Gallery Owner Salander Files for Bankruptcy

NEW YORK—Salander-O'Reilly Galleries owner Lawrence Salander and his wife have filed for personal bankruptcy protection, citing creditor claims of more than $50 million, Bloomberg reports. The filing comes amid a criminal investigation based on customer complaints about fraud as well as a barrage for lawsuits from individuals and companies who contend that Salander pocketed proceeds of art sold on consignment, failed to deliver promised investment profits, and reneged on loans, bills, and credit-card charges. Creditors with $4.6 million in claims filed an involuntary petition against Salander-O'Reilly Galleries November 1.

The couple's bankruptcy filing "is not surprising, because both they and the gallery had a lot of debt that seemed to be connected,'' said Dean Nicyper, a lawyer representing Earl Davis, the son of artist Stuart Davis, who seeks $2.9 million from Salander and the gallery. 

Salander lawyer John Moscow declined to comment on why his client filed for personal bankruptcy or on whether a petition on the gallery's behalf is imminent.