The Salander Chronologies: The Roy Lennox Case

NEW YORK—The following timeline—drawn from legal complaints, other court documents, and one report from Bloomberg—traces the relationship between Lawrence Salander and Roy Lennox, an executive at hedge-fund company Caxton Associates who invested over $2 million through the Salander-O’Reilly gallery only to later declare the operation “nothing more than an illegal Ponzi scheme.” Now trying to reclaim his investments and recoup $812,812 spent on a Donatello sculpture he alleges is merely a copy, Lennox is one of several claimants who allege they were convinced by an initial successful deal to enter Salander’s world of rarified art and diminishing returns. (For an extensive timeline of Salander’s numerous ongoing court cases, click here. For details on the Earl Davis case, click here.)

Jan. 2003 – Around this time Lawrence Salander approaches Roy Lennox, a friend and neighbor of his in Millbrook, N.Y., with a proposition to jointly purchase a $800,000 Jean-Baptiste-Camille Corot painting. Salander says he has found a buyer who will pay $1.25 million for the artwork, and that if Lennox invests $400,000 in the painting he will earn the money back plus $225,000.

Jan. 2004 – Lawrence Salander makes good on his initial deal with Roy Lennox, paying him $625,000. Afterward Salander offers Lennox a chance to invest $950,000 in three other artworks—a Santi Buglioni sculpture, a stucco relief by Desiderio da Settignano, and Stuart Davis’s painting Combination Concrete—for a promised return of $1.5 million.

March 2005 – When Roy Lennox is due to receive proceeds from the sales of the three works, Lawrence Salander proposes that he reinvest the $1.5 million owed plus $500,000 more to help the gallery buy 45 unspecified artworks from an Italian estate. Salander assures Lennox that he will receive a full inventory in due course and that he will be alerted each time a work is sold, receiving his share of the profits within ten days. Lennox agrees to the deal, acquiring a one-third share of the collection.

Sept. 2005 – Between this month and April 2006, Roy Lennox and his wife invest a total of $1,135,000 through the gallery in shares of Arthur Dove’s Sun and Moon, Marsden Hartley’s Abstraction, Provincetown, and Jackson Pollock’s Untitled, 1943. As before, Salander states that there are buyers in place, and he says the investment will earn back $1.6 million. Lennox also buys stakes in two Goya paintings, Capriccio with Five Heads (in May 2005) and Bullfight (in September), for $550,000, but is not guaranteed specific returns from sales.

March 2006 – Roy Lennox and his wife each receive overdue payments of $166,666 from the sale of the Hartley, for a total of $333,332. This is the last time Lennox and his wife, who have invested $3,135,000 since the first deal, see any money from the gallery.

June 2006 – Around this time Roy Lennox asks Lawrence Salander for an update about the art Lennox has invested in and inquires when he will see his returns. Salander assures Lennox that the art is safe in the gallery’s warehouse and that although some works had not yet sold, there is nothing to worry about.

Jan. 2007 – Concerned about the lack of payments, Roy Lennox again asks Lawrence Salander about the money owed. Salander offers to pay Lennox with artworks from the gallery’s holdings. Later this month he offers Lennox the chance to buy a bozzetto, or scale model, that Donatello made for his Cavalcanti Annunciation at the Basilica of Santa Croce in Florence. At first Salander says most of the $812,812 price would be covered by the money the gallery owes Lennox, but after delivering the sculpture to Lennox’s home he asks for the full amount, saying he wants to buy other works from the people who sold it. Lennox agrees after Salander emphasizes how excellent a deal it is for a Donatello. According to Lennox, Salander later tells other people that the sculpture is actually an anonymous copy.

Feb. 2007 – Roy Lennox’s accountant contacts the gallery—after numerous unsuccessful attempts—to discuss the money owed his client. Salander-O’Reilly acknowledges that it owes Lennox $1,266,668 and that he had invested an additional $2,550,000, but instead of making payments Lawrence Salander again offers to compensate Lennox with art from the gallery. At one point the dealer sends Lennox an unsolicited selection of works, which Lennox returns. On another occasion Salander offers to bid on art for him at Sotheby’s in exchange for reducing the debt, but Lennox refuses.

May 2007 – After Roy Lennox’s accountant contacts the gallery again and Lennox contacts Lawrence Salander personally, the dealer says he will begin making monthly $100,000 payments beginning May 15. No payments are made.

Aug. 29, 2007 – Roy Lennox sues both Lawrence Salander and Salander O’Reilly, accusing the defendants of operating “nothing more than an illegal Ponzi scheme.” All the while, the suit alleges, Salander and the gallery were “using Lennox’s investments to pay other creditors and investors.” Lennox seeks $4,629,480—the amount invested and owed plus the money spent on the purported Donatello sculpture—and an additional $10 million in punitive damages.

Oct. 15, 2007 – Lawrence Salander agrees to give Roy Lennox six artworks and a library of rare art books, plus money and jewelry if the library is worth less than $1 million. However, various competing claims on Salander’s assets tie up the settlement. (2)
Nov. 7, 2007 – Roy Lennox’s case will return to court.

Key to sources: Maine Antique Digest (1), Bloomberg (2), New York Times (3), New York Sun (4), New York Post (5)