Bank of America sues real estate execs over artwork
Bank of America is suing two Atlanta commercial real estate executives and their companies, demanding they hand over pricey artwork to help settle a $4.5 million debt.
The suit, filed this week in U.S. District Court in Atlanta, says Barry Real Estate Cos. Inc., BSTwenty LLC, Chairman Harold Barry and Chief Executive Officer Christian Schoen owe the money after defaulting on $12 million in loans taken out in 2007.
Efforts were made Thursday to reach Barry and Schoen for comment. Morris, Manning & Martin in Atlanta, the law firm representing Bank of America, said it had no comment.
Both Barry Real Estate and BSTwenty shared offices on Ivan Allen Jr. Boulevard in Atlanta, but the secretary of state’s website shows BSTwenty has not been registered with the state since 2010.
Barry Real Estate’s projects include the 15-story Allen Plaza in Atlanta, Pershing Point Plaza in Midtown, and office buildings in Nashville and Birmingham, among others.
According to Bank of America’s lawsuit, Barry Real Estate took out a $4.5 million loan in January 2007 that was secured by a pledge of artwork owned by Schoen if the loan went into default, which it did in July 2008, the bank said.
BSTwenty took out a loan in August 2007 for $7.5 million, which matured in August 2010. The suit said Schoen, Barry and Barry Real Estate promised the BSTwenty debt would be repaid.
The bank said Barry Real Estate’s failure to meet its obligations on its loan also constituted a default on the BSTwenty loan, since it was a guarantor of the BSTwenty note.
Bank of America said the defendants also failed meet obligations under a 2009 loan modification agreement, which they agreed to satisfy by January 2010.
The bank said it is owed $1.4 million on the Barry Real Estate note and $3.1 million on the BSTwenty note.
To help pay down the debt, the bank said Schoen sold six paintings in May 2012 for $2.6 million, of which Bank of America received about $1.7 million.
The bank claims one of those paintings, an Andy Warhol portrait of country superstar Dolly Parton, fetched $550,000, but Schoen kept the proceeds instead of giving it to the bank.
The bank said Schoen still has four paintings worth $3.1 million, based on appraisals by Christie’s auction house.
In addition to the artwork and payment from the sale of the Warhol painting, Bank of America is seeking attorneys’ fees and any other relief that the court “deems just and proper,” the suit says.
