Christie’s Snatches Purse Specialists, Heritage Sues for $60 Million
The growing luxury accessories market is increasingly cutthroat.
Designer Hermès handbags—or, more precisely, the experts who help sell them—have become a major point of contention in a lawsuit filed against Christie’s by Heritage Auctions. As reported by the New York Times, three handbag specialists, including Matthew Rubinger, who have decamped from Heritage for Christie’s have been accused of breach of contract and stealing trade secrets, and are being sued along with their new employer for $60 million in damages and lost profits.
In the world of designer handbag auctions, a “vintage” purse (never “used,” but sometimes made as recently as last year) can fetch over $100,000. In the past, Christie’s hasn’t focused much of its business on designer accessories, but that is about to change.
A sale at Heritage Auctions in late 2011 set the handbag record with a $203,000 bright red crocodile Hermès Birkin, with handles and embellishments of diamond-encrusted 18-karat white-gold. The purses are produced in extremely limited numbers at an atelier in a Parisian suburb from the finest and most exotic materials, and rumor has it that the wait-list for a new Hermès can be as long as three years.
“If you buy one Hermès bag for $20,000, depending on the popularity, the skin, the color, the size, you can resell it down the road for an average of 60 percent to 150 percent of what you paid for it,” Heritage president Gregory Rohan told the Times in a phone interview.
The resale market for designer bags is a relatively recent development. As a college student, the now 26-year-old Rubinger, who had previously had a small-scale resale business for inexpensive purses and a designer handbag eBay shop, interned at online retail shop DropShop (now Portero). There he launched the company’s luxury category, which quickly became its second-most profitable area.
When Rubinger met Rohan in 2010, the former was put in charge of Heritage’s luxury accessories business, which soon became Rohan’s primary focus. The two shared an office and closely collaborated on the growing business.
“I thought he was a close, personal friend. We socialized…”
To Rohan’s great surprise, Rubinger tendered his resignation in May. “I thought he was a close, personal friend. We socialized. We had lunch and dinners together frequently. We collaborated on everything,” said Rohan. “Honestly, my wife and I don’t have children, and I thought of him as a son.”
According to the lawsuit, Rubinger received extensive training and important introductions to sources in Asia, as well as insider information about the auction house’s expansion and branding plans. The suit also claims that Rubinger arranged for one of the other handbag experts who moved to Christie’s to sit in on an important executive meeting with access to confidential strategic plans the week before their departure.
Rohan believes that Heritage “created a dynamic worldwide market that everyone would like to own.”
Christie’s, for its part, is not about to admit any wrongdoing. “We have reviewed the complaint and find it to be wholly without merit,” a spokesperson for the auction house told the Times. “We are prepared to vigorously defend these claims and Christie’s decision to expand our existing handbag department.”
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