstract

The art market is a high-risk industry, in which authentication is the sina qua non of merchantability. In an era of increased market capitalization and ever-growing demand for fine art—either for the status it confers on its owners qua art or for its investment value—authentication is the art collector’s most frequent stumbling block. Authentication technology has become incredibly sophisticated, enabling scientists and historians to identify works from minutia as discrete as the lead in white paint and the weave of an individual bolt of canvas. Simultaneously, however, increasingly sophisticated art forgers are developing new ways to evade detection, through both artificial intelligence and already-present weaknesses in the market. This Article examines the art market’s reliance upon authentication as the conveyor of value in a work, provides an overview of the risks associated with authentication, and considers the rights, obligations, and remedies when an owner of art—be it an individual, a gallery, or a museum—discovers that the art they own is a forgery or a fake. It then examines the role of artificial intelligence and blockchain technology in both assuring authenticity and creating further short-term problems for the provenance of presently unauthenticated works. Finally, the Article examines the ethical and normative obligations of collectors of fine art. Ultimately, authentication is a double-edged sword. On the one hand, it drives up the value of paintings, creates publicity that benefits their owners, and can add prestige to institutions whose art has been authenticated; on the other hand, authentication can destroy the value of a work of art as easily as it can bolster it, with risks ranging from situations where the mere question of a work’s authenticity made it impossible to sell to situations where authentication led to a legal duty to destroy the work in question, upon proof of was a forgery. While technology can streamline, reinforce, and guarantee the authenticity of a work, it can also create the opportunity for nefarious actors to perpetrate fraud on a massive scale. Until these risks can be addressed, and the art market adapts ways to address them, the old adage of caveat emptor¬—buyer beware—will continue to be the hallmark of art authentication.

Suggested Citation

Dixon, Katie and Shufro, Zachary, Risky Business: Fraud, Authenticity, and Limited Legal Protections in the High Art Market (August 24, 2020). 10 N.Y.U. J. Intell. Prop. & Ent. L. 246 (2021), Available at SSRN: https://ssrn.com/abstract=3679660

Katie Dixon

University of North Carolina (UNC) at Chapel Hill - University of North Carolina School of Law

Chapel Hill, NC
United States

Zachary Shufro (Contact Author)

NYU School of Law ( email )

New York, NY
United States
8606042619 (Phone)

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