The trial between art collector Ron Perelman and insurers who refused his $400 million claim for 5 damaged paintings began on Monday.
In 2018, the East Hampton home of Ron Perelman caught fire. The building housed five major paintings at the time – two by Ed Ruscha, two by Andy Warhol, and another by Cy Twombly. The 5 paintings were collectively insured for $400 million by Perelman. The clause in the insurance allowed him to claim the full amount, which was significantly more than the collective market value of these works, in case of damage or destruction of the works. The works were insured by the groups American International Group Inc, Llyod’s of London Ltd, and Chubb Ltd.
However, the insurance companies rejected Perelman’s claim in 2020, citing that the paintings suffered no detectable damage. Perelman, however, argued that “all of the pictures lost their luster, lost their depth, lost some of their definition and lost a lot of their character.” His lawyers then filed a court case seeking damages.
The lawyers for the insurers pointed out in court that Ken Griffin (founder, Citadel) and dealer Larry Gagosian visited Perelman’s home in 2020, after the fire, but before the claim was filed. They also pointed out that Griffin bought a painting from Perelman – a painting which was in the same room as the 5 works in question. These facts, they claimed, suggested that the collector lied about the damages. Perelman’s lawyers argued that the insurance companies had already paid for 30 other paintings damaged in the same fire.
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In May 2024, the court gave a summary judgment that it couldn’t be decided via arguments alone if the works were damaged or not. Now, the case has gone on trial, so both parties can expect a concrete decision in the coming months.
