Diamond Auction Houses and Justice Department of America
2000: Diamond Auction Houses Have Been Undergoing Serious Investigation
The two main auction houses, Christies and Sotheby’s, are having serious legal problems. Since 1997, the U.S. Justice Department has investigated if the two companies violated anti-trust laws by colluding to set their commission structures. But according to reports, the investigation took a turn a few weeks ago, when Christie’s disclosed that it had cut a deal with the Justice Department for conditional amnesty in exchange for information on price-fixing in the industry, including information about its own conduct under prior management. There are also several class-action lawsuits stemming from the investigation. This has already had major repercussions in the companies — both the president and CEO of Sotheby’s recently resigned.
From our readers’ perspective, the important news is that, as a result of this, the auction houses have both changed their commission structures. Sotheby’s new sellers commission numbers include:
20% Up to $1,999
15% $2,000 to $7,499
10% $7.500 to $99,999
9% $100,000 to $249,999
8% $250,000 to $499,999
6% $500,000 to $999,999
And while we don’t have Christie’s numbers yet, one thing is assured — their numbers will be different.