Collector Libbie Mugrabi Says Lenders Stole Her Warhol. They Say She Stiffed and Defamed Them

22 Oct Collector Libbie Mugrabi Says Lenders Stole Her Warhol. They Say She Stiffed and Defamed Them

Posted at 19:21h in Uncategorized by Artnet News

Source Credit: Content and images from Artnet News. Read the original article - https://news.artnet.com/art-world/collector-libbie-mugrabi-says-lenders-stole-her-warhol-they-say-she-stiffed-and-defamed-them-2556924

Art-collecting socialite and fashion designer Libbie Mugrabi is locked in heated and byzantine litigation with the lending company Art Capital Group (ACG) and its executives, Ian Peck and Terence Doran, over an art-backed loan that was never made.

ACG says that it is entitled to all or part of seven-figure artworks—a 1982 Jean-Michel Basquiat painting worth around $30 million and an Andy Warhol portrait of Jacqueline Kennedy Onassis pegged at $1.5 million—because Mugrabi did not pay fees on an unsuccessful loan application she pursued.

Mugrabi initially offered the Basquiat as collateral to cover those fees, according to her legal filings, but then decided instead to use the Warhol.

The firm claims that Mugrabi has undertaken a public retaliation campaign against it, reporting the Warhol as stolen to police in Southampton, N.Y., and plastering Manhattan’s Upper East Side and the Hamptons with “Wanted” posters with the faces of Peck and Doran that offer a $10,000 reward for the return of the piece. ACG is asking for up to $30 million for “financial loss, professional stain, and emotional distress.”

Mugrabi’s attorneys have asked the judge to dismiss ACG’s claims and said they are filing a separate lawsuit requesting the rejection of ACG’s claim that it holds a stake in the Basquiat. They are also seeking damages of up to $20 million, arguing that the lenders improperly filed paperwork saying that they had a stake in the Basquiat.

Mugrabi has gained notoriety in the past for doing things like showing up to court in a bulletproof vest during her contentious divorce from the wealthy collector David Mugrabi, whom she alleged hired an assassin to kill her.

The fees that Art Capital Group says Mugrabi owes were initially stated at just under $27,000, according to court records, but grew to about $97,000.

Court papers show that ACG took possession of the Warhol roughly a year ago. A recent email from ACG attorney Joe Sidley to Mugrabi attorney Claude Castro indicates that ACG has sold the work to cover the unpaid fees, though details about the price and buyer have not been disclosed.

Mugrabi’s attorneys say that they have yet to see a detailed breakdown of the loan and research fees they claim are owed. They also insist that Mugrabi repeatedly offered to pay all the fees stemming from the loan application. ACG’s “unauthorized removal and retention” of the Warhol, her lawyers write, is “tantamount to a ‘theft.’”

“We have no comment other than that we believe our complaint speaks for itself and our clients deny Ms. Mugrabi’s allegations of wrongdoing and consider them frivolous,” said Sidley, the ACG attorney, in an email to Artnet.

ACG’s suit says that Mugrabi willingly handed over the Warhol last fall in an effort to fund the fees for the potential loan. According to ACG’s claim, in November of last year, Peck, Mugrabi, and Mugrabi’s financial advisor, Joon Ho Chun, met at Mugrabi’s home in Sag Harbor, N.Y., and “Mugrabi instructed her staff and Chun to bubble wrap and release the Warhol to Plaintiff” in order to move forward with due diligence for the loan.

An attorney for Mugrabi declined to comment and referred Artnet instead to recent filings seeking dismissal of the lawsuit.

The attorney also said that ACG has attempted to prevent Mugrabi from selling the Basquiat at auction by threatening legal action against an unidentified auction house in an effort to “extort” her.

Mugrabi’s filing emphasizes that the “sole collateral” for the transaction was the Warhol, and not the Basquiat.

ACG fired the first shot on September 26 in a New York court in a filing against Mugrabi and Moo Moo Enterprises, her fashion company, that said that, after a back-and-forth about the unpaid fees, the two sides had been nearing an agreement that would have seen ACG sell the Warhol.

According to ACG’s filing, at what started out as an “amicable” closing lunch at a Manhattan restaurant in early 2024, Mugrabi stood up and announced to diners that the plaintiffs were “thieves” who had stolen her Warhol. They allege that Mugrabi’s then-boyfriend, who is not named, “menaced” Terence Doran, telling him that he had done a stint on Rikers Island, a New York prison, in order to intimidate him.

ACG also alleges that Mugrabi failed to maintain insurance on the Basquiat and the Warhol, as required under their agreements, making her liable for any damage to the works.

This is not the first time that ACG has tussled publicly with a high-profile art world name. In 2009, it sued Annie Liebovitz for repayment of a $24 million loan that the photographer had taken using her images and real estate holdings as collateral.