Can a Museum Sell Your Art?: The Berkshire Museum Saga As a Cautionary Tale

In our first full-length episode, we discuss the Berkshire Museum’s controversial decision to sell off 40 works of iconic art from its permanent collection to raise funds to rebrand itself as a science and natural history museum, and build a large endowment. Only after the regional museum had signed an agreement with Sotheby’s auction house to deaccession these works, did the museum announce its plans to the public. Museum and cultural groups, the fine arts community, and certain local constituents have passionately opposed these plans. Other stakeholders and commentators have strongly supported the museum’s efforts to monetize its collection and rebrand. We will discuss both the ethical and legal issues around deaccessioning and the Berkshire Museum’s actions in particular. We are joined by the financial and art-market journalist, Felix Salmon.

More information on the Berkshire Museum and deaccessioning

From Felix Salmon:

More perspectives:

Litigation status and some papers:

More about deaccessioning:

Episode Transcription

Steven Schindler: Hi, I’m Steven Schindler.

Katie Wilson-Milne: I’m Katie Wilson-Milne.

Steven Schindler: Welcome to the Art Law of Podcast, a monthly podcast exploring the places where art intersects with and interferes with the law.

Katie Wilson-Milne: And vice-versa. The Art Law Podcast is sponsored by the law firm Schindler Cohen & Hochman LLP, a premier litigation and art law boutique New York City.

Felix Salmon: There’s this very vivid and high-stakes debate, which people care about very much about the deaccessioning and like 99% of the planet has no idea it really exists. But, the people who care about it, care about it very much. They basically said, look at this, there is a bunch of billionaires out there in the world who are willing to pay millions and millions of dollars for the art in our little museum, and we don’t have very much money and we can raise like $50 million just by selling off all of our art.

And then, honestly we would rather have $50 million then the bunch of dusty old paintings, this art is worth more to those billionaires who we don’t even know who they are, then it is to us. And, the idea of a museum being a place which preserves cultural heritage basically goes straight out the window and they get to play with this vast pool of money that they have decided they can conjure up just by selling off their paintings.

Katie Wilson-Milne: In July 2017, the Berkshire Museum, a quirky museum in Pittsfield, Massachusetts announced to the public that it would auction of 40 works of art from its collection. To raise more than $60 million for capital projects, to transition to a science and national history museum, and to raise a substantial endowment. Chief among the objects for sale are two premier paintings Norman Rockwell, one thought widely to be his best work, and two Alexander Calder sculptures. These works alone were estimated to bring in over $40 million.

Now, when a museum decides to sell works from its collection, it is called deaccessioning. Deaccessioning is controversial and the Berkshire Museum’s decision to sell works from its collection set off a firestorm in the art community, that spawned two multi-party law suits, a devoted protest movement, and sanction in disavowal from the art and museum community.

Steven Schindler: And that’s what we want to talk about in this episode. We will explore the question, ‘Can a museum sell art from its permanent collection?’ One reason why we choose to focus on this story in this episode is that it is really a great vehicle to think more generally about ethical issues around museum deaccessioning, the plight of small regional museums and about the public’s interest and ownership stake in museum art collections.

Katie Wilson-Milne: These really are the questions at the heart of the Berkshire Museum story, so let’s turn to it. To really understand both sides of these issues, we need to take a step back and look at the history of the museum and the surrounding area. In 1903, a wealthy local philanthropist named Zenas Crane donated a building located in Pittsfield, Massachusetts for use as a public museum of art and artifacts.

Pittsfield is a city in Western Mass, an area called the Berkshires known for its natural beauty and today a lively summer vacation and art scene. Crane wanted this museum in rural Massachusetts to be a window to the world for the area’s people. The Berkshire museum was originally located behind and operated by the Berkshire Athenaeum, and they shared a board of trustees.

The museums earlier relationship with the Athenaeum is important to our story for one primary reason: The Massachusetts legislation establishing the Athenaeum in 1871 stated that its property could not be removed from the town of Pittsfield. In 1932, the museum became a separate and standalone entity. By law, the Athenaeum transferred to the museum, the museum building, its land, as well as the money and objects donated by Zenas Crane. The 1932 legislation doing this did not have any language about the property staying in Pittsfield, but it did state that museum property be used according to any written conditions of the donor.

Things changed in Pittsfield in the following decades, as the trial court in the current litigations stated, “Since the 70s, the national economic winds have eroded the Berkshire County business environment resulting in many industries and businesses dying off or relocating. The population has shrunk and most importantly generous benefactors have vanished.”

Steven Schindler: And it’s true, Pittsfield today is an economically struggling and depopulating city. The Berkshire Museum, the city’s main museum is in financial trouble. It operates at a significance deficit and has a relatively small endowment. In light of the museum’s financial needs, the current board of trustees embarked on a master planning process in 2015 in which they considered changes to the museum’s mission and physical layout, they also considered options for increasing revenue and reducing costs, including approaching Christie’s and Sotheby’s to value the museum’s collection.

Katie Wilson-Milne: And, we should note the museums former director, Stuart Chase, has adamantly opposed deaccessioning works to pay for operating expenses, which caused a clash with the board. He was replaced with a new director, Van Shields, in 2011, who has been proponent of monetizing the museum’s collection.

Steven Schindler: The board also hired a consulting firm, heald focus groups and several board retreats focused on the future of the museum. The consulting firm recommended the museum raised $25.6 million to stabilize operations and suggested the deaccessioning of 22 to 41 works of art. The board eventually opted to raise much more, a $60 million plan with $20 million to go toward transforming the museum into a science museum and $40 million toward a robust endowment.

By the fall of 2016, the board had decided to sell off the most valuable parts of the museum’s collection to raise these funds. And in spring of 2017, the board signed an agreement with Sotheby’s to auction of 40 works no longer deemed relevant to the museums updated mission. Months later in July 2017, the museum announced its plan to deaccession works of art to the public for the very first time. Sotheby’s anticipated that the auctions would raise somewhere between $46 and $68 million.

Katie Wilson-Milne: And, while only 40 works were up for sale out of the museum’s 40,000 or so objects, these works were the vast majority of the Berkshire Museum’s collections value, and included pieces by famous artists such as Norman Rockwell and Alexander Calder. Norman Rockwell’s painting, Shuffleton’s Barber Shop, widely thought to be his best work, alone accounts for an estimated 35% of the value of the entire museum collection. Now Norman Rockwell had lived and worked in the Berkshires and had a close relationship with the museum. He in fact had called it his favorite museum and he donated two of the works to be sold at auction to the museum himself in 1958 and 1960.

Interestingly, Alexander Calder, now one of the world’s most famous sculptors with works regularly selling for tens of millions of dollars, got his start with the Berkshire Museum. His first ever public commissions flanked the existing museum’s theatre and his father’s woodwork sculptures define another of the museum spaces. Among the works to be sold are two Calder sculptures acquired in the 1930’s, when the museum was the first to give Calder an exhibition and the first museum to purchase his works. So that’s the factual background. There are many vocal supporters and opponents of what the museum’s called its “New Vision Plan” and the public outrage and legal battles comes next.

Steven Schindler: So, let’s dive into the ethical and legal issues in this case. And what’s interesting to me is the overlap between the ethical and legal issues. So, starting with the ethical issues; certain museum member groups have adopted ethical guidelines for deaccessioning, and principally these groups are the American Alliance of Museums and the Association of Art Museum Directors. And, these two groups have both adopted ethical guidelines and any museum that’s affiliated with or the directors who are affiliated with these groups are really ethically bound to go along with them.

Over the years, the rules for deaccessioning have developed, but in principle these ethical rules require that each museum have and adopt a set of guidelines that deal with managing their collections and how you buy and you sell art. One of the principle guidelines is that whenever you sell works of art, and there are number of reasons why museums are entitled to sell works of art, but one of the principle rules is that when you sell or deaccession works of art, the proceeds of deaccessioning should only be used to buy new works, is simply not permitted to use the proceeds of selling art to pay for electricity or to build a new movie theatre.

So, for years the Berkshire Museum had a standard deacessioning policy, one that would fit right squarely within the guidelines that we’ve just been discussing, and it had on occasion deacessioned works in accordance with these kinds of guidelines, they sold works and they bought other works. But, it turns out that shortly after they consigned the 40 works to Sotheby’s, somebody looked at their policy and said, “Well this doesn’t make sense and this consignment to Sotheby’s is contrary to the policy that we have.” So what did they do? They amended the policy after the fact, specifically allowing the very transaction that they were contemplating. And the consequence of violating these ethical guidelines is that the museum gets sanctioned and can no longer borrow works, which is central to the core operating function of a museum.

Now once this became public, the Massachusetts Cultural Council, the Smithsonian, the Peabody Essex, AAM, AAMC, AAMD, all vociferously came out against the sale and basically called this a violation of the public trust. So, these ethical guidelines are enough to ostracize the Berkshire Museum from the museum community, discourage donors from giving, and prevent it from cooperating productively with other museums in the future. They do not however make the museum’s deacessioning illegal. At least in Massachusetts, there are no laws adopting these ethical guidelines, where in New York we do have such laws, but at least in Massachusetts these are ethical guidelines and are not legally binding standards.

Katie Wilson-Milne: But it’s not just an ethical issue, right Steve?

Steven Schindler: No, in fact two high profile law suits have been filed.

Katie Wilson-Milne: So, what are the legal arguments given that Massachusetts doesn’t have a statute prohibiting deaccessioning for operating expenses?

Steven Schindler: Well, this goes back again to the history of the museum and whether the museum, under its own legal commitments and state laws, permit it to sell these works. Two groups of plaintiffs have sued the museum seeking to enjoin the sale. Now, let me describe these two law suits. The first law suit was brought primarily by the sons of Norman Rockwell, and they name the trustees of the Berkshire Museum as defendants and also brought into the law suit, Maura Healey, who is the attorney general of the State of Massachusetts, in her capacities as attorney general. The second law suit was brought by members of the Berkshire Museum. Both of these law suits were eventually consolidated and arguments were heard before the trial judge as to whether or not the sale of Sotheby should be enjoined or stopped. So, the parties before the court argued that the sale of the museum’s core art collection violates three restrictions. The first argument was that the sale of the works to Sotheby’s violated the museum’s charitable purpose, contained in its charter to be an art museum.

The second argument was that the statutes creating the museum and its predecessor entity, that is the Athenaeum or Athenaeum, prevent it from selling any of the art acquired by the museum or its predecessor before 1932. And then, the third argument is that Norman Rockwell himself intended and the museum agreed that his art would remain at the museum for the community in perpetuity. So, that is the sort of first set of arguments which we can call either breach of trust, breach of contract. The second set of arguments is based upon the trustees’ of the museums alleged breach of their fiduciary duty of care to the museum.

And the way that argument generally goes is that essentially that the museum’s decision to sell off the core collection of the museum was not reasonable under all of the circumstances. And that rather than undertaking an extensive survey and search to try to see if there were any other ways to keep the museum solvent while retaining the collection that they didn’t do any of those things. And, their failure to explore any alternatives, constitutes a breach of their fiduciary duty of care.

Now, let me just stop here for legal concepts that are relevant. The first is how do you get an injunction and what is it? Typically, you are entitled to enjoin something from happening if you can show that you will be irreparably harmed if an injunction is not issued and that generally means that money after the fact is not going to compensate you for your loss. You also have to be able to show to the judge that you are likely to succeed on the merits and that the equities that is looking at the harm or potential harm to both sides are in your favor. And so, with this mind both cases went before the judge seeking this kind of preliminary injunction of the Sotheby sale.

The other legal standard that comes into play here is a somewhat arcane concept called Standing, Legal Standing. And that question is who has the right to go to the judge and ask that action be taken on behalf of themselves or on behalf of the museum. And in this case, both of the private parties had difficulty with standing. The judge had observed that while the Rockwell heirs were indeed sons of Norman Rockwell, the problem was that they were not executor of his estate and therefore didn’t have the right to come into court on behalf of Norman Rockwell’s estate.

And then, with respect to the members, the judge also observed that the trustees of the museum are the ones who have the authority to act for the museum and simply by the virtue of the fact that you are a member of a museum doesn’t mean that you are entitled to come into court and challenge the actions of the museum. I’m a member of the Metropolitan Museum of Art, I pay a few hundred dollars a year for that privilege, but I can’t go into court and enjoin them from building the next new wing. Now, while the attorney general had standing to bring this law suit, the trial judge at least after hearing the case in October of 2017 decided that the attorney general did not meet the standard for obtaining a preliminary injunction. And principally, the judge concluded that the attorney general was not likely to succeed on the merits of the case. After the trial court dismissed the case and denied plaintiff’s request for an injunction, the parties immediately appealed.

And, now to tell us more about the controversy is Felix Salmon. Felix Salmon is a financial journalist, formerly of Portfolio Magazine and Euromoney and a former finance blogger for Reuters. He has hosted Slate’s ”Money Podcast” since 2014. Felix has recently writing about the controversy at the Berkshire Museum. Welcome to the Podcast Felix. So, why is the deaccessioning is such a big deal, why should anybody care?

Felix Salmon: So, I think one way to think about this is to put yourself in the shoes of Norman Rockwell when he donates what is probably his single greatest painting, arguably his single greatest painting, Shuffleton’s Barbershop, to the Berkshire Museum in the 1950s. And, back then, there was no such thing as the deaccessioning. Deacessioning only really began as a thing in the 1970s. So, when Norman Rockwell donates this painting to the Berkshire Museum, and Norman Rockwell lives in the Berkshires, he has done his entire practice in the Berkshire, he cares about the Berkshires.

What is it that he is doing? And what he doing quite explicitly, and this has been recorded contemporaneous letters and back and forth between him and the then directors of museum, is he is giving his painting to the people of the Berkshires, for the people of the Berkshires, for them to look at and enjoy in perpetuity. That’s what museums do, you give your work of art to a museum, and the museum then is a custodian basically for the painting, and presents it in a certain context and manages to – and people can come to museum to see that work of art, that’s the whole point.

What happens in deaccessioning is that the museum basically reneges on that agreement and says, we no longer feel that it’s our job to look after this painting and to show it to the people to the Berkshires and to use it for the benefit of the people of Berkshires, instead what we are going to do is we are going to ship it off to Sotheby’s in New York, they are going to sell it to the highest bidder who is almost certainly not going to be in the Berkshires and we are going to use the cash to build an atrium. That is clearly not what the agreement between — no one in the original agreement when Rockwell gives that painting to the Berkshire Museum ever dreamed that might ever happen.

Steven Schindler: Right. Are there any circumstances in which deaccessioning is acceptable?

Felix Salmon: Absolutely. Yes. And the deaccessioning happens frequently, and it happens all the time. And grand institutions like the Museums of Modern Art or the Metropolitan Museum or any major museum you guys can think of is constantly deaccessioning their various works. Now, what they are not doing is selling off the Desmoiselles, they are not selling off Starry Night. They’re not selling off their greatest artworks. What they are doing is they are saying, we have vastly more art than we can ever show, that for whatever reason is not important or interesting or doesn’t fit into our program, and at the same time, and this is the important thing, we have a relentless appetite to stay relevant to create a program which is important to our audience, and so we need to do acquisitions.

And so what they are basically doing is swapping out, and they are saying, if we sell a bunch of art here that gives us the resources to buy a bunch of out there. What art is not is asset on the balance sheet, which can be liquidated just to fill a whole in your annual P&L. That art is always in the history of museum finance been held on the balance sheet of the zero value for exactly that reason. But not that it has never happened, it has happened, but when it does happen there is nearly always a controversy and a bit of bru ha ha.

And most museums directors, when they start moving in that direction, tend to do so quite apologetically and talk a lot about existential crises and how they have no choice and they’re trying to create like a whole new sustainable situation, where they’re never going to have to do this again and they’re very apologetic about it. One of the interest things about the Berkshire Museum announcement was that there was none of that and they were just enthusiastically selling off literally what seems to be well over 90% of the value of their collections.

Katie Wilson-Milne: Yeah. I think we want to ask you too about what went wrong in this particular example. Because, I think for probably many of non-art world or non-museum listeners, it makes total sense for a museum to sell assets to generate liquidity when it needs to keep the lights on or to pay salaries. It’s only real asset is the art. If it doesn’t have funds coming in from another source and there is art that’s not being displayed, why not sell it? I mean, I know you disagree.

Felix Salmon: Yeah. And, because I mean — the first response to that is there is a stock versus flow problem there, you have generally don’t sell of this family silver to plug, you know, to pay a credit card bill.

Steven Schindler: But, what if I wanted to do it to send my daughter to college? There has to be some discussion at some point, wouldn’t there be of weighing priorities and what is important, I mean it may be that — my great grandmother left her prized chifforobe to be handed down from generation to generation. And then, one day I wake up and I say, well, I can either look at this dusty relic or I can sell it and send my daughter to college, and what would she rather have, because she is not here any longer to talk her about it?

Felix Salmon: Right. And then – I’m sympathetic, and you of course have every right to do that. And, I’m sympathetic to anyone who pushes back against the idea that we should totally run our lives according to the wishes of dead people. You know, dead people are dead, like, let’s run our lives according to the wishes of what we are doing right now, but a museum is a living thing, and a museum exists to look after artworks and to preserve artworks. And it’s not — as I say, that they are never allowed to deaccession, they totally are.

But, that is within the context of creating a collection, not in the context of an annual shortfall. If you are having annual shortfalls, that’s a bigger issue which is hard to solve on a sustainable basis through deaccessioning. One of the things we are seeing with the Berkshire Museum is that they are actually going one step further, and they are trying to fill a kind of annual shortfall in perpetuity by selling off so much art, like that they can put it into an endowment and then just extract money from the endowment to cover these hypothetical shortfalls that they’ll will have in decades time, and that seems a little bit weird to me.

The other really important thing when you talk about the deacessioning is to just have one eye on future donations, the slogan is that collectors collect art, and museums collect collectors. And so, the question is always in the back of our head, how are we going to collect the collectors? Every collector in the world is looking at you and looking at how you look after the art that you have been entrusted by previous collectors. If collectors look at you and say, well, the way you look after the art that has been entrusted to you by artists like Norman Rockwell and other previous collectors is you just sell it off to make payroll, you are not going to get very many future collectors donating you anything at all. So, in terms of the long term future of the institution, you are kind of cutting yourself off at the knee caps if you start engaging in egregious deacessioning of this form.

Katie Wilson-Milne: Are you saying that, that’s the underpinning for why there are ethical guidelines on deacessioning?

Felix Salmon: That’s one of the underpinnings; it’s not the only one. There is also this idea that there is a job of museums which is to keep art and to look after art and that is a very central role that museums have. One of the things you see frequently in auction catalogues is there will be some editioned work, there will be like a Warhol say, and the auction catalogue will say, this is the last of this series in private hands, and they will say, the other five are all in museums, and this is your last chance to get one of the paintings in this series, because the other five are all in museums. And what’s the thinking behind that? What’s was the logic behind that? The logic behind that is obviously if the other five are all in museums, they’re never going to come on the market. That’s just an understood part of the art market, the whole art market, the way that people think about what’s available and what isn’t would change, valuations would certainly fall.

Steven Schindler: Reading your articles about Berkshire Museum, I’m struck by your objections to the process of what happened, the lack of transparency in the museum’s actions. This is a situation where the museum seemed pretty careful to try to hide what they were doing from public view.

Felix Salmon: There is absolutely no conceivable reason why you would sign a contract with Sotheby’s, which is like an irrevocable contract, and ship the art off to New York City before you announce that you are facing financial difficulties and that you have come to the conclusion that a certain amount of the deacessioning will be necessary. What we have seen time and time again with museums is that they come out and say, “eek!” we have this really nasty cash crunch, and we are going to have to do something pretty drastic, and one of the options on the table is deacessioning of some form or another.

And, once the announcement has been made, a bunch of options often start presenting themselves and people start coming along and saying, hey, I didn’t realize you are having this really nasty cash crunch, and maybe I can help out. The Berkshire Museum never gave the community that option, if there was a local benefactor say who might have been able to acquire one of the Rockwells and donate it to the Norman Rockwell Museum down the street, that would have kept the Rockwell in the Berkshires, that would provided liquidity to the Berkshire Museum, and that might have helped bridge a certain amount of gaps. So, it seems clear that there was something else going on in this case.

Katie Wilson-Milne: Well, and what do you think it was, because clearly the museum’s position is they were having trouble fundraising, they didn’t have this wealthy local owner.

Felix Salmon: Well one of the reasons that they were having trouble fundraising was that they fired all their fundraisers, but yes.

Katie Wilson-Milne: Pittsfield especially, but the Berkshire is not a wealthy area, there are wealthy people that go in the summer to go Tanglewood or Jacob’s Pillow or do other art related things, but it doesn’t have a wealthy year-round population anymore and one of the museum’s claims, I think, or what’s implicit in their papers is that the times have changed, the population of the Berkshires had changed. You know, people were not as interested in going to look at Norman Rockwell painting or Calder sculpture.

Felix Salmon: Well, that would maybe be more compelling if they’d actually tired. And, it’s interesting, because those claims are very similar, the situation of Pittsfield in Berkshire is actually very similar to the situations of North Adams which is a couple of hours —

Steven Schindler: MASS MoCA.

Felix Salmon: — further north, and not only is North Adams is home to MASS MoCA, which is a hugely successful museum, and is expanding and is doing amazing stuff right now, but it has even now started opening up new spaces and Tom Kraines wants to open up a new museum there with Frank Garry and there is a whole bunch of like interesting cultural stuff going on in North Adams, and it’s becoming a cultural destination. Pittsfield can do that too, Pittsfield is bigger it has better communications and the museum is located in the city centre, in the part of the town which is dire need of rehabilitation and that was the other thing, North Adams one of the ways that MASS MoCA put itself on the map was by getting grants from the city and state to say — and saying like if you look help us out here we will revitalize the entire town.

Katie Wilson-Milne: And they did.

Felix Salmon: And they really did, it worked. And that’s something which again the Berkshire Museum never really attempted.

Steven Schindler: Could you tell, and I haven’t been able to tell us from the court papers, whether or not there were any studies done to actually demonstrate that attendance was down or the people weren’t interested in coming to see these works of art, was that just something that the museum just said to justify what it was doing?

Felix Salmon: The museum claimed that they spent a couple of years talking to various local stakeholders. Most of the local stakeholders who are consulted and talking about this consultation process will tell you that basically the way these meetings worked, because they get got called in and they were asked, “Do you send your kid to the Berkshire Museum’s Ooey Gooey Camp?” And they say, “Yes, we do, we love it!” And they said, “Would you like more things like Ooey Gooey Camp?” And they said, “Yes! More things like Ooey Gooey Camp would be great!”

And the museum never asked should we sell our Rockwells in order to create more Ooey Gooey Camps, but they took the answers to those questions as a public buy-in to the idea that they should, they never really presented the people they were talking to with any kind of tradeoffs. And, the first that the local community ever heard that there was any kind of fiscal crisis was the announcement that they already signed this deal with Sotheby’s.

Steven Schindler: So, how much is the opposition coming from the local community and how much is coming from what I would view as sort of out of town elitist art snobs, like ourselves?

Felix Salmon: So, this is — the museum loves the idea that like there is a bunch of snobby art types in Boston and New York, who don’t understand the realities of Pittsfield and are out of touch and honestly like have they even been to Pittsfield and who are they to say anything, and the local community is supportive of them and all you need to do is to read the letters page of the Berkshire Eagle to understand that is totally not true and that Save The Art Campaign and various other people are genuinely grassroots. It’s not to say that there is no support. I mean, what the museum has done is really cleaved the town in two, and friendships have been broken over this and people and – there are marriages where people are on either side of it, it’s really like the big debate in Pittsfield and in the surrounding area, but there is no — I mean, that’s primary reason for them not to have done this in the first place. Like, a museum is meant to be the focal point, a place in the town which brings the town together, instead what they have done is they have torn the town apart. That in itself is good reason not to have gone down this road.

Katie Wilson-Milne: Should say that the Berkshire Eagles is the amazing local paper that has had terrific journalism about this whole saga and has actually I think changed its mind, came out in the very beginning like the Boston Globe did in favor of this New Vision Plan, and then later, after doing some serious digging, recanted that and has been pretty against deacessioning plan.

Felix Salmon: To the point at which the museum is now refusing to talk to the Berkshire Eagle.

Katie Wilson-Milne: So, it seems obvious to us, especially the way you are presenting it, that this was a terrible decision, no museum that knows what’s doing, would ever have deacessioned in this manner at least, if that all, to pay for capital projects, but what was the board thinking? I mean, are these people who are so completely out of touch, who have no concept of their obligations as trustees?

Felix Salmon: Well, one of the things that Van Shields did when he became director was he basically put an end to any kind of acquisitions policy. The people who were in charge of acquisitions got pushed out of the museum, and the art shows in the museum started becoming less and less of a priority. There are non-art shows in the museum, it’s also a museum of natural history and science and stuff like that. The board chair is a science teacher and the role played, there was this a group of friends of the museum who would pay a $1000 a year to meet with the museum to talk about their collections and that kind of stuffs.

And that group just waned to nothing, because there were no meetings. When people went up to Van Shields and said I have this collection of X, Y, Z, do you — would you be interested in acquiring it, should that it donate it to you? Van, he would just turn around and say, you know what, don’t bother we’ll just sell it, we’ll never exhibit it. And so —

Katie Wilson-Milne: He said that out loud?

Felix Salmon: He said that out loud to collectors.

Katie Wilson-Milne: Wow!

Steven Schindler: Wow!

Felix Salmon: And so, what happened was that every — he systematically pushed out and alienated everyone in the community who had any love for art, which meant that by the time he presented his plans to the board, there were no real — there was no one on the board who cared about the art holdings.

Katie Wilson-Milne: Because they would have already left?

Felix Salmon: Exactly.

Katie Wilson-Milne: So, are there any examples you know of where deacessioning was done appropriately and that should be sort of the gold standard for museums who face this quandary?

Felix Salmon: So, obviously, as I say, that the way that larger successful museums like MoMa or the Met do their deaccessioning is perfectly fine –

Katie Wilson-Milne: And no one objects.

Felix Salmon: — and no one objects. If what you wanted to do is use art – use proceeds from the sale art for non-acquisition purposes, the example I gave in my New Yorker piece was the New-York History Society.

Katie Wilson-Milne: Right.

Felix Salmon: And, they did something which was highly controversial and the lot of people to this day think they shouldn’t have done it, but what they did was what I call responsible deaccessioning. They talked to the attorney general. They talked to all of the stakeholders. They created a system whereby even if someone won the work of art being auctioned, they still wouldn’t be guaranteed that they could take it home, because any other museum in first New York State, but then anywhere else in the country would have a sort of rights of first refusal to buy it at a discount to that price.

They tried very hard to keep that art in the museum world broadly defined, but I will say that this is – that litigating this stuff in the courts as this is being done is a clear sign that something has gone very, very wrong, like it should never reach this point. And there were other things which are clear signs, like for instance if you are going to be a museum of science and art, two of the works being sold are very important Calder pieces, which were acquired by the museum. They were the first works that Calder ever sold to any museum. They were part not only of the museum’s attempt to show great art in the Berkshires, but they were also very scientifically important. They were motorized in a way that no art had ever been done before.

And of course Calder and his dad Stirling Calder, who built a bunch of the upstairs room in Berkshire Museum where were very local, like, these works are so integral to not only the mission of the museum, but also to the history of the museum that you would never sell them. Like that would, it would be thinkable to sell them and the idea they just got sort of piled into this job lot without so much as a second thought, again is the indication that something just went hardly wrong here. If you are going to be an art museum of the Berkshires, then frankly Calder and Rockwell are the top two names that you want to have, because those are the two great Berkshires artists.

Katie Wilson-Milne: So, will it be different if what was being deaccessioned wasn’t art. Is there something special about art that makes people so upset at this prospect they wouldn’t be true if it was a significance piece of furniture from a certain period or some kind of non-art object that had historical significance? Is there something about art?

Felix Salmon: I think what happened is that the valuations that artists been able to achieve in the secondary market have skewed incentives that there is really no non-art object that a museum is likely to own, which you could send off to Sotheby’s and which could fetch $30 or $40 million.

Steven Schindler: There are the 40,000 other things that they had in their collection.

Felix Salmon: And none of those were being —

Katie Wilson-Milne: Were worth nothing, right.

Felix Salmon: Consigned, exactly, and Sotheby’s had no interest in those. And it’s not just the Berkshire Museum, it’s pretty much all museums. You could go along to the Met and you could take all of the furniture in the Met and consign it at Sotheby’s and add it altogether and it would be worth less than one of their paintings.

Katie Wilson-Milne: So, they just never do it, because it wouldn’t raise the money?

Felix Salmon: It doesn’t move the needle.

Katie Wilson-Milne: So, in conclusion; museum sells art all the time, deaccessioning is a common form of collections management. But, it is accepted by the museum and fine art community only if the funds go to buy new art, not to the operations of the museum like salaries, renovations, et cetera. That puts a small regional museum, which is asset rich, but cash poor in a difficult position. And while there may be legal reasons why a museum can’t sell its own art, such as if the donor put a restriction on the sale of the work, the museum agents violate fiduciary obligations or the sale is illegal from some independent reason, they are typically far more ethical and moral concerns at play.

Steven Schindler: And that’s it for today’s podcast.

Katie Wilson-Milne: We will share information about the Berkshire Museum and other deaccessioning controversies on the podcast website, artlawpodcast.com, and in the show notes, as well as some more information on our guest Felix Salmon.

Steven Schindler: And please subscribe to us on iTunes or wherever you get your podcasts and send us feedback at podcast@schlaw.com. We would love to hear from you.

Katie Wilson-Milne: Until next time, I’m Katie Wilson-Milne.

Steven Schindler: And I’m Steven Schindler bringing you the art law podcast, a podcast exploring the places where art intersects with and interferes with the law.

Katie Wilson-Milne: And vice-versa.

Produced by Jackie Santos