One of the University”s wealthiest alumni and most generous contributors was convicted yesterday of price fixing by a U.S. District Court jury in New York and could face up to three years in prison.
Billionaire A. Alfred Taubman, a Bloomfield Hills shopping mall mogul and former chairman of Sotheby”s auction house in New York City, was found guilty of conspiring with rival auction house Christie”s International to inflate prices and commissions between the auction houses, which control 90 percent of the world”s art auctions.
Prosecutors believe the scheme made Taubman and Christie”s Chairman Anthony Tennant $400 million in commissions over six years.
Throughout the years, Taubman has made pledges to the University totaling $35.6 million. The Taubman School of Architecture and Urban Planning, the Taubman Medical Library and the Taubman Center of University Hospitals all bear the benefactor”s name.
After Taubman”s indictment in May, the University released a statement saying Taubman”s name would continue to be recognized on University buildings, regardless of the outcome of the trial.
University President Lee Bollinger said there is no policy for removing a benefactor”s name from buildings or programs.
“He has given us much and we”ll continue to honor those contributions,” Bollinger said in the statement. “In our recollection, the University has never before removed an individual”s name in this way We are committed to retaining his name.”
University officials said yesterday that despite the conviction, they are still standing by this policy.
Taubman has proclaimed his innocence since the indictment, saying that although there might have been a price-fixing conspiracy between Sotheby”s and Christie”s, he did not know about it and did not orchestrate it.
“As confirmed by the lie-detector test I have taken, the truth is on my side,” Taubman said in response to the indictment. “While any trial is difficult, I look forward to the opportunity to clear my name in court.”
But the jury found Taubman”s words hard to believe.
During the trial, which began Nov. 9, prosecutor John Greene of the U.S. Department of Justice”s antitrust division focused on testimony from Sotheby”s former chief executive, Diana Brooks, who testified that Taubman and Tennant held a secret meeting in 1993 in which they agreed to eliminate discounts and end the rivalry between the two auction houses.
Tennant, who lives Andover, England, has refused to come to the United States to face charges.
As chairman of the company and real estate mogul, Taubman “thought he was above the law,” Greene said. “You don”t become a millionaire without knowing how to read the bottom line.”
During the trial, defense attorney Robert Fiske, a graduate of the University”s Law School, said Brooks had conspired to fix prices without Taubman”s permission or knowledge.
Fiske also presented testimony from other Sotheby”s executives who painted Taubman as a simple businessman who fell asleep at board meetings and did not have the know-how to plot such a conspiracy with his rivals.
“We agree with the prosecution that a crime was committed,” Fiske told the jury.
“The question for you is whether Mr. Taubman had anything to do with that agreement.”
Brooks pleaded guilty to the same price-fixing charges in October 1999 and had also faced three years in prison before testifying against Taubman.
In addition the University of Michigan, Taubman has also given substantial donations to Brown University and Harvard University, which have created the Taubman Center for Public Policy and American Institutions, and the Taubman Center for State and Local Government, respectively.
Two of Taubman”s major contributions to the Detroit area include Briarwood and Somerset malls.
The Associated Press contributed to this report.