CLEVELAND: Bidder 78 is putting more than a quarter-million dollars into the pockets of beleaguered Fair Finance Co. creditors.
Saturday's art auction of work collected by Fair Finance co-owner Timothy Durham raised more than $400,000 — well above what the Akron company's bankruptcy trustee and even the auctioneer thought would be brought in.
A huge chunk of change was dropped by the anonymous Bidder 78, who spent more than $267,000 via telephone bids on numerous works by contemporary artist Peter Max, prints by Picasso and other pieces. The bidder declined to be identified, other than to say he owns an art gallery in Florida and does business in England.
Net proceeds from the auction — which lasted more than three hours at Trinity Cathedral in Cleveland — will go into the estate of Fair Finance for eventual distribution to thousands of creditors.
The amount, while exceeding expectations, is a drop in the bucket compared with the more than $200 million that an estimated 5,300 Ohio residents had invested in the company, which is under investigation.
Durham, the chief executive of movie firm National Lampoon Inc. who bought Fair Finance in 2002 with Indianapolis business partner James Cochran, turned over the art collection for the auction. The FBI, meanwhile, in the summer seized Durham's motor vehicle collection, which the bankruptcy trustee is also in the process of selling.
Creditors forced Fair Finance into bankruptcy in February after FBI raids on its Akron headquarters and related offices in Indianapolis late last year. While court records show that federal investigators suspect Fair Finance was being operated as a Ponzi scheme, no one has been charged or arrested.
''Thank the Lord for Bidder No. 78. I have no idea who that is,'' said Joseph Esmont, a Cleveland lawyer at Baker Hostetler who works alongside Fair Finance trustee Brian Bash. Esmont sat in the back row of the auction where he monitored the proceedings.
''Overall, we're very pleasantly surprised,'' he said. ''We didn't expect to match the value of the insurance valuation. We're happy with the bids. I didn't expect the Peter Max [pieces] to catch as much fire as they did.''
Bids rise fast
Bids surprised other people at the Cleveland Auction Co.-run event, with the audience of more than 60 gasping at times as bids increased by thousands of dollars in less than a minute. People could bid in person, by telephone or online.
Nancy Hoislbauer, a budget administrator with the Ohio Department of Health in Cleveland, successfully bid on a Renoir print.
''The money will go to the creditors, which is great,'' she said. Hoislbauer said she had learned of the auction just a day earlier and decided to attend.
How much money is brought in from the auction won't be known until it is all collected over the next several days, said Kelly Grimm, auctioneer and principal at Cleveland Auction.
''I am so relieved it did better than our expectations. We got some good prices,'' she said.
''I got four pieces of art. I'm a collector,'' said Gary Burlin of Cleveland Heights. ''I thought it was a great auction. Surprised at some of the prices. Astonished at some of the prices.''
The first Peter Max artwork to go up for auction, one of nine mixed-media portraits of rock group U2's lead singer Bono, opened at $800. Bidder 78 won with $4,250 — and proceeded to get the eight other Bono portraits at prices ranging from $4,000 to $10,500.
Bidder 78 also won all five Picasso prints with successful bids ranging from $5,250 to $7,250.
A Peter Max race car painting called Lady 500 sold for the most money. It opened with an $1,800 bid and sold for $24,000.
Prices exceed estimates
Not everyone got what they wanted.
Shaker Heights residents Lindsay Tucholka and her stepson, Michael, 9, hoped to buy a James Bond movie poster autographed by all of the actors who have portrayed Bond over the years.
''We're big James Bond fans,'' Lindsay Tucholka said. ''That's all we're here for, really.''
But the piece opened with a $550 bid, higher than they could afford. The winner — Bidder 78 — got it for $1,000.
Curtice Malone, a Mentor resident who described himself as an eclectic art collector, said he was stunned by some of the winning bids. While he thought pieces might sell for double the auctioneer's estimates, many went for triple or higher, he said.
''It was really something to see how high they went,'' Malone said.
One piece, a Miro etching that he thought might sell for a couple thousand dollars, had a winning bid of $12,500, he said.
Not all of the Peter Max works went for large amounts. A serigraph print of Disney cartoon character Goofy went for $550, while one of Mickey Mouse went for $700.
And six Peter Max portraits of Durham sold to another anonymous telephone bidder at prices ranging from $700 to $1,300.
''Why anybody would bid on the Tim Durham pictures is beyond my imagination,'' Malone said, speculating that perhaps Durham himself was bidding on the portraits from his own home.
Jim Mackinnon can be reached at 330-996-3544 or email@example.com.