Hobby Lobby Stores Inc. was recently ordered to forfeit to the Iraq government a rare antiquity it had purchased for $1.7 million. The Gilgamesh Dream Tablet, a rare cuneiform tablet bearing a portion of the Sumerian epic of Gilgamesh, is considered one of the world’s oldest works of literature. It originated in Mesopotamia, which is modern-day Iraq, around 3,500 years ago. It is believed to have been stolen from an Iraqi museum sometime after the Persian Gulf war in 1991.

The civil forfeiture case was pursued by U.S. Immigrations and Customs Enforcement’s Homeland Security Investigations (HSI). Hobby Lobby had purchased the artifact for display at the Museum of the Bible in Washington, D.C., which was founded by the chain store’s president, Steve Green. The tablet was seized from the museum by law enforcement agents in September 2019.

“We are proud of our investigation that led to this reclaiming of a piece of Iraq’s cultural history. This rare tablet was pillaged from Iraq and years later sold at a major auction house, with a questionable and unsupported provenance,” stated Peter C. Fitzhugh, special agent in charge for HSI New York.

Richard P. Donoghue, United States Attorney for the Eastern District of New York, said, “In this case, a major auction house failed to meet its obligations by minimizing its concerns that the provenance of an important Iraqi artifact was fabricated, and withheld from the buyer information that undermined the provenance’s reliability.”

Questionable behavior

According to HSI, a U.S. antiquities dealer purchased the tablet from a Middle Eastern dealer in London. The dealer sold the item with a false provenance letter that stated it had been inside a box of miscellaneous bronze fragments purchased in a 1981 auction. This false provenance letter traveled with the tablet and was provided to the auction company, Christie’s, by a later owner.

As part of its due diligence, Christie’s antiquities director spoke with the dealer, who advised that the provenance claim would not withstand scrutiny and should not be used in connection with a public sale. Christie’s nevertheless told Hobby Lobby that the tablet was purchased in the 1981 auction. Hobby Lobby purchased the tablet in a private sale in 2014.

Hobby Lobby and the Museum of the Bible became concerned about the tablet’s provenance in 2017, and made further inquiries to Christie’s, which claimed that the dealer had confirmed the details of the provenance. However, Christie’s withheld the false provenance letter and the dealer’s name from Hobby Lobby and the museum.

A run of bad luck

This was not the only problem Hobby Lobby and the Museum of the Bible have had with stolen artifacts.

In 2020, experts retained by the museum found that its collection of Dead Sea Scrolls was comprised entirely of fakes. Also in that year, Green agreed to return 11,500 artifacts from his collection to Iraq and Egypt because of provenance issues. In another case, Hobby Lobby also had to forfeit over 5,500 artifacts and pay a $3 million fine.

Green attributes these problems to inexperience and trusting the wrong people: “In 2009, when I began acquiring biblical manuscripts and artifacts for what would ultimately form the collection at Museum of the Bible, I knew little about the world of collecting. It is well known that I trusted the wrong people to guide me, and unwittingly dealt with unscrupulous dealers in those early years. One area where I fell short was not appreciating the importance of the provenance of the items I purchased.”

Litigation pending

Hobby Lobby has already sued Christie’s in connection with the sale. At the surface level, Christie’s was just a broker on the deal and has no personal responsibility for the misrepresentations of the seller. But if the HSI determinations are correct — and bear in mind, they have not been proven in court — it would seem that Christie’s may have crossed the line and exposed itself to liability to Hobby Lobby by misrepresenting the provenance, declining to identify the parties, etc. We may be reading more about this in the future.

If a claim like this proves successful in court, at a minimum, you are entitled to get your money back from the seller. You paid to acquire ownership of the property, and you didn’t get it. Implicit, if not actually stated, in the deal is that the buyer is going to get good title to the things being purchased. The seller can go back against his seller, and so forth, until the initial thief is left holding the bag.

But one problem is that this approach only gets you a refund of what you paid — you never recover your profit. And, if you held the stolen assets for a long time, the lost profit can be a big number, a number upon which you paid income taxes. Let’s also recognize that the previous seller may not be capable of refunding your purchase price.

What about cars?

All this is interesting, but what does it have to do with cars? Well, nothing, but maybe everything.

As valuable as cars have become, their values are still small relative to great works of art. The collector-car hobby is pretty well developed internationally, but it pales in comparison to collecting art and antiquities. It’s fair to say that the scams we are seeing in the collector-car world are old news in the art world.

Along these lines, our firm handled a similar case involving a stolen car. Our client was watching television coverage of a major collector-car auction and saw a car cross the block that was stolen from his father decades previously.

The car had been taken by the owner of the facility where the car was stored. He managed to falsify a new title by claiming he had foreclosed on the car for unpaid storage fees, and then sold the car.

When the theft was discovered, our clients filed suit against him, and it ended up in bankruptcy court, where the culprit admitted to the theft. Nonetheless, the car was not recovered.

We contacted the auction company, one of the majors. We explained that we did not believe that they knew anything about the theft, and we were happy to proceed against the buyer to recover the car. All we wanted to know was the buyer’s name and contact information.

That request was met with a refusal — the buyer’s identity is confidential, and the auction house cannot disclose it. Of course, this is not true. There is absolutely nothing in the law that treats that information as confidential.

“Unjust enrichment”

Unable to negotiate a solution, we filed suit. We only wanted information, and we had no ability to recover our attorney fees under the law. So we made a second claim for what the law calls “unjust enrichment.” Essentially, the auction company profited by selling our client’s car. That wasn’t right, and it should be forced to give up its profit and pay it to our client.

We received a prompt response from the auction company’s litigation counsel, and we quickly came to a settlement agreement. The auction company is providing contact information for the buyer, plus paying its entire commission to our client.

This is today’s world

While these may seem like interesting anecdotes, this is becoming an increasingly common problem. Since the COVID-19 pandemic, online collector-car sales have exploded. As you might imagine, once you have long distances between the buyer and the seller, and purchase decisions are made based upon photographs instead of physical inspections, it becomes pretty easy for an unscrupulous seller to commit fraud.

There are a lot of stolen cars out there. Some have been missing for years, taken for a joyride, and then tucked away to avoid discovery. Now some of them are more valuable than ever imagined. Many of these are finding their way into the marketplace and can trade hands multiple times before someone figures out what the car really is.

Of course, the vast majority of collector-car sales are on the up and up. You aren’t buying the vast majority, however, just one car at a time. It’s important that you know exactly what you are getting and have knowledgeable and trustworthy professionals inspect the car. Do your due diligence before hitting the “bid now” button. ♦

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