Thursday, October 7, 2004
Discredited gallery owner struggles to survive
All he needs is time, says Pioneer Square art dealer Kurt Lidtke. With time, he can pay his way out of debt and prevail in the art business.
"It's the only business I ever wanted to be in," he says. "If I make a couple of sales, even one big sale, I can pay everybody."
|Meryl Schenker / P-I|
|Kurt Lidtke, seen in front of his Pioneer Square art gallery, is accused of owing money to owners of art consigned to his gallery. He expressed confidence in his ability to redeem his name.|
In his first interview since the public disclosure of his financial dealings with owners of art consigned to his gallery, Lidtke said his problems began with the 2001 earthquake that closed his gallery and forced him to relocate within the Square.
Sales were down, and his financial margin of safety began to erode. To stay afloat, he held on to money due clients without their permission, hoping for a quick turnaround.
Lidtke said that in most cases there were problems of miscommunication and issues of art conservation, making it difficult for him to pay on time.
In any event, clients sued. Hundreds of thousands of dollars of judgments against Lidtke have been filed and collected. He lost his Bainbridge Island house. His wife is divorcing him. Besides more unpaid collectors and artists, he has, he said, unpaid taxes, gallery rent and suppliers.
Lidtke wants his creditors to trust him. Unfortunately, many of them haven't been able to reach him by phone or in the gallery. People desperate to know what happened to their artworks call him, and he doesn't call them back, a pattern he acknowledged.
Because trust is fundamental to art dealing, the Lidtke case has rattled the Seattle art world. Clients who would never dream of giving a real estate agent unsecured custody of their property think nothing of giving an art dealer art worth thousands or hundreds of thousands of dollars on the strength of a signature or even a handshake.
That's because fraud, double-dealing and even delays in making payments are rare in Seattle art circles. Everybody's guard is down, and that includes dealers themselves.
James Harris, owner of the Pioneer Square gallery bearing his name, said the Lidtke case has caused him to be more cautious. A few months ago, when a woman Harris didn't know called him and asked if he'd send her an $18,000 painting "on approval," he hesitated. She provided references, and because he had "a good feeling" about her, he didn't bother to call them.
"She ended up buying the painting and paying me promptly, but I don't think I'd do that again," Harris said.
Most Seattle dealers let clients make monthly installments on an art purchase, and virtually none charges interest. Some have contracts with their artists and clients, but many do not. "We have verbal agreements," said Phen Huang, owner of the Foster/White Gallery. Those who have contracts describe them as "loose." Francine Seders said she doesn't think contracts help much.
William Traver of the William Traver Gallery said he thinks art dealers who fail to pay their artists are a blot on the industry. "The vast majority are rigorously honest," he said. "In this business, dishonesty stands out. You can't last if you don't do the right thing."
Lidtke has run his gallery for 12 years, and worked for Don Foster of Foster/White Gallery (now retired) before that. "Don gave me my first break," said Lidtke.
They parted after three years with mutual ill will. Lidtke said he thought Foster (a highly respected figure in the gallery world) didn't do enough for his artists. Foster said Lidtke is "totally unprofessional," adding, "I think of him what his consigners think."
Lidtke is not the first Seattle art dealer to stumble financially. Polly Friedlander, the top Pioneer Square art dealer in the 1970s, went out of business in 1977 owing artists money, most prominently painter Alden Mason, to whom she owed and never paid between $15,000 and $20,000.
Silver Image Gallery owner Dan Fear was in the gallery business nearly 20 years before he began to "borrow from Peter to pay Paul," he said. "I closed 11 years ago, and I'm still ashamed of not paying those debts." Compared to Lidtke's debts, Fear's are minor.
Last year, The Seattle Times reported Thesaurus Fine Art in Pioneer Square was selling fakes of ancient Asian art. It caused no more than a ripple in the Seattle art circles, principally because Thesaurus was an antiques store, not a gallery. The owners closed the shop and fled the country to avoid criminal charges.
Sam Davidson, owner of Davidson Galleries, situated on the same block as Thesaurus, said he was amazed anyone thought the gallery was selling genuine Asian art and antiques.
"I thought the name of the gallery indicated it sold replicas," he said. "Isn't a thesaurus a compendium of substitute words? I never went in there, so I didn't know what they sold."
The Lidtke case, however, is causing Seattle art dealers serious waves. Lidtke runs a real gallery and has mounted exceptionally fine exhibits featuring artists of the Northwest School.
|Meryl Schenker / P-I|
|"I'm bulletproof," Lidtke says. "Does that sound arrogant? I'm not arrogant. I'm as humble as humble pie."|
"I'm sad about what's happening here," said attorney and art collector Merch Pease. "Kurt had so much potential. Some of the shows he has put together over the years have been quite scholarly."
Late last week, Lidtke expressed confidence in his ability to put his troubles behind him.
"I'm bulletproof," he said. "Does that sound arrogant? I'm not arrogant. I'm as humble as humble pie. I'm sorry about the pain I've caused, and I know I can make it right."
Lidtke, 39, grew up in Salem, Ore. He went to the University of Oregon in Eugene on a tennis scholarship but didn't relate well to the school.
"There were all these political types, people involved in issues," he said. "I'd say, 'Give me an issue, and I'll give you a tissue.' "
He transferred to Portland State University and graduated with a double major in history and philosophy. On the strength of a philosophy and art paper he wrote, Foster gave him a job at his gallery, where Lidtke eventually became associate director.
In his own gallery, Lidtke specializes in the Northwest School. Because Northwest School artists are nearly all dead, that means he deals primarily with resale of artworks.
"I prefer the term adoption to resale," Lidtke said. "I try to find good homes for the artwork in my care."
Like most dealers focusing on resales, Lidtke is aggressive about finding clients. He pores through catalogs and other documentary material to find out who owns what. Then he calls those collectors and says he has a client for the painting or paintings they own. If they don't want to sell, he offers to put their art in a show, which helps establish a relationship. Failing that, he tries to arrange for the loan of the artwork for a museum exhibit.
There's nothing unusual about this. Seattle collector Jane Davis said that New York dealer Larry Gagosian has been calling her for decades to see if she might be interested in selling a Mark Rothko in her collection.
"The answer's always no because I'm giving the painting to the Seattle Art Museum," she said. "Every time he calls, the price has gone up."
Early in 2003, retired architect Edward Cushman agreed to let Lidtke sell a Mark Tobey and a Morris Graves for him. Lidtke sought him out. Cushman had suffered a stroke and was confined to a wheelchair. He needed the money to help pay for his home care.
He had to sue Lidtke to get it.
Retired Boeing designer Sital Alim is afraid the gallery is broke, and he's missing a sumi ink drawing by George Tsutakawa and a painting by Kenneth Callahan.
"I didn't buy art from Kurt Lidtke," said Alim. "I bought from Gordon Woodside principally, and also from Foster/White and Francine Seders. Never from Kurt Lidtke. But he pestered me to let him sell something. Always, he was asking. I'm sorry I trusted him."
Lidtke first said Alim's artwork was out on approval, but yesterday he told Alim it was sold and he'd pay in 10 days.
"Isn't that what people like Kurt Lidtke always say?" asked Alim. "The check's in the mail?"
Also "out on approval" is a significant Mark Tobey owned by painter John Koenig. Koenig has hired an attorney to try to get paid or get the painting back.
"We have not been able to find Kurt to deliver a summons and complaint to him in person, and we believe he is hiding out to avoid service of legal papers," said Koenig's attorney, Jim Webster. Webster expects to collect for his client with a default judgment. Although Lidtke hired a lawyer to represent him in his divorce, he's primarily representing himself in suits against the gallery.
Eugene painter Adam Grosowky said he owes Lidtke a lot, which is generous, because the financial debt is in the other direction. Last year, Lidtke sold a series of Grosowkys to a client for $48,000.
After Lidtke failed to pay and blamed the client, Grosowky called her. She said she had sent Lidtke the check for the full amount months ago, producing a receipt. The client severed connection to Lidtke, saying she was offended and shocked by his dishonesty. She commissioned another $48,000 worth of art directly from Grosowky. In that way, said the painter, he came out whole.
Because he remained grateful to Lidtke for helping him start his career, Grosowky agreed to give Lidtke 19 paintings for a solo show last June. "I thought," said the painter, "what do I have to lose?" Last week, Grosowky hadn't received any money from the show or any of the paintings back.
"I'm an idiot," he said. Thanks to an intervention from Art Tech, the Seattle art handling company that showed up at the gallery when Lidtke was there for an interview last Friday, 14 of the paintings were returned to the artist. Lidtke says five others, the big ones, are "out on approval."
Lidtke acknowledges this history with Grosowky but says he is sure that the Oregon painter will be willing to work with him again. ("No way," said Grosowky.) Lidtke also said he expects to be open regularly this month.
"I know what I'm made of," said Lidtke. "I have self-confidence because of my experience with sports. When other kids were sleeping in, I'd jog over to the tennis club and hit balls as the sun rose. While everyone else was waking up, I was on my way to school.
"Being an art dealer is the core of what I am," he continued. "Can I get credit for being squeaky clean in this business for more than a decade? What about the donations I've arranged for museums and the help I've given in researching exhibits?"
The Tacoma Art Museum thanked him in the catalog for his help on its "Northwest Mythologies" exhibit last year. Other curators at other Northwest museums who he said would be good references declined to speak on his behalf.
No Seattle dealer has rebounded from these kind of financial difficulties, which isn't true in Los Angeles or New York. Famous for treating his bills as if they didn't exist is Doug Christmas of Ace Gallery, the most beautiful and one of the most important spaces in L.A. Since 1976, Christmas has been sued 55 times, by artists, other dealers and art collectors, according to a profile last year in LA Weekly.
Christmas continues to have trail-blazing exhibits. Plenty of collectors and artists who know the stories remain eager to do business with him.
Lidtke says he's broke, but he has the inventory to get out from under his bills.
"People are calling me expressing their support. I don't want to name them, but they are out there. Artists want me to represent them. Clients outside of Seattle have no idea I'm having all this trouble. In a few months, no one will remember it," he predicted. "They'll put the attention back where it should be, on the art."
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