Artist settles with Costco

Times Staff Writer

If you happen to have dropped a grand or two at Costco on a signed, limited-edition art print by Cao Yong, a Chinese immigrant painter of popular romantic cityscapes, he wants to grab it and burn it.

Costco reached a settlement this week with Yong in an art-counterfeiting suit he had brought in U.S. District Court in Los Angeles. He claimed that the mammoth, members-only merchandising chain had sold phony prints of his paintings in Southern California and provided buyers with faked certificates deeming them “signed and numbered by the artist.”

Costco landed in a separate, highly publicized art controversy last year when Pablo Picasso’s daughter asserted that two purported Picasso drawings sold on Costco’s website were not authentic and that accompanying certificates supposedly bearing her signature were frauds.


Yong’s attorney, Eric Goodman, said that the artist was “happy with the resolution” but that the parties had agreed to keep the terms of the settlement private. The other defendants were a Los Angeles company, Day-O Graphics Inc., which Yong suspected had provided the prints to Costco, and Dan Luo, identified in the suit as a former employee of Yong.

The case’s conclusion doesn’t end Yong’s concerns, Goodman noted, because having bogus prints floating around “potentially impacts the value of legitimate [ones] in circulation.”

The attorney said that federal law gives Yong the right to seize any fakes of his work and that the artist would like Costco customers who bought the prints to turn them in for “a counterfeit-burning party.”

“We would expect Costco to reimburse buyers,” Goodman added, although such an outcome was not part of the settlement. Sales records produced as potential evidence were murky, he said, and “there might be anywhere from at least seven to 15 out there.”

Barry Kellman, attorney for Costco and Day-O Graphics, had no comment about the settlement. Asked whether Costco would provide refunds for the disputed prints, he said by e-mail that “unrelated to this lawsuit, you should know that Costco guarantees . . . 100% satisfaction” for all merchandise.

Frank Zhang, a San Francisco physician who paid Costco $37,000 for what he believed was a Picasso crayon sketch of a face, said Thursday that the company had recently offered him a full refund and a $500 gift certificate. Zhang said he was considering whether to take the money or press Costco to obtain an expert opinion on the drawing’s authenticity.

“It’s painful,” he said. “You bought the one you love, thinking it’s a Picasso original, and it seems it’s not. I don’t know what to do now.”

According to Yong’s attorney, the artist, a La Habra Heights resident, began to suspect a problem more than a year ago when he learned that his work was being sold in Costco stores in California. He has sales agreements with more than 300 galleries nationwide, said Ming Chuong, sales manager for Cao Yong Editions, but not with Costco.

Yong and his sister subsequently purchased prints of three of his works at Costco stores in City of Industry and Laguna Niguel, priced from $1,000 to $2,165. Goodman said substandard frames, canvases and reproduction gave them away as forgeries. He said Costco sold the prints at art “road shows” that would move from store to store.

Yong, 44, first drew Western attention in 1989, when authorities raided a show of his paintings in Beijing. The works, inspired by Tibetan Buddhism, incorporated nude figures. Since he settled in L.A. in 1997, his work has been more commercial.