The Fiduciary Eye | Summer auction highlights

July is generally a quiet month in the auction calendar, but this year Sotheby’s captured global attention by offering 'Gus', a 67-million-year-old Tyrannosaurus rex in its Natural History auction in New York. Needless to say, it was the first time a dinosaur was exhibited at the Breuer Building – the Modernist landmark built to house the Whitney Museum and now serving as Sotheby’s global headquarters – which made the exhibition of the 12 ½-foot-tall, 38-foot-long fossilized skeleton especially dramatic. Estimated at $20-30 million, Gus went for an incredible $50.1 million.

A T. rex is not a traditional sculpture, even when it is shown in a gallery, and yet it commanded a price that one would expect from a top-tier modern or contemporary artwork at an evening sale. Auction house specialists value artworks based on a combination of factors, like rarity, quality, art-historical importance, and provenance. Generally, the most valuable art has extensive documentation behind it, like exhibition and publication history, which collectors additionally use to gauge value. But what are the considerations that go into determining the value of a prehistoric fossil that lay hidden in the ground since the late Cretaceous period?  

Provenance is important for an artwork, but it is the critical factor that affects a dinosaur fossil's marketability and value. When collectors, museums, and auction houses evaluate a dinosaur specimen, one of the first questions they ask is where it was found. The find site determines not only the fossil's scientific context, but also whether it can be imported, exported, sold, or even legally owned. A spectacular specimen with uncertain provenance or a risk of claims from foreign governments can be effectively unsaleable while a lesser fossil with clear title may command a considerable price.

Fossil ownership laws vary dramatically across jurisdictions, so for the market, a specimen's  provenance can be more important than its scientific significance. In the United States, fossils recovered from federal land are generally considered public resources held in trust by the federal government and may not be legally sold. Under the Paleontological Resources Preservation Act of 2009 (PRPA), scientifically significant fossils may only be collected pursuant to a scientific permit and must be deposited in an approved repository, such as a museum or university research collection, where they remain accessible to scientists and the public. Similar protections apply on many state-owned lands, and fossil collecting on Native American lands is governed by tribal authorities. As a result, fossils discovered on federal or otherwise protected lands are not typically legally available to private buyers, regardless of their scientific or commercial appeal.

In the US, different laws apply on privately owned property. Fossils found there generally belong to the landowner and may be lawfully sold – creating the legal foundation for a robust commercial fossil market. Other countries take a different approach. Many – including Mongolia, Morocco, and Brazil – treat dinosaur fossils much the way they treat antiquities. They are part of the national patrimony, irrespective of whether they are found on public or private land. They cannot be privately owned and may not be legally exported or traded. And the force of these laws does not stop at a country's border. In the case of Mongolia, the actor Nicholas Cage discovered this the hard way. In 2007, he acquired the skull of a Tyrannosaurus bataar from a Beverly Hills gallery for $276,000. In 2014 the Department of Homeland Security tracked down the dinosaur and informed Cage that the fossil has been stolen. There was little question it had been: that species has been found only in Mongolia. Cage surrendered his dinosaur skull and was not accused of any wrongdoing. 

Because those countries laws vest ownership in the State, US law treats fossils taken from those countries as stolen property. The Department of Homeland Security has forced collectors to surrender fossils covered by these laws, and at least one person has been imprisoned for dealing in them. Therefore, given the legal pitfalls, the next time you want to pick up some dinosaur fossils while on vacation in Marrakech . . .  you may want to call us first! 

US law permits a licit market, making the US the most important source for large, complete dinosaur skeletons. 'Gus,' the Tyrannosaurus rex skeleton that Sotheby's sold in July, is an excellent example.  Gus is among the most complete T. rex specimens ever discovered – it has 75% to 80% of the animal's total skeletal mass.  This combined with its anatomical rarities (including almost complete dinosaur feet, and healed battle scars and bites from other dinosaurs) and its impeccable find site on private land, made Gus the ultimate 'trophy dinosaur.' The auction house was involved with the dig from the outset, photographing every step, and presented the story in a carefully produced 11-minute documentary video filmed at the dig site. The impeccable provenance combined with the rarity of the dinosaur itself, propelled the record setting price.

Fossils are a special category of object, but the question of how to assess value is of increasing relevance as any number of non-traditional collectibles are appearing alongside art at the major auction houses. Music and sports memorabilia are also surging in value, with prices often turning on 'proof' that a particular object was part of popular history. In March, David Gilmour’s 'Black Strat' became the world’s most expensive guitar when it sold at Christie’s for $14.6 million; the auction house was able to document that the instrument was used in every Pink Floyd album, and so its very sound was embedded in the consciousness of millions of fans. For sports memorabilia, value hinges on definitively connecting a particular item to a great player and a notable game. Over the summer, Sotheby’s offered a basketball warm-up jacket that had been worn by Wilt Chamberlain in the 1972 NBA finals in its Summer Sports Marquee auction. The jacket was discovered at Goodwill by a 19-year-old 'treasure hunter' for $3.07!  The auction house proved its historical place through rigorous photo-matching to 54-year-old images from the NBA finals. It ultimately went for $89,600 – nothing close to the $10.1 million Sotheby’s got in 2022 for Michael Jordan’s 'Last Dance' game-worn jersey from the 1998 NBA finals, but not bad for a $3 thrift-store find.  

Sotheby's auction of major 19^th- and 20^th-century paintings and sculpture from the collection of British financier Joe Lewis and his daughter Vivienne totaled £306.6 million ($406.2 million). Nine lots sold for more than £10 million, led by an Amedeo Modigliani nude that went for £48 million ($63.9 million). The sale was fascinating from a fiduciary perspective for two main reasons. First, collections of this value have traditionally come to market following the passing of the collector, but the 89-year-old Lewis, who became a billionaire through currency trading, is very much alive, as is his daughter. Increasingly, collectors are choosing to sell during their lifetimes, simplifying the division of an estate, creating liquidity for the next generation, and, importantly, retaining control over how a collection they spent decades building is presented to the public. Art-rich estates often face significant financial challenges, including enormous liquidity needs and compressed tax deadlines. That can force decisions about valuable works on a timetable that is far shorter than one would ideally want for planning, positioning, and selling a major collection. This is why we believe conversations about succession need to begin well before there is an estate to administer. For important collections, the question isn’t simply who inherits the art but what the family ultimately wants the collection to accomplish — financially, culturally, and as part of the collector’s legacy.