Anschutzian Deaccession: Having Your Cake and Eating it Too?

In the Press · September 1, 2008

In the late spring of 2008, Colorado businessman and art collector Philip Anschutz assisted the Denver Art Museum (DAM) in the acquisition of Thomas Eakins’ "Cowboy Singing."  The potentially controversial and precedent-setting portion of their agreement grants Mr. Anchutz a fifty percent ownership stake in a piece of the DAM’s existing collection, Charles Deas’ "Long Jakes (The Rocky Mountain Man)" – or what has been coined a partial deaccession.
 
The Issue 
The rub in this transaction is whether or not the transfer of a fifty percent interest in a work already part of a museum’s collection triggers a deaccession.  In fact, DAM director Lewis Sharp acknowledged the question in an interview with Tyler Green of Modern Art Notes.  Dr. Sharp indicated that:  "It seemed to me that probably falling on the safe side, I decided to use the inflammatory phrase deaccessioning.  Deaccessioning is a technical term and it simply means that you’ve taken it off the registrar’s

at the museum – and we haven’t, because we still have fifty percent … If I have the whole thing to do again, I probably would remove the term deaccessioning."
 
But should he?  After all, while technically the work has not been removed from the registrar it has, to a degree, been partially removed from the collection for six months of the year (the Anschutz agreement allows the painting to be in the possession of DAM for six months and by Mr. Anschutz for six months).  Additionally, the original donor’s intent in providing the work to the museum most likely did not anticipate a fractional ownership arrangement between DAM and a private collector. A key component to any museum deaccession policy and any analysis into the authority of a museum to engage in a deaccession is the consideration of the donor’s intent.     
 
At present, the Association of Art Museum Directors (AAMD) is scrutinizing the deal in light of its Professional Practices in Art Museums. Although the strict standards of the AAMD specify that deaccessioning funds are to be used only for the acquisition of new works, which occurred in the DAM case, the AAMD will undoubtedly look into whether or not the preferred methods of sale standards (publicly advertised auction, sale to an established dealer or other public institution) were violated, whether or not the deal concerned a party with an "association" to the museum, and whether or not the public benefit outweighs the benefit to a private collector.  The AAMD decision may provide insight into the future of partial deaccessioning.
 
Protective Steps 
While we await the AAMD comments and the final resolution of the Anschutz transaction, there are steps that museums may take to help avoid a messy public debacle.  Most often, the loudest opponents to a deaccession event are members of the public with the opinion that museums should acquire art, not dispose of art.  As a result, whenever a piece of art is deaccessioned, museums must take detailed steps to strictly follow their own deaccession policies and involve patrons, donors, and the public to the extent necessary.
 
In light of the potential burgeoning market for half-deaccessioning, or for lack of a better term, Anschutzian Deaccessions, museums should consider taking certain precautionary steps:
 
1.  Deaccession Policy Revision.  Museums should revisit their deaccession policies and determine whether the policies address a partial deaccession.  If the Anschutzian Deaccession is attractive, any museum looking to model a transaction as a partial deaccession should provide proper language in its policy so that the public, donors, and patrons are aware of the policy from the outset.  This language will need to be crafted in a manner that is both workable and falls into line, to a degree, with the AAMD standards.
 
2.  Donor Documentation Revision.  All agreements with donors regarding accession transactions should make reference to the possibility of either a full deaccession or partial deaccession in accordance with the terms and conditions of the museum’s deaccession policy.  Donors should be the first to be contacted about a partial deaccession.  Donors will need to be educated on the possibility of a partial deaccession, if contemplated by the museum.
 
3.  Public Reaction Management.  With any deaccession, there is certain to be public dismay with the museum action.  Educating the public, donors and patrons of the museum as to any potential partial deaccession with a private party, including public notice, should be seriously considered.  Technically, the AAMD regulations prefer a sale through a publicly advertised auction, sale to another public institution, or sale to a reputable dealer.  Any sale that falls outside of these preferences should be communicated to the public, donors, and patrons through advertising and proper notice.
 
4.  AAMD Clearance.  Although not required in any deaccessioning, and although the AAMD guidelines are not strictly mandatory, until the AAMD issues new regulations or a clarifying memorandum, a museum may want to consider presenting a potential partial deaccession transaction to an AAMD committee for comment. This may help protect the museum in the event of any third-party action as a result of the deaccession. Although certainly not dispositive of the issue, the blessing of an industry association can have an important impact on a legal analysis of the legality of a deaccession and help appease the public that the museum has taken the precautionary steps necessary to ensure the equity of such a transaction.
 
As the price and competition for important pieces of art increases, museums must become creative in their acquisition strategy.  Anschutzian Deaccessions may be a vehicle to provide much-needed funding for museums while allowing museums to keep a piece of work in their catalog for public display.  How such deaccessions will be received by the public, donors, and patrons remains to be seen.  However, museums may be able to strike a delicate balance with such deaccessions, enabling them to have their cake and eat it, too.

For more information on Art and Museum Law, please contact Peter J. Caruso II  of Prince Lobel’s Media and Intellectual Property Group at 617 456 8034 or pcarusoii@princelobel.com.