A. Alfred Taubman, an art collector and shopping mall tycoon who sold Renoirs and root beer with equal panache and turned a sleepy Sotheby’s auction house into a global power of art sales, but went to prison in a commission-fixing scandal involving archrival Christie’s, died at his home in Bloomfield Hills, Mich., on Friday. He was 91.
Taubman died of an apparent heart attack, said his son, Robert S. Taubman, chairman, president and chief executive of Taubman Centers, owner of properties nationwide including the Beverly Center in Los Angeles; and The Gardens on El Paseo and El Paseo Village in Palm Desert.
In the genteel world of art auctions, paintings and sculptures are displayed like museum pieces. Buyers nod and millions are spent with the touch of a gavel. But behind a luxurious facade, cutthroat competition lurks. And at Sotheby’s and Christie’s in the 1990s there was more: a conspiracy that, prosecutors said, cheated buyers and sellers of $100 million.
In 2001, Taubman, the chairman of Sotheby’s, was convicted in U.S. District Court in New York of colluding with Sir Anthony Tennant, his counterpart at Christie’s, to raise sellers’ fees and cut buyers’ incentives.
The scandal exposed the seamy underside of a $4 billion-a-year business that traded on upper-class images and English roots dating to the founding of Sotheby’s in 1744 and Christie’s in 1766. And it spelled disgrace for Taubman, who owned an archipelago of upscale malls and department stores and had created university research centers, libraries and health care facilities with his philanthropies.
Tennant was indicted, too, though under English law he could not be extradited from London and never stood trial. But Taubman went to prison for 9 1/2 months and was fined $7.5 million.
In addition, Sotheby’s pleaded guilty to price fixing, paid a $45 million fine and settled a civil suit by aggrieved clients for $256 million. To avoid further liability, Taubman paid $156 million of the civil costs, plus $30 million to settle a stockholders’ suit. He sold his controlling interest in Sotheby’s in 2005 for stock and $168 million in cash, ending 22 years as its principal owner.
It had long been a profitable association for Sotheby’s, which had the cachet, and for Taubman, who had the cash. By 1983, when he bought the house, then known as Sotheby Parke Bernet, it had fallen on hard times. It was losing money and was down to $20 million in assets. Two businessmen offered $100 million, but the house’s management regarded them as vulgar. Taubman paid $124.8 million for Sotheby’s, much of it raised from friends, including Henry Ford II.
Taubman was an aggressive entrepreneur who owned real estate, A&W Restaurants, movie theaters, office and apartment towers, department stores and many of America’s best-known malls. But he also collected old masters and 19th and 20th century art and was on the boards of cultural organizations. “Selling art has much in common with selling root beer,” Taubman said. “People don’t need root beer and they don’t need to buy a painting, either. We provide them a sense that it will give them a happier experience.”
With his flair for retailing, he transformed Sotheby’s, which catered mainly to dealers, into a modern full-service art retailer, offering customers financing, insurance, storage, art education and a vision of themselves as people of intellect, taste and the means to become collectors.
He solicited clients with mass mailings of glossy catalogs; gave credit to buyers and concessions to consignment sellers; threw parties for clients, and guaranteed minimums to sellers regardless of sales prices. He opened branches in Hong Kong, Monte Carlo and Russia; introduced lines in Scandinavian art, Victorian paintings and rock ‘n’ roll memorabilia; and spent lavishly on palatial New York headquarters.
It worked, in a way. By 1989, Sotheby’s sales totaled $2.9 billion, against Christie’s $2.1 billion. In one 1990 transaction, Sotheby’s sold Renoir’s “Au Moulin de la Galette,” from the collection of Mr. and Mrs. John Hay Whitney, for $78.1 million. But expenses were huge and profit margins perilously low.
As detailed in his subpoenaed diaries, Taubman met Tennant 12 times in London and New York between 1993 and 1996. Taubman’s protge and chief executive, Diana D. Brooks, the principal witness against him, testified that he directed her to meet with Christie’s chief executive, Christopher M. Davidge, and jointly implement higher sellers’ fees and lower incentives to buyers.
Taubman acknowledged meeting Tennant but denied collusion and insisted Brooks had lied to get probation. After a 16-day trial, he was convicted of antitrust violations. (A book by Christopher Mason, “The Art of the Steal: Inside the Sotheby’s-Christie’s Auction House Scandal,” was published in 2004.)
The sultan of art, 77 and suffering from diabetes and other ailments, became Inmate 50444-054 at the Federal Medical Center in Rochester, Minn. Released from a halfway house in June 2003, he flew in his Gulfstream to his oceanfront estate in Southampton, New York, and was soon back home in Manhattan, Palm Beach, Fla., and Bloomfield Hills, Mich., partying with Michael Eisner, Barry Diller, Henry Kissinger, Donald Trump and others in arts, entertainment and business.
“I had lost a chunk of my life, my good name and around 27 pounds,” he recalled in a 2007 memoir, “Threshold Resistance: The Extraordinary Career of a Luxury Retailing Pioneer.” But he added: “I’m out and I’m not bitter. I believe in the system. It’s still the greatest system in the world.”
Adolph Alfred Taubman was born in Pontiac, Mich., on Jan. 31, 1924, one of four children of German-Jewish immigrants, Philip and Fannie Ester Blustin Taubman. His father was a builder, but the family was hit hard in the Depression and the schoolboy, who stuttered, was dyslexic and had difficulty reading and writing, took part-time jobs.
He sold shoes and took construction jobs while studying architecture in the 1940s at the University of Michigan and the Lawrence Institute of Technology (now called Lawrence Technological University) but graduated from neither. He went into business in 1950, borrowing $5,000 to build and rent out a store. More stores, then parking lots, followed. By 1953, he owned a string of strip shopping centers.
As the postwar middle class migrated to the suburbs, he developed the Mall at Short Hills, N.J.,, the Queens Center in New York, Woodfield Center outside Chicago and Fairlane Town Center near Detroit, eventually expanding to 20 malls from coast to coast. He designed them with skylights, waterfalls, leafy interiors and wide store entranceways to overcome what he called “threshold resistance.”
He persuaded major retailers to move in – Neiman Marcus, Nordstrom, Saks Fifth Avenue, Marshall Field’s, and designer shops like Yves Saint Laurent, Ralph Lauren and Louis Vuitton. He promoted malls as places to take the family, meet friends, hang out, catch a movie or a meal – and shop.
“Suburban growth after the war,” he told The New York Times in 1977, “allowed us to build large developments based on new road patterns and new freeways that came in. We were able to duplicate to a great degree what occurs in a downtown, all under one ownership and one control.”
Critics said he siphoned business and jobs from downtowns, hastening the decline of old cities like Detroit; turned farmland and wilderness areas into parking lots and intensified traffic and pollution. He rejected the criticisms, calling malls modern equivalents of ancient marketplaces. And he earned millions, spending lavishly on Kandinskys, Jackson Pollocks, French impressionists – and more properties.
In 1977, he assembled a syndicate that outbid Mobil Oil and paid $337.4 million for the Irvine Ranch, a 77,000-acre Orange County oceanfront estate and one of the largest parcels in the Los Angeles area. It was resold six years later for $1 billion. Taubman earned $100 million and called it the best deal since the Louisiana Purchase.
In 1982, he bought A&W Restaurants, a booming chain that had begun with root beer stands. He bought two department store chains – Woodward & Lothrop in 1984, and John Wanamaker in 1986 – and in 1983 acquired the Michigan Panthers, a U.S. Football League team that later merged with the Oakland Invaders and folded in 1985 with the rest of the league.
Taubman, who had homes in New York, London and other locales, looked like one of his football players (although he preferred golf and tennis), a barrel-chested, 6-foot 3-inch competitor with jowls, a thrusting chin and eyes that narrowed to slits, even when he smiled. Friends said his combative manner softened after his conviction.
In 2003, his empire, Taubman Centers, survived a hostile takeover bid by Simon Property Group, the nation’s largest mall owner, and Westfield America. He remained one of the nation’s richest men, with a fortune estimated by Forbes at $3.1 billion in 2015.
He donated millions to the University of Michigan’s health care center, medical school library and college of architecture and urban planning; to Harvard’s John F. Kennedy School of Government, and to Brown University’s public policy and American institutions program. He led a $75 million expansion of the Detroit Institute of Arts, and was a director of the Detroit Symphony and other cultural organizations.
His first marriage, to Riva Kolodney, ended in divorce in 1977. In 1982, Taubman married the former Judith Mazor.
Chris Tennyson, a spokesman for the family, said Taubman is survived by his wife; three children, Robert and William Taubman and Gayle Kalisman; two stepchildren, Christopher Rounick and Tiffany Dubin; nine grandchildren, and one great-grandchild.
