California Enters Wallis-LACMA Fray

The California Attorney General’s office has ordered an inquiry into a dispute between the Los Angeles County Museum of Art and a foundation set up by the late film producer Hal B. Wallis in which the museum contends the foundation improperly removed paintings loaned to it so they could be sold at auction.

An attorney general spokesman said the review would seek to determine if either the Wallis Foundation or the museum had violated laws governing the way charitable institutions can conduct their affairs in California. Both the foundation and the museum, which is operated by an organization legally known as Museum Associates, are state-regulated nonprofit entities.

The spokesman characterized the inquiry as a “preliminary review,” and said it was ordered Thursday following published reports on legal action involving the museum and the Wallis Foundation, headed by Wallis’s son, Brent.

Earlier this week, the museum sued the foundation in state court in New York City charging the foundation had improperly taken back Impressionist paintings once owned by Wallis that had been on permanent loan to the museum. The paintings were auctioned May 10 in New York for $39.6 million.

Thursday, the foundation and the museum reached an agreement that proceeds of the sale will be held in escrow by Christie’s auction house. A New York judge ordered the foundation to show cause at a hearing June 6 why the sale proceeds should not be impounded.