Anatomy of the rise and fall of a price-fixing conspiracy: Auctions at Sotheby's and christie's

Abstract

The Sotheby's-Christie's price-fixing scandal that ended in the public trial of Alfred Taubman provides a unique window on a number of key economic and antitrust policy issues. The trial provided detailed evidence as to how the price-fixing worked, and the economic conditions under which it was started and began to fall apart. The role of the amnesty program was important to the case, and does not appear to have had a role in the cartel's enforcement of price-fixing or the cartel's demise. The outcome of the case also provides evidence on the auction process used to choose the lead counsel for the civil settlement. Finally, though buyers received the bulk of the damages, a straightforward application of the economic theory of auctions shows that it is unlikely that successful buyers as a group were injured. © Oxford University Press 2005, all rights reserved.