DPS Contractor Spent Lavishly, Lawsuit Shows

[Zacha341]

Goodness! What a legacy of deep-dished, bold-faced graft and corruption, on so many levels all for the hook-up, even down to "teaching" entrepreneurs how, among other things, to get contracts [[blood suck some more) from the district... Perhaps some down line building too?! Yet these greedy folk still cannot pay their tax bill, even after all the money diversions and scams. Truly ugly.... [[see below parts 1 and 2 broken over two threads)

Embattled DPS contractor spent lavishly, lawsuit shows
Contractor's bank records surface as suit heads to trial

BY JENNIFER DIXON
FREE PRESS STAFF WRITER

http://www.freep.com/apps/pbcs.dll/a...EWS01/4110512/

In the summer of 2005, Detroit businesswoman Sherry Washington and three partners sold Detroit Public Schools on a pilot wellness program for its employees. Their company, Associates for Learning, promised to educate roughly 3,000 employees on the benefits of a healthy lifestyle for $150,000.

By 2006, payments to Associates for Learning had ballooned to $3.32 million, DPS alleges in a lawsuit. And yet fewer than 150 workers had taken part in a health-assessment survey that was the key to the company's proposal, DPS claims in the lawsuit, which is scheduled for trial in July. Software for the survey cost the district another $1.4 million.

According to court records, federal authorities now are investigating Washington, one of her partners and Stephen Hill, the school official who approved the payments.

DPS also is alleging that Hill, the former head of risk management for the district, accepted as much as $30,000 in kickbacks from Washington's group.
This is not the first time Washington has been tied to questionable DPS payments. In February 2007, the Free Press reported that officials overseeing Detroit's impoverished schools purchased $1.6 million in art from Washington's downtown Detroit gallery.

Bank records recently obtained by the Free Press show that as Associates for Learning was collecting millions from DPS to improve the health of school employees, the company was spending money at the Somerset Collection, a BMW dealership, Comerica Park and casinos. And then there was that $16,000 stay and shopping spree in the Cayman Islands.

DPS says company did little, spent lots

The school district obtained the bank records as part of its lawsuit against Associates for Learning and its four founders: Sherry Washington, a prominent downtown art gallery owner; Dr. Gwendolyn Washington, a Southfield physician, and Detroit business consultants Sally Jo Bond and Marilyn White. Bond has worked for the City of Detroit and the Wayne County Commission, and White has taught at Marygrove College.

DPS contends the company provided few services in return for the multimillion-dollar payments it received between October 2005 and September 2006.

The company's bank account routinely was debited for expenses ranging from the mundane [[gas, groceries, a car wash, shoe repairs, dry cleaning, manicures and pedicures) to the luxurious [[$1,733 at Louis Vuitton in Troy, more than $16,000 in the Caymans for unidentified travelers, $1,609 at a duty-free shop in Windsor).

The records do not show who made the purchases -- they simply list dates and amounts paid.

The company also spent thousands more at Marshall Field's and Nordstrom, jewelry stores and restaurants, including a $1,256 tab at Seldom Blues in Detroit. It paid for iTunes downloads, spent money at a BMW dealership, Comerica Park and Circuit City. It even paid $67.84 at the Build-A-Bear Workshop in Troy. And it routinely withdrew cash at casinos.

A larger pattern

The district's claims against Associates for Learning are part of a larger lawsuit that alleges the former DPS director of risk management, Stephen Hill, and his assistant, Christina Polk-Osumah, diverted more than $57 million in improper wire transfers to a dozen vendors, including Associates for Learning. The suit claims Hill used secret offices and computer systems to hide the payments, which were made to vendors who were friends, associates or relatives of Hill and Polk-Osumah.

The FBI has opened a criminal probe of Hill, the Washingtons and others, according to court records.

In late 2007, FBI agents raided Hill's Detroit home, where they seized a computer and two laptops, mail, paperwork and photos. They also searched the offices of Associates for Learning and Sherry Washington's gallery, taking computer images and a dozen boxes of financial records and paperwork, according to search warrants filed in U.S. District Court.

Washington referred questions about the investigation to her lawyer, Jeffrey Collins of Detroit, who did not return repeated calls last week.

Collins, who also represents Gwendolyn Washington, said in a December court filing that a federal prosecutor has indicated the Washingtons are targets of a federal investigation.

"The government contends the evidence they have against Sherry Washington and Gwendolyn Washington is compelling," Collins wrote. "The threat of criminal charges is real and imminent."

Spokeswomen for the FBI and U.S. Attorney's Office in Detroit declined to comment last week.

In a Feb. 16 deposition, Sherry Washington repeatedly invoked her Fifth Amendment right against self-incrimination when questioned by a DPS lawyer about the money paid to Associates for Learning.

Gwendolyn Washington also invoked the Fifth Amendment repeatedly.

White and Bond did not attend their scheduled depositions in December 2009, both citing the pending criminal investigation.

Bond declined to comment; Gwendolyn Washington and White could not be reached.

The company's former lawyer, however, has said in court records the women did not commit any unlawful or improper acts, and did not orchestrate any fraudulent scheme. He said they had a deal with the district to provide services, which they delivered, and were entitled to be paid.

Robert Bobb, the district's emergency financial manager, did not address the allegations against Sherry Washington and her partners in a recent statement to the Free Press, but said: "The level of corruption that has been allowed to flourish in Detroit Public Schools in the past simply cannot be tolerated. That is why we are quickly and aggressively working to hold accountable those who have chosen to enrich themselves at the expense of our children."
Ida Short, a member of the Detroit Board of Education, said last week the board brought the lawsuit two years ago because "we want to get any and all money back that was illegally obtained by whoever it was obtained by."

In the spotlight

Sherry Washington has made headlines before:

• In 2008, the IRS filed a lien against Washington for $253,006 in unpaid income taxes; as of early April, it had not been lifted.

• In 2007, the Free Press reported that DPS spent at least $1.6 million in bond money -- funds that taxpayers approved to build or repair decaying schools -- to buy artwork through her gallery. She told the newspaper then that she took a 20%-50% commission, depending on the artist and work. The school district's inspector general, John Bell, said he currently is investigating the art purchases.

• In 2006, the Free Press reported that DPS was paying $200,000 to BWW Group of Detroit, a company formed by Washington, White and Bond, to teach entrepreneurs how, among other things, to get contracts from the district. At that time, DPS said it intended to spend another $180,000 with BWW in 2007. Critics said the money could have been used to hire teachers and that local business associations offered similar training.

• In 2004, the Detroit News reported that Cobo Center officials spent $500,000 to buy artwork from her gallery -- at a time when the conference center was expected to lose millions.

A presence downtown

Washington, 53, is a prominent presence downtown. She has sold contemporary and African-American inspired art since 1989; was on the board of the Downtown Development Authority from 2002-08, and has been a member of the Detroit Library Commission since 2005.

In addition to her DPS contracts, Washington has helped the Wayne County Community College District develop a cultural arts program, according to WCCCD Chancellor Curtis Ivery. In 2009, the district paid her gallery $92,880, up from $77,500 in 2008 and $67,250 in 2007. Her services include setting up art exhibits at galleries on its campuses, coordinating fund-raising events to support cultural activities, writing news releases and coaching students in overseas programs.

[[see part 2 of article below)

[Zacha341]

[[continued from part 1)

Embattled DPS contractor spent lavishly, lawsuit shows
Contractor's bank records surface as suit heads to trial

http://www.freep.com/apps/pbcs.dll/a...EWS01/4110512/

Ivery wrote glowingly of Washington in a March 18 letter to the Free Press.
"Ms. Washington has a tremendous following throughout Wayne County and, therefore, has been a great asset in our community outreach initiatives," Ivery wrote.

Associates for Learning had yet to be incorporated when it first approached Hill, then-head of risk management for the school district, about launching a wellness initiative in August 2005.

The company proposed a voluntary program to motivate and educate school district employees on the benefits of healthy lifestyles through education, special events and promotions.

It began as a pilot project with a $150,000 budget and plans to reach about 3,000 employees between November 2005 and March 2006. The company's proposal called for the district to make three payments between September 2005 and May 2006, totaling $150,000.

Instead, by March 2006, the company had received more than $1 million, then billed the district for another $2.2 million in May for what it called additional phases.

Questionable approval

Records show that Hill approved those payments that summer even though he was no longer a district employee.

At that time, Hill was working for a large risk-management company, Marsh & McLellan of New York, which allegedly had loaned him back to DPS. Marsh is also named in the lawsuit. The district accuses the company of billing the district for services at inflated rates or commissions, and for services DPS didn't need.

The district's lawsuit, filed in Wayne County in June 2008 and scheduled for trial this July, claims Associates for Learning billed the district for services it didn't intend to perform, and never performed. It also contends Associates for Learning paid Hill as much as $30,000 in kickbacks.

The suit said Hill chose Associates for Learning without competitive bidding and without a written contract detailing the complete scope of the project, and that both Hill and Associates for Learning "knew that making the selection this way would conceal their fraudulent, unlawful or otherwise improper scheme to get unauthorized, excessive or illegitimate claims paid."

Contact JENNIFER DIXON: 313-223-4410

[DetroitTeacher]

HMMM, I never heard of a wellness plan. I never filled out a survey because I never received one. What a pity that the money spent on this bologna wasn't used on the kids.

[Zacha341]

"Wellness Program" indeed! Just some fake "hopped-up" never-reached-the-intended-audience junk... Most of which could have been gleaned FREE from the web and distributed to staff at little cost towards healthy eating for example or for lifestyle options such as exercise or what not.

Instead, you get some hyped blown-up "program" or mega-dollar "study" with this and that consortium, and who-hah-ha consultant [[with the correct paperwork), and the endless royal enclosure meetings, useless power point presentations and flow-charts and the yack-ki-tee-yack with a couple of peeps at the top peeling off the top money.... yep the bureaucratic cash grab.

More of that to come and it will not just be local.

HMMM, I never heard of a wellness plan. I never filled out a survey because I never received one. What a pity that the money spent on this bologna wasn't used on the kids.

[Blueidone]

Something occurred to me today as I read this...

Does anyone know if other major cities are having these types of corruption problems? Are other major cities now thinking..."We better check on what is going on here to make sure it happening within our district"?

The pervasiveness of the corruption in the City of Detroit is almost mind-boggling. It seems that every area of administration in the City and the Schools needs to be "disinfected" from these parasites that have been living lavishly on our tax dollars. I realize that it is all beginning to come to light...but the damage done in the past few years may be irrevocable.

[Buy American]

Does any of this surprise you? There is corruption in Detroit that knows no bounds, from City Government to public schools. Unfortunately, the teachers are asked to sacrifice their wages and health benefits to supplement the losses the DPS have suffered because of these many thieves at the top level. The students are made to suffer because books, computers, and educational supplies are either sitting in some abandoned building gathering dust or have been stolen by these thieves. When are people going to be prosecuted? When will someone step in and get rid of every last one of these thugs? Bobb is doing a "so-so" job but more needs to be done. This will continue and the next generation of DPS administrators will only perpetuate the problem unless something drastic happens and people are made examples of.

[DetroitTeacher]

I did hear that the "artwork" purchased from Washington has disappeared from the halls of Cass. I heard from reliable sources that it wasn't the kids or any staff at Cass that took the art, either.

[firstandten]

Something occurred to me today as I read this...

Does anyone know if other major cities are having these types of corruption problems? Are other major cities now thinking..."We better check on what is going on here to make sure it happening within our district"?

The pervasiveness of the corruption in the City of Detroit is almost mind-boggling. It seems that every area of administration in the City and the Schools needs to be "disinfected" from these parasites that have been living lavishly on our tax dollars. I realize that it is all beginning to come to light...but the damage done in the past few years may be irrevocable.

The short answer is yes ! Philly has had some corruption problems, and B-ham Ala just put there mayor in jail [[ had to have elections and all, just like here)

When I discovered years ago that DPS and the City of Det were numbers 1 and 2
for employment of Detroit residents I felt that was not good. There needs to be more private sector employment for city residents. [[ Big reason why unemployment is around 50% for city residents)

The two public entities were nothing but cash-cows for certain folks and we all knew that at some time that cow was going to run out of milk.

Now that the contract-letting cash cows of city gov't and DPS has dried up, we are now just seeing the extent of the corruption that has gone on around here. I'm afraid there's more to come.

[English]

The short answer is yes ! Philly has had some corruption problems, and B-ham Ala just put there mayor in jail [[ had to have elections and all, just like here)

Chicago is just as corrupt as Detroit, if not more. The difference is that in Chicago, the corruption actually helps everything run [[or so the natives tell me). The Daley machine's skids are greased by the corruption, but somehow Chicagoans manage to have a world-class city because of [[or in spite of) it.

Our corruption, in contrast, seems to be either more egregious or more bumbling... perhaps mostly the latter. Whenever I read stories like this, I shake my head. Everyone in town knew that Sherry Washington was an artist. Why on earth was a local artist hired to helm a "wellness" program when the DMC, Wayne State, and Henry Ford Hospital have educational arms? I don't care if one of her partners was a doctor. There are too many local nonprofits with expertise in this area to justify this kind of expense. The district could have also sought grant funding.

When I discovered years ago that DPS and the City of Det were numbers 1 and 2
for employment of Detroit residents I felt that was not good. There needs to be more private sector employment for city residents. [[ Big reason why unemployment is around 50% for city residents)

The two public entities were nothing but cash-cows for certain folks and we all knew that at some time that cow was going to run out of milk.

Now that the contract-letting cash cows of city gov't and DPS has dried up, we are now just seeing the extent of the corruption that has gone on around here. I'm afraid there's more to come.

Agreed. Working in the government and/or education sectors is supposed to garner one a respectable living. NO ONE is supposed to get rich from it, or to have that expectation. I know all the sociological explanations for the kleptocracy, but our materialism has GOT to be curbed! Many Americans seem to care only about the outward trappings of wealth and luxury, and don't care about long-term investment.

The same mentality we see in the D and make fun of led to the housing crash and the criminal bailout of the banks. It just looks and sounds different... Detroit crooks usually can't make their words and their motives sound all pretty for the television. But the system is corrupt from top to bottom.

[barnesfoto]

[QUOTE: The same mentality we see in the D and make fun of led to the housing crash and the criminal bailout of the banks. It just looks and sounds different... Detroit crooks usually can't make their words and their motives sound all pretty for the television. But the system is corrupt from top to bottom.[/QUOTE]

Thank you. There is corruption in AMERICA that knows no bounds. How sad that so many myopes can see it locally but not nationally.

The sick cult that occupied the White House from 2000-2008 launched a criminal invasion of Iraq, based on phony intelligence. Our tax dollars paid for all sorts of reconstruction projects, including the rebuilding of schools in Iraq. Many of these projects were never completed.
Much of the work was contracted with BECHTEL, a huge corporation run by right wing cultists.

Naturally, it is much easier to ignore such criminal acts, because most of us never spend much time in Iraq.
However, some of us might have spent time in Boston, where Bechtels' work on the "Big Dig" project resulted in a disaster. Has Bechtel been required to step up and accept responsibility for their actions?

http://griperblade.blogspot.com/2006...d-big-dig.html

[jt1]

Just sickening.

I hope that if these scumbags ever go to trial the judge considers not just the dollar amount but the stolen opprotunities from all of the children in DPS.

Cahrge them with theft, chil abuse and any other charges that can be tied to the long term damage they cause the students by depriving them off books, etc.

[eastsidechris]

Nothing would surprise me when it comes to DPS approving contracts. A few years back I went to a school board meeting, and the board approved a testing contract for several hundred thousand dollars around 11 p.m. with nary any discussion about it before it passed. It made me wonder back then how many late night contracts have been approved by the district only because somebody knew somebody else and the public just had to trust the ethics of the board in passing them.

[ejames01]

I would bet that most of that money is in offshore bank accounts.

[DetroitTeacher]

I would bet that most of that money is in offshore bank accounts.

It isn't being used in MY classroom, that's for sure!

[daddeeo]

Has someone been dispensing License to Steal cards around here?
This is so bizarre that it is almost laughable except the teachers and school kids
have been getting screwed in the process.
Nice oversight heh?
Like maybe none!!!

[ejames01]

Where are the names of the DPS people that made this happen? Sherry could not have done this without any help. Why aren't they being sued? Did the School Board approve this deal?

[Detroitnerd]

Sherry Washington has been a smooth operator for years. I remember about six years ago I first heard that the art she was selling may have been less than it was billed as. I remember her getting a contract to put art in Cobo Center for $500,000 back when that structurecould barely be maintained. I remember the story from three years ago when they started looking into the $1 million she got for DPS schools. It's been slowly building. I am going to enjoy seeing her in court.

Bottom line: DPS and Detroit should never do no-bid contracting. Ever.

[ejames01]

And to think that I used to have a crush on her 20 years ago!

Sherry Washington has been a smooth operator for years. I remember about six years ago I first heard that the art she was selling may have been less than it was billed as. I remember her getting a contract to put art in Cobo Center for $500,000 back when that structurecould barely be maintained. I remember the story from three years ago when they started looking into the $1 million she got for DPS schools. It's been slowly building. I am going to enjoy seeing her in court.

Bottom line: DPS and Detroit should never do no-bid contracting. Ever.

[Zacha341]

I AGREE! Some people inside were either very STUPID to let this "tissue thin" BOLD-FACE Neon light bright scam "Wellness Plan" sail thru. Or getting their palms greased with cash too. The other obscenely high cost art stuff too, there was a green light for all of that.

I am certain this was another closed caballah of high-profile high amenities, royal enclosure folks too... part of the "clique" read click and tick. Talking slick!

Where are the names of the DPS people that made this happen? Sherry could not have done this without any help. Why aren't they being sued? Did the School Board approve this deal?

[Zacha341]

It need not be an either/ or construct. That's the con that keeps the culture of corruption going!

When in point of fact it's the white house [[national) AND in this case our "house" [[local), like where our children go daily. That house too. We "really" can take in the range that corruption has gone on here and at the white house... simultaneously.

The "cult" of greed and corruption under-girds it - full steam ahead. Fueled by justification derived from the "look what the repubs do" while we DO OURSELVES IN... with little constraint as we see from this extreme rip off from our community by people who say they are for the community and education. Please.... Hah!

Greed, and graft at this local level [[and at the white house - dems or repubs) has few boundaries when the people are blind - whatever you party APPARENTLY. We will have the evidence of that if this thing bows out in court full blown.

The repubs have stole, right along with our fair dems right here locally. When all is said and done it boils down to the party of SELF INTEREST too often!

[QUOTE: The same mentality we see in the D and make fun of led to the housing crash and the criminal bailout of the banks. It just looks and sounds different... Detroit crooks usually can't make their words and their motives sound all pretty for the television. But the system is corrupt from top to bottom.

Barnesfoto wrote: Thank you. There is corruption in AMERICA that knows no bounds. How sad that so many myopes can see it locally but not nationally.

The sick cult that occupied the White House from 2000-2008 launched a criminal invasion of Iraq, based on phony intelligence. Our tax dollars paid for all sorts of reconstruction projects, including the rebuilding of schools in Iraq. Many of these projects were never completed.
Much of the work was contracted with BECHTEL, a huge corporation run by right wing cultists.

Naturally, it is much easier to ignore such criminal acts, because most of us never spend much time in Iraq.
However, some of us might have spent time in Boston, where Bechtels' work on the "Big Dig" project resulted in a disaster. Has Bechtel been required to step up and accept responsibility for their actions?

http://griperblade.blogspot.com/2006...d-big-dig.html

[/quote]

[Lowell]

I have been wondering how long it was before this house of cards would collapse. My hackles were first raised with the Cobo art deal. After viewing the collection placed there, and knowing a thing or two about the artists and their prices, I remember thinking that the mark up had to be incredible. As I recall, it was a no-bid contract. But then Sherry Washington was highly regarded in the Detroit Art community for promoting several up-and-coming and prominent local artists and had long committed presence in downtown Detroit. So it was reasonable to assume that she had paid her dues and was getting her desserts.

Then came the same rumblings about the Cass Tech collection. Since I haven't seen it other than printed reproductions, I will reserve my personal judgment. From what I hear, again anecdotal, it may not be possible to see and what is there is nowhere close to the price tag. Why did she get such a big contract and again no-bid became the again begged question.

Art can provide a good cover since its value is always subject to debate and the morass of commissions, hanging and lighting, negotiating fees can further muddy the costs. Nonetheless, if the collections went to auction, I would be very surprised if they would fetch 10% of the their cost. But then maybe one of those artists might become renowned and one piece could recoup the entire bill. That's why art can provide such a good argument and why I don't think she will ever take a fall on those, if indeed there was any wrong-doing.

Now it surprises me to learn of these other non-art enterprises that she engaged in. She is innocent until proven guilty, but it does not look good. At the least she should have stuck to the vagaries of art where she was doing very well.

Now, suddenly, the fact that her gallery has long been next to Rep. Cheeks-Kilpatrick's office in the King Building make me go hmmm...

[Lowell]

Also, the Sherry Washington allegations are peanuts compared to the multi-million dollar stink surrounding Park West Galleries on Northwestern Hwy over alleged scams about overvalued sales on cruise lines. This was covered in Crains at the end of last year. http://www.crainsdetroit.com/article...FREE/311299949 I suspect it did not get much traction locally as it was not taking money from school kids and many of the alleged victims were not local. However here is some of the cases as cited by Crain's.

Southfield-based Park West Galleries Inc. is defending its reputation in nine pending lawsuits, eight filed against the gallery on behalf of art buyers and one filed by the gallery itself against a Phoenix company that has published buyers' allegations online.

In August, the federal Judicial Panel on Multidistrict Litigation found that most of the buyer lawsuits in federal court could be centralized at the U.S. District Court in Seattle, since they share similar allegations of “a fraudulent scheme to sell fake, worthless or low-value artwork at shipboard auctions or in private sales.” Seattle is home to Holland America Inc., one of the cruise lines to host Park West auctions and a co-defendant in some of the cases. The lawsuits, in order by filing date, are:

•Alan Beegal et al v. Park West Galleries Inc. et al
Filed: November 2001, resumed in June 2007, Burlington County Superior Court, New Jersey
Claim: Beegal is part of a group of buyers who have claimed inflated prices for artwork sold on cruise ships due to alleged Park West bidding practices during the auctions. An order was entered certifying a class action in the case, but that was reversed in 2007.
Status: Motion hearings expected in January 2010. No trial date set.

• David Bouverat v. Park West Galleries Inc., Park West at Sea
Filed: June 20, 2008, U.S. District Court for the Southern District of Florida.
Claim: Bouverat of Florida seeks a class action and alleges violations of the Florida Deceptive and Unfair Trade Practices Act, breach of contract and unjust enrichment. Bouverat purchased art from Park West aboard a Celebrity Cruise Line in June 2007. Damages sought exceed $15,000.
Status: Transferred in August 2009 to the U.S. District Court in Seattle, to be combined with the Rodney Blackman/Myra Kean case detailed next.

• Rodney Blackman and Myra Kean v. Park West Galleries Inc., Fine Art Sales, Holland America Line Inc., HSBC Finance Corp. and Does 1-10
Filed: Sept. 2, 2008, U.S. District Court, Seattle.
Claim: Blackman of Chicago and Kean of Kentucky seek a class action certification and allege fraudulent concealment, violations of the federal Racketeer Influence and Corrupt Organizations Act, breach of contract and unjust enrichment. Blackman purchased art from Park West aboard a Holland America cruise ship in 2003, and Kean purchased art from Park West auctions aboard a Royal Caribbean ship in 2007. By order of the federal Judicial Panel on Multidistrict Litigation, the Seattle court will hear this case along with at least two and possibly four federal cases in Michigan plus one in Florida.Status: Awaits oral argument on pending pretrial motions Dec. 2, and a Jan. 15 deadline to join new parties and additional pleadings. Trial currently set for May 2, 2011.

• Albert and Vivian Best, Sharon Day et al v. Park West Galleries Inc., Royal Caribbean Cruises Ltd., Albert Scaglione and Morris Shapiro
Filed: Dec. 23, 2008, Oakland County Circuit Court
Claim: The Bests, Day and seven other buyer plaintiffs allege violations of Michigan's fine art statue and the Michigan Consumer Protection Act, along with fraud, breach of contract, negligent misrepresentation and violations of a state law on multiple art sales. Most of the plaintiffs bought artwork aboard cruise ships between 2003 and late 2007, although Albert Best made a local art purchase in 1973 and Day and her husband purchased a collection of Dali works after a cruise in 2008.
Status: Awaits pretrial motion hearing Dec. 2; tentative trial date Feb. 22.

• Joseph Bohm and John Lee v. Park West Galleries Inc., PWG Florida, Vista Fine Art Sales L.L.C. d/b/a Park West at Sea, Albert Scaglione and John Does 1-100
Filed: April 13, 2009, U.S. District Court, Detroit.
Claim: Bohm and Lee of New York state seek a class action and allege violations of the federal Racketeer Influence and Corrupt Organizations Act, the Michigan Consumer Protection Act, state statutes on fine art sales along with breach of contract and unjust enrichment. Bohm and Lee “jointly” purchased art at Park West auctions aboard Celebrity Cruise Line and Carnival Cruise line ships in 2002 and 2004.
Status: Transferred in September to U.S. District Court in Seattle, to be combined with the Rodney Blackman/Myra Kean case.

• Bruce and Patricia Alleman v. Park West Galleries Inc., PWG Florida, Vista Fine Art Sales L.L.C. d/b/a Park West at Sea, Albert Scaglione, Royal Caribbean Cruises Ltd. and John Does 1-100.
Filed: July 22, 2009, U.S. District Court, Detroit.
Claim: The Allemans of Illinois seek a class action and allege violations of the federal Racketeer Influence and Corrupt Organizations Act, the Michigan Consumer Protection Act, state statutes on fine art sales along with breach of contract and unjust enrichment. The Allemans purchased art from a Park West auction aboard the Royal Caribbean ship The Enchantment of the Seas in 2005.
Status: A Nov. 23 conference to discuss settlement and jurisdiction was delayed; the judge placed a motion to dismiss Royal Caribbean from the case on hold. A decision on whether the case would be transferred to the Seattle court could come by year's end.

• Sean Mullen v. Park West Galleries Inc., PWG Florida, Vista Fine Art Sales L.L.C. d/b/a Park West at Sea, Royal Caribbean Cruises Ltd., Albert Scaglione, Holland America Line N.V., Carnival Corp. & plc, and John Does 1-100
Filed: July 24, 2009, U.S. District Court, Detroit.
Claim: Mullen of Washington, D.C., seeks a class action certification and alleges violations of the federal Racketeer Influence and Corrupt Organizations Act, the Michigan Consumer Protection Act, state statutes on fine art sales along with breach of contract and unjust enrichment. Mullen purchased art from Park West aboard Royal Caribbean ship Serenade in 2003 and Holland America ship Zuiderdam in 2005.
Status: Awaits a Jan. 27 hearing on a motion to dismiss the claims against Royal Caribbean, which is already dismissed in the Seattle case. Also conditionally transferred in September to the U.S. District Court in Seattle, to be combined with the Rodney Blackman/Myra Kean case.

• Donald and Joyce Hatter v. Park West Galleries Inc., PWG Florida, Vista Fine Art Sales L.L.C. d/b/a Park West at Sea, Carnival Corp. & plc, Albert Scaglione and John Does 1-100
Filed: July 29, 2009, U.S. District Court, Detroit.
Claim: The Hatters of New Jersey seek a class action and allege violations of the federal Racketeer Influence and Corrupt Organizations Act, the Michigan Consumer Protection Act, state statutes on fine art sales along with breach of contract. The Hatters purchased art from Park West aboard Carnival ships Triumph and Paradise in 1999 and 2001.
Status: Transferred in September to the U.S. District Court in Seattle, to be combined with the Rodney Blackman/Myra Kean case.

[Hermod]

1. No government entity at any level should be purchasing "art" for any reason. The peole who let the contraxcts should spend a few years inj iron-bar city.

2. Any person buying art on a cruise ship is too feeble-minded to be allowed out without a "keeper". The people saw the pictures and liked them. No criminal act here. Selling art on cruise ships is like selling food and drinks at sporting events. You charge what the traffic will bear.

[Lowell]

To say no art should be be purchased by a government would, by extension, mean that all government buildings should be plain functional boxes with no aesthetic additions and barren interior walls. That said, I would agree that any art purchases should be done with great care and oversight.

As for ship board purchases, most of that was done using established artists and done as much, if not more, for investment. Essentially it is similar to selling someone a mutual fund or some other financial product. Such art is evaluated by art historians and auctioneers who know the current market values, the authenticity of the work and other factors not obvious to the layman.

The allegations in the Park West suits are that the works were fraudulently overvalued or contained reproductions not authorized by the artist, i.e. misrepresented. Yes you can sell what the traffic will bear, but you cannot legally pour Mohawk vodka into a Grey Goose bottle and sell it as Grey Goose even if the patron can't tell the difference.