The Bold and the Dutiful

Arriving for his trial one morning this week, A. Alfred Taubman hugged a family member, nodded toward the courtroom and offered his appraisal: “She’s been quite an actress--amazing.”

The 76-year-old former billionaire chairman of Sotheby’s auction house was not speaking of actress Sigourney Weaver, who has taken in some of the proceedings to prepare for a TV movie on the case. Taubman’s review was directed at his former protegee and CEO at Sotheby’s, Diana D. “Dede” Brooks, who spent the week playing the real-life role of star witness--against him.

On Wednesday, Brooks wrapped up the prosecution’s case by completing three days of testimony about how her former mentor instructed her to “work out the details” of a plot to fix commissions with rival Christie’s and later used ridicule in a bid to keep her quiet. Just as a federal investigation was gaining momentum in January 2000, thanks to the cooperation of Christie’s, Taubman chided her, “Don’t act like a girl,” according to Brooks, who at the time was considered the most powerful woman in the art world.

Soon after, as they walked from a meeting in Sotheby’s boardroom, Taubman pointed to a newspaper photograph of her and quipped, “You’ll look good in stripes,” Brooks added.

Months later, Brooks made a deal with prosecutors that could well keep her out of prison garb--but which may have Taubman wearing it, if her testimony is believed by the jury hearing the price-fixing case in U.S. District Court.

The trial figures to be the only one stemming from the scandal that has stripped away the veneer of civility the auction world strives to maintain: The two firms already have settled a class-action civil suit filed by former customers for $512 million. And other parties in the criminal case have avoided trials: Brooks and Sotheby’s through plea bargains, and Christie’s former chairman Sir Anthony Tennant by staying away from the United States.

So it’s come down to Taubman and a trial that has unfolded like an upper-crust soap opera, with its episodes of suspicion and betrayal among a cast of English bluebloods, their American old-money counterparts and the nouveau riche as well.

Brooks, who presided over Sotheby’s celebrated 1996 Jacqueline Kennedy Onassis auction and was a trustee at Yale, is the old money and Taubman the new, having earned his fortune developing shopping centers before buying the 250-year-old British auction firm in 1983.

He made Brooks his CEO a decade later, and after his 70th birthday in 1995 wrote her a “Love, Alfred” note of appreciation for her work and for the gift the firm gave him--a pair of bronzes, a bull and a bear.

But other trial evidence shows that their work relationship was not all love-and-kisses. Brooks did not attend the birthday party; she was off skiing in Canada. And in a 1997 note, she suggested that Taubman step down as chairman or appoint someone else to a top position who had the energy and prestige to help her woo elite clients from Europe, Asia and California. Rival Christie’s had a handful of such rainmakers, she complained. “We are constantly outgunned,” she wrote.

Prosecutors have used the testimony of Brooks and her former counterpart at Christie’s, Christopher Davidge, to make the case that those two CEOs were only acting at the behest of their superiors--Taubman and Tennant--when they met to find ways of increasing profits in the $4-billion industry their firms already dominated.

Onassis Auction Under Her Gavel

Lawyers for Taubman’s defense, meanwhile, hope to convince the jury that Brooks acted on her own, hoping to salvage the value of her stock options--2 million at one time--and preserve her reputation as a “celebrity” executive.

“You liked that publicity, didn’t you?” defense attorney Robert Fiske Jr. asked Tuesday, noting how Brooks personally wielded the gavel on opening night of the Onassis auction.

“I enjoyed that sale,” Brooks replied.

It’s a fair bet that few of the jurors have ever been close to such an auction. One staffs a subway booth, another was a prison guard in Puerto Rico, and a third provides home care for an Alzheimer’s patient. Each side has taken every chance to remind them that the key figures in the trial inhabit another world--one side hoping they will dislike Taubman, the other Brooks.

At the start of their case, prosecutors introduced Taubman’s date books to document a series of private meetings he had with Tennant in 1993. But the date books also provided glimpses into Taubman’s lifestyle: morning haircuts in his Fifth Avenue apartment, using his own Gulfstream to jet to London, dining with royalty.

Taubman’s lawyers, in contrast, have portrayed him as a child of the Depression who began working at the age of 9, joined the Air Force in World War II and had less than $10,000 to his name when he began building shopping centers. While Taubman’s eldest daughter sits behind the defense table, his wife--a former Israeli beauty queen--has stayed away from court. The tall, burly Taubman listens to testimony over headphones, because he is hard of hearing, his lawyer said.

His lawyers do not want to paint too humble a portrait of him. In opening statements, Fiske told jurors that Taubman was worth about $700 million--so why would he risk everything on such blatant collusion? The prosecution’s answer: to make his business more profitable at a time when the auction industry was reeling.

Davidge was the first major witness. The dapper Englishman, who started at Christie’s at 19 as a printer, won amnesty from prosecution by volunteering to cooperate with authorities and even gained an $8-million severance agreement with his auction house. He related for the jury how he and Brooks worked out the fine points of the price-fixing deal in their own series of meetings, including one in the back seat of her car, after she met him at Kennedy Airport in February 1995.

That’s when they finalized new operating procedures designed to end their constant undercutting of each other in pursuit of valuable estates. They would both set nonnegotiable fees for sellers. No more donations to potential customers’ favorite charities. No advance payments interest-free. And most important, no punishing reductions in their commissions as part of the wooing process.

Soon after the meeting in Brooks’ car, Christie’s announced its new policy. Weeks later, Sotheby’s followed. When the dual moves aroused suspicion, the auction houses denied collusion. They said it was merely one competitor keeping an eye on the other--like corner gas stations matching each other’s posted prices.

In reality, Brooks admitted in court, the heads of the two firms had decided that they “were killing each other on the bottom line, and that it was time to do something about it.”

When Taubman instructed her to fix prices, “I was nervous about it, but I agreed to do it willingly,” she said.

She estimated at the time that having firm commission rates could increase Sotheby’s profits by $10 million to $15 million a year. And she testified this week that she had convinced herself that customers would not be harmed, because the white-glove treatment they received was worth more than they had been paying.

Just Following Orders, or Giving Them?

Defense attorneys have harped on Brooks’ admission that she has no notes to document that she was following Taubman’s orders. They have had to admit Taubman’s secret meetings with his Christie’s counterpart but insist those had legitimate purposes, such as cutting down raids on each other’s staffs.

In arguing that Brooks was trying to protect her own reputation, defense attorneys used a large screen to show jurors the embarrassing results of auctions early in her tenure. They displayed the covers of two 1994 Sotheby’s catalogs, one featuring Jasper Johns’ painting “Highway,” the other a Monet--neither of which sold, even though Sotheby’s had guaranteed the owner of the first work $9.5 million.

“The sales were not good sales, that was true,” Brooks testified.

With Sotheby’s stock slumping, the defense contends that Brooks took drastic steps to preserve her image as “the tall, blond, self-confident executive,” as Town and Country magazine described her.

Brooks was hardly that in court. She has let her hair go gray and was more glum than confident. Tears came to her eyes when the defense showed a TV clip of her touting the honesty of the auction business. “Our integrity is all we have,” she said on the show.

Taubman’s defense has to sell his claim that she was being a good actress then and still is one in court as she ties him to the price-fixing.

Brooks denied that Wednesday, under final questioning from prosecutors. She disclosed that her own plea bargain with them almost fell apart last year when they pushed her to tie Taubman, and herself, to earlier collusion--when Sotheby’s and Christie’s raised the rates they charged buyers in 1993.

“It wasn’t true,” Brooks said of that allegation, and she wouldn’t testify to it, even though it might have gotten her “a significantly better deal,” guaranteeing that she would avoid prison when she is finally sentenced. Prosecutors have only promised to ask for leniency.

“If I was going to make something up, why not add to that?” she asked.

Minutes later, she was off the witness stand and the prosecution rested.

Testimony resumes Monday, and U.S. District Judge George B. Daniels announced that the defense could be done by the end of the week, ahead of schedule.

Defense attorneys have not said whether Taubman will risk taking the stand himself to try to convince the jury that he knew nothing of the price-fixing.

“We still have plenty of time,” one of his lawyers said.