the thirty-seventh annual iowa high school mock …

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THE THIRTY-SEVENTH ANNUAL IOWA HIGH SCHOOL

MOCK TRIAL TOURNAMENT 2019

KELLY CROWN

V.

BRYCE CUTTER d/b/a CHARITY OPERATIONS

NETWORK

A program of

The Iowa State Bar Association Center for Law & Civic Education

In cooperation with the Young Lawyer’s Division

Of The Iowa State Bar Association

With generous financial support from The Iowa State Bar Foundation

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IOWA HIGH SCHOOL MOCK TRIAL TOURNAMENT

2019

KELLY CROWN

V.

BRYCE CUTTER d/b/a CHARITY OPERATIONS

NETWORK

Original Case Materials Developed for INDIANA MOCK TRIAL

© 2015

Case Adapted for Iowa High School Competition Use By: The Iowa State Bar Association

Center for Law & Civic Education 625 East Court Avenue

Des Moines, Iowa 50309

Many thanks to the Indiana Mock Trial Program & the Indiana Bar Foundation for permitting use and adaptation of the case material and especially to Susan Roberts, original author of the problem

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CASE BACKGROUND

The wealthiest and most elite citizens of Iowa gathered together on a beautiful September evening in 2016 for one of the most publicized events of the year. The exclusive list of VIP guests arrived with much fanfare and media attention for the prestigious gala and fundraising event at the luxurious Hotel LeRoche Resort and Spa for the Thomas J. Levis Caring Hearts Children's Hospital Foundation. Plaintiff Kelly Crown, a recent multi-million dollar lottery winner, attended the charity art auction to purchase a collectible work of art as an investment while simultaneously supporting the Foundation's goal to provide funds for pediatric cardiology equipment and services for the children of Iowa.

At the art auction, Crown was the successful bidder for a highly collectible E. Colline oil

painting. Bryce Cutter, d/b/a Charity Operations Network, the Defendant Auctioneer, purportedly represented that the painting was authentic and came with a Certificate of Authenticity. When the painting was in the process of some restoration work by Rene Beltracchi, Crown was notified that the painting was a fake.

Was the painting purchased by Crown at the art auction a fake? Was there a misrepresentation

of the painting's authenticity and provenance? Did the Defendant perform sufficient due diligence to determine the authenticity of the painting? Did the Plaintiff exercise due diligence before purchasing the painting? And, who can be trusted in this myriad of personalities and egos?

Plaintiff’s Witnesses: Kelly Crown - Plaintiff and Purchaser Rene Beltracchi – Art Restorer, Expert Witness, and Former Forger Taylor Hanratty – FBI Agent and Art Fraud and Forgery Investigator Defendant’s Witnesses: Bryce Cutter – Defendant, Auctioneer and Owner of Charity Operations Network Morgan Walden– Estate Representative of Painting’s Original Owner Evelyn Pears - Appraiser, Expert Witness, and Former Museum Curator Exhibits:

1. Charity Auction Catalogue 2. Painting 3. Sales Receipt 4. Certificate of Authenticity 5. Appraisal 6. Charity Operations Network Website Excerpts 7. Notes from Auction 8. Curriculum Vitae of Evelyn Pears

The Case Background is not to be used as evidence in the case, but rather is provided for background

purposes only. This case is a work of fiction. The names and events described herein are intended to be fictional. Any similarity or resemblance of any character to an actual person or entity should be regarded as only fictional for purposes of this mock trial exercise. However, the history of the American Impressionist Movement and the work of the Hoosier Group are real.

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IN THE IOWA DISTRICT COURT OF POLK COUNTY KELLY CROWN ) ) CIVIL ACTION ) IAHSMT - 2019 Plaintiff, ) ) vs. ) PETITION AT LAW ) BRYCE CUTTER, d/b/a ) CHARITY OPERATIONS NETWORK )

) Defendant. )

COMPLAINT

Plaintiff, Kelly Crown, by counsel, files this Complaint against the Defendant, Bryce Cutter, and states:

General Allegations

1. Plaintiff Kelly Crown is a resident of St. Charles, Madison County, Iowa.

2. Defendant Bryce Cutter, d/b/a Charity Operations Network, is a resident of Gotham City, Gotham

County, Iowa and purports to be a professional charities art auctioneer.

3. On September 10, 2016, Plaintiff was at the Thomas J. Levis Caring Hearts Children’s Hospital

Foundation Gala & Charity Auction (Charity Auction) where Defendant offered for sale for the benefit of

the Foundation works of fine art represented to be collectibles and Masters.

4. Defendant organized and managed the Charity Auction from start to finish, including, but not

limited to, providing works of art for the auction, auctioning the works of art, collecting payment, and

delivering the works of art to the buyers.

5. Defendant prepared, published and distributed to Plaintiff a catalogue of all works of art

available for sale at the Charity Auction (“the Catalogue”).

6. The Catalogue represented that Lot 39 was an original oil canvas painting by American

Impressionist Emerson Colline (“the Artist”), entitled Fishing at Dawn, painted in 1927 and signed by

artist Emerson Colline (“The Painting”).

7. The Catalogue further represented that the Painting was in “good condition” with minimal

restoration.

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8. The Catalogue also represented that the owner obtained the Painting by descent from a

family member that received it directly from the Artist.

9. The Catalogue represented that the Estimated Value of the Painting was between $300,000-$500,000.

10. Paintings by the Artist in the American Impressionist style are highly collectible and valuable

11. At the beginning of the Charity Auction, Defendant represented that all works of art at the

Auction that contain a signature had been authenticated by a nationally recognized, indepe

ndent third party.

12. When the Painting came up for auction, Defendant represented that the Painting came

with a Certificate of Authenticity and that the Painting was authentic.

13. Defendant either knew or failed to perform sufficient due diligence to determine if the

representations made about the painting were false.

14. Plaintiff relied upon the representations made by Defendant in writing and verbally at the

Charity Auction.

15. Defendant failed to conduct adequate independent research into the authenticity of the

Painting.

16. Plaintiff was the highest bidder for the Painting in the amount of $455,000.

(“the Purchase”).

17. Plaintiff paid Defendant the purchase price of $455,000 by wire transfer on September 12,

2016.

18. Defendant delivered the Painting to Plaintiff at Plaintiff’s residence on October 12, 2016.

Count I Rescission Based on Mutual Mistake

19. Plaintiff incorporates the allegations in Paragraphs 1 through 18 as if fully set forth

herein.

20. Plaintiff bought the Painting believing it to be a genuine painting by Colline .

21. Defendant represented in the Sales Receipt issued to Plaintiff for said Purchase that the

Painting was the Artist’s work.

22. The Painting is a forgery.

23. Plaintiff had no knowledge that the Painting was a forgery.

24. Plaintiff relied upon the representations made by Defendant to his/her detriment.

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25. To the extent Defendant was not aware of the forgery, Plaintiff and Defendant were

mutually mistaken in believing that the Painting was an authentic work by Emerson

Colline.

26. Plaintiff agreed to and did purchase the Painting without any knowledge of these

mistakes.

27. Plaintiff fully performed all of his/her obligations for the purchase.

28. Plaintiff has no adequate remedy at law and is therefore entitled to a rescission.

Count II Breach of Express Warranties

29. Plaintiff incorporates the allegations in Paragraphs 1 through 28 as if fully set forth herein.

30. Before and at the time of the sale, for the purposes of inducing Plaintiff to purchase the

Painting, Defendant represented to Plaintiff that the Artist who created the Painting was

Emerson Colline, that the Painting was authentic, that the Painting had a Certificate of

Authenticity, and that the Artist’s signature on the Painting had been independently

verified.

31. Plaintiff relied upon Defendant’s express warranties concerning the Painting's authenticity

and would not have purchased the work had he/she been aware that those warranties

were false.

32. Plaintiff fully performed any obligations under the purchase agreement.

33. Defendant breached its express warranty because the Painting is a forgery.

34. Plaintiff suffered damages, as a result of this breach.

Count III Fraud

35. Plaintiff incorporates the allegations in Paragraphs 1 through 34 as if fully set forth herein.

36. Defendant fraudulently induced Plaintiff to purchase the Painting by falsely stating the

Painting was authentic.

37. Defendant knew the Painting was a forgery, and that it had no value.

38. Defendant knowingly participated in the sale of a forgery.

39. Plaintiff had no reason to know that Defendant’s statements were false.

40. Plaintiff relied on each of the misrepresentations made by Defendant in purchasing the

Painting.

41 Plaintiff’s reliance on Defendant’s misrepresentations was reasonable.

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42. In reliance on the misrepresentations and omissions of Defendant, Plaintiff was

damaged.

43 Because Defendant engaged in the fraudulent conduct, willfully and maliciously, and

with the intent to damage Plaintiff, Plaintiff is entitled to an award of punitive damages.

Count IV – Negligence

44. Plaintiff incorporates the allegations in Paragraphs 1 through 43 of the Complaint as if

fully set forth herein.

45. Defendant was negligent in failing to exercise due diligence in determining the

authenticity, provenance, condition and value of the Painting.

46. As a consequence of the negligence of Defendant, Plaintiff suffered damages.

47. The damages sustained by Plaintiff were proximately caused by the negligence of

Defendant.

WHEREFORE, Plaintiff, Kelly Crown, prays for damages against Defendant Cutter, and all other just

and proper relief.

________________ . Attorney for Plaintiff

JURY DEMAND Plaintiff respectfully requests trial by jury.

________________ .

Attorney for Plaintiff

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IN THE IOWA DISTRICT COURT OF POLK COUNTY KELLY CROWN ) ) CIVIL ACTION ) IAHSMT - 2019 Plaintiff, ) ) vs. ) ANSWER ) BRYCE CUTTER, d/b/a ) CHARITY OPERATIONS NETWORK )

) Defendant. )

DEFENDANT’S ANSWER TO COMPLAINT

The Defendant, Bryce Cutter d/b/a Charity Operations Network, for his/her answer to the Complaint, states as follows:

1. Defendant is without knowledge or information sufficient to form a belief as to the truth of the allegations of paragraph 1 of the Complaint.

2. Defendant admits the allegations of paragraph 2 of the Complaint.




6. Defendant denies the allegations of paragraph 6 of the Complaint.


8. Defendant denies the allegations of paragraph 8 of the Complaint. 9. Defendant denies the allegations of paragraph 9 of the Complaint. 10. Defendant admits the allegations of paragraph 10 of the Complaint. 11. Defendant admits the allegations of paragraph 11 of the Complaint. 12. Defendant denies the allegations of paragraph 12 of the Complaint. 13. Defendant denies the allegations of paragraph 13 of the Complaint.

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14. Defendant is without knowledge or information sufficient to form a belief as to the truth of the allegations

of paragraph 14 of the Complaint. 15. Defendant denies the allegations of paragraph 15 of the Complaint. 16. Defendant admits the allegations of paragraph 16 of the Complaint. 17. Defendant admits the allegations of paragraph 17 of the Complaint. 18. Defendant admits the allegations of paragraph 18 of the Complaint.

Count I

19. Defendant incorporates herein by reference its answers to the allegations of paragraphs 1 through 18 of the

Complaint.


of paragraph 20 of the Complaint.













Count II


Complaint.






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Count III


Complaint.









Count IV


Complaint.




WHEREFORE, Defendant prays for judgment in his/her favor, that Plaintiff take nothing by way of his/her complaint, for costs, and all other just and proper relief.

AFFIRMATIVE DEFENSES

First defense The sole proximate cause of the damages allegedly sustained by plaintiff was plaintiff's own negligence, and for that reason, plaintiff is not entitled to recover.

Second Defense The damages allegedly sustained by the plaintiff were caused in whole or in part, or were contributed to, by the negligence or fault of the plaintiff, and for that reason, the plaintiff is not entitled to recover, or, plaintiff's damages must be reduced accordingly.

Third Defense Plaintiff failed to exercise due diligence. WHEREFORE, the Defendant prays that Plaintiff take nothing by way of his/her complaint; that judgment be entered in favor of Defendant; and for such other and further relief as is just and proper.

_____________________ Attorney for Defendant

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IN THE IOWA DISTRICT COURT OF POLK COUNTY

KELLY CROWN ) ) CIVIL ACTION ) IAHSMT - 2019 Plaintiff, ) ) vs. ) STIPULATIONS ) BRYCE CUTTER, d/b/a ) CHARITY OPERATIONS NETWORK )

) Defendant. )

1. All exhibits included in the case materials are authentic and accurate representations and the

proper chain of custody with regard to the exhibits has been maintained, teams must still use the

proper procedures for admitting exhibits into evidence.

2. The signatures and signature representations on the witness statements and all other documents are

authentic. No challenges based on the authenticity of witness signed documents will be

entertained.

3. The dates of witness statements are not relevant and therefore not included. No challenges based

on the dates of the witness statements will be entertained. All statements were taken after the

alleged incident but before trial.

4. The jurisdiction and venue for this mock trial case have been previously established and are

proper.

5. All of the witnesses can be portrayed by students of either gender. Any instances where a witness

is only referred to as only him or her or only he or she is inadvertent.

6. Whenever a rule of evidence requires that reasonable notice be given, it has been given.

7. All pretrial motions have been considered by the Court and do not affect the trial of this case.

8. The parties agree that Exhibits 1, 3 and 6 are created by a person with knowledge of the

information contained therein at or about the time of the events, that such records are kept in the

course of regularly conducted activity and that it is not necessary to enter the exhibits through the

custodian of the records.

9. The parties stipulate and agree that the Curriculum Vitae of Evelyn Pears (Exhibit 8) is

admissible, without objection.

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10. As is the tradition in Civil mock trial problems, this trial is bifurcated. Damages will not be awarded in

this phase of the trial. While teams may choose to discuss elements of damages, it is neither necessary

nor expected in this trial.

11. All witnesses are familiar with their statements as provided with the case materials prior to trial. No

witness may feign either ignorance or inability to read or recall the substance of her/his statement

provided.

12. Exhibit 2 (listed as the “Painting” in the Exhibit List) is intended to be the actual painting currently in

possession of the Plaintiff, Kelly Crown.

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APPLICABLE LAW

Burden of Proof in Negligence Cases

The plaintiff has the burden of proof by a preponderance of the evidence on the following propositions:

a. that the defendant was negligent ; b. that the plaintiff suffered damages; and c. that the negligence of the defendant was a proximate cause of the damages suffered by

the plaintiff. Negligence

Negligence is the failure to use reasonable care.

A person may be negligent by acting or by failing to act. A person is negligent if he or she does something a reasonably careful person would not do in the same situation or fails to do something a reasonably careful person would do in the same situation.

Reasonable or Ordinary Care

Reasonable or ordinary care is the care a reasonably careful and ordinarily prudent person would use under the same or similar circumstances. Reasonable care does not require a person to foresee and guard against that which is unusual and not likely to occur.

Proximate Cause

An act or omission is a proximate cause of the damages suffered if the damages are a natural and probable consequence of the act or omission. To establish that an act was the proximate cause of damages, a party must show:

(1) That damages would not have occurred but for another’s negligence; and (2) That damages were reasonably foreseeable as the natural and probable consequence of

the other’s negligence.

Fraud

Fraud exists when:

(a) there is a material misrepresentation of fact (b) made with knowledge of its falsity or recklessly made without knowledge of its truth (c) with the intention of being acted upon by another, which (d) is relied upon by another (a buyer) (e) to his/her damage.

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STATUTES AND RELATED LAW:

2009 Iowa Code Title 13 - Commerce Subtitle 5 - Regulation of Commercial Enterprises CHAPTER 554 - UNIFORM COMMERCIAL CODE

554.2313 EXPRESS WARRANTIES BY AFFIRMATION, PROMISE, DESCRIPTION, SAMPLE. 1. Express warranties by the seller are created as follows: a. Any affirmation of fact or promise made by the seller to the buyer which relates to the goods and becomes part of the basis of the bargain creates an express warranty that the goods shall conform to the affirmation or promise. b. Any description of the goods which is made part of the basis of the bargain creates an express warranty that the goods shall conform to the description. c. Any sample or model which is made part of the basis of the bargain creates an express warranty that the whole of the goods shall conform to the sample or model. 2. It is not necessary to the creation of an express warranty that the seller use formal words such as "warrant" or "guarantee" or that the seller have a specific intention to make a warranty, but an affirmation merely of the value of the goods or a statement purporting to be merely the seller's opinion or commendation of the goods does not create a warranty. 554.2314 IMPLIED WARRANTY: MERCHANTABILITY – USAGE OF TRADE. 1. Unless excluded or modified (section 554.2316), a warranty that the goods shall be merchantable is implied in a contract for their sale if the seller is a merchant with respect to goods of that kind. Under this section the serving for value of food or drink to be consumed either on the premises or elsewhere is a sale. 2. Goods to be merchantable must be at least such as a. pass without objection in the trade under the contract description; and b. in the case of fungible goods, are of fair average quality within the description; and c. are fit for the ordinary purposes for which such goods are used; and d. run, within the variations permitted by the agreement, of even kind, quality and quantity within each unit and among all units involved; and e. are adequately contained, packaged, and labeled as the agreement may require; and f. conform to the promises or affirmations of fact made on the container or label if any. 3. Unless excluded or modified (section 554.2316) other implied warranties may arise from course of dealing or usage of trade. 554.2315 IMPLIED WARRANTY -- FITNESS FOR PARTICULAR PURPOSE. Where the seller at the time of contracting has reason to know any particular purpose for which the goods are required and that the buyer is relying on the seller's skill or judgment to select or furnish suitable goods, there is unless excluded or modified under section 554.2316 an implied warranty that the goods shall be fit for such purpose.

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554.2316 EXCLUSION OR MODIFICATION OF WARRANTIES. 1. Words or conduct relevant to the creation of an express warranty and words or conduct tending to negate or limit warranty shall be construed wherever reasonable as consistent with each other; but subject to the provisions of this Article on parol or extrinsic evidence (section 554.2202) negation or limitation is inoperative to the extent that such construction is unreasonable. 2. Subject to subsection 3, to exclude or modify the implied warranty of merchantability or any part of it the language must mention merchantability and in case of a writing must be conspicuous, and to exclude or modify any implied warranty of fitness the exclusion must be by a writing and conspicuous. Language to exclude all implied warranties of fitness is sufficient if it states, for example, that "There are no warranties which extend beyond the description on the face hereof." 3. Notwithstanding subsection 2 a. unless the circumstances indicate otherwise, all implied warranties are excluded by expressions like "as is", "with all faults" or other language which in common understanding calls the buyer's attention to the exclusion of warranties and makes plain that there is no implied warranty; and b. when the buyer before entering into the contract has examined the goods or the sample or model as fully as the buyer desired or has refused to examine the goods there is no implied warranty with regard to defects which an examination ought in the circumstances to have revealed to the buyer; and c. an implied warranty can also be excluded or modified by course of dealing or course of performance or usage of trade. 4. Remedies for breach of warranty can be limited in accordance with the provisions of this Article on liquidation or limitation of damages and on contractual modification of remedy (sections 554.2718 and 554.2719). ADDITIONAL LAW:

Express warranties are not created from puffing or statements of personal opinion such as I think this is a beautiful painting or an affirmation of value such as this is one of the best values you can find today in art of this period.

One who sells a piece of art has a fiduciary responsibility to exercise due diligence in the authentication of a piece of artwork. Due diligence is the responsibility of one who sells, buys or donates personal property to establish that the item is not stolen and can change hands with good title and that it is real. Autocephalous Greek Orthodox Church v. Goldberg & Feldman Fine Arts, Inc. 917 F .2d 278 (7th Cir 1990)

“In a transaction like this, all the red flags are up and the red lights are on, all the sirens are blaring. In such cases, dealers can (and probably should) take steps such as a formal IFAR search, a documented authenticity check by disinterested experts, a full background check of the seller and his claim of title, insurance protection and contingency sales, contract, and the like.”

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Rescission The abrogation of a contract, effective from its inception, thereby restoring the parties to the positions they would have occupied if no contract had ever been formed.

By Agreement Mutual rescission, or rescission by agreement, is a discharge of both parties from the obligations of a contract by a new agreement made after the execution of the original contract but prior to its performance. Rescission by mutual assent is separate from the right of one of the parties to rescind or cancel the contract for cause, or pursuant to a provision in the contract.

The parties to an executory or incomplete contract can rescind it at any time by mutual agreement, even if the contract itself contains a contrary provision. A rescission by mutual assent can properly include a promise by either or both parties to make restitution as part of the contract of rescission.

The right to rescind is limited to the parties to the contract or those legally authorized to act for them. As with other contracts, the parties to the rescission agreement must be mentally competent.

Form The rescission agreement can be either written or oral. An implied agreement is also effective, provided the assent of the parties can be shown by their acts and the surrounding circumstances. An express rescission of a contract as a whole is adequate and effective, without specifically designating each and every clause to be rescinded. Unless a statute provides otherwise, an oral rescission agreement is valid, even though the contract being rescinded contains a provision that it can be altered only in writing.

Assent All the parties to the contract must assent to its rescission because mutual rescission involves the formation of a new contract. A meeting of minds can be reached by an offer to rescind and an acceptance by the other party. One party to a contract cannot rescind it simply by giving notice to the other party that he or she intends to do so.

Although a breach of contract by one party is not an offer to rescind, the other party can treat the repudiation as an offer to rescind that he or she can accept, leading to rescission of the contract by mutual assent. Rescission must be clearly expressed, however, and the conduct of the parties must be inconsistent with the existence of the contract. The fact that some of the materials that form part of the subject matter of the contract have been returned is not conclusive as to whether rescission has occurred.

Consideration An agreement to rescind a prior contract must be based on a sufficient consideration, an inducement. When a contract remains executory on both sides, an agreement to rescind by one side is sufficient consideration for the agreement to cancel on the other, and vice versa. If the contract has been executed on one side, an agreement to rescind that is made without any new consideration is void, that is to say of no legal force or binding effect.

Operation and Effect The mutual rights of the parties are controlled by the terms of their rescission agreement. The parties are generally restored to their original rights in regard to the subject matter. They no longer have any rights or obligations under the rescinded contract, and no claim or action for subsequent breach can be maintained.

Whether rights or obligations already accrued are abandoned when the contract is rescinded in the course of performance depends on the intention of the parties, as deduced from all attending facts and circumstances, and on whether the parties have reserved such rights. Recovery can be allowed, however, for partial performance.

https://legal-dictionary.thefreedictionary.com/Course+of+Performance

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Wrong or Default of Adverse Party No arbitrary right exists to rescind a contract. An executory contract that is voidable can be rescinded on the grounds of fraud, mistake, or incapacity.

A contract, whether oral or written, can be rescinded on the ground of fraud. The right to rescind for fraud is not barred because the defrauded party has failed to perform. Generally, false statements of value, or the failure to perform a promise to do something in the future without fraudulent intent, will not provide a basis for rescission for fraud or misrepresentation. A party proves sufficient grounds for rescission by showing that he or she was induced to part with some legal right or to assume some legal liability that he or she otherwise would not have done but for the fraudulent representations.

On discovering the fraud, the victimized party can affirm the contract and sue for damages. He or she might instead repudiate the contract, tender back what he or she has received, and recover what he or she has parted with, or its value; the adoption of one remedy, however, excludes the other.

A contract obtained by duress can be rescinded, and in such a case, the same rules apply as in the case of fraud. A contract cannot be avoided because of duress or coercion, however, unless the duress was sufficient to overcome completely the will of the party who is seeking to avoid the contract.

A mutual mistake concerning a material fact entitles the party affected by the mistake to rescind the contract, unless the contract has already been completed and rescission would be an injustice to the other party. Rescission can also be allowed even for a unilateral, or one-sided, mistake in order to prevent an unjust enrichment of the other party. On rescission, the aggrieved party can recover the money he or she has paid or the property he or she has delivered under the contract.

A contract made by a person of unsound mind can be rescinded when the parties can be restored to the status quo. This rule applies even if the opposite party was unaware of the mental condition, and the contract was fair, reasonable, and made in good faith for adequate consideration. When one party knows of the other's incapacity, the contract can be rescinded on the ground of fraud. When both parties are sane and the contract is valid, subsequent insanity of one of the parties is not a ground for rescission, unless it affects the substance or purpose of the contract, as in the case of a personal services contract. As a general rule, a contract cannot be rescinded because one of the parties was intoxicated at the time it was made. If, however, unfair advantage was taken of a person's intoxicated condition, or if the intoxication was induced by the party seeking to take advantage of the contract, the contract can be set aside on the ground of fraud. Similarly, habitual drunkenness that impairs a party's mental abilities can constitute a ground for rescission.

Inadequate Consideration Mere inadequacy of consideration is not a sufficient reason to justify rescission. When the consideration is so inadequate that it shocks the conscience of the court or is so closely connected with suspicious circumstances or misrepresentations as to provide substantial evidence of fraud, it can furnish a basis for relief.

Nonperformance or Breach One party to a contract can rescind it because of substantial nonperformance or breach by the other party. The party who knowingly and willfully fails to perform cannot complain that the other party to the contract has injured him or her by terminating the contract. The right to rescind does not arise from every breach but is permitted only when the breach is so substantial and fundamental that it defeats the objective of the parties in making the agreement. The breach must pertain to the essence of the contract. The act must be an unqualified refusal by the other party to perform and should amount to a decision not to be bound by the contract in the future. A party to a contract who is in default cannot, however, rescind because of a breach by the other party.

https://legal-dictionary.thefreedictionary.com/arbitrary

https://legal-dictionary.thefreedictionary.com/voidable

https://legal-dictionary.thefreedictionary.com/fraud

https://legal-dictionary.thefreedictionary.com/misrepresentation

https://legal-dictionary.thefreedictionary.com/unjust+enrichment

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When time is of the essence in a contract, failure to perform within the time stipulated is a ground for rescission. Otherwise a delay in the time of performance is not considered a material breach justifying rescission. When performance is intended within a reasonable time, one party cannot suddenly and without reasonable notice terminate the contract while the other party is attempting in good faith to perform it.

An unconditional notice by one party that he does not intend to perform a contract is a ground for rescission by the other party. In order to justify rescission, the refusal must be absolute and unconditional.

When one party to a contract abandons it and refuses further performance or her conduct shows that she is repudiating the contract, the other party is entitled to rescission. A disagreement over the terms of the contract and a subsequent refusal to perform in a particular manner by one of the parties do not constitute an abandonment of the contract justifying rescission.

Time A right to rescind must be exercised promptly or within a reasonable time after the discovery of the facts that authorize the right. A reasonable time is defined by the circumstances of the particular case. The rule that rescission must be prompt does not operate where an excuse or justification for a delay is shown.

https://legal-dictionary.thefreedictionary.com/abandonment

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GUIDANCE FROM THE FEDERAL TRADE COMMISSION

UNDERSTANDING WARRANTIES Generally, a warranty is your promise, as a warrantor, to stand behind your product. It is a statement about the integrity of your product and about your commitment to correct problems when your product fails.

The law recognizes two basic kinds of warranties—implied warranties and express warranties.

Implied Warranties Implied warranties are unspoken, unwritten promises, created by state law, that go from you, as a seller or merchant, to your customers. Implied warranties are based upon the common law principle of "fair value for money spent," There are two types of implied warranties that occur in consumer product transactions. They are the implied warranty of merchantability and the implied warranty of fitness for a particular purpose. The implied warranty of merchantability is a merchant's basic promise that the goods sold will do what they are supposed to do and that there is nothing significantly wrong with them. In other words, it is an implied promise that the goods are fit to be sold. The law says that merchants make this promise automatically every time they sell a product they are in business to sell. For example, if you, as an appliance retailer, sell an oven, you are promising that the oven is in proper condition for sale because it will do what ovens are supposed to do—bake food at controlled temperatures selected by the buyer. If the oven does not heat, or if it heats without proper temperature control, then the oven is not fit for sale as an oven, and your implied warranty of merchantability would be breached. In such a case, the law requires you to provide a remedy so that the buyer gets a working oven.

The implied warranty of fitness for a particular purpose is a promise that the law says you, as a seller, make when your customer relies on your advice that a product can be used for some specific purpose. For example, suppose you are an appliance retailer and a customer asks for a clothes washer that can handle 15 pounds of laundry at a time. If you recommend a particular model, and the customer buys that model on the strength of your recommendation, the law says that you have made a warranty of fitness for a particular purpose. If the model you recommended proves unable to handle 15-pound loads, even though it may effectively wash 10-pound loads, your warranty of fitness for a particular purpose is breached.

Implied warranties are promises about the condition of products at the time they are sold, but they do not assure that a product will last for any specific length of time. (The normal durability of a product is, of course, one aspect of a product's merchantability or its fitness for a particular purpose.) Nor does the law say that everything that can possibly go wrong with a product falls within the scope of implied warranties. For example, implied warranties do not cover problems such as those caused by abuse, misuse, ordinary wear, failure to follow directions, or improper maintenance.

Generally, there is no specified duration for implied warranties under state laws. However, the state statutes of limitations for breach of either an express or an implied warranty are generally four years from date of purchase. This means that buyers have four years in which to discover and seek a remedy for problems that were present in the product at the time it was sold. It does not mean that the product must last for four years. It means only that the product must be of normal durability, considering its nature and price.

A special note is in order regarding implied warranties on used merchandise. An implied warranty of merchantability on a used product is a promise that it can be used as expected, given its type and price range. As with new merchandise, implied warranties on used merchandise apply only when the seller is a merchant who deals in such goods, not when a sale is made by a private individual.

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If you do not offer a written warranty, the law in most states allows you to disclaim implied warranties. However, selling without implied warranties may well indicate to potential customers that the product is risky—low quality, damaged, or discontinued—and therefore, should be available at a lower price.

In order to disclaim implied warranties, you must inform consumers in a conspicuous manner, and generally in writing, that you will not be responsible if the product malfunctions or is defective. It must be clear to consumers that the entire product risk falls on them. You must specifically indicate that you do not warrant "merchantability," or you must use a phrase such as "with all faults," or "as is."

You should be aware that even if you sell a product "as is" and it proves to be defective or dangerous and causes personal injury to someone, you still may be liable under the principles of product liability. Selling the product "as is" does not eliminate this liability.

Express Warranties Express warranties, unlike implied warranties, are not "read into" your sales contracts by state law; rather, you explicitly offer these warranties to your customers in the course of a sales transaction. They are promises and statements that you voluntarily make about your product or about your commitment to remedy the defects and malfunctions that some customers may experience. Express warranties can take a variety of forms, ranging from advertising claims to formal certificates. An express warranty can be made either orally or in writing.

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Statement of Kelly Crown

My name is Kelly Crown. I live outside of St. Charles, Iowa, about 30 miles southwest of 1

downtown Des Moines on an acreage near the Imes Covered Bridge – one of the famed Bridges 2

of Madison County. I also have an estate in Key Largo, Florida. Even though I now live in 3

mansions in pretty swanky areas, I have humble beginnings. I grew up in the small town of 4

Dinkla, North Dakota, where life was pretty simple, and my family, neighbors, and friends felt 5

good about putting in an honest day's work. My parents instilled in me the core values of 6

fairness, honesty, integrity and truthfulness. I have held on to my core values from those 7

humble beginnings. The way I see it is that if a person has integrity, nothing else matters. If a 8

person does not have integrity, nothing else matters. Perhaps I have been naive in thinking that 9

once I ventured out into the world that others would abide by those same principles. 10

Unfortunately, the circumstances surrounding this lawsuit have shown me that is not the case. 11

If you're wondering how a simple 36-year-old from Dinkla, with just a high school 12

education, amassed such wealth to own two mansions and circulate among the rich and 13

famous, I guess you could say I won the lottery - literally. In August of 2015, I won one of the 14

largest Jackpots in the history of Powerball, with winnings of $750 million and some change. 15

Ordinarily, I didn't waste the little money I had on a game of chance. But I knew the jackpot 16

was going to be big the week I purchased my ticket and I thought that spending $20 for a few 17

chances at that size jackpot was at least worth the entertainment of looking at the winning 18

numbers the next day to see if they matched. Like they say, you can’t win if you don’t play. 19

After paying the IRS and Iowa their respective shares in taxes, I still was left with quite a 20

fortune. Becoming instantly wealthy gave me the opportunity to purchase a new home, 21

expensive cars, and some of the finer things in life, including artwork. 22

Prior to winning the lottery, I worked at the Lakeside Casino in Osceola, Iowa. During 23

my employment at Lakeside, I was assigned to the craps table. Craps is a dice game where 24

players make wagers on the roll, or a series of rolls, of a pair of dice. I rotated positions on the 25

craps table as either a Stickman (the person who announces the results of each roll and moves 26

the dice on the table with an elongated wooden stick) or a base dealer (the person who collects 27

22

and pays bets to the players). What I observed as an employee at Lakeside is that people would 28

lose hard-earned money with the roll of a dice. The “House” (the casino) always had the 29

advantage. There may be players who are really lucky for a period of time, but in the long run 30

those winning streaks end, and their money is lost. When I won the lottery, I didn’t want to risk 31

losing money in a “crapshoot.” I wanted to invest my winnings in something stable; something 32

that was “a sure bet.” 33

Many people came out of the woodwork when I won the lottery. There were relatives I 34

never knew and friends from even grade school that soon referred to me as their favorite 35

relative or best friend. Some wanted a loan, others had investment “opportunities.” I was even 36

solicited by a local soccer club, Scipio F.C., for a contribution. I remember my days as a kid 37

playing futbol, so I gave them money for new equipment and an update to their training 38

facilities. 39

There were many investment and financial advisors that contacted me with ways to 40

grow my money. Of course, I was a bit nervous about investing in the stock market when some 41

analysts were predicting that the market was headed for another crash, and I saw my 401K drop 42

to half of its value after the 2008 stock market crash. I’ve burned through a series of financial 43

advisors – one who was way too conservative, another who wanted to too freely spend my 44

cash, and another charged exorbitant fees for doing very little. I finally settled on Christina 45

Thompson Financial Advisors. She and her minions tried to steer me away from the art market, 46

but once they knew that I was serious about investing, they offered some sound advice. 47

You see a family friend, Jim Jessen, who had acquired some Salvador Dali signed prints, 48

told me that the value of the prints had quadrupled in value and suggested that I look into art 49

as an investment. I had always heard that art was a good investment. I admit I was, and still 50

am, new to the art scene and a novice buyer. However, I thought it would be a safe investment 51

for some of my money, if I purchased collectible art from a reputable dealer. 52

When I was invited as one of the exclusive, VIP guests to attend the Thomas J. Levis 53

Caring Hearts Children’s Hospital Foundation’s fundraising gala and art auction, I thought it 54

was the perfect opportunity to acquire a collectible art piece. At the same time, I thought I could 55

help a charitable cause, especially one that would provide for the health and well-being of 56

23

children. The Levis Foundation's goal was to provide funds for pediatric cardiology equipment 57

and services for the children of Iowa. So, on September 10, 2016, I attended the Foundation’s 58

Gala and Art Auction at the posh Hotel Le Roche Resort and Spa in West Des Moines. The 59

wealthiest and most elite citizens of Iowa were there. I even had a chance to meet the reclusive 60

billionaire, Van Everett. He mentioned that he had a few investment opportunities for me to 61

look over. I think he believes that the future is strong in alternative medicines. The Gala was 62

one of the most publicized events of the year in Iowa, and the fanfare surrounding the event 63

was over the top. The “buzz” of excitement at the gala set the mood to contribute and buy some 64

art to support the children of Caring Hearts. I shared the enthusiasm of other prospective 65

donors to give generously to the charity. 66

The art auction was conducted by Bryce Cutter of Charity Operations Network. A week 67

prior to the auction, I along with the other attendees received a glossy Catalogue of the art 68

pieces with photographs of the art that would be auctioned at the fundraiser. Anyone wishing 69

to view any of the art to be auctioned had the opportunity to schedule an appointment with 70

Cutter to have the art examined, or even appraised. I was busy negotiating the purchase of my 71

new estate in Key Largo and didn’t see any need to personally examine the paintings prior to 72

the auction. The catalogue noted that the paintings I was interested in came with a Certificate 73

of Authenticity, so I felt like I had a guarantee. I did not request any documentation of any 74

particular painting’s history, Certificate of Authenticity, or Lot Condition Report. It had not 75

occurred to me that a charitable auction company raising funds for a children’s hospital 76

couldn’t be trusted. Exhibit 1 is a true and accurate copy of excerpts of the Art Catalogue for 77

the Thomas J. Levis Caring Hearts Children’s Hospital Foundation Art Auction. 78

I was particularly drawn to the American Impressionist paintings because they depict a 79

lighter, carefree sense of life, which reminded me of my youth and growing up in Dinkla. The 80

Catalogue featured paintings by Daniel Garber, Theodore Robinson, and Emerson Colline 81

(pronounced EM-ur-son Cah-LEEN). I had no idea of the current market value for collectible 82

American Impressionist original paintings. Feeling like a fish out of water, I used ARTnet.com, 83

an internet data base, to determine the current market price for similar works of Garber, 84

Robinson and Colline. The recent sale prices on ARTnet.com for those artists were consistent 85

24

with the estimated prices listed in the Charity Operations Network Catalogue. In fact, the 86

recent sales prices that I located on the website sold higher than the estimated market value. 87

The line-up of artwork at the September 10th art auction was nothing less than 88

impressive. Charity Operations Network pulled out all of the stops. Early in the evening, it 89

was evident that bidding would be active, and the event would generate some serious cash and 90

the much-needed funds for the Children’s Hospital. Even to an art novice like me, I could tell 91

there were plenty of offerings that were drawing attention as highly desirable collector’s items. 92

The reactions of other guests and sophisticated potential buyers to many of the art lots 93

convinced me that this was my opportunity to purchase a collectible painting. As I browsed the 94

various lots displayed at the Gala, I referred to the Catalogue for each painting’s description, 95

provenance, condition, and estimated value. Then, I used a smartphone app that instantly 96

connects with auction house databases to check on comparable paintings by the artist. A few of 97

the guests told me that they had hired an appraiser to preview specific pieces at the Charity 98

Operations Network gallery prior to the auction, or to accompany and advise the buyer at the 99

auction. In retrospect, I wish I had done that. 100

I narrowed my selection to a painting by Daniel Garber, called Bayou, depicting two row 101

boats, and an Emerson Colline painting depicting a boat with two people ready to fish, entitled 102

Fishing at Dawn. I was drawn to both paintings because of the serenity of the water and the way 103

the light danced off the landscape. Both paintings were considered highly collectible and there 104

were crowds surrounding those displays. The Colline piece went up for auction first, so I 105

decided not to take any chances. I also thought the piece by Colline was a better investment 106

because the Catalogue noted that most of Colline’s American Impressionist paintings had been 107

destroyed in a fire, and that in later years she followed the movement into Modernism. In an 108

attempt to familiarize myself with some of the Lots in the Catalogue, I read a few blogs about 109

some of the American Impressionists. I learned through the blog that there were only a few 110

women American Impressionist painters, and Emerson Colline was quite prominent. I believe 111

the blog was authored by Rene Beltracchi, although I did not know him/her at the time. I recall 112

that the blogger said he/she would like to get his/her hands on a Colline painting and noted that 113

they were rare and in demand. I did not print the blog and I have since looked for it on the 114

25

Web but it has been taken down. I think it was by Rene Beltracchi, but I can’t recall with any 115

certainty. 116

Bryce Cutter, the owner of Charity Operations Network, was the auctioneer for the 117

Thomas J. Levis Caring Hearts Children’s Hospital Foundation Charity Auction. Of course, 118

auctioneers can talk really fast, but there were definitely some things that Cutter said that I 119

clearly understood and provided reassurance that I was purchasing something of great value 120

and a solid investment. At the opening of the auction, Cutter said Charity Operations Network 121

uses nationally known signature authenticators for all items. More specifically, when Cutter 122

described the Colline painting during the auction, he/she represented that the painting came 123

with a Certificate of Authenticity. Cutter said the painting had provenance and had been 124

verified as authentic. I also noted that the Catalogue indicated that a Certificate of Authenticity 125

was available for the Fishing at Dawn painting. 126

The bidding at the auction for Colline’s Fishing at Dawn was quite fierce. Ultimately, the 127

final bidders were some Chicago land developer, an investment firm, and me. The hammer 128

came down on my bid of $455,000. Of course, I was also required to pay the Buyer’s premium 129

fee of 20%, which I understand is fairly typical in the art auction world, and sometimes it is 130

even more. And I also paid the Iowa sales taxes. Exhibit 2 is the Painting I purchased at the 131

Auction and Exhibit 3 is a true and accurate copy of the Sales Receipt for the purchase of that 132

painting. I paid a premium price for the E. Colline painting, but I wouldn’t have been the 133

successful bidder if I had not bid the $455,000. In any event, I was happy to help out the 134

Children’s Hospital, and I was satisfied that because Fishing at Dawn was in such high demand, 135

it would be a great investment and would only increase in value over time. 136

When I purchased the Emerson Colline painting, it was the first “real” artwork I had 137

ever purchased and the first item I had ever purchased through an auction, charity or 138

otherwise. I purchased the painting, not because of its value, as there were lots of other works 139

of art at the auction that had greater value. Rather, I purchased it because I liked it. At the time, 140

I was not familiar with the artist, and had no idea that Fishing at Dawn was such a valuable, 141

coveted, piece. I subsequently gained more appreciation for the fact that Colline’s work is quite 142

an exception in the art world and that she was one of the few female American Impressionists 143

26

of that time, and certainly also in the Midwest. Colline had studied in Europe with many of the 144

Impressionists, such as Claude Monet and Pierre-Auguste Renoir. However, Colline was most 145

heavily influenced by the works of Alfred Sisley, a French Impressionist, who was the most 146

consistent of the Impressionists in his dedication to painting landscape en plein air (i.e., 147

outdoors). 148

I provided a wire transfer of the total sales price to Charity Operations Network the 149

Monday following the auction. When speaking with Cutter regarding the wire transfer, I also 150

asked about the Certificate of Authenticity. Cutter responded that everything would be 151

delivered in thirty days. On October 12th, the painting was delivered from Charity Operations 152

Network. When the painting was delivered, the Certificate of Authenticity was not presented to 153

me. I contacted Cutter again, and he/she said the paperwork had been misplaced. Cutter said 154

“Oh, I know we have it in a file somewhere.” I finally received the Certificate of Authenticity 155

one year later (after the painting was discovered to be a fake). Exhibit 4 is a true and accurate 156

copy of the Certificate of Authenticity. 157

When I first took receipt of the painting, of course I uncrated it. It was as I remembered 158

it from the auction – two people fishing from a rowboat. I can’t say that I noticed anything 159

different, but then so many factors change. The light in my house, for example, is much 160

different than the perfect auction gallery lighting. I admit that I did not get a real close look at 161

the painting prior to or at the auction. Truth be told, this is my first time ever handling such a 162

valuable work of art – or so I thought. 163

Hey, I did my research. I knew that this kind of painting from this kind of artist rarely 164

came up for auction. That meant the value was sure to rise over time. I considered it a great deal 165

with a much better rate of return than any traditional bank investment or simply stuffing cash 166

in my mattress. I’ve learned my lesson now. My only art purchases in the future will be from 167

the dude selling paintings on the college quad for $10. At least I know his paintings are real, 168

since he paints them right in front of you! 169

I did not press to receive the Certificate of Authenticity because it was just a piece of 170

paper; the artwork should speak for itself as to its authenticity. I needed to obtain an appraisal 171

anyway for valuation purposes to insure the painting and to determine any charitable 172

27

contribution I could take on my tax return. When I inquired at art galleries and dealers as to a 173

recommendation for a fine art appraiser, and particularly American Impressionist paintings, 174

Evelyn Pears kept coming up as the top recommendation for an appraiser. 175

I made arrangements for Pears to come to my home for purposes of appraising the 176

painting that I had purchased at the Caring Hearts Auction. Pears arrived at my home on 177

November 3, 2016. I was surprised by Pears’ demeanor. Even though his/her business thrives 178

on social and business connection, he/she was generally rude. Pears acted haughty. Perhaps 179

that know-it-all attitude, however, convinced me to blindly trust his/her opinions as to the 180

Colline painting. 181

Pears attributed the painting to that of Emerson Colline. Pears was unequivocal that the 182

painting was authentic. Pears appraised the value of the painting at $575,000. Exhibit 5 is a true 183

and accurate copy of Pears’ appraisal. Pears did note some condition issues of the painting, 184

specifically some prior restoration work. However, Pears mentioned that these condition issues 185

were minor and did not affect the value of the painting. Pears recommended that I hire an art 186

conservator to perform restoration work to bring out the painting’s full beauty and to preserve 187

its value. Pears also suggested that I invest in re-framing it to highlight the painting’s flow of 188

lighting throughout the piece. Pears recommended Rene Beltracchi as the conservator and 189

restoration expert. Pears informed me that Beltracchi specialized in American Impressionist 190

paintings, and had a keen eye for Colline’s paintings, among others. After I found out the 191

painting was a fake, I filed suit against Pears. Unfortunately, Pears filed bankruptcy. The 192

lawsuit is probably why Pears is here in court testifying against me. In any event, any claim I 193

had against Pears has been discharged in the bankruptcy case. 194

Shortly thereafter, I followed up with Rene Beltracchi by phone to set up an 195

appointment to discuss the potential restoration work. On November 10, 2016, I met with 196

Beltracchi at his/her Des Moines East Village studio. My instant read on Beltracchi was that 197

he/she is a bit quirky, but very likeable. Beltracchi disclosed right from the beginning his/her 198

past and life of crime as a forger. Rene showed humility, yet strength of character. Beltracchi 199

shared with me his/her history of imprisonment for forgery and how it changed his/her life. I 200

learned that Rene now even works with the FBI. After Rene’s confession, I had no concerns of 201

28

his/her trustworthiness. As evidence that my trust was not misplaced, Rene is the one who 202

uncovered the forgery and it was Rene who notified the FBI and started an investigation on the 203

same day Rene notified me that my painting was a fraud. Beltracchi showed his/her stand-up 204

character and never even sent me a bill for any work he/she did on the painting. I guess he/she 205

felt bad that I was the victim of a forgery. 206

Beltracchi was passionate about his/her conservation work. Beltracchi discussed his/her 207

the meticulous attention to detail and care he/she takes to preserve the Masters. He/she did not 208

want to do anything that would decrease the value of a painting. In Beltracchi’s studio, he/she 209

showed me some of the work he/she had done for other collectors, museums, and galleries. 210

Beltracchi specialized in restoration work of American Impressionists. I knew that by hiring 211

Beltracchi, I was retaining a conservator who is very skillful and knowledgeable, and likely the 212

best in his/her field. Before Beltracchi would accept the restoration work, however, he/she said 213

it was necessary to view the painting in person. 214

The following Monday, on November 14th, Beltracchi came to my home and looked at 215

the Fishing at Dawn painting. Beltracchi’s reaction to seeing the painting for the first time was 216

priceless. It was like seeing a long-lost friend after years of separation. It was like Beltracchi 217

could not keep his/her eyes off the painting. Rene examined the painting closely and then told 218

me that he/she would be honored to be entrusted with the care of Fishing at Dawn and restoring 219

the painting to its original beauty. In addition, Beltracchi said that he/she had the perfect frame, 220

almost like it had been made just for it. 221

Rene talked to me about maintaining the quality of the painting once it had been 222

restored, including proper humidity levels, keeping it out of direct sunlight, proper methods to 223

hang the picture, and how to dust and clean it. Rene even suggested a place where he/she 224

thought the painting should be hung in my home. To enhance the painting, Beltracchi 225

suggested accent lighting and even recommended a contractor to do that work. Beltracchi also 226

recommended that I install added security measures given the significant value of the painting 227

and the lure of it for art thieves. Beltracchi made a recommendation for a security system 228

contractor, Jerry Schnurr, as well. Beltracchi won me over with all of his/her personal attention 229

and interest in making sure the painting would be preserved long-term. 230

29

Rene discussed his/her hourly fee for restoration work of $250.00 per hour plus the cost 231

of materials, including the frame, which would be $14,000.00. Rene noted that significant 232

restoration work was not necessary as the painting was in good condition. He/she estimated 233

30-40 hours of work and described in detail the work that would be performed to clean, make 234

repairs, and reframe it. 235

Rene could not start on the project immediately due to other pending projects and the 236

upcoming holidays. Beltracchi also explained he/she would need to work on it intermittently 237

between working on a significant project at a local school of restoring murals done through the 238

WPA. Beltracchi was also working on a mural at a local church. I was in no rush to get the 239

painting back. In fact, as I told Beltracchi, I had plans to leave right after Thanksgiving for a 240

four-month World Cruise. Satisfied with my arrangements with Beltracchi, I agreed to have 241

him/her do the restoration work and authorized him/her to pick-up the painting from my home 242

when he/she was ready to start the project. 243

Prior to departing for my World Cruise, I made arrangements for work to be done on 244

my house to upgrade the lighting and to upgrade my security system to safeguard the Colline 245

painting. The Schnurr Security Specialists began work on November 21st. I authorized the 246

contractors to release the painting to Beltracchi when he/she was ready to work on it. While I 247

was on my cruise, I received a text message confirming that Beltracchi had picked up the 248

painting on January 6, 2017. 249

I returned from my cruise on March 25th. I had no idea what news was in store for me. 250

Then on April 11, 2017, I received a call from Beltracchi. He/she said “Sit down. I have bad 251

news for you.” Beltracchi then told me that he/she had just begun the restoration work on the 252

painting and upon closer examination had discovered it was a forgery. Beltracchi told me that 253

he/she had notified FBI Special Agent Taylor Hanratty of the forgery and a federal investigation 254

had been started. Imagine my shock. Imagine my anger. Bryce Cutter and Charity Operations 255

Network had duped me. After I was informed by Special Agent Hanratty that the Justice 256

department would not be filing criminal charges in this matter, I consulted my own attorney 257

and we filed this lawsuit because one should be able to trust and rely upon the expertise of, and 258

statements made by, the auctioneer. 259

30

Statement of Rene Beltracchi

My name is Rene Beltracchi. I live at 309 East 5th Street in Des Moines, Iowa. For the past 1

eleven years, I have owned and operated The Art of Art, an art restoration business, also located 2

in Des Moines’ East Village. Specifically, I restore high-end master paintings. I also am a guest 3

art columnist for the Des Moines Tribune and blogger. 4

I primarily specialize and would consider myself a connoisseur of oil paintings by 5

Impressionists and American Impressionists. It is an art of immediacy and movement, of 6

candid poses and compositions, of the play of light expressed in a bright and varied use of 7

color. Impressionists were radicals. They violated the rules of traditional academic painting at 8

the time. Impressionists’ brush strokes are small, thin and short, but are visible. Their 9

paintings are characterized by the use of colors that are blended, but not smoothly, as was 10

customary, to achieve an effect of intense color vibration. They portray overall visual effects 11

instead of details. They used open composition with an emphasis on the accurate depiction of 12

light and its changing qualities. The subject matter of their paintings focused on realistic scenes 13

of modern life, with ordinary people, and used movement to illustrate the human perception and 14

experience. Impressionists often painted outdoors. Previously landscapes were usually painted 15

in a studio. 16

My restoration work includes preventing deterioration of paintings, repairing damages, 17

and re-framing the paintings. My business is successful, without advertising. Word of mouth 18

generates most of my business. I get referrals from numerous art galleries, art dealers, fine art 19

appraisers, collectors, and even museums. My ability to mirror the work of the masters in 20

order to preserve it is a critical component of my success as a restorer. I have a knack for 21

recreating the likeness of the artist’s original without disturbing the original painting and 22

decreasing its value. I have become well-respected in the inner sanctum of the art world 23

because when I restore a painting, I am meticulous about keeping the original art piece as true 24

as possible. I exercise great caution to not change the painting, or if I make changes to have 25

those changes documented and obvious. For example, I will use paints for the touch-up that are 26

chemically different than the original paint, so that they can be removed in the future without 27

damaging the original. 28

31

I am not a member of the Appraisers Association of America (AAA), nor am I a member 29

of the American Society of Appraisers (ASA). I also am not a member of the American Institute 30

for Conservation of Historical and Artistic Works (AIC). I do not need the labels to get referral 31

work. Not to say that I reject the purpose of establishing guidelines for this industry. As a 32

matter of fact, the manner in which I perform restoration work is consistent with AIC 33

guidelines. 34

I did not attend college, nor have any formal training in art restoration, appraisals, 35

forensics or art history. Instead, I have years of on the job training, so to speak. In my prior 36

life, I was an art forger. I forged several American Impressionists, and some have yet to be 37

discovered. A few of my forgeries are still hanging in museums. I never forged any works of 38

Emerson Colline, although I would have enjoyed the challenge of doing so. Her brushstrokes, 39

techniques, and visual acuity are quite unique. 40

I never forged for greed. Rather, I had been rejected by the art world for my original 41

works and so it was a sense of pride for me to pull off forged art to unsuspecting museum 42

curators, art galleries, and the like. To forge artwork also requires a cunning spirit. To be in on 43

the con, you have to project an image of expertise and sophistication that comes with years of 44

training. But the one thing that kept me from getting caught for many years was to follow the 45

cardinal rule of keeping lies to a minimum. I was turning around forgeries of major pieces in a 46

month to two months’ time. But it soon all caught up with me. My vanity got to me and I 47

started putting my initials hidden in the art work I forged. It was my little joke on the art 48

world. That’s how FBI finally caught me, and I landed in prison. My imprisonment for art 49

forgery hurt my family, and I vowed that when I got out I would lead an honest life. Shortly 50

after my release, I met with film producer and director Allyn Funt about a possible project to 51

bring light to the underworld of art forgery. As they say in the world of movies, the project is 52

still “in development.” 53

I ended my life of forgery, but I have used that knowledge, skill, and connoisseurship to 54

make an honest day’s wage. As you might expect, forgers make good conservators. My 55

experience as a forger has taught me the techniques and practices of individual artists, enabling 56

me to restore the work of an artist as if their hand was on my brush. I opened this little shop for 57

32

restoration work, and business has been great. I don’t hide the fact that I once was a con, 58

forging art work. I am completely upfront about it to all of my customers. In fact, my “bad” 59

reputation has been good for business. My ability to mimic almost identically an artist is a 60

much sought-after talent in art restoration. I have reaped personal rewards too. I now have 61

gained recognition and notoriety for my talents that I had to once hide as a forger. 62

As part of my transformation, and in a complete turnaround, I now work with the 63

Federal Bureau of Investigations to detect forgeries. I've turned a dark period of my life into 64

something good. People think a person can't change their stripes, but I am living proof that you 65

can. The FBI uses my expertise as a former forger to determine attribution and authenticity of a 66

painting. In addition to aiding the FBI in the detection of art forgeries, my experience with 67

known forgers has been helpful to the government to identify the forger. You see, I have the 68

unique experience, unlike most art experts, of recognizing a forger’s work, as well as the work 69

of particular artists. I am not a detective, nor am I trained as one. My training is in street 70

smarts, which candidly sometimes the stodgy FBI agents lack. I like to think of myself as an art 71

sleuth. I approach detecting forgeries by looking for clues. The more clues I have, the more I 72

learn about the forger, the more I am able to fit the clues together and wrap up a case. I’m 73

much like Sherlock Holmes. Each case is a study in collecting and analyzing clues, then 74

drawing logical conclusions from the clues. 75

The perception that an art piece was created by the artist is critical to its desirability and 76

salability. A buyer wants to believe that the art piece represents the artist's creative genius and 77

vision. Many artworks have value because of their attribution. A big name brings big bucks. 78

Unfortunately, art is an appealing target for a forger, and easier to get away with than forgers of 79

currency. A forger's mission is to create something that will be accepted as genuine and have 80

value, and it must go undetected by those who are practiced at examining a particular artist. 81

Through my blog, I try to help educate the public on acquiring art. Many people are 82

under the delusion that acquiring art is a solid investment. The best way to double your money 83

is to not buy art, but rather take your money out of your wallet, fold it in half and put it back in. 84

The perception that art is an investment is perpetuated by the myth that art always goes up in 85

value. While the myth may be true in certain circumstances, buyers should not accept this 86

33

wholesale. Buyers need to do their homework, know who they are dealing with, and refer 87

questions about a potential purchase to an art professional, such as an appraiser. 88

Buyers can be fooled by the "packaging" of a painting. If it looks old, it must be old, 89

right? For example, reproductions of seventeenth century paintings can be dummied up to look 90

authentic by using a top-grade color printer, gluing it on oak panels, then highlighting with oil 91

paint in places. You package up what appears to be an original in an elaborate gold frame, and 92

the painting appears to be more than it is. It is an easily affordable technique to masquerade as 93

an original antique oil painting. Also, it is common for a painting to be inherited and the later 94

generations believe they have a prize possession when, in fact, the artwork is merely decorative 95

art that looks like it could be something of value. 96

Nor should a buyer rely upon a Certificate of Authenticity (COA). Many COAs are 97

faked and forged, and simply are not reliable. Traveling charity auction companies and internet 98

sellers are notorious for offering a certificate of authenticity, such that there is now a cottage 99

industry willing to fabricate COAs. In many galleries, and particularly traveling charity auction 100

companies, the truth is replaced by a fictional narrative. 101

The Certificate of Authenticity is one of the most misunderstood and abused tools in the 102

art market. The only person who can authenticate a work of art is the person who created it. In 103

other words, the only certificate that matters is the one signed by the artist himself or herself. 104

All other certificates are merely opinions of authenticity and are only as valid and credible as 105

the reputation of whoever signed it and the extent of the research they performed to arrive at 106

their opinion. A certificate of authenticity does not become more valid if it is printed on special 107

paper with a fancy border and a gold seal. To be useful, a COA should contain the name, 108

nationality, and life dates of the artist, the title of the artwork, the medium, dimensions, location 109

and medium of the artist's signature, identification of the person signing the certificate and the 110

date, and most important, a guarantee of the truthfulness of the information. If a dealer or an 111

auctioneer is unwilling to provide a money back guarantee, there is reason to doubt the veracity 112

of the information provided by that dealer or auctioneer. Yet, I find it amazing how people are 113

so willing to accept a certificate that provides no guarantee. 114

People get the art they deserve. If you don’t enter the art market with a level of 115

34

sophistication you become fair game. Even those considered to be collectors and art aficionados 116

are in danger of buying a forgery attributed to a famous artist. They trust the dealer or auction 117

company and do little to nothing to obtain an independent opinion or scholarly review. The 118

best advice I can give any buyer of fine art, especially a novice buyer, is to rely upon an 119

independent expert, such as an appraiser. 120

A conservator is practiced in the art of looking at art as a physical object, paying less 121

attention to its content, like that of an art historian or connoisseur. The conservator is looking 122

closely at the painting to determine what needs to be restored. The initial visual inspection by 123

the conservator isn’t undertaken to determine authenticity. That’s not why you are hired. 124

Nevertheless, in some instances, just looking at the painting to do the conservation work reveals 125

something suspicious. 126

For me, the first thing about spotting a fake is something just seems a bit off. Something 127

seems not right. A forger almost always unintentionally incorporates something of his or her 128

own nuances to a painting. I have used my gut instincts to uncover other fakes because the 129

forger was not careful enough to do a thoroughly convincing job. If one develops an expertise 130

in a particular artist's works, that expert will trust their initial response to an art piece and 131

usually know at first contact that something is not right. As in many other professions, your 132

brain compares available data with prior experiences. Anomalies always raise red flags and 133

demand an explanation. The clues are always there. I find that 99% of the time, if I follow the 134

clues, I will confirm my first impression. Most often, you don't need scientific testing or an 135

involved, lengthy analysis to determine a painting is a fake. 136

Of course, as with any rule, there are exceptions. The rule that "if everything doesn't 137

look right it may be a fake" does not always hold true. Sometimes an artist incorporates 138

elements into an artwork that they had not previously utilized. In those circumstances, only the 139

artist would know if the painting is their work or a fake. 140

In November 2016, I received a call from Mr./Ms. Crown requesting restoration and 141

reframing for a painting. Crown mentioned that Evelyn Pears, a colleague and appraiser, had 142

recommended me. According to Crown, Pears suggested that a painting that Crown recently 143

purchased needed some restoration work to increase its value. I met with Crown at my studio 144

35

on November 10th. As I do with all of my customers or potential customers, my first order of 145

business is to confess my prior life as a forger. I do so with great humility, as I realize now that 146

when you are on the receiving end of forged art, you feel violated. We then discussed the 147

general nature of my services and my fees of $250 per hour. I also showed Crown several of 148

restoration projects that I was in the process of completing, in various stages of the process – 149

from the beginning to the end. I used a raking light to show how a painting, when it is first 150

received by me, may have heavy, poorly done restoration. Then I showed the other steps in the 151

restoration process, including cleaning, structural repairs, touch-up, and applying varnish. 152

When a customer is considering hiring me to do conservation work, I think it is 153

important to educate the customer so that they see the value of my services and can understand 154

the necessity of conservation to maintain the value of their investment. Deterioration due to 155

age is a fact of life for everything, including art. Deterioration is constant, relentless and 156

ongoing. Conservation treatment is a way by which we can slow down this deterioration and 157

attempt to preserve the art piece. I explain to my customers that paintings are fragile creations 158

that require special care to ensure their continued preservation. Paintings consist of various 159

layers. Traditional paintings are finished with a coat of varnish. Paintings that do not have all 160

of the traditional layers may be more fragile and susceptible to change or damage. 161

Crown asked me to do the restoration work for the painting that he/she had recently 162

purchased. My schedule was already booked solid and I hesitated to take on another 163

commitment, especially if a customer wanted a quick turnaround. Crown told me that he/she 164

was in no hurry and that he/she was leaving soon on a lengthy cruise. Crown then told me the 165

painting was by the artist Emerson Colline depicting a boating scene on Lake Lemon in Indiana. 166

My interest was piqued, as I have long appreciated Colline’s work. So, I agreed to view the 167

painting at Crown’s home before making a commitment to accept the restoration job. 168

After our initial meeting, I met with Crown the following week at his/her home in St. 169

Charles. After seeing the Colline Fishing at Dawn painting, I was excited about doing the 170

restoration work. I have always admired Colline’s work and style. There are so few of her 171

paintings remaining because of the fire at her studio in the late 1920’s. I felt it was an honor to 172

work on the piece. I wanted to do my part to preserve one the few Colline Impressionist 173

36

paintings remaining. I consulted with Crown about doing his/her part also to preserve the 174

painting. We discussed proper conditions such as humidity, temperature, direct and indirect 175

lighting, and even proper dusting techniques. We also discussed the best location in the house 176

to hang the painting. Finally, I cautioned Crown that a rare piece like the Colline painting 177

would have thieves scouting the place, especially with no one home. I suggested hiring a 178

trusted contractor that I knew, Jerry Schnurr, to install proper lighting and a highly 179

sophisticated security system. I recall spending more time consulting about how Crown could 180

best preserve and display the painting in his/her home than the time I spent examining the 181

painting. I probably did not spend more than fifteen minutes looking at the painting. My only 182

thought was that I did not see heavy restoration work done previously, so I estimated that it 183

would only be between 15 and 20 hours of conservation work. 184

I was not able to work on Crown’s painting prior to January due to the holidays, and I 185

was committed to other private collection restoration projects. I was involved in restoration 186

work at a local school, Callanan Middle School, involving murals created under the WPA. The 187

mural restoration was a pretty exciting project, but it was time-consuming. Finally, I was able 188

to arrange and have the painting delivered to my studio on January 6, 2017. I knew when it was 189

delivered that my time would be limited in working on it, and that I would have to work on it 190

intermittently between the mural project, an off-site restoration at a local church, as well as a 191

project for the Boyd Corporation, a local business known for its extensive art collection, all of 192

which had been contracted earlier. 193

I actually didn’t see the painting when it arrived. The painting had been wrapped in 194

paper and then securely stored in a crate. The contractors said that they wrapped it up and 195

protected it from the dust from their work shortly after Crown left for the cruise. In hindsight, I 196

probably should have been more fastidious about confirming the delivery was legitimate and 197

arrived undamaged. I should have, at a minimum, taken a cursory glance of the painting, 198

inventoried it, and taken a photograph. For all I knew, it could have been a print of Elvis on 199

Black Velvet behind that wrapping. 200

When the piece was delivered to my studio, I set it aside because I knew I had a few 201

months to work on it. My pressing priority at the time was consulting in another case – a sting 202

37

operation in Gotham City, Iowa - with the FBI regarding an art forgery, which preoccupied 203

much of my time for the next month. Actually, that has become my most lucrative source of 204

income. In the United States, I am one of only a handful of experts on American Impressionist 205

artists. Many consider me to be the preeminent authority on the Midwest American 206

Impressionist and Hoosier colonies. I have been an expert witness for the FBI, the IRS, state 207

attorneys, almost always as a dis-interested third party. This particular case is quite unusual 208

because I was hired to do the restoration work, and I was the first one to suspect and ultimately 209

detect the forgery. Usually, there is a suspicion of a forgery and I confirm that the artwork is a 210

forgery. When I’ve been called to testify, I have always concluded that the artwork in question 211

is a forgery. I wouldn’t be testifying if the artwork was authentic. There would be no dispute. 212

Cleaning and restoring a painting is very delicate and tedious work. A good restorer 213

will make sure that all techniques used in the restoration process are reversible and that any 214

retouching is limited to the specific areas of damage. It typically takes about one to three 215

months from the time the restoration begins until it is finished. Oil painting restoration is an 216

exacting, labor intensive process and adequate drying time is necessary between steps of the 217

restoration process. The first step is to remove the frame carefully so as not to damage an aged 218

canvas. The next step is to clean the painting of dirt, smoke, grime and other “stuff” that, over 219

many, many years, has accumulated and adhered to the surface of an oil painting. The 220

cleaning of a painting is a slow, methodical process using special solvents and neutralizers, 221

cotton balls, Qtips, and hours upon hours working 2 square inches at a time under a bright light 222

and magnifier. Most oil paintings have had one or more coats of a varnish applied. So, the 223

next step is to remove the varnish. Subsequently, the conservator will repair damages, such as 224

holes, scratches, peeling, chipping or other damage to the surface of the painting. Then, 225

inpainting or re-touching will begin. This is the process that requires the highest level of skill 226

because the integrity of the original painting must not be compromised. While many 227

individuals can learn to clean a painting, kill mold, and even repair a tear or hole, it is the 228

careful reapplication of paint to the surface of the painting that reveals the difference between 229

having a painting restored by a technician or a true artist. The careful and precise mixing and 230

application of oil paint and replicating the original artist’s technique is crucial. The last step is 231

38

to apply a varnish to protect the art. 232

Once Crown’s painting arrived at my studio, it was several weeks before any restoration 233

work began. We were behind in fulfilling commitments on other restoration work, and I had 234

the added obligation of assisting the FBI in a forgery case. So, I had my assistants handle some 235

of the groundwork on the Crown restoration work – removing the frame and handling the 236

tedious, time-consuming cleaning process. Finally, after the preliminary work was done, 237

including the cleaning, removing the varnish, it was given time to dry. My expertise is in the 238

actual restoration of matching the strokes and colors and images where needed to bring the 239

picture back to its full glory. 240

Once I began my part of the work for the restoration is when I began to question 241

whether it was a forged piece. I didn’t initially suspect it was a forgery. In fact, it was a very 242

good, almost perfect, forgery. Even the signature of E. Colline appeared authentic. But I 243

noticed a few things. I took my time, just like I would do if I had been hired to detect whether it 244

was a forgery or to verify it was authentic. There were subtle changes and clues – the shadows 245

of the trees by the dock looked unnatural but could have also been a stylistic change by the 246

artist. The darker shadows among the trees looked flat, rather than deep and had a uniformity 247

that I found unconvincing. There is also a spot at the back of the boat that seems out of place. 248

Over the next few days, I studied Crown’s painting more closely. I used 50x magnification to 249

look at the age of the painting and to see if the cracks in the painting were consistent with its 250

age. I was unable to confirm that the cracks were fabricated. Of course, a highly skilled forger 251

can add cracks to a recently painted piece that goes virtually undetected by baking the painting 252

in a low temp oven. 253

One additional tool available is a long wave ultraviolet light, which is frequently 254

referred to by the oxymoron black light. I use ultraviolet light to establish authenticity. One 255

telltale sign of a forgery is the paint pigments. Some forgers unknowingly use paint pigments 256

that were not available at the time the work was allegedly created. Different painting materials 257

exhibit characteristic fluorescence when exposed to ultraviolet light. Using a portable ultra 258

violet light, I observed that the shadows among the trees all fluoresced brightly and were 259

therefore, in my opinion, a type of pigment in the paint that was not available in the 1920’s. I 260

39

don't believe the discrepancies were a matter of changes to the varnish from cleaning or 261

restoration. Based upon my training and expertise in Colline’s paintings and other American 262

Impressionist paintings, it is my opinion that the purported Emerson Colline painting called 263

Fishing at Dawn is a fake. 264

It is also my opinion that Bryce Cutter misrepresented the painting as authentic. It is 265

also my opinion that Cutter failed to perform necessary due diligence before offering the E. 266

Colline painting for sale at the charity auction. Cutter has a duty to verify the painting’s 267

provenance and to confirm the authenticity of the painting through the retention of qualified 268

experts who will thoroughly examine the painting through subjective and scientific methods. 269

I contacted the FBI art fraud squad as soon as the UV light confirmed my suspicions. On 270

that same day, April 11th, I contacted Kelly Crown. I told both of them that the Colline painting 271

was a forgery. 272

I am familiar with Evelyn Pears. Pears’ training and background is as a museum curator 273

and as a connoisseur, studying the work of an artist. In contrast, I am a conservator. A 274

conservator tends to be more objective than a connoisseur. The conservator and connoisseur 275

both use magnifying glasses to examine the artwork more closely. After using magnification, a 276

connoisseur is likely to stop further investigation. They will only do further work after the 277

initial visual examination if there is a red flag that causes suspicion. The conservator will 278

explore more deeply to get a complete picture. 279

I understand that Pears performed an appraisal of this painting for insurance purposes 280

for Crown. Given that the scope was for insurance purposes, I believe that Pears may have 281

been sloppy in performing the appraisal for this painting. Insurance companies will accept 282

values from almost any source and they are not particular as to the amount of detail or work 283

that is done to provide an opinion for the appraisal. 284

Generally, I have a lot of respect and admiration for Pears’ expertise. However, Pears 285

can be arrogant and pretentious. Pears wants to sound erudite and knowledgeable, using lots of 286

art jargon. His/her character makes no difference to me unless it interferes with his/her 287

assessment of art he/she has evaluated. In this case, Pears’ arrogance is getting in the way of the 288

facts. Pears won't let his/her ego admit that he/she is wrong. That ego also causes him/her to 289

40

discredit opinions contrary to his/her own. He/she is impressed with his/her own credentials 290

and does not believe anyone has the ability or credentials sufficient to evaluate art in the same 291

manner as he/she does. I disagree that one needs formal training to detect forged art pieces. In 292

fact, I think understanding how forgers work gives me an edge that Pears can never have. 293

Evelyn and I have evaluated several paintings in the past and in all of the prior cases we have 294

reached the same conclusion as to the authenticity of the work. This is the first case that we 295

have differed, and quite frankly, I think Evelyn is standing by his/her opinion to avoid liability 296

for failing to detect the forgery at the time he/she appraised the piece. 297

Pears relies heavily upon the provenance of the painting. In the fine art market, 298

generally, the artworks carry provenance establishing a history of exhibitors, ownerships or 299

publications in which the painting’s authenticity and importance is verified. Often there are 300

stickers on the back from particular collections or exhibits which adds to its credibility and 301

market value. In this case, no stickers were present. Still, Pears relies upon the statements of 302

Morgan Walden that E. Colline was a family friend and that the painting was given to Bob Ross 303

Alcott shortly after its creation, and remained in his possession until his death, then given to his 304

daughter Maggie White Walden, who then gifted it to the hospital Foundation. 305

However, the apparent provenance can blind those associated with a painting – owner 306

and appraiser – to facts that in hindsight seem fairly evident. For example, a very well-known 307

Norman Rockwell painting, titled Breaking Home Ties was purchased directly from Rockwell 308

and remained in the possession of friend and fellow illustrator, Don Trachte. It was one of 309

several paintings contested when Trachte and his wife divorced. Trachte generously loaned the 310

painting for exhibitions. Twenty-five years later, the painting was in an exhibition when it was 311

noted that there were disparities in the painting from a picture of it on the Saturday Evening 312

Post cover of 1954. No one suspected that it was a copy of the real painting created to protect 313

the original. Subsequently, it was discovered that Trachte had a false wall built in his home 314

where he had hidden his originals while hanging the copies on the wall for others to see. So, 315

the moral of the story is Caveat Emptor, translated “Let the buyer beware!”316

41

Statement of Taylor Hanratty

My name is Taylor Hanratty. I am a Special Agent with the Federal Bureau of 1

Investigation. The FBI defines its core values as obedience to the Constitution, dignity of those 2

it protects, compassion, fairness, integrity, accountability, and leadership. I have been a Special 3

Agent for 28 years, after graduating from Columbia University in Art History. A special agent 4

must be a US citizen, and have a Bachelor’s degree from an accredited University. All 5

employees of the FBI undergo a thorough screening and background check in order to qualify 6

and maintain a top-secret security clearance. 7

Once selected to become an FBI agent, we train for 20 weeks at Quantico, Virginia. There 8

are 200 categories of Federal law that come under the FBI's investigative authority. The FBI, in 9

addition to protecting the United States from terrorist attacks and foreign intelligence ops and 10

espionage, also combats public corruption, criminal organizations and major white-collar crime. 11

To be quite frank, the United States has a lukewarm commitment to art crime. Of the 12

14,000 special agents in the FBI, there are only 16 agents assigned to the art theft team. The 13

Bureau generally assigns cases to the appropriate squad in the city closest to where the crime 14

occurs. I work out of the Chicago field office along with a colleague, Torey Cuellar, and 15

typically handle most art-related crimes in the Midwest. I’m the painting expert while Torey 16

handles sculptures and mixed media art. Art theft and other related crimes are often forgotten 17

among cases involving corruption of public officials and violent acts of gangs and gangsters. 18

There is a perception that art forgery is a victimless crime, or rather that it only affects the very 19

rich and that these elitists deserve to have the wool pulled over their eyes. The prison 20

sentences for art forgers tend to be slight too, and many forgers achieve fame and wealth after 21

they are caught. 22

Yet, art theft and forgeries should be a major concern of the FBI. Art forgery, fraud, and 23

theft are the 3rd largest crimes in the country in dollar value, only after sales of illegal drugs and 24

firearms. There is an estimated $6 billion in losses due to art theft annually. Art crime is a 25

problem of epic proportions. Forgery is widespread and routine. 26

Art theft includes theft, looting, and faking originals, and transporting illegal art across 27

42

state and international lines. Art thieves are different than art forgers. Art thieves have no 28

specialized knowledge or skills and tend to steal art only on occasion. Art forgers, in contrast, 29

are complex psychological characters, driven by a diverse range of motivations to the life of 30

crime, such as fame, revenge, pride, and of course, greed. The most common is greed. 31

Frequently, pride plays a role in the forger's modus operandi. The forger takes pride in fooling 32

those considered to be experts, especially museum curators and the heads of auction companies 33

who often can be smug and arrogant. 34

Forgers fake art in all price ranges, not only expensive pieces or those by famous artists. 35

So don't think that you're safe just because you’re not buying a Monet. Fifty-two percent (52%) 36

of all pilfered works are taken from private homes and organizations, such as galleries, 37

churches, and archaeological sites. As an interesting aside, the US government has a warehouse 38

full of art forgeries and relics. We use those fakes for undercover work, for example to catch 39

Central American drug dealers. 40

One of the most interesting FBI investigations into public corruption was the undercover 41

sting operation named ABSCAM. The name came from a fake company set up by the FBI, 42

supposedly run by a rich Arab sheik who wanted to invest oil money in valuable artworks. FBI 43

agents posed as representatives of the sheik to target mobsters trying to sell forged paintings. 44

As it turned out, the evidence led to the arrest of members of Congress, who offered to arrange 45

for a state gambling license in Atlantic City in exchange for a bribe from the fake sheik who 46

supposedly wanted asylum in the United States. 47

The art market is not a regulated market. All one has to do to go into business is hang 48

out a shingle and find a place to display the art for sale. There are few protections from shady 49

art dealers, cunning forgers pretending to be sophisticated experts, auction companies, and 50

even internet sales. Often a buyer of fine art will not find out for years, if ever, that the art 51

purchased is a fake. 52

Victims generally share common characteristics. First, victims of art fraud are usually 53

unsophisticated first-time buyers. They are propelled into a market which they know very little 54

and rely totally upon the representation of others. Second, they have sufficient capital to invest. 55

Third, they have an interest in art, but naiveté about the art market. Too often the art dealer, or 56

43

in this case, the auction company will take advantage of the ignorance of the buyer. They count 57

on the tendency of most people to rely upon the expert and to trust that they would not take 58

advantage of him/her. A purchaser needs to exercise his/her own due diligence. They need to 59

do independent research and obtain a separate appraisal prior to an art purchase. 60

The primary burden of due diligence, however, falls upon the dealer or auctioneer 61

selling the painting. The auctioneer has a responsibility to verify the authenticity and 62

provenance of a painting. This entails thoroughly researching the painting’s history, examining 63

the painting in person, using fluorescent lighting, and even submitting a valuable painting to 64

the International Foundation for Art Research (IFAR). 65

Dealers and auction companies often avoid digging very deep into the authenticity of a 66

work of art in order to turn a blind eye to the possibility that it is a forgery. One of the secrets 67

that art dealers and auction companies keep to themselves is the number of fakes in circulation 68

and in collections. Bogus works of art hang in all museums and galleries, appear in almost 69

every auction, and are sold online. No dealer wants the reputation of being a whistle blower on 70

another dealer as it will only be a matter of time before the tables are turned. Consequently, 71

most fakes will often just reappear on the market. 72

If the art dealer or auction company disclosed the truth, they would lose the money they 73

invested. Galleries and auctions often are unwilling to guarantee the art sold because they 74

don’t want the forgeries back. In their book "Everyone’s Guide to Buying Art,” authors Peggy and 75

Harold Samuels say that every art buyer should determine their personal painting size. The 76

authors explain that your size is the measurement of the curled fingers of your hand to your 77

armpit – because after your purchase, if you try to sell the art, you will go from gallery to 78

gallery with the painting under your arm looking for a buyer to unload it. 79

I am familiar with Charity Operations Network, the defendant in this case. I have 80

studied Charity Operations Network’s practices and routines in depth. For years, Bryce Cutter 81

and Charity Operations Network have been on my radar, and under investigation by the FBI, 82

for suspicion of art fraud. Whether or not Cutter and his/her business are primary participants 83

in a forgery scheme, their actions or rather inactions perpetuate an environment and culture 84

where forgeries are part of the marketplace. Cutter made several misrepresentations on the 85

44

night of the auction according to Kelly Crown that induced him/her to purchase a forgery. 86

Cutter falsely stated that all signatures on the artworks are verified by independent experts. 87

Cutter also misrepresented that the Colline Fishing at Dawn painting was authentic, and we now 88

know that not to be true. 89

Cutter also negligently failed to uncover the forged Colline painting. Cutter and Charity 90

Operations Network are prime examples of turning a blind eye toward uncovering a forgery 91

prior to selling it to the detriment of victims of forgeries. In my opinion, the company helps art 92

cons because it does not perform sufficient due diligence. Bryce Cutter does not look closely at 93

the works of art he/she sells. Due diligence requires a dealer or art auction company to 94

thoroughly examine a painting and compare it with other known legitimate works of an artist. 95

A thorough investigation of a painting requires looking at every aspect of the painting. For 96

example, a forger may unwittingly add a motor to a rowboat, not realizing that power motors 97

were not invented until years after the artist’s death. If something looks off in a painting, then 98

it should raise red flags, and an expert should be brought in to evaluate its authenticity. 99

Due diligence requires examining the painting using a magnifying glass. There are 100

several clues that can tip off an examiner as to a forgery. Sometimes forgers leave evidence of 101

previous marks when a forger tries to sketch the original artist's rendition before creating the 102

painting itself. Or the forger's paint strokes may show unusual paint brush lifts and bluntness, 103

rather than something fluid and smooth. Often a forgery is revealed in the signature of the 104

painter. The signature may have an uneven writing speed and pressure, or hesitations. When 105

examining artwork for authenticity, we look for the cracks that naturally occur with the age of a 106

painting. Close magnification will reveal that some forgers attempt to replicate those cracks by 107

painting them on the fake piece. Magnification will also reveal whether worm holes in the 108

frame or painting are real or replicated. 109

Due diligence also requires the auction company to use a raking light to determine if 110

there has been restoration work, and to better understand the condition of the painting. Further 111

investigation may be required using an ultra violet light to determine the pigments and type of 112

varnish used to determine if the elements are found in the painting are consistent with the time 113

period. 114

45

Bryce Cutter does not thoroughly check the provenance of a work of art that Charity 115

Operations Network is selling through the auction. Due diligence requires that the dealer or 116

auction company verify the chain of ownership through verified documentation. The 117

provenance verification should include reviewing the exhibits and publications where the 118

artwork has received acknowledgement of its authenticity. Often museums, galleries and 119

special exhibitions that display the artwork will include a stamp or sticker on the back of the 120

frame of the art work, if possible. In the case of the Fishing at Dawn painting, there were no 121

stickers or stamps showing that the Colline painting had ever been displayed in an exhibit, even 122

though we know that Fishing at Dawn has been exhibited several times. 123

Charity Operations Network buyers likely are victims of fakes. Bryce Cutter does not 124

have enough information on the artist and does not do enough research. Cutter has not 125

sufficiently developed a connoisseurship and does not have enough contacts with experts to 126

solicit a second opinion. Duped buyers at one of Cutter’s auctions, unknowingly, have fake 127

paintings displayed in their fancy homes with the latest and greatest accent lighting and 128

expensive security systems to protect what they still think is a valuable piece of art. Those 129

buyers may never discover their prize possessions are worthless. People believe that an auction 130

house expert wouldn’t let a sale go through, if it wasn’t right. Unfortunately, charity auction 131

companies often have moved on to new fishing grounds and are unaccountable. 132

Charity Operations Network moves tons of artwork regularly under the pretense of 133

helping charities. Don't be fooled by the "charitable" aspect of Cutter’s business. There's 134

nothing charitable about it. Cutter’s business is in the business of making money. Sure, Cutter 135

supposedly helps charitable organizations - - for a fee; both a fee tacked on to the sale price, but 136

also submitting outrageous expense requests to the charity as “the cost of doing business.” 137

And don't be conned by Cutter’s panache and charismatic persona. Cutter may roam 138

the world's palaces and villas, charming owners with his/her extensive knowledge of fine art, all 139

the while convincing people to part with their priceless artwork. Behind that disarming 140

exterior is a slick snake in the grass. To keep his/her business going, Cutter preys upon people 141

at their moment of weakness - the "three D's" - divorce, death and debt. But don't worry, one 142

day, I know, Cutter will slip up, and we’ll get him/her. 143

46

I was the lead investigator in a previous investigation of Bryce Cutter and his/her 144

charitable auction company. At the time, Cutter operated under a different business name - 145

Services for Charity Auctions & Management, Inc. The business folded after insurance fraud 146

claims were filed against it. The investigation involved artwork lost in a fire in Cutter’s storage 147

unit in Gotham City, Iowa. A fire always raises suspicions. There were rumors that Cutter had 148

stolen the artwork and replaced it with fake paintings which were destroyed in the fire. The 149

arson investigation revealed that the fire was intentionally set, but I never could prove that 150

Cutter was behind it. I was frustrated that we were never able to make an arrest of Cutter in the 151

prior incident. 152

I thought that when the Colline forgery was discovered that we would have a solid 153

criminal case against Cutter, only to be out-smarted again. Cutter had an opportunity to have a 154

forgery created and swap it out before the painting was delivered to Kelly Crown. Cutter had 155

the painting at his/her facility for nearly four months. Despite a vigilant investigation we could 156

not determine that Bryce Cutter had the necessary criminal intent to pass off a forged piece at 157

the time of the sale of the painting to Kelly Crown. You have to keep in mind that in a criminal 158

case, the prosecutor has to prove guilt of the crime beyond a reasonable doubt, whereas in a 159

civil case the burden of proof is by preponderance of the evidence. If the Department of Justice 160

only had to establish proof by a preponderance of evidence, there would be plenty evidence to 161

find him/her liable. 162

Rene Beltracchi reported the Colline Fishing at Dawn forgery to me on April 11th, 2017. 163

The FBI's investigation in this case was inconclusive and therefore we did not bring criminal 164

action against any person in connection with this forgery. The FBI agrees with Rene Beltracchi 165

that the artwork by Emerson Colline in the possession of Kelly Crown is a forgery. The FBI did 166

not undertake its normal, routine steps to confirm the forgery because Rene Beltracchi had 167

already identified the piece as a forged work. Rene provided his/her analysis in determining 168

the piece to be a forgery, and as the FBI often relies upon Rene for forgery determinations, there 169

was no need to duplicate the work. The paperwork was reviewed by several of my Art Squad 170

colleagues. They concur with my assessment. 171

I am fully aware that Rene Beltracchi previously was an art forger. However, I have 172

47

seen a true transformation of Beltracchi. I believe after his/her imprisonment for forgery, 173

Beltracchi is now a changed person and actually helps the “good guys.” We keep a close watch, 174

of course. It can be so easy to slip back into the life of crime. It probably comes as no surprise 175

that conservators (restorers) who are practiced in the technical tools and historical methods of 176

artists have on occasion been found to be behind forgery schemes. Van der Veken is one of the 177

most widely known. His expertise and connoisseurship made him the preferred conservator. 178

He was entrusted with some of Belgium’s greatest masterpieces, but instead used the 179

opportunity to forge and switch out the original masterpieces. In Beltracchi’s case, it was never 180

about money. Beltracchi wanted notoriety as a forger. Beltracchi’s successful business and 181

reputation in the art world now as a conservator satisfies that need. So the FBI has classified 182

his/her recidivism as low risk. It is rare for a former theif who now works with the Bureau to 183

“independently contract” or backslide into their former lifestyle. There are a few high-profile 184

cases of top-notch hackers who continued to hack while working with us, but we have never 185

come across that in the field of fine art. 186

I am convinced that Bryce Cutter was behind the forgery of the Colline art piece. Cutter 187

had the opportunity to switch out the art piece between the time of the auction and the time the 188

piece was delivered to Crown. My suspicions were raised and my investigation focused on 189

Cutter as soon as the forgery was discovered because of a prior investigation involving Cutter. 190

Art crime may be widespread, but it is a small, relatively tight-knit community of scoundrels. 191

Bryce Cutter occupies a small but significant role in this den of thieves.192

48

Statement of Bryce Cutter

My name is Bryce Cutter. I am the owner of Charity Operations Network, formerly 1

Services for Charity Auctions & Management, Inc. Unfortunately, the latter business closed its 2

doors in 2008 when there was a financial crisis. Investors were no longer flush with cash to 3

invest in fine art. The uncertainty of the stock market created cautiousness for giving 4

generously to charities. I started Charity Operations Network in 2010. Charity Operations 5

Network is a fundraising company specializing in benefit auctions of fine art. We help charities 6

throughout the Midwest to raise funds to benefit people and organizations in need. We provide 7

our services to over 100 charities and organizations every year. 8

I have a Doctorate in Art History from the University of Chicago with a concentration in 9

twentieth century art. I received my Bachelor of Arts degree in the History of Art from the 10

University of California, Berkeley. I also have completed graduate level courses at Tabard 11

University on "Appraisal of Paintings," and “Due Diligence”, as well as courses through the 12

Appraisal Studies program at New York University on "Old Masters and 19th Century 13

Paintings" and "Fine Art Restoration." I also completed coursework at the Center for 14

Philanthropy and Fundraising through New York University. 15

I started as an Auctioneer for charities about eighteen years ago when a friend asked me 16

if I would do their benefits auction. The auction was a success. A few years later, I formed my 17

company, and I have continued to assist charities in fundraising through fine arts auctions as 18

my life’s work. I believe in channeling creativity for a good cause, raising funds on behalf of 19

programs and services that help others. 20

In order to be a charity arts auctioneer, not only is it imperative to have a solid 21

foundation in art history and art mediums, as well as a background in appraisals, but it is 22

imperative to have excellent communication skills. Public speaking skills are utilized not only 23

during the auctioneering process, but also when speaking with potential donors to donate art to 24

be sold at an auction for charity, as well as potential buyers. An auctioneer needs to thrive in a 25

fast-paced environment and be a natural entertainer. When speaking to donors and potential 26

buyers, it is important to be personable and engaging, outgoing and enthusiastic, and 27

49

persuasive while at the same time demonstrate poise, confidence, and maturity. As a charity 28

arts auctioneer, I also have the ability to educate people on art history and the value of fine art. 29

It may sound self-aggrandizing, but you also have to have an attitude of importance and 30

affluence. It is necessary in this job to travel where the rich and famous travel, and to adapt to a 31

diverse group of people and cultures. My expense budget for travel, meals and entertainment 32

is significant because I need to wine and dine potential donors. It goes with the territory of 33

hobnobbing with the elite to get what you want. I don’t view any of it as unscrupulous. I am 34

doing charities a favor by getting donations for them. Don’t get me wrong, I’m not twisting any 35

arms. The donors want to give to charities; it’s just sometimes they need a little help being 36

directed to your worthy cause. 37

I am well versed in all styles of the fine arts, including Baroque and Renaissance periods, 38

as well as Impressionism, American Impressionism, Post-Impressionism, Modernism, and 39

Contemporary. I have concentrated the majority of my studies, however, in Impressionism and 40

American Impressionism. 41

To understand the Emerson Colline painting that is the subject of this lawsuit, it is 42

important to get a brief lesson in art history. You can’t analyze a painting or form an opinion on 43

its authenticity without understanding the key components of a certain style and having a 44

background in how that style developed. 45

In the early 1860s, four young painters—Claude Monet, Pierre-Auguste Renoir, Alfred 46

Sisley, and Frederic Bazille shared an interest in painting landscape and contemporary life 47

rather than historical scenes. They often ventured into the countryside together to paint in the 48

open air. They painted in sunlight directly from nature and made use of brighter and bolder 49

pigments, such as cerulean blue, in their painting, creating a lighter feel. Impressionism was 50

born. 51

The development of Impressionism was, in part, a response to the development of 52

photography and the artist’s attempt to create a “snapshot” of life through their paintings, 53

where movement was more fluid and temporary, and the action of day-to-day life was 54

captured. Prior to the Impressionists, the subject matter of the painting was the focal point. The 55

Impressionists relaxed the boundary between subject and background. 56

50

Many American artists studied in Europe and brought the Impressionism style with 57

them when they returned to the United States. Groups of artists who shared a common vision 58

in their art formed in small towns that provided affordable living and abundant scenery for 59

painting. From the 1890s through the 1920s, American Impressionism flourished in these art 60

communities. One such group was the Hoosier Group based in Indiana. The leader of The 61

Hoosier Group was T. C. Steele. His home in Brown County, Indiana was a gathering spot for 62

many of these painters. As plein-air painters, they focused on local scenery. The Group became 63

known as one of “the most notable regional art centers in America in the early twentieth 64

century.” Thus, their paintings are very desirable in the open market. 65

American Impressionist paintings are distinguished by certain key components and 66

techniques. Paint is applied in short, thick strokes to a white ground. The paint is often 67

applied impasto. Colors are applied side-by-side with as little mixing as possible. The play of 68

natural light is emphasized, and shadows are boldly painted with the blue of the sky reflected 69

on various surfaces, giving a sense of warmth and newness. 70

Many American Impressionist artists, including Colline, moved toward Modernism in 71

the late 1920’s, and the Impressionist style became out of vogue. Impressionism in America lost 72

its status in 1913 when an exhibition of modern art took place in New York City. The “Armory 73

Show” showcased a new painting style which was considered more in touch with the fast-paced 74

world, especially after the outbreak of the World Wars. 75

Emerson Colline, in keeping with the Impressionism and American Impressionism style, 76

focused on the naturalistic depiction of light and color. Her paintings focused on small, thin, 77

yet visible brush strokes, open composition and an emphasis on light and its changing qualities. 78

Paintings were generally ordinary subjects, with an inclusion of movement. 79

Colline’s Fishing at Dawn exhibits these elements of the typical American Impressionist 80

style. Colline, along with other American Impressionists, desired to have their 81

paintings represent modern life. Colline would often paint his/her subjects as they stood near 82

the shallow water or in a boat. Nature was primarily a social experience to these painters. Also, 83

the ever-changing face of nature lent itself perfectly to their interest in capturing fleeting 84

moments of everyday life. 85

51

A lot of enthusiasm is generated when a Colline Impressionist painting is in an auction. 86

It is rare to see one of her paintings. In 1927, her studio was engulfed by fire and she lost all of 87

the paintings that were in the studio. She switched painting styles to Modernism shortly 88

thereafter, so few of her Impressionist landscapes exist in today’s market. The few remaining 89

paintings are in the hands of private collections. Thus, her landscapes are quite collectible and 90

often priceless. 91

Fishing at Dawn is quite a remarkable painting. Not only is it one of her rare 92

Impressionist paintings, but it is also of excellent quality. The painting was one of her last 93

Impressionist paintings and her talents were at the height of her career. The energetic, 94

flickering brushstrokes are an expression of Colline's excitement in the effects of light and 95

color. The rhythms of the rounded forms in the trees, along with the fluid brushwork, 96

contribute to the vitality and sense of movement in Fishing at Dawn. There is nothing immobile 97

in our surroundings and therefore nothing immobile in Colline's paintings. Waves lap against 98

the shore. Clouds change shape and change places continually. Colline explained that "one 99

must paint quickly because much is lost in an instant and can never be found again." 100

I had been following the Fishing at Dawn painting. It had been shown at various 101

museums and special exhibitions in the 1990’s and early 2000’s. That tells me a little something 102

about the owner of the painting. It told me that the owner was willing to let it go, even if only 103

temporarily, and that the owner appreciated that others would enjoy seeing it. So, I made 104

arrangements to meet with Maggie White Walden in February 2007 to see if she was willing to 105

part with the painting for the benefit of one of the charities I assist. 106

When I met with Maggie, she was thrilled that there was so much interest in the 107

painting. I could tell she was unaware of how valuable it was, even back then. To her, it was 108

just a painting of her mother and father doing what they always did every morning at the crack 109

of dawn. She enjoyed the simplicity of the painting and it transported her back in time to her 110

childhood memories. She explained to me that her father and mother (Bob Ross and Abigail 111

White Alcott) owned a small farm/retreat in Brown County, and when some painters were 112

looking for outdoor landscapes to paint, they loved the small lake, trees and lighting on his 113

farm. The painters were part of the Hoosier Group. Maggie’s father invited those painters to 114

52

come and go freely on the property, and even offered them a place to stay. Eventually, as a gift 115

for all of the kindness that her father had shown these painters, Emerson Colline gave a 116

painting to him, Fishing at Dawn. 117

I used my persuasive skills and transitioned our conversation from the giving acts of 118

Maggie’s father to the acts of giving that she could also provide to so many others. The 119

painting was central to the giving and paying it forward. It all started with Maggie’s father’s act 120

of kindness. Emerson paid it forward with the gift of the painting and now Maggie could do 121

the same, or so my argument was. Maggie needed no time to contemplate her decision to 122

provide a specific bequest in her will to donate the painting to the Thomas J. Levis Caring 123

Hearts Children’s Hospital Foundation. A week later she called me to let me know that her will 124

had been changed to include the gift of the Colline painting to charity. 125

I met with Maggie after the specific bequest had been made to obtain a copy of the will 126

for my files. I also took steps at that time to authenticate the painting and to examine its 127

condition. The authentication of works of art is more art than it is science. Technically, the only 128

person who can authenticate an artwork is the person who created it. If the artist is deceased, 129

you perform your own due diligence. 130

The next best way to authenticate an artwork is to consider its provenance, that is its 131

history and story. Thus, as a student of art history, I have a unique understanding of 132

connecting the dots to authenticate a painting. A painting may be authenticated by verifying a 133

person was present when the painting was created. Although Bob Ross Alcott and Abigail 134

White Alcott were deceased, I learned that the painting had been in the family’s possession 135

since it was originally painted. Maggie was able to show me photographs of Emerson Colline 136

on the family retreat, along with some of the other painters from the Hoosier Group. Of 137

particular importance, was a photograph of Emerson, Bob Ross and Abigail standing in the 138

front room of the family home next to the Fishing at Dawn painting. On the back of the 139

photograph, was hand scribbled “Emerson, Bob Ross and Abigail September 22, 1928 (Bob 140

Ross’ birthday present).” I explained to Maggie that it is important to establish a history of the 141

painting so that it can be shown to be authentic and therefore be of more value to the Levis 142

Foundation. She let me have the photos of the plein air painters and the photo of the gift of the 143

53

painting. Unfortunately, that documentation of the painting’s provenance was destroyed in a 144

fire at my shop in Gotham City in April, 2008. Fortunately, Maggie had not entrusted me with 145

the Colline painting so it had not been destroyed in the fire too. 146

The fire to my facility in 2008 was devastating. I lost nearly everything and even had to 147

close my doors to business later that year, although the struggling economy didn’t help matters. 148

Fire Investigators determined that the fire was intentionally set and ruled it as arson. I certainly 149

had nothing to do with the fire. I’m not sure who would have set it, but I did everything in my 150

power to cooperate fully with the investigators and provide as many leads as possible. I was 151

investigated by both the local authorities, Detective Robin Wayne, and by the FBI and Agent 152

Hanratty in connection with that fire. The FBI subsequently closed its investigation, and to my 153

knowledge, never was able to identify the arsonist. It was preposterous that I would destroy all 154

of those beautiful paintings that had been entrusted to me for the benefit of the charities I 155

support. I admit, that 2008 and shortly after were lean years. Art was not carrying the value it 156

had carried in prior years, but I am passionate about my job especially knowing that I benefit 157

charities each and every day, which touches thousands of lives. 158

If it was arson, the only thing I could think of who would set it would be some 159

disgruntled divorcee or heir that thought some valuable work of art should have been their 160

possession rather than benefitting a charity. Some people misunderstand too that although the 161

fine art is held by my company, it hasn’t been given to my company. I am not receiving a half 162

million-dollar gift, for example. It is the charity that receives the gift. My company is merely 163

the conduit to make that happen. And I am compensated with the buyer’s premium that is 164

added on top of the hammer price, the successful auction bid. 165

In addition to the photographs to establish the painting’s provenance, which 166

unfortunately I no longer have due to that fire, I also documented the museums and special 167

exhibitions where Fishing at Dawn had been displayed, thereby establishing that those museum 168

curators and other connoisseurs believed it to be authentic. 169

Maggie was kind enough to allow me to make an examination of the painting in her 170

home. I made a complete examination of the painting. Nothing seemed out of place. The 171

objects in the painting seemed natural and sized proportionately, the pigments all seemed 172

54

fitting to the period, there were no distortions of cracks in the surface like it had been recently 173

created, and the brushstrokes seemed natural and not forced or imitated. Given my familiarity 174

with Colline’s painting it appeared to be 100% consistent with her style and techniques. Given 175

the provenance that had been established and my physical examination, I was of the opinion 176

that the painting was authentic and that there was no need for further testing. 177

Maggie White Walden passed away in May 2015. Receiving the painting was more 178

complicated than I had contemplated. Maggie’s family filed a lawsuit contesting the will 179

regarding the specific bequest of the gift of the Colline painting to the Thomas J. Levis Caring 180

Hearts Children’s Hospital Foundation. Isn’t that ironic? In one lawsuit I am defending the gift 181

of the painting because everyone believes it to be authentic, and now I am embroiled in this 182

litigation defending the same painting that the plaintiff alleges is not authentic. 183

With regard to Maggie’s family and heirs, I understand their frustration. The painting 184

was the only asset of value in the estate other than a few knick-knacks and pieces of furniture. 185

In addition, the painting held special memories for the family. The painting depicts Bob Ross 186

and Abigail White Alcott fishing, a favorite pastime. At least the family was able to enjoy the 187

painting a little while longer while the lawsuit was pending. The family and I finally came to 188

an agreement on July 2, 2016. The court upheld and enforcied the will’s provisions for the 189

painting to benefit the Thomas J. Levia Caring Hearts Children’s Hospital Foundation by 190

auctioning the painting to the highest bidder. The concessions made to the family seemed to 191

warm them to the auction process. Once the ruling was made official, Morgan Walden has 192

cooperated and we have no animosity between us. Morgan delivered the painting to Charity 193

Operations Network a week later, just in time to be included in the Catalogue for the Charity 194

Auction and Gala. 195

Once I received the painting from Morgan, I used my independent experts to verify the 196

signature of Emerson Colline to be authentic. The company I use for signature verification of all 197

signed art pieces is TruWrite, headed by Abhay Nadipuram. Abhay and his company are 198

nationally recognized for their expertise in handwriting analysis. I ordinarily receive written 199

confirmation of the signature verification for each piece, but it must be mis-filed. I checked with 200

TruWrite for a duplicate copy and was told that the company only keeps the records for one 201

55

year as possession of an art piece may change hands after one year and there’s no guarantee 202

that the painting couldn’t be switched out if ownership changes. TruWrite did confirm, in its 203

opinion, the signature of E. Colline to be authentic. 204

A week prior to the auction, Charity Operations Network mailed to every invitee a high 205

gloss catalogue of the art pieces that were up for auction on the evening of the event. Exhibit 1 206

is a true and accurate copy of excerpts from the Catalogue for the Thomas J. Levis Caring 207

Hearts Children’s Hospital Foundation from September 10, 2016. In the catalogue, we ensure 208

that buyers are fully aware that they have the opportunity to preview any of the works of art 209

that will be auctioned at the event. The Art Catalogue also suggests that potential buyers obtain 210

a copy of the condition report for any work of art that the buyer has interest. In fact, we 211

encourage them to do both. Certainly, the buyer can also hire an appraiser or connoisseur to 212

examine the artwork at our facility or at the function. We want to be fully transparent. It is in 213

everyone’s best interest (the charity, my company, and the buyer) to have the buyer comfortable 214

and confident about what he/she intends to buy through the auction. After all, it’s not only the 215

auction company that must perform due diligence. I would fully expect that anyone paying 216

that kind of money for a painting would do their own due diligence, and have some level of 217

sophistication as a connoisseur of a particular artist or style of art. 218

At the beginning of the auction, I made every effort as the auctioneer to create an 219

ambiance full of excitement, anticipation and enthusiasm. After making some introductory 220

remarks, I then explained the bidding process, payment requirements, and useful information 221

that are in the catalogue. While generating interest in bidding, I provided some reassurance to 222

the bidders. I told the audience that signatures on any artwork have been authenticated by a 223

nationally recognized, independent third party. However, I also advised that lots may be in 224

imperfect condition, and that there are no guarantees. Exhibit 7 is a true and accurate copy of 225

Excerpts of the Note Cards I used for the Thomas J. Levis Caring Hearts Auction on September 226

10, 2016. It is the regular practice of my work as an auctioneer and Charity Auction organizer to 227

make such records. The Note Cards were created by me at or about the time of the auctions. 228

The cards are kept in the course of regularly conducted activity of my appraisal, and I am the 229

custodian of such records. 230

56

I did not make a claim of the availability of a certificate of authenticity for the Colline 231

Fishing at Dawn painting. As you will see from my Note cards for the auction, I do not have any 232

reference with respect to the E. Colline painting as to the existence of a Certificate of 233

Authenticity. Furthermore, no one, including Kelly Crown, asked to see a Certificate of 234

Authenticity prior to the auction or during the auction. Kelly Crown also did not ask to 235

preview the painting or have an expert examine it prior to the auction. Crown didn’t even ask 236

to see the Condition Report for the E. Colline painting - - ever. 237

The bidding for the E. Colline painting was very active. There were a number of 238

bidders at first, including Kelly Crown, the Walden family, an investment firm named Cobra 239

Kai, and, of course, Beatty Wiese, a Chicago-area land developer who is a regular at my charity 240

auctions. 241

Beatty is an interesting character and a very generous person. I usually provide him 242

with an update of new acquisitions and upcoming auctions. This is no more than I do with 243

other regular patrons. I want them apprised of the collections up for bid and generate some 244

interest. Beatty does have a peculiar request, however, but I really don’t think it’s relevant in 245

this situation. He has asked me to let him know of any new participants – not just people new to 246

my auctions, but to let him know of anyone brand new to the fine arts auction scene. I think 247

Beatty considers it part of his philanthropy to at times run up the hammer price on certain 248

pieces. While he does acquire art frequently, more often he comes a close second in bidding 249

wars. Since a higher bid price results in a higher premium for me, I can’t complain. No, I 250

definitely do not have any sort of financial arrangement with Beatty Wiese. Yes, he bailed me 251

out of a jam when my original business went under, but that was long ago and all of my debts 252

have been paid off. 253

The stakes got higher and higher in the Levis Caring Hearts Foundation auction and the 254

excitement in the crowd was palpable. Bidding was fast and furious. I had little time to catch 255

my breath. Finally, the bidding came down to Crown, Cobra Kai, and Wiese, with the hammer 256

falling on Crown’s last bid of $455,000, prior to the buyer’s premium and taxes. I earned 257

$91,000 on that sale alone. 258

We have a policy to make sure that all payments clear before delivery is made. Due to 259

57

other scheduling issues, we were finally able to deliver the painting purchased by Crown to 260

his/her home on October 12, 2016. When the delivery was made, Crown inquired as to the 261

paperwork for the Certificate of Authenticity. I did not have my Note Cards or the catalogue 262

with me at the time, so I could not recall whether a Certificate of Authenticity was even 263

available for this particular painting. I recall telling Crown that the Certificate had been 264

misplaced, which can happen. I need to get a better filing system. Crown never asked for the 265

Certificate of Authenticity again, and quite frankly, it was not something that was on the top of 266

my mind. When this lawsuit was filed in September of 2017, I was reviewing my files on this 267

case and I found the Certificate of Authenticity stuck behind some other paperwork, so I mailed 268

it to Crown. 269

Charity Operations Network performed sufficient due diligence as I received proper 270

documentation from the donor confirming how the painting had been acquired, I examined the 271

painting adequately, and had the signature on the painting verified by an independent third 272

party. Any statements I made as the auctioneer for Charity Operations Network as to the artist, 273

date, age, provenance, condition or estimated Hammer Price of the painting were merely 274

statements of opinion and did not imply any guarantee. All notations and illustrations in our 275

catalogue only serve as guidance. Kelly Crown, as part of his/her due diligence, should have 276

formed his/her own opinions as to authenticity, attribution and condition of the painting by 277

personal inspection during the preview period or at the auction. 278

Kelly Crown is not a victim here. Art collectors are no saints. Their motives include 279

greed and vanity to show affluence. Many collectors do not collect for love of art but because 280

they believe it is a good investment. They hold on to it then sell it at a higher profit or make a 281

charitable donation at an appreciated fair market value and enjoy the tax benefits. A true patron 282

of the arts would have taken responsible measures to protect their investment and ensure that a 283

work is exactly what it purports to be.284

58

Statement of Morgan Walden

My name is Morgan Walden. I reside at 2010 Roberts Road, Roxbury, Iowa. I am 56 1

years old and am the granddaughter/grandson of Bob Ross Alcott and Abigail White Alcott. I 2

am also the personal representative of the Estate of Maggie White Walden, my mother. 3

My grandfather knew the artist, Emerson Colline, quite well. The painting that is the 4

basis for this lawsuit, Fishing at Dawn, was given to my grandfather as a gift back in 1927. My 5

grandfather owned a small farm retreat in Southern Indiana in Monroe County. In the early 6

twentieth century, there were artists that grouped together with common interests in painting 7

landscapes in the Impressionist style. These artists formed small art communities in towns and 8

rural areas where the cost of living was reasonable, yet they were close enough to a big city to 9

sell their paintings. Monroe and Brown County, Indiana were ideal for them because they had 10

a perfect setting for their landscapes to paint. One of those art communities formed near my 11

grandfather’s property. The group was known as the Hoosier Group and was still flourishing 12

in the mid to late 20’s and even into the 1930’s. 13

My grandfather’s property was mostly farmland. It had haystacks which were quite 14

popular to paint among impressionists, both European and American artists. Several of the 15

painters liked to paint the haystacks on the farm, as it reminded them of some of their European 16

counterpart paintings. His property also had a lake and a wide sweeping landscape, two other 17

favorite subjects for Impressionists. Grandpa often entertained me with his stories of the artists 18

on his farm. Grandpa would let the artists set up their open air painting clinics on his property 19

– by the haystacks or near the lake. The artists were welcome any time and were free to come 20

and go on his property as they pleased. Some of the artists even captured my Grandpa and 21

Grandma in a snapshot of their day-today life, whether it be fishing, or relaxing by the lake, or 22

working the farm. 23

My grandfather also had an extra building on the property that he used on occasion for 24

hired hands on his farm. When the Depression hit, many of the artists were no longer able to 25

support themselves as many of the wealthy individuals who had been buying the artwork had 26

lost significant money in the stock market crash and with banks that failed. My grandfather 27

59

would share food from his table to many of the artists, whom he had come to know when they 28

painted at his farm. He also paid some of the artists for lessons. Grandpa Bob Ross wanted so 29

badly to paint, but other than perfecting puffy clouds, he didn’t seem to have much aptitude. I 30

still have a couple of his paintings – worthless, except to me as a memory of my grandfather. 31

Emerson Colline was one of the artists and insisted that Bob Ross accept one of her 32

works. She gave him the painting she called Fishing at Dawn. I never questioned the 33

authenticity of the painting. My Grandfather knew Colline and received the work directly from 34

her. Colline's days were filled with plein air painting along the lakefront of Lake 35

Lemon. Colline usually set up her easel and materials in a secluded area by the water, quietly 36

developing her interpretation of the movement of the water, the light of the day, and the 37

subjects' intensity in their tasks. She never asked my grandparents to pose for a painting, but 38

rather would try to fade into the background creating a very natural snapshot of life. 39

My grandfather lived a simple life and had few possessions. Mother received the 40

painting after my grandfather passed and it was prominently displayed in her home in 41

Roxbury, Iowa, to which she moved after her marriage into the Walden family. She did not 42

have an appreciation for its value, artistic or monetary. To her the painting was valuable for 43

sentimental reasons because it reminded her of “home” and of the simple, easy summers, 44

relaxing around the lake and enjoying fishing at dawn. 45

In 1994, the T.C. Steele Museum in Brown County, Indiana had a Special Exhibit 46

Celebrating the Works of Emerson Colline. Prior to that time, no one had inquired into the 47

Fishing at Dawn painting. It had been our little family secret. When it was exhibited at the T.C. 48

Steele Museum, the curator remarked what a wonderful painting we possessed. There was also 49

quite a lot of hype in the art community about the Emerson Colline collection at the museum. It 50

was then that I realized the painting may have had some value. 51

Shortly thereafter, I convinced my mother to have the Colline painting appraised. The 52

appraiser provided a very low appraisal ($75,000), stating that the painting did not have 53

sufficient provenance to properly authenticate it. We were disappointed that the appraisal had 54

not been better. But the appraiser offered to “take it off our hands” for the “discounted” 55

appraised value. We decided to keep the painting, again for sentimental reasons. I later found 56

60

out that this is one of the scams that shady characters practice in the art world. Appraise it low, 57

then buy the painting from you and sell it high to someone else. Any appraiser that appraises a 58

painting, and then attempts to buy the painting, has an inherent conflict of interest. I no longer 59

have that appraisal. I ripped it up once I found out it was a scam. 60

There were a few other occasions my mother would loan the painting to museums or for 61

special exhibits on American Impressionism. She did so rarely, though, and only for short 62

periods of time, preferring instead to keep the painting in her home as a pleasant reminder of 63

her youthful days. Again, whenever the painting would be exhibited to the public, the museum 64

curators or special exhibitions remarked as to the jewel of a painting that we had. We loved the 65

painting but did not realize how special it was until later. 66

Emerson Colline’s paintings are quite collectible because she is one of only a few female 67

American Impressionism painters. Also, much of her artwork was destroyed in a fire in 1927. 68

She had given my grandfather the painting only a couple of months before the fire. He offered 69

to give it back to her after the fire, but she wanted him to keep it. Not long after the fire, Colline 70

stopped painting in the American Impressionist style because that was not selling during the 71

Depression and World War era. She transitioned to Modernism. However, most collectors are 72

more interested in Colline’s American Impressionism paintings than in her Modernist work. 73

Our family used to have a photo of Emerson Colline on the farm with her easel set up 74

painting the landscape. We also had a photo of my grandparents and Emerson in the front 75

parlor with the three of them standing next to the picture. The painting had been given to my 76

grandfather as a birthday gift. I didn’t know what had happened to those photographs until 77

this lawsuit. Now I know that the photos were given to Bryce Cutter and subsequently 78

destroyed in a fire. I wish Mother had made copies before handing over the photographic 79

originals. I’ve looked through my grandparents’ belongings to see if there were negatives of the 80

photos kept but was not able to find anything useful. 81

The painting does have provenance. I can verify, of course, that the painting that is the 82

subject of this lawsuit is the painting that Emerson gave my grandfather so long ago. He kept it 83

in his home until it was passed down to my mother. My mother also kept it in her home, except 84

for a few exhibitions. I can verify that there were photos taken of the painting with Emerson 85

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and my grandfather. Cutter can corroborate my statements. The museum exhibitions also 86

establish the painting’s provenance. The museums and special exhibitions were thrilled to 87

have the Colline painting on display with the rest of their American Impressionism or Hoosier 88

Group collections. There was never any question as to its authenticity when the painting was 89

displayed at these exhibitions. There are, however, no stickers or stamps on the frame to 90

establish its presence and acceptance at the exhibitions. My mother was not necessarily 91

interested in provenance and did not want anyone touching her painting and somehow 92

damaging it. Admittedly, I’m no art expert, but the painting sold at the auction was identical to 93

the painting I saw every day growing up. 94

My mother met Bryce Cutter of Charity Operations Network at one of the Special 95

Exhibits where the Fishing at Dawn was on special display. Then, in Spring of 2008, Cutter 96

arrived at my mother’s home and they discussed the possibility of a charitable contribution of 97

the painting. My mother had always talked about a lasting legacy, but we never had much 98

financially to contribute. After Cutter tried to persuade my mother to give up our one and only 99

heirloom, my mother said she would think about it. I was present at the time of these 100

discussions. Cutter took the opportunity to examine the painting. He/she appeared to examine 101

the painting very closely. Cutter used a magnifying glass and looked at it inch by inch. Cutter 102

said it was consistent with other paintings by Colline, including style, color, techniques, and 103

brushstrokes. He/she also said the signature appeared to be authentic. Cutter mentioned it was 104

in very good condition and, unlike many other paintings, had not been heavily restored. 105

Cutter noted something a bit obscure in the painting and looked at it for a very long time using 106

the microscope. When I asked what he/she noted, he/she said, “Oh, it’s probably nothing.” 107

And then I think Cutter said, as he/she muttered under his/her breath, “Is it just me, or is this 108

out of place in this boat?” But he/she could have said “Is it just me, or could you just take a 109

place in this boat?” noting perhaps Mother’s resemblance to the people in the boat. I think 110

Cutter later satisfied himself/herself that there was nothing suspicious in the painting. 111

Otherwise, why would he/she fight so hard for it when we contested the bequest in the will? 112

My mother passed away in May 2015. Unbeknownst to me, my mother had changed 113

her will. She included a specific bequest to donate the painting to Charity Operations Network 114

62

for the auction for the Thomas J. Levis Caring Hearts Children’s Hospital Foundation’s Gala & 115

Charity Auction. 116

After mother passed, I had another appraiser take a look at the painting. The second 117

appraiser saw it for its worth and provided a Certificate of Authenticity. I did not ask for a full 118

written appraisal and I did not receive one. When the painting went through the auction, the 119

Certificate was attached to the back of the painting and was available for anyone at the auction 120

to review it prior to the auction. Exhibit 4 is a true and accurate copy of the Certificate of 121

Authenticity. 122

Mother was often confused in her later years. When I discovered that her Will left the E. 123

Colline painting to the Charity Auction I was convinced there was undue influence. It would 124

be an understatement to say that I was upset that a priceless Colline painting had been taken 125

from the family. I litigated the matter against Bryce Cutter. We finally settled by striking a deal 126

with Cutter. The silver lining, I guess, was that I was able to enjoy the artwork in my home for 127

the year that the litigation was pending. 128

When we didn’t succeed in litigation, my siblings and I decided to attend the auction. 129

We thought we might have a chance to be the successful bidders on the painting. Too bad we 130

weren’t lottery winners. We pooled together our resources and came up with $123,500. We 131

actively participated in the bidding at the Thomas J. Levis Caring Hearts Children’s Hospital 132

Foundations Charity Auction, until the bidding rose above the resources we had pooled. I was 133

happy Kelly Crown was the successful bidder. Crown seemed to care more about the painting 134

than showing his/her affluence. The other two primary bidders, an investment firm and a 135

wealthy Chicago businessman were more interested in the painting as an investment than as a 136

work of art to enjoy. 137

I was very tuned into everything Cutter said about the painting to the attendees because 138

for me it was personal, - it wasn’t just a “thing” to acquire. I wanted to make sure that Cutter 139

did not misrepresent the painting’s importance and our family’s involvement. I can say with 140

absolutely certainty that Cutter did not make any statements about the painting being 141

authentic, and Cutter did not mention the Certificate of Authenticity that I had provided. I 142

thought that was unusual, but the bidding started quickly and continued back and forth like 143

63

rapid-fire that he/she just didn’t have time to mention it or didn’t need to mention it. It seemed 144

with the bids going the way they were on that painting, there was no cautiousness by the 145

bidders that the painting was anything but the genuine article, or in this case an original, 146

Emerson Colline American Impressionist landscape/water scene. 147

I’ve accepted now that it was my Mother’s wish for the painting to be sold at an auction 148

so that she could benefit some worthy charity. I know she would be happy to know that the 149

proceeds will help build a pediatric neurosurgery wing for the Children’s Hospital. Her estate 150

is now closed. 151

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Statement of Evelyn Pears

My name is Evelyn Pears. I am 76 years old and reside at 36 Owl’s Head Drive in Des 1

Moines, Iowa. At 76 years old, I have accumulated a vast knowledge of the fine arts. I am a 2

renowned art appraiser with 50 years of experience, specializing in all forms of Impressionist, 3

Post-impressionist, and Modern Art. I am an Accredited Senior Appraiser of fine art. The 4

American Society of Appraisers (ASA) confers the Accredited Senior Appraiser designation to 5

an individual who has a four-year college degree, at least five years of full-time appraisal 6

experience, and has passed a set of four principles of valuation courses which lay the 7

foundation for the remainder of the accreditation process. I am also a Life Member of the 8

Appraisers Association of America. The Appraisers Association of America, Inc. is the oldest 9

non-profit professional association of personal property appraisers with over 700 members 10

across the country and the world. Most members of AAA are personal property appraisers 11

specializing in one or more of over 100 areas of specialization. A Life Member is an appraiser 12

with a distinguished career like me, that is 75 years or older, has been a member for 25 years or 13

more, and adheres to Uniform Standards for Professional Appraisal Practice (the USPAP). 14

Exhibit 8 is a true and accurate copy of my curriculum vitae. 15

I consider myself a connoisseur of fine art. A connoisseur is someone with expert 16

knowledge and training, especially in the arts. An expert develops familiarity with an artist’s 17

style by seeing and studying his or her works. Connoisseurship is not a genetic gift but rather 18

a lifelong pursuit that develops and matures. It is an acquired status. It must be cultivated 19

through proper training and experience. The connoisseur or expert, through this lifelong study 20

of the artist, knows the artist’s brushstrokes, the application and thickness of the paint, the way 21

the artist paints certain objects or recurring themes, and the “feeling” the artist conveys through 22

the painting. 23

Unfortunately, there is no national or international standard as to who can be called an 24

expert. There are many poseurs who purport to provide an opinion on art, but they have no 25

formal education necessary to understand the nuances and intricacies of fine art. Experience 26

may not be substituted for a qualifying education. Likewise, I do not intend to imply that 27

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formal training is all that is required to become an expert in the art world. I believe that art 28

history graduates and art historians do not have the requisite connoisseurship. I have worked 29

with many professionals who have a Masters or even a PhD as art historians, and I have found 30

their skills to be lacking in proper techniques of assessing the authenticity of artworks. They 31

may be familiar with an artist's background, the history of a particular painting or style of art, 32

but they do not have true appreciation for the nuances of an artist’s style nor how to detect 33

fakes and forgeries. They can't name painting techniques, let alone identify them by sight. 34

Seven hundred hours of personal property appraisal experience in an area of specialization is a 35

basic necessity. 36

Of course, my experience as a museum curator, owner of an art gallery, and art 37

appraiser, in addition to my formal education and training, provide me with valuable 38

knowledge and the ability to discern more about an artwork's materials, style, and 39

workmanship. Over many, many years, I have cultivated relationships with artists, gallery 40

owners, and aficionados in the art industry. I also was fortunate to grow up in a family of 41

professional artists and museum administrators. 42

My appraisal business has slowed greatly. Unfortunately, there are no licensing or 43

regulations to recognize true professionals. Even private buyers and sellers, as well as those 44

needing insurance, use the internet to do it themselves. The widespread use of the internet 45

along with ignorance is responsible for the downturn in the appraisal business. Online 46

brokerage sites are the source of much of the ignorance prevalent in the art market. People 47

posting offerings rarely have professional help and are frequently asking prices that they have 48

made up or obtain from some other unreliable source. No one in the chain really has enough 49

experience or understanding to evaluate the information and know what is reality. Many 50

appraisers even fall victim to the idea that everything can be found on the internet and they 51

don’t do the in-depth research and analysis that would provide a full understanding of the 52

market for a particular art piece. 53

I am dismayed when a colleague’s office does not contain a full library. Scholars are 54

expected to have books, and to use them! Professional appraisals of artwork are based mostly 55

on consideration of comparables. It is my opinion that almost no nonprofessional can make 56

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reliable comparisons with comparables. Art is sold “as is” and a comparable found in an 57

online offering may be in a different condition from the art being researched. It also may have 58

been restored poorly or heavily. Furthermore, the comparable may be from a different period 59

in the artist’s work and may or may not be as desirable. Nonprofessionals also know nothing of 60

the effect on value of provenance, even if relying upon the owner of the piece. Sometimes it 61

takes many years for art owners to find out what they really have and what its true value is. 62

One who does not possess the market experience and connoisseurship of an appraiser has no 63

more chance of accuracy than one who self-diagnose without a medical education. Even more 64

dangerous is the smartphone application that instantly connects with auction house databases. 65

An individual can obtain information about recent sales and upcoming events. The buyer may 66

be pleased they have saved the cost of an appraisal, but they have not obtained information that 67

is reliable. 68

An appraiser is an advocate only for the appraiser's process and conclusions, never 69

directly the interests of a client. An appraisal should consider five attributes of a work of art – 70

(1) provenance, (2) authenticity, (3) exposure (4) condition, and (5) quality. 71

A proper appraisal report should tell everything you know, then tell everything you don’t 72

know, and contain a commentary that guides the client through your process and the information 73

relied upon to reach your conclusions. It is imperative that any appraisal report follow the 74

Uniform Standards of Professional Appraisal Practice (USPAP). The USPAP provides that an 75

appraisal report should include: 76

(1) Sufficient characteristics to establish identity; 77

(2) Sufficient characteristics to establish quality of the item 78

(3) All other physical and economic attributes with an effect on value. 79

An appraisal report does not guarantee authenticity. Rather it serves as a vehicle for the 80

appraiser’s opinions. As appraisers, even though we are not authenticators, we need to take 81

steps to demonstrate the due diligence in establishing the probable authenticity of an art piece. 82

An appraiser needs to consider the question of authenticity when red flags pop up in our 83

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identification of a work of art. When we know there is a plethora of counterfeits in the market, 84

it is incumbent upon us to ask the right questions to the right people to serve our client and to 85

protect ourselves. 86

Determining the authenticity of a piece may be the most difficult of all functions an 87

appraiser has to perform. Many appraisers would agree that they are not the ones to make the 88

primary determination. An authenticator is a scholar with extensive experience, specializing in 89

a highly specific narrow field. For this reason, appraisers often rely on third-party sources as 90

authenticators. Such third-party sources include auction houses, dealers, famous scholars, 91

museum curators, friends and family members of deceased artists, or if you are lucky enough to 92

have one, a catalogue raisonne. A catalogue raisonne is designed to list and often illustrate all 93

the works by an artist considered to be genuine. Unfortunately, one is rarely available for every 94

artist. Catalogues take an enormous amount of time and money to produce. There is no such 95

catalogue for the work of E. Colline. 96

An important tool in providing an opinion of authenticity is the provenance, or the 97

history, of the work of art. The provenance may include a list of previous owners, exhibitions, 98

and any printed references. Although it is just another tool, it may be important because it 99

gives evidence that others have accepted the work as being what it appears to be. In other 100

words, it provides a pedigree of sorts. Documents that provide provenance must be carefully 101

evaluated to confirm their authenticity. The appraiser’s job in checking provenance is never 102

simple or easy, but a good faith effort must be done as part of the appraiser’s responsibility to 103

give an opinion of authenticity. Any report by an appraiser should be recognized as an opinion 104

of authentication, not a statement of fact. 105

In the two decades that I was a museum curator, I must have examined 100,000 works 106

in all fields. About 40% were fakes or poorly restored, or misattributed. I suspect forgeries 107

have risen since I left my positions with the museums. Fakes exist at every level of the art 108

market. I may be the only museum curator that has not been duped by a forger. There have 109

been no pieces of art in my museums or art appraised that have ever been found to be a fake. 110

Fakes are created in different ways. Some are copies of reproductions of existing works 111

with forged signatures. Others are pastiches that are created from assembling a variety of 112

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images that are copies of the originals so that the fake includes identifiable aspects of a master's 113

work. Others are just complete fabrications that appear to be the same style as the masters. 114

Buyers of artwork can be fooled in many ways. Often a buyer relies too much on the 115

person selling the piece. Although the buyer may know that that an auctioneer's job is to sell a 116

painting, they somehow believe that the auctioneer knows a lot more about art, and therefore 117

should be trusted. Every buyer of art should maintain a healthy level of suspicion regarding 118

any purchase. It is advisable to get a money back guarantee from an auction company, or at 119

minimum, have an independent appraiser with the requisite training and experience evaluate 120

the piece and confirm its authenticity prior to making the purchase. 121

I was retained by Kelly Crown to appraise an oil on canvas painting in the American 122

Impressionist style by Emerson Colline painted in 1927 and called “Fishing at Dawn.” Crown 123

stated that the purpose of the appraisal was to have a valuation for purposes of insuring the 124

painting. Crown explained to me that he/she was a novice of fine arts but had recently won the 125

lottery and had been invited to a charity art auction. Crown stated that he/she had purchased 126

the Colline painting at the charity auction and had not sought out an expert opinion prior to 127

bidding on the painting or purchasing it. Crown stated that other wealthy individuals had 128

experts with them at the auction who had evaluated the piece, and those same people 129

participated in bidding on the Colline piece. 130

I arrived at Crown’s home at 8:30 a.m. promptly on November 3, 2016 to appraise the 131

painting. I was fully equipped with the tools of my trade, including, of course, my books. I did 132

not complete my examination until 4:15 p.m., taking only short breaks, and stopping only for a 133

light lunch. As I mentioned, there are five things that an appraiser needs to evaluate to form a 134

proper opinion for an appraisal - (1) provenance, (2) authenticity, (3) exposure (4) condition, 135

and (5) quality. I like to end with provenance because I don’t want my knowledge of the 136

history of a painting to somehow sway my opinion of the other aspects I am evaluating. To 137

determine authenticity, exposure, condition and quality you have to thoroughly examine the 138

painting. Artworks must be thoroughly analyzed; otherwise mistakes are made regarding 139

attribution, or misreading a signature, or missing problems or conditions that impact value. 140

The first thing I do to evaluate a painting is to stand back and look at the overall 141

69

painting. Sometimes the “Big Picture” is worth a thousand words. You need to be able to see 142

the forest for the trees - literally. 143

The appraiser is looking for consistency of style, techniques of paint application, 144

consistency with blending and use of colors. The problem with most so-called art experts is 145

that they become fixated upon certain characteristics of a particular artist's style or themes. 146

However, with some artist's such as Colline, there are no absolute rules. Every time one sees a 147

pattern, it is only a matter of time before exceptions are discovered. There is one rule that I 148

have confirmed over and over, and that is that there is no absolute rule. Colline's spontaneity in 149

her paintings shows that an image flowed out of her head and onto the canvas with little 150

evidence of the work being done in steps. Colline did not sketch out a painting then go back 151

and complete the image. In an oil painting a "sketch" appears as outlines of images that were 152

painted, then painted over. A raking light will reveal the underlying image as barely 153

discernable ridges, called impedimenti. Curators and other art experts who examine Colline's 154

work may look for primo pensiero (the artist's first thoughts), but that supposition would be 155

incorrect. I have never seen them in Colline's work. If I do see preliminary work beneath a 156

drawing or painting, it creates suspicion that the work may not be genuine. 157

Art dealers, appraisers, or other so-called art experts, in my opinion, rarely look closely 158

enough at an artwork. Examining antique paintings requires the use of magnification. You 159

want to see every aspect of the painting to understand and determine its age, quality, materials, 160

and probable value. I use the OptiVisor magnification device. I wear the OptiVisor on my 161

head and have interchangeable lenses for various different magnification strengths. I have a 162

10x, 15x and 30x. I have learned more about pieces of art through my OptiVisor than any other 163

way. If an appraiser, dealer or auctioneer doesn't use magnification, I believe you can't trust 164

their opinions. If I were deemed the czar of appraisers, I would make training in the use of 165

magnification equipment a standard part of all professional development for people who deal 166

with art. 167

The painted surface should be examined closely. Although I noticed a bit of 168

differentiation in the shadows of the trees on Colline’s painting, it appeared that the painting 169

had been cleaned and the varnish removed and replaced. I noted this minor issue on my 170

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appraisal. I did not view this issue to affect this value of the painting, which was in excellent 171

condition otherwise. We also look for damages such as wormholes, fungus, or places where the 172

paint is peeling. A thorough appraiser will examine a painting for craquelure, the natural web 173

of cracks that occur on the surface of paint as it expands and contracts due to changes in 174

humidity and weather. Then we determine if it is consistent with the age of the piece. 175

I did not see the need for the use of an ultraviolet light when examining Colline’s 176

painting. There were no suspicious pigments, colors, or blending that I observed through 177

magnification that I needed to determine if there was fluorescence. Sometimes, the ultraviolet 178

light will reveal fluorescence on the painting. That might suggest that a more modern pigment 179

had been used. However, fluorescence doesn’t necessarily indicate the painting is a forgery. 180

Sometimes, it only shows that some heavy-handed restoration had taken place. In this instance, 181

the pigments in the painting were consistent with what was used in the 1920’s, so there was no 182

need to explore the pigments further. 183

After the physical examination, I reviewed the provenance of the painting. It is 184

important to look at who owned the painting, how they came about owning it, who has 185

examined the painting previously, and if there have been any questions in its past regarding its 186

authenticity. Often the more a painting has changed ownership or hands, the more suspect one 187

must be. On the other hand, if an antique painting has never been seen or heard of previously, 188

the red flags should go up. Too often people are duped by the garage sale or thrift store find of 189

an Old Master. It is extremely rare for an Old Master not to have some established record of 190

ownership. 191

After my complete and through examination, I determined that, in my expert opinion, 192

the Emerson Colline Fishing at Dawn painting owned by Kelly Crown is authentic and is in 193

excellent condition. I do not issue a Certificate of Authenticity when I perform appraisals. 194

Unless a certificate of authenticity originates from, and is signed by, the artist who created the 195

art, that certificate is pretty much meaningless. A Certificate of Authenticity attempts to 196

guarantee a painting is authentic, whereas an appraisal is an opinion as to its authenticity with 197

delineated facts to support that opinion. No one can provide a 100% guarantee that a painting 198

is authentic, other than the artist herself. 199

71

Based upon my analysis of the Colline painting, I valued it, for insurance purposes, in 200

the amount of $575,000. Exhibit 5 is a true and accurate copy of my appraisal. It is the regular 201

practice of my work as an appraiser to make such records. The appraisal was created by me at 202

or about the time that I performed my appraisal services. The appraisal is kept in the course of 203

regularly conducted activity of my appraisal, and I am the custodian of such records. 204

I advised Kelly Crown that he/she needed to have it re-framed, cleaned and re-touched 205

to restore its beauty and increase its worth. I recommended Rene Beltracchi because of his/her 206

expertise with Colline’s work. If anyone could restore the picture without blemishing it and 207

make it look like the artists’ own strokes, it would be Rene. I recommended Beltracchi because 208

he/she is an expert in American Impressionist work and is renowned throughout the country 209

and even abroad for his/her precision. I question now, however, whether that recommendation 210

was the right decision in light of the accusations that the painting is a fake. 211

I unequivocally stand by my opinion that the artwork purchased by Kelly Crown at the 212

Charity Auction on September 10, 2016 is authentic. Rene Beltracchi is questioning my 213

integrity and reputation. I find that to be disconcerting. In the past, I had a modicum of respect 214

for Beltracchi. We crossed paths on prior occasions to assess the authenticity of certain artwork. 215

We have always come to the same conclusions of authenticity and attribution. This time, 216

however, Beltracchi is just wrong. I have far more expertise, training and knowledge. 217

Beltracchi lacks the credentials to question me. Rene Beltracchi’s complete lack of any formal 218

training, in my opinion, disqualifies him/her of any valid opinion regarding contradicting my 219

opinions. A true art expert, like me, will detect flaws, shortcomings, authenticity issues, that 220

others will miss. And quite frankly, one has to question why Rene Beltracchi would 221

intentionally claim a piece is a fake when I know, for a fact, that the painting I saw is the real 222

deal. I question Beltracchi’s motives, given his/her history of the life of crime. As Mark Twain 223

so eloquently said, "You can straighten a worm out, but the crook remains in it." 224

Unfortunately, I am unable to determine whether the painting in court is the same 225

painting as the painting that I observed at the home of Kelly Crown on November 3, 2016. Six 226

months ago, I was diagnosed with macular degeneration, which is the deterioration of the 227

central portion of the retina, the macula. The macula is responsible for focusing central vision 228

72

in the eye, and it controls the ability to read, recognize faces or colors, and see objects in fine 229

detail. In the early stages, macular degeneration does not affect vision. But, as the disease 230

progresses, people experience wavy or blurred vision. 231

I had no blurred vision or any signs of the macular degeneration at the time that I 232

appraised Fishing at Dawn in November 2016. My vision has not deteriorated rapidly. I 233

currently have some slight haziness with my vision and blind spots in the central part of my 234

vision. I am simply unable to see the fine detail that I would normally be able to discern. 235

Unfortunately, this ended my career as an appraiser and takes away one of the most enjoyable 236

aspects of my life. Nothing can be done to reverse the progression of the disease. I still have a 237

vivid image and recollection of the painting that I appraised, as well as my thorough appraisal. 238

Given my inability to continue the sight-dependent work due to my macular 239

degeneration, my income was abruptly halted and my medical expenses increased significantly. 240

Unfortunately, I had little cash reserves to cushion the blow due to the downturn of the use of 241

appraisers as a consequence of the misguided use of the internet for values for fine art. Facing 242

this financial crisis, I found it necessary to file for bankruptcy and any claims that Kelly Crown 243

may have had against me are discharged. 244

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EXHIBITS

74

Exhibit 1 (1 of 4)– Charity Auction Art Catalogue Excerpts THOMAS J. LEVIS CARING HEARTS CHILDREN’S HOSPITAL FOUNDATION ART AUCTION September 10, 2016 Read this simple guide to buying at auction. If you still have questions, more information can be found in the All You Need To Know section at the back of this catalogue. We strongly encourage you to read these sections as they set out the terms on which property is bid for and bought at our sales. BROWSING Browsing our catalogue is a great way to discover more about what’s available at the Thomas J. Levis Caring Hearts Children’s Hospital Foundation Art Auction. Seven (7) days prior to the event, all artwork on sale will be on view. Feel free to drop in and visit our gallery, open seven days a week. DESCRIPTIONS Art descriptions cover basic catalogue information such as size, date or age, medium, type, and attribution. ESTIMATES Estimates are given for all lots and are based on prices recently paid at auction for comparable artwork. Estimates take into account rarity, condition, quality and provenance. TALK TO OUR SPECIALISTS who will always be happy to discuss the lot in greater detail. Our Specialists are available by appointment. CONDITION REPORTS Descriptions provided in our catalogue do not include complete condition reports. The absence of a qualification of the condition does not imply that the lot is in perfect condition or completely free from wear and tear, or other imperfections. Interested bidders are strongly encouraged to request a condition report on any lots upon which they intend to bid, prior to placing a bid. Condition reports are available for all lot descriptions. These supplement the catalogue description and provide guidance on a lot’s condition. VIEW THE LOT PERSONALLY We always recommend coming to our gallery and looking at a lot for yourself, especially in the case of more valuable items. Our viewing rooms are open to the public and are free of charge. SYMBOLS The symbols next to the lot number can indicate a variety of things, such as if the lot has special attributes. There is a key to symbols in the All You Need To Know section at the back of this catalogue.

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Exhibit 1 (2 of 4) – Charity Auction Art Catalogue Excerpts

LOT 39*^

Lot Description Emerson Colline (1873-1933) Fishing at Dawn (Lake Lemon, near Bloomington, Indiana), USA Painted in 1927 signed “E. Colline” (lower left) oil on canvas Framed 29 x 23 in.

Lot Condition Report Good condition, minimal restoration. See condition report for further detail.

Provenance Private collection – acquired directly from the artist, then descent to family T.C. Steele Museum – Special Exhibit Celebrating Works by E. Colline – July 1, 1994 – September 5, 1994 Indiana State Museum – Indiana Landscapes Special Exhibition Aug. 3, 1997 – Oct. 5, 1997 Art Institute of Chicago – By the Lake -American Impressionists Special Exhibition March 24-26, 2000 Milwaukee Art Museum – Special Exhibit American Masterpieces, Oct. 23, 2004 to Jan. 30, 2005 Gotham City Art Museum – Celebration of American Impressionists, September 4 to December 24, 2007 Estimated Value $300,000-$500,000

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Exhibit 1 (3 of 4) – Charity Auction Art Catalogue Excerpts

Pre-Lot Text Emerson Colline, American Impressionist Born in St. Frances, Minnesota, Colline spent the summers of 1899 and 1900 at the Darby School of Painting in Fort Washington, Pennsylvania. Rather than confining artists to a studio, the curriculum encouraged students to paint landscapes en plen air, observing natural life, forms and light. Colline studied abroad for two years in England, Italy and France on a fellowship from the Academy working with European Impressionists. Colline worked with several other American artists while in Europe and developed lifelong friendships, particularly those later known as the Hoosier Group. Colline set up her studio in Brown County, Indiana in 1923. It was this landscape that would remain her inspiration and subject for the rest of her career in American Impressionism. She mainly painted with oil on canvas using a broad spectrum of color for her landscapes. She soon won the patronage of Indiana Governor Warren McCray and wealthy merchants and entrepreneurs, and her career developed in response to the demands of the local market. With the end of the American Impressionism movement, Colline dabbled in Modernism until her death in 1933. In 1927, her studio was engulfed by fire and few of her impressionist landscapes exist in today’s market; the few remaining are in the hands of private collections. Thus, her landscapes are quite collectible and often priceless. The piece exhibited in this auction is from a private collector’s estate – the donor’s wishes to provide resources for the Thomas J. Levis Caring Hearts Children’s Hospital Foundation.

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Exhibit 1 (4 of 4) – Charity Auction Art Catalogue Excerpts (Back of Catalogue for Levis Caring Hearts Children’s Hospital Foundation Gala & Art Auction) All You Need To Know These Conditions of Sale, and the terms contained elsewhere in this catalogue, contain all the terms on which Charity Operations Network contracts with the buyer. These terms may be amended by oral announcements made during the sale. By bidding at auction you agree to be bound by these terms.

Examination of property Prospective buyers are strongly advised to examine personally any property in which they are interested, before the auction takes place. Condition reports are usually available on request.

Catalogue and other descriptions All statements by us in the catalogue entry for the property or in the condition report should be evaluated by personal inspection by the bidder or a knowledgeable representative. The absence of any limited qualifications of the authenticity or quality of the Lot does not imply that an item is free from defects or restoration. The estimate of the selling price is based upon comparisons to similar artwork and may vary depending upon the demand and condition of the Lot.

Buyer’s responsibility Buyers are responsible for satisfying themselves concerning the condition of the property and the matters referred to in the catalogue entry. All items offered are considered for sale “as is.”

Payment And Passing Of Title Immediately following the sale, the Buyer must provide us with his or her name and permanent address and details of the bank from which payment will be made. The Buyer must pay the full amount due (comprising the Hammer Price, Buyer’s Premium and any applicable taxes) within two days after the sale. The Hammer Price is the winning bid for a lot at auction. It is the price upon which the auctioneer’s hammer falls, determining the sale price, but does not include the Buyer's Premium. The Buyer’s Premium on each lot is 20% of the Hammer Price. The Buyer will not acquire title to, or receive delivery of, the lot until all amounts due to us from the Buyer have been received by us and have cleared the Bank. Delivery For Iowa deliveries, we will transport your Lot purchase to Buyer’s address within thirty days upon confirmation that payment has transferred, free and clear to Charity Operations Network. For deliveries outside the State of Iowa, Buyer is responsible to make arrangements for delivery of the Lot purchased. The purchased Lot must be picked up from our facility within thirty days from the date payment clears. Symbols The following key explains the symbols you may see inside this catalogue. + Lots with this symbol indicate that Charity Operations Network has an ownership interest in the lot in whole or in part or has an economic interest in the lot equivalent to an ownership interest. * Lots with this symbol indicate that a Certificate of Authenticity is available, at Buyer’s request, for the lot. ^ Lots with this symbol indicate that parties with a direct or indirect interest in the lot may be bidding on the lot, including (i) the beneficiary of an estate selling the lot, or (ii) the joint owner of a lot. If the interested party is the successful bidder, they will be required to pay the full Buyer's Premium. In certain instances, interested parties may have knowledge of the reserve.

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Exhibit 2 – Painting

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Exhibit 3 - Sales Receipt

Charity Operation Network 6221 Roberts Circle

Gotham City, IA

Sales Receipt

Receipt # 234678 Date: 09/10/16 Event: Thomas J. Levis Caring Hearts Children’s Hospital Foundation Art Auction Successful Bidder/Buyer Name: Kelly Crown Address: 36829 Crown Place, St. Charles, Iowa Bank Account: Tenth Bank & Trust, Account # XXX-XXXX-0007 Wire Transfer Authorization #: XXXXX16980 Purchase Price Hammer Price: $455,000.00 Buyer’s Premium: $ 91,000.00 Iowa Taxes: $ 38,220.00 Total Purchase Price $584,220.00 Lot Description Artist: E. Colline Title: Fishing at Dawn Medium: Oil on Canvas Canvas Size: (h) 23” (w) 29” Year of Creation: 1927 Details of Inscription on the Artwork: Position: Lower Left Artist signature: E. Colline Auctioneer Signature: B. Cutter .

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Exhibit 4 - Certificate of Authenticity

Certificate of Authenticity (Limited)

Artist: Emerson Colline (1873-1933)

American Impressionist Title: Fishing at Dawn Medium: Oil on Canvas Canvas Size: (H) 23” (W) 29” Year of Creation: 1927 Details of Inscription on the Artwork: Position: Lower Left Artist signature: E. Colline Condition: Heavy restoration work Provenance: Private collection. Acquired directly from the artist, by descent in the family to the present owner Appraisals Ready Today, LLC By: Thomas Haverford, AAA, ASA Signature: Thom Haverford . Dated: June 29, 2015. This document certifies that the artwork described above is, to the best of our knowledge, an original artwork created by the Artist. All statements as to the (presumptive) artist, origin, date, age, genuineness, source, provenance, and condition are statements of opinion only and shall never imply any guarantee.

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Exhibit 5 (I of 3) – Appraisal

APPRAISAL Evelyn Pears, ASA, AAA

Date of Appraisal: November 5, 2016 Date of Field Examination: November 3, 2016 Equipment Used: Magnifying Optivisor, 10x, 15x, 30x; Raking Light, Ultra Violet Light Owner: Kelly Crown Purchased: Charity Operations Network – Charity Auction for Caring Hearts Children’s Hospital Fdn. Date Purchased: September 10, 2016 Other Appraisals?: No Artist: Emerson Colline (1873-1933)

American Impressionist, Hoosier Group Painting: Fishing at Dawn Location: Lake Lemon, near Bloomington, Indiana, USA Date of Painting: 1927 Type: Oil on canvas Framed: Yes, original frame Size: 29” x 23” Signature: signed “E. Colline” (lower left) – no appearance of stopped or broken strokes, consistent with signature of artist

Provenance: Private collection – Emerson Colline gave the painting as a gift to Bob Ross and Abigail White Alcott in 1927. The painting has remained in the family ever since. The painting was passed down by descent to Maggie White Walden, the daughter of Bob Ross and Abigail. Maggie passed away in May 2015 and the painting has been in the possession of Maggie’s son/daughter Morgan Walden. Painting has been bequeathed for the Caring Hearts Children’s Hospital fundraiser. Will contest resulted favorably for Hospital and Auction Company This painting has been displayed at various museums and special exhibitions. No sticker or stamps appear on the back of the frame, per the restrictions placed by owner. The following museums and exhibitions have accepted this painting as authentic. T.C. Steele Museum – Special Exhibit Celebrating Works by E. Colline – July 1, 1994 – September 5, 1994 Indiana State Museum – Indiana Landscapes Special Exhibition Aug. 3, 1997 – Oct. 5, 1997 Art Institute of Chicago – By the Lake -American Impressionists Special Exhibition March 24-26, 2000 Milwaukee Art Museum – Special Exhibit American Masterpieces, Oct. 23, 2004 to Jan. 30, 2005 Gotham City Art Museum – Celebration of American Impressionists, September 4 to December 24, 2007

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Exhibit 5 (2 of 3) – Appraisal Description of observations regarding style and techniques:

Colline's landscapes generally reach to the farthest horizon rather than be closed in. By extending the

horizon, Colline created a foreground, a middle ground and a distant background. The juxtaposition of

the gray tones of the sky and the morning crispness of the blue waters contrasting with the rich,

saturated hues of the trees and surrounding landscape is consistent with Colline’s style.

Colline's landscapes were almost always painted starting with dark and moving toward light, especially

for a thickly vegetated woodland scene. This allowed her to add several layers of graduated lighter

values over the dark masses building the density and creating depth. Colline seldom painted only lush

green foliage. She liked to see some branches that alluded to the architecture in the trees, and the

subtle changes of the seasons as depicted with the changing color of the foliage and the loss of leaves

on the branch above. The Fishing at Dawn painting is consistent with Colline’s approach.

Movement fascinated Colline, as much as light. In Fishing at Dawn, the two subjects ready themselves

for their days' catch. The rippled surface of the water contrasts and merges with the subjects' calm

preparations. The painting's dramatic impact of movement is heightened by the contrast of the radiant

color of the one subject's red jacket.

Like most American Impressionists, lighting is a critical element to Colline's work. The American

Impressionist style uses light to show that nature is a reflection in one way or another of everything

around it. Colline used sunlight to create a sense of wholeness by recognizing all of the direct and

indirect light sources. During the final phase of painting, Colline went over the entire picture, lightening

areas and adding gleams of light. She also added warm and cool colors to show reflections coming from

the sky or bouncing off nearby sunlit surfaces. The painting is consistent with this style and technique.

No evidence of impedimenti or primo pensiero, consistent with Colline’s approach to painting en plein

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Exhibit 5 (3 of 3) – Appraisal

Description of observations regarding paint tones and pigments:

The paint tones of the trees and other vegetation were consistent with a Colline painting. Sometimes

you can detect a forgery when the forger uses pigments that were not invented during the artist's

lifetime. In this case, the pigments used were all consistent with the period when Colline would have

created the painting.

The blue gray sky, notably have tonal gradations. Tonal value can often be difficult to discern when

working with low intensity earth colors and more highly chromatic cadmiums on the same

palette. Cadmium pigments are known for excellent light-fastness. The paler shades can fade with

exposure to sunlight. Cadmium was discovered in 1817 but production was delayed until 1840 because

the metal was scarce. It is still in use today. However, it has been replaced by some artists in more

recent years with azo pigments. There was no evidence of azo pigments in this painting.

Condition Needs to be reframed. Excellent condition, minimal restoration. No damages such as wormholes, fungus, or places where the paint is peeling noted. The cracks of the paint were consistent with the age of the painting and were not re-created through painting cracks into the piece. Appears that the painting had been cleaned and the varnish removed and replaced. This issue should not affect value of the painting, which is in excellent condition otherwise Assessment: In my opinion, the Fishing at Dawn painting is authentic and is in excellent condition. Appraised value: $575,000 Recommendations: re-frame, clean and re-touch to restore its beauty and increase its worth THIS APPRAISAL IS NOT A CERTIFICATE OF CLEAR TITLE OR A CERTIFICATE OF AUTHENTICITY.

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Exhibit 6 (Page 1of 3) – Excerpts of Charity Operations Network Website

Charity Operations Network “Sharing Dreams, One Art At A Time”

“I dream my painting and I paint my dreams” – Vincent Van Gogh

WHO WE ARE:

Charity Operations Network is a fundraising company specializing in benefit auctions of fine

art. We help charities throughout the Midwest to raise funds to benefit people and

organizations in need. Bryce Cutter, owner of Charity Operations Network, started as a Benefit

Auctioneer fifteen years ago when a friend asked Bryce, who has a Doctorate in Art History and

a background as an Art Auctioneer, if he/she would do their benefits auction. The auction was

a success (we still do their auction!) and word spread. We now provide our services to over 100

charities and organizations every year.

OUR MISSION:

While our mission statement is not an original like the artwork we auction, we’ve embraced it

and made it our own:

Do all the good you can. By all the means you can. In all the ways you

can. In all the places you can. At all the times you can. To all the

people you can. As long as ever you can. - - Unknown Author

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Exhibit 6 (Page 2of 3) – Excerpts of Charity Operations Network Website WHAT WE DO:

From start to finish, Charity Operations Network organizes and manages your fundraising

event to make it a success and provide a fun and stress-free event for your organization.

We begin by creating the kind of “buzz” that impresses donors and drives up bidding. Charity

Operations Network will publish a sale catalogue that includes information about each artist

and the work of art that's for sale. It is our belief and experience that the more time a potential

bidder has to consider bidding on a particular art piece, the more likely they are to not have any

trepidation about bidding. Also, once attendees to your event realize the quality of the Masters

that you will have at your Fundraising Auction, the more excitement leading up to the event

will build.

On the day of the auction, we will have an experienced auctioneer who is familiar with the art

to be auctioned. The auctioneer will describe each art piece in an informed manner. More

important, our auctioneer will make the event fun, and excite the audience. Our auctioneers are

skilled in encouraging competition among bidders, enticing extra bidding, and convincing

bidders to be extra generous on behalf of the cause and your organization.

NO RISK:

Your success is our success! Charity Operations Network is dedicated to the success of your

event to maximize your fundraising. If you make money, we make money. And you have zero

risk. First, our services are available at no cost to you. Second, we will provide works of art,

with many masters and collectibles available to choose from, on a consignment basis, with no

financial obligation or risk on your part. Items that do not sell at your event will be returned to

us at no additional cost to you. We ship your auction items to you the location of your event,

completely free of charge. If after your event you have any items that didn’t sell, you simply

return them with no charges to you – not even for the cost of shipping! How easy is that?

Rest assured that Charity Operations Network uses nationally known signature authenticators

for any signed item. Many of our items also include Certificates of Authenticity.

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Exhibit 6 (Page 3 of 3) – Excerpts of Charity Operations Network Website

TIPS FOR SELECTING THE BEST CHARITY AUCTION COMPANY

• An auctioneer should be well versed in the artist’s background, style of painting, and the

provenance of the painting. The auctioneer should have notes to describe the art piece a

nd the artist. Keep in mind that the better the art is described, the more the auctioneer cr

eates a desire for the art piece, and ultimately the more money it will add to your organiz

ation’s fundraising needs.

• The Company should display each piece of art as prominently as possible. Attendees at

your event will bid higher if the art looks “rich” in its surroundings. Treat the art piece li

ke it is worth millions - use white gloves and museum quality easels. Prior to the actual

bidding process, display the artworks against white walls in well-spaced partitions. Use

other embellishments to enhance the desirability of the art piece.

• Make sure bidders have information in advance on the artists and the works of art that w

ill be offered at the auction. Allow potential bidders an opportunity to view items up for

auction at least one week in advance, and access to have an item appraised. The more co

mfortable a buyer feels about the value of an item up for auction, the higher they tend to

bid.

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Exhibit 7 - Notes from Auction

#46 Lot #39 Emerson Colline (1873-1933) – Am. Impr. Hoosier Group; high demand – few female Am Imp. & few paintings left – studio fire Signed – lower right; verified as authentic One of few didn’t use pencil sketches under work – work flows, shows natural lighting Fishing at Dawn (Lake Lemon, near Bloomington, Indiana), USA Painted in 1927 signed “E. Colline” (lower left) oil on canvas, Framed, 29 x 23 in. Good condition, minimal restoration. acquired from artist, then by descent to estate - donor gifted to Hospital

Prov.: T.C. Steele Museum – Special Exhibit Celebrating Works by E. Colline – July 1, 1994 – September 5, 1994 Indiana State Museum – Indiana Landscapes Special Exhibition Aug. 3, 1997 – Oct. 5, 1997 Art Institute of Chicago – By the Lake -American Impressionists Special Exhibition March 24-26, 2000 Milwaukee Art Museum – Special Exhibit American Masterpieces, Oct. 23, 2004 to Jan. 30, 2005 Estimated Value: $300,000-$500,000

#1 Introduction – Welcome – Benefit for Thomas J. Levis Caring Hearts Children’s Hospital Foundation

• Recognize Chairman of Foundation, Thomas J. Levis • Recognize Hospital Dignitaries

Goal:

• $ for pediatric cardiology equipment/services for children of Iowa • build a pediatric neurosurgery wing for the Children’s Hospital

Preliminary matters:

• Explain Bidding Process • Payments • Hype all works of Art to be auctioned

o Lots may be in imperfect condition, no guarantees o All Items offered “As Is” o Signatures authenticated by 3rd party independent, nationally recognized o Back of Catalog – take note of symbols that may assist your bidding process o Invite to examine for specific flaws, imperfections, cracks, etc.

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Exhibit 8 (1 of2) - Curriculum Vitae of Evelyn Pears

CURRICULUM VITAE OF EVELYN PEARS, ASA, AAA EVELYN PEARS 36 Owl’s Head Des Moines, Iowa Evelyn Pears is an Accredited Senior Appraiser credentialed in Fine Art with the American Society of Appraisers. Pears provides personal property valuation services, consultation and expert testimony to colleagues, museum administrators, private collectors, art dealers, foundations, art galleries, CPAs, attorneys, insurance companies, corporations, and law-enforcement agencies. Pears has extensive experience with valuation of fine art and also has expertise in estate tax and charitable contribution appraisal. Pears is well versed in the Federal government requirements for these reports. Evelyn Pears has over forty years of professional appraisal experience. All appraisals conform to the Uniform Standards of Professional Appraisal Practice (USPAP) and the Code of Ethics of the American Society of Appraisers. The American Society of Appraisers has a mandatory recertification program for its Accredited Senior Appraisers. Pears is in compliance with this program. PROFESSIONAL ASSOCIATION CERTIFICATIONS AND MEMBERSHIPS Accredited Senior Appraiser, American Society of Appraisers (ASA)

Certified in Personal Property/Fine Art since 1976; Re-accredited most recently in 2012; Personal Property Committee, 1977–1989: Board of Examiners, 1977–1995

Appraisers Association of America (AAA), Member, 1977; Life member, 2017 – present Certified Appraiser in Impressionism, American Impressionism and Post Impressionism; President, 1984–1986; Co-chairman, Education Committee, 2001–2006;

CAREER RELATED ACTIVITIES Art appraiser, specializing in all forms of Impressionist, Post-impressionist, and Modern Art. Expert witness and consultant with extensive courtroom experience Consultant to IRS New York office, 2003– present Instructor in Arts and Humanities Appraisal Program, Indiana University, Bloomington, 2003-present Instructor of Art History (Introduction to Personal Property Valuation) Instructor of Art History (Personal Property Valuation: Methodology, Research and Analysis) Course Developer and Instructor, Inspecting Fine Art Course Developer and Instructor, Signs and Symbols in the Visual Arts Course Co-developer and Instructor, American Impressionism Art and Design Course Co-developer and Instructor, Modern Art and Design Panel moderator and speaker, Appraiser’s Association of America Conference, 1985–2003 Museum Curator, Director for curatorial services and curator, American Impressionism, Indiana University Art Museum 1995-2003 Museum of Arts and Sciences, Macon, GA., Curator and Executive Director 1990 - 1995. Tennessee State Museum, Nashville, TN., Curator. 1984-90

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Exhibit 8 (1 of2) - Curriculum Vitae of Evelyn Pears Art History/Technology Research Associate, the J. Paul Getty Trust, 1982-1984 Adjunct Instructor in Appraisal Studies, George Washington University, 1978-81 An American Portrait, 1776–1976”—Oils, Watercolors, and Prints, shown in 50+ museums, 1975–1977 Indiana State Museum, Assistant Curator, including the T.C. Steele Museum 1972-1977 Pears Art Appraisal Services 1972 - present Pears Art Gallery 1969 - 1972 EDUCATION: 1964 Bachelor of Arts – Indiana University, Bloomington 1965 Master of Arts – University of Cincinnati 1968 PhD Studies – University of Florida; University of London 1969 New York University, Appraisal Studies Program, "Development of American Impressionism" SPECIALTIES:

• Art & Paintings- Impressionist • Art & Paintings- American Impressionist • Art & Paintings - Post Impressionist • Art & Paintings -Modern