Hasted and Kraeutler Sue Each Other over Claims of Lavish Expenses and Missing Artwork

Accusations range from ill-gotten hairdos and exotic mini bar treats to missing artwork.

Sarah Hasted and Joseph Kraeutler.
Photo Patrick McMullan.

The conflict between New York art dealers and former partners Sarah Hasted and Joseph Kraeutler has heated up, with both sides filing legal complaints seeking damages as high as $1.6 million.

The pair’s Chelsea gallery, Hasted Kraeutler, which opened in 2010 and focused on contemporary photography, closed this summer, as reported by artnet News.

An August 12 summons that Hasted provided to artnet News levels a number of accusations against Kraeutler. Hasted claims that he sold artworks for his own personal gain, without paying commissions to the gallery. She accuses him of slander for what she calls false statements to the gallery’s artists. She says he improperly accessed her email, even citing the 1968 Wiretap Act. He improperly seized the gallery’s assets, she charges, and furthermore claims that Kraeutler’s lawyer abetted his client’s breach of fiduciary duty by falsely informing gallery employees that Hasted had been removed from her management position.

She seeks $1.6 million in damages. She’s represented by attorney Herbert Deutsch.

Kraeutler’s October 21 complaint claims a “grievous betrayal of trust.” Despite the gallery having been funded with more than $595,000 that came from Kraeutler and loans from his family, it says, Hasted “used the gallery as a personal piggy bank in order to fund her extravagant lifestyle.” It says Hasted used the gallery’s American Express card “to enjoy lavish spa treatments, eat in expensive restaurants, buy designer clothing, and stock her home refrigerator with gourmet treats.”

He says she ran up more than $175,000 on the card to get memberships in boutique fitness clubs, to “have her hair ‘done’ at high-end New York salons,” and to buy books and music. Moreover, she misappropriated a $25,000 photograph by Jean-Paul Goude, an $11,000 photo by Pierre Gonnord, and a $9,000 photo by Albert Watson, according to Kraeutler.

Kraeutler blames the gallery’s closure on Hasted and seeks $250,000 in damages. Representing him is Joshua Epstein of Davis & Gilbert, LLP.

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