Judge Dismisses Koch Suit Against Christie's

If wine collector believed bottle was fake when he bought it, he can't claim fraud, judge finds
Mar 21, 2011

A federal judge in New York has dismissed wine collector William Koch’s lawsuit against auction house Christie’s International. Koch had accused Christie’s of selling him a counterfeit bottle of 1870 Lafite for $4,200 at an auction. But the judge ruled that because Koch believed the wine was a fake when he bid on it, he could not claim he had been injured by Christie’s.

“Here the cause of his injuries was not Christie’s’ misleading statements but plaintiff’s desire to gather evidence against Christie’s,” U.S District Judge Barbara Jones said in her decision.

Koch’s suit against Christie’s was a major salvo in his five-year campaign against counterfeit wines being sold to collectors. Koch, a Florida energy executive who spent more than $12 million amassing a 40,000-bottle cellar beginning in the late 1980s, has spent several million dollars suing wine merchants and auction houses over alleged counterfeits.

Koch has won a default judgment against wine broker Hardy Rodenstock, the source of several bottles that Rodenstock claimed were late-18th century Bordeauxs bottled for Thomas Jefferson. Koch recently settled suits against Zachys Auctions and the Chicago Wine Company after the firms agreed to change the disclaimer language in their auction catalogs. Suits against Acker Merrall and Condit and wine collector Eric Greenberg are still pending.

The challenge for Koch in his suit against Christie’s was proving the auction house had wronged him personally. Christie’s sold the first of Rodenstock’s Jefferson Bordeauxs, and Koch alleged in his suit, filed last March, that the credibility of Christie’s, and the reputation of the former head of its wine department, Michael Broadbent, induced him to buy four of the Jefferson Bordeauxs through other merchants. He also alleged that he had uncovered evidence that Christie’s had systematically ignored evidence it was selling counterfeit wines. Koch also alleged that he bought the 1870 Lafite because he believed it was a fake, and then had it tested in a lab, where researchers found Cesium isotopes that prove the wine came from after 1952.

But Judge Jones rejected Koch’s claim that if Christie’s had disclosed that the bottle was counterfeit “Koch would never have needed to spend $4,200 to purchase the bottle,” ruling that he was no longer acting as a reasonable consumer. “He was acting as an investigator who chose to pay $4,200 despite knowledge that the wine was worth far less,” Jones said.

“We have great respect for Mr. Koch but have always believed his claims were without merit and are therefore grateful for the court’s decision affirming this,” Christie’s spokesman Toby Usnik said in a statement.

A spokesman for Koch said he will appeal the ruling. "It was a technicality—it certainly wasn't on the merits of the case," said Brad Goldstein.

Koch is a fan of the old American West, collecting rifles, pistols and other memorabilia from that era. And he has described himself as a sheriff cleaning up the wine auction industry since he began filing lawsuits six years ago. He has told Wine Spectator that a major goal of those suits has been to force auction houses to reveal their records through discovery proceedings.

But at the end of the day, Koch is a collector, not a criminal investigator. While a spokesman for the FBI has told Wine Spectator that the Bureau’s art fraud division is examining allegations of widespread sale of counterfeits in wine auctions, no charges have been filed.

Collecting Crime Fraud News

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