Graff v. Leslie Hindman Auctioneers, Inc

342 F. Supp. 3d 819
District Court, E.D. Illinois·Decided September 19, 2018·No. No. 17 C 6748·Published·Cited by 3 cases

Opinion

SARA L. ELLIS, United States District Judge

Plaintiff Stanley V. Graff brings this suit to recover three paintings that his wife pawned to Defendant Biltmore Loan and Jewelry Scottsdale LLC ("Biltmore"), and of which Biltmore then sold two at auction after Graff's wife defaulted on her loan. In his second amended complaint, Graff brings claims against Leslie Hindman Auctioneers, Inc. ("Leslie Hindman"), Biltmore, and The Owings Gallery, Inc. (the "Owings Gallery"), Nathaniel O. Owings, *822Ray Harvey, Zaplin-Lampert Gallery, Inc., and Jim Parks (collectively, the "Owings Defendants"). He alleges claims for conversion, unjust enrichment, replevin, detinue, promissory estoppel, promissory fraud, and civil conspiracy. Biltmore moves to dismiss the claims against it for lack of personal jurisdiction pursuant to Federal Rule of Civil Procedure 12(b)(2) or, alternatively, to transfer the case to the District of Arizona pursuant to 28 U.S.C. § 1404(a). The Court agrees that Graff has not sufficiently established Biltmore's contacts with Illinois to subject it to jurisdiction in this Court with respect to the claims Graff brings against it. Leslie Hindman and the Owings Defendants also move to dismiss the claims against them pursuant to Federal Rule of Civil Procedure 12(b)(6). Because Graff has not sufficiently pleaded that the paintings are his separate property, and Texas law only allows him to seek recovery from his wife for disposition of community property, and not against third parties, the Court dismisses the claims against Leslie Hindman and the Owings Defendants, disposing of the entirety of the second amended complaint.

BACKGROUND1

Graff, who lives in Dallas, Texas, owned three pieces of Western American art. First, on May 18, 2002, he purchased Taos Indians and the Sangre de Cristos , an oil painting by Oscar Edmund Berninghaus (the "Berninghaus painting"). On May 13, 2006, he purchased Snow Capped Mountains , also referred to as Meadow with Cattle , an oil painting by William Victor Higgins (the "Higgins painting"). On July 29, 2009, he purchased By the Light of the Moon , an oil painting by Frank B. Hoffman (the "Hoffman painting"). Graff claims to have been the sole owner of these paintings, with them remaining his separate property since the date of purchase.

On September 28, 2003, Graff married Deborah Graff. In January 2013, Deborah filed for divorce in Dallas, Texas. The Dallas County District Courts have a standing order applicable to all divorce proceedings, which provides that, during the pendency of the suit, both parties to the proceeding are to refrain from "[s]elling, transferring, assigning, mortgaging, encumbering, or in any other manner alienating any of the property of either party, whether personal property or real property, and whether separate or community, except as specifically authorized by this order." Doc. 81 at 43. But while the divorce proceeding was ongoing, Deborah took the Berninghaus, Higgins, and Hoffman paintings from the Graffs' marital home in Dallas without Graff's permission and pawned them to Biltmore, located in Arizona. She thereafter defaulted on her loan.

Once Deborah defaulted, Biltmore contracted with Leslie Hindman, located in Chicago, Illinois, to sell the three paintings *823at auction. Biltmore sent the three paintings to Chicago, and Leslie Hindman received them around September 25, 2015. At the Leslie Hindman-organized auction, Biltmore sold the Berninghaus painting to an individual living in Dallas, Texas. Biltmore also sold the Higgins painting to the Owings Defendants. Owings organized this group to purchase the Higgins painting at the auction. The Hoffman painting did not sell at the auction and currently remains in Biltmore's possession.

Shortly after the auction, in November 2015, Graff learned for the first time that Deborah had removed the Higgins painting from his home and that the Owings Defendants had it in their possession. He learned of this by searching Leslie Hindman's sale records after he found out that Leslie Hindman had auctioned off the Berninghaus painting. Graff also discovered that the Hoffman painting had not sold during auction. Graff then called Harvey for advice and help locating a lawyer to aid in getting back his three paintings. Graff did not know that Harvey belonged to the group that had purchased the Higgins painting, but Harvey realized this when speaking to Graff. Harvey informed Graff the next day and told him that he could not help Graff and that he had spoken to Owings, who told Harvey that the Owings Defendants had title to the Higgins painting, which would be sold. Graff then contacted Owings, telling him that the Higgins painting had been wrongly taken from him and that he wanted it back. Owings indicated that he still had the Higgins painting, he would not sell it, and he would contact Leslie Hindman about it. But despite this conversation, the Owings Defendants sold the Higgins painting. The sale has since been reversed, and the Owings Gallery has possession of the Higgins painting. See Doc. 48.

Graff has regained possession of the Berninghaus painting. He has demanded the return of the Higgins painting from the Owings Defendants and the Hoffman painting from the Biltmore. But these Defendants have refused to return these two paintings to Graff.

LEGAL STANDARD

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Graff v. Leslie Hindman Auctioneers, Inc, 342 F. Supp. 3d 819 (illinoised 2018).

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