Following Tuesday’s post on the travails of celebrity photographer Annie Leibovitz, the deadline for the repayment of her $24m loan to New York-based art finance company Art Capital Group passed at midnight on Tuesday – leaving her liable to lose control of her properties – including brownstones in New York City and a sprawling property in Rhinebeck, New York – and copyright over all her work.
Bloomberg reported on Thursday that a spokesman for Art Capital would not confirm whether Leibovitz was now in default, or whether new loan terms were being worked out. There was no comment, either, from Goldman Sachs - a creditor for the loan, the news service added.
But as HuffingtonPost reports, a spokesman for Leibovitz said on Wednesday that “Annie is continuing to work to resolve this matter with Art Capital”.
Art Capital has “legitimate rights under its current agreement”, an intellectual property lawyer told HuffingtonPost. But the case had “an emotional component” that might make it “want to consider some type of negotiated solution rather than a litigated solution.”
Leaving aside the negative publicity that would inevitably arise from the pursuit of Leibovitz – who while not vastly popular has drawn sympathy for her struggles – there are tricky issues in wresting control of her work and properties.
Legal experts told Bloomberg that declaring Leibovitz in default of her loan “may not be in Art Capital’s best interests”. While a default notice would clear the firm to sell the collateral, the move could also spark a flurry of cross-defaults by other lenders, according to one expert on bankruptcy and restructuring.
At the same time, adds Bloomberg, a default declaration could force the photographer into bankruptcy court. That would postpone all claims against her and place her under the protection of a bankruptcy judge.
As blogsite Luxist noted, Art Capital appears to be treating the situation “delicately”, as it wants to avoid the messiness of bankruptcy proceedings. The answers may come at the next court date, scheduled for October 2, unless the parties can come to an agreement before then.
For a financially stricken artist, Leibovitz’s near-$100m worth of assets are not to be sniffed at. The New York properties may be worth as much as $40m and her photographs have been valued at more than $50m by Art Capital, Bloomberg added.
Leibovitz could certainly do with a break. On top of the immediate matter of a $24m default, she is contending with another legal battle, after Italian photographer Paolo Pizzetti sued her for $300,000 last week alleging that she misappropriated his photographs and used them in a coffee advertising campaign. Oh and the US tax authorities are pursuing her for some allegedly unpaid taxes.
As one legal expert told Bloomberg: “No one wants to be the last person suing after all the assets are gone”.