A New York judge has ruled against billionaire investor and art collector Ronald O. Perelman in his bid to collect $400 million from insurers for five paintings he said were damaged in a 2018 fire at his East Hampton estate, according to the New York Times.
Justice Joel M. Cohen of State Supreme Court in Manhattan found on Friday that there was “no visible damage” to the works—two by Andy Warhol, two by Ed Ruscha and one by Cy Twombly—and “nothing traceable to the fire” that would reduce their value. “The artworks [can] be enjoyed as they were before,” Cohen said in his bench ruling.
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Perelman, once among the richest men in America, claimed the fire robbed the works of their “spark” and “oomph.” His lawyers argued that high humidity, smoke, and soot penetrated the protective frames, dulling color and contrast, even if the damage was not immediately visible. “All of the pictures lost their luster, lost their depth, lost some of their definition and lost a lot of their character,” Perelman said in his complaint.
The insurers—including Lloyd’s of London, Chubb, and AIG—countered that the works were unscathed and accused Perelman of filing claims while under severe financial pressure following a collapse in the value of Revlon stock, which he had long used as collateral for loans. In court papers, they called the case “a money grab,” noting that Perelman sold 71 works for nearly $1 billion between 2020 and 2022 to satisfy lenders after Deutsche Bank issued a margin call. Revlon filed for bankruptcy in 2022.
The trial, which began this week, drew on years of wrangling over how to define art damage and the differences between visible destruction and microscopic or chemical change. Expert witnesses included conservators and chemists who debated whether humidity could cause long-term structural deterioration. Insurers dismissed the testimony as “unscientific and unreliable.”
The case also highlighted Perelman’s ties to top collectors and dealers. In 2020 Citadel founder Ken Griffin and gallerist Larry Gagosian visited The Creeks to view works in the dining room where the Twombly and Warhols hung. Griffin later bought a Brice Marden painting from Perelman for $30 million, a work that had also been in the house during the fire. Insurers cited the visit as evidence that Perelman contradicted himself, first treating the paintings as marketable, then declaring them damaged when they failed to sell.
Perelman’s attorneys noted that insurers had already paid claims on more than 30 other works from the same fire, including pieces on the same floor as the disputed paintings. They argued that policy terms entitled him to collect the full insured value even if damage was nominal.
While siding with the insurers, Justice Cohen declined to find that Perelman had intentionally misled them. Lawyers for his holding companies declined to comment on whether they will appeal.
The case, one of the art market’s most closely watched legal battles, has stretched on for years and included nearly 2,000 court filings. It underscores the difficulty of quantifying damage to art, particularly when the dispute involves a collector with both a reputation for philanthropy and a long trail of legal filings.