United States District Court, E.D. Pennsylvania
[Copyrighted Material Omitted]
For MICHAEL JACOBS, Plaintiff: ALEX J. MURLAND, RONALD L. WOODMAN, FRIEDMAN SCHUMAN PC, JENKINTOWN, PA; MICHAEL YANOFF, ROBERT H. NEMEROFF, FRIEDMAN SCHUMAN APPLEBAUM NEMEROFF & MCCAFFERY PC, JENKINTOWN, PA.
For SHARON HALPER, PERSONAL REPRESENTATIVE OF THE ESTATE OF BARRY HALPER, BARRY HALPER, INC., Defendants: MONICA WATSON, LEAD ATTORNEY, PIB LLC, PHILADELPHIA, PA.
For SOTHEBY'S, INC., SOTHEBY PARKE BERNET, INC., SOTHEBY'S HOLDINGS, Defendants: JONATHAN S. ZISS, LEAD ATTORNEY, MICHAEL P. LUONGO, SETH L. LAVER, GOLDBERG SEGALLA LLP, PHILADELPHIA, PA.
For SOTHEBY'S, Defendant: JONATHAN S. ZISS, LEAD ATTORNEY, MICHAEL P. LUONGO, GOLDBERG SEGALLA LLP, PHILADELPHIA, PA.
For GREY FLANNEL AUCTIONS, INC., GREY FLANNEL COLLECTIBLES, INC., Defendants: SAMUEL E. COHEN, MARSHALL DENNEHEY WARNER COLEMAN & GOGGIN, PHILADELPHIA, PA.
WENDY BEETLESTONE, J.
This dispute concerns Plaintiff Michael Jacob's purchase in December 1999 at a Sotheby's auction of a 1951 Willie Mays New York Giants signed rookie road jersey (the " Mays Jersey" ) and a 1950's Willie Mays New York Giants travel bag (the " Mays Travel Bag" ) (together, the " Mays memorabilia" ), which he subsequently learned were inauthentic. Plaintiff alleges that the Defendants knew the items had not been authenticated at the time he bought them despite making written representations in the auction catalogue that they had. Plaintiff brings this lawsuit against three separate groups of Defendants: (1) Sharon Halper and Barry Halper, Inc. (collectively, " Halper" ), who were alleged to be engaged in the business of buying and selling sports memorabilia, and who were the previous owner(s) of the Mays Jersey and Mays Travel Bag; (2) Sotheby's, Inc., Sotheby Parke Bernet, Inc., Sotheby Holdings, and Sotheby's (collectively, " Sotheby's" ), all of which allegedly served as the auction house for the sale of the Mays Jersey and Mays Travel Bag; and, (3) Grey Flannel Auctions, Inc. (" GF Auctions" ) and Grey Flannel Collectibles, Inc. (" GF Collectibles" ) (collectively, " Grey Flannel" ), which allegedly specialize in authenticating, appraising, and auctioning sports memorabilia, and who were represented by Sotheby's to have authenticated the Mays Jersey prior to the Sotheby's auction.
Each of Defendants has filed a motion to dismiss pursuant to Federal Rule of Civil Procedure 12(b)(6). The Grey Flannel Defendants have also moved the Court for dismissal pursuant to Rule 12(b)(2) for lack of personal jurisdiction. The Court held oral argument on the motions.
A. Sotheby's Advertises the Halper Collection
In or about early 1999, Sotheby's advertised an auction sale of Barry Halper's collection of baseball memorabilia, which was described as " the world's largest and most significant private collection on baseball." Am. Compl. ¶ 23. With the help of Grey Flannel, Sotheby's and Halper published a three-part auction catalogue entitled " The Barry Halper Collection of Baseball Memorabilia" (the " Halper Catalogue" ). Id. ¶ 22. The Halper Catalogue stated that the auction would " establish new standards for the hobby in the areas of condition, authenticity, provenance, and historical significance." Id. ¶ 24. Further, the Halper Catalogue represented that Grey Flannel had authenticated all the uniforms and jerseys in the auction. Id. ¶ 25. Specifically, page 37 of the Halper Catalogue states, " Grey Flannel has authenticated all uniforms and apparel (excluding most baseball hats)." Id., Ex. A.
B. Plaintiff's Purchase of the Mays Jersey and Travel Bag
Plaintiff obtained a copy of the Halper Catalogue in or about the summer of 1999. Id. ¶ 26. The catalogue described the Mays Jersey as " one of the most important pieces of memorabilia relating to [Willie Mays'] glorious career." Id., Ex. B. On around September 29, 1999, Plaintiff bid by telephone on the Mays Travel Bag and the Mays Jersey. Id. ¶ 28. Plaintiff was the successful bidder on both items and paid $8,625.00 for the bag and $63,000 for the jersey, id. ¶ 30, by wiring the money plus the applicable sales tax to Sotheby's. Id. ¶ 31.
The Halper Catalogue included a copy of Sotheby's Conditions of Sale and Terms of Guarantee (" Conditions & Guarantee" ). Sotheby's Opp'n, Ex. B. The Terms of Guarantee set forth the following provisions:
Authenticity. . . . If within five years from the date of sale of a purchased lot, the original purchaser of record tenders to us a purchased lot in the same condition as when sold and it is established that the catalogue description of the lot as it relates to its authenticity (as defined above . . . ) is not substantially correct based upon a fair reading of the catalogue as a whole, . . . the sale of such lot will be rescinded and the original purchase price refunded.
Sole Remedy. It is further specifically understood that the remedy set forth herein, namely the rescission of the sale and refund of the original purchase price paid for the lot, is exclusive and in lieu of any other remedy which might otherwise be available as a matter of law.
Id. In addition, the Conditions of Sale included a New York state choice of law clause, which provides:
These Conditions of Sale and Terms of Guarantee, as well as the purchaser's and our respective rights and obligations hereunder, shall be governed by and construed and enforced in accordance with the laws of the State of New York. By bidding at an auction, whether present in person or by agent, order bid, telephone or other means, the purchaser shall be deemed to have consented to the jurisdiction of the state courts of, and the federal courts sitting in, the State of New York.
C. Plaintiff Retains Leland Collectibles to Appraise the Value of the Mays Jersey
In or around July 2012, Plaintiff retained Leland's Collectibles of Bohemia, New York (" Leland's" ) to appraise the Mays Jersey for insurance purposes. Id. ¶ 33. At that time, Leland's appraised the Mays Jersey at $400,000. Id. ¶ 34.
In or around June 2013, Plaintiff entered into a written sales agreement with Leland's in which Leland's agreed to purchase the Mays Jersey from Plaintiff for $675,000, subject to the approval of the third-party to whom Leland's had agreed to sell the jersey. Id. ¶ 35. Leland's and/or its prospective buyer thereafter retained MEARS to authenticate the Mays Jersey. Id. ¶ 36. MEARS examined the Mays Jersey and concluded that it was inauthentic. Id. ¶ 37. As a result, Leland's rescinded its sales agreement with Plaintiff. Id. ¶ 39. At the same time, Leland's advised Plaintiff that the Mays Travel Bag was also inauthentic. Id. ¶ 40.
D. Plaintiff Seeks Explanations from Sotheby's and Grey Flannel
On September 20, 2013, Plaintiff advised Sotheby's by letter that he believed the Mays Jersey was counterfeit and intended to pursue recovery of his damages. Id. ¶ 42, Ex. C. On October 7, 2013, Sotheby's sent a response letter noting the expiration of its five (5) year Guarantee of authenticity and denying Plaintiffs claim in its entirety. Id. ¶ 43, Ex. D.
On March 19, 2014, Plaintiff sent a letter to Grey Flannel advising them he had determined that the sports memorabilia he had purchased from the Halper auction was inauthentic. Id. ¶ 51. In June 2014, Plaintiffs counsel spoke with counsel for Grey Flannel by phone and requested information as to whether Grey Flannel had, in fact, ...