Bankrupt Canadian auction house Ritchie’s now a mere memory

TORONTO (ACNI) – Visitors to the Web site for Canadian auction house Ritchie’s will find that the company’s last connection to the sector it once dominated no longer exists. A notice on the company’s site, www.ritchies.com, confirms that a bankruptcy order was issued against Ritchie’s Inc. on Oct. 26, 2009, with Grant Thornton Limited of Royal Bank Plaza, Toronto, shown as the court-appointed trustee.

Once known for its multimillion-dollar art sales held in conjunction with Sotheby’s, Ritchie’s had been in financial trouble since last summer, at least. Sotheby’s ended its 8-year association with Ritchie’s after the latter company failed to meet a deadline for payment to consignors. But it was their landlord, Hildegard Hammer, who petitioned the Canadian Superior Court to force Ritchie’s into bankruptcy, claiming she was owed $131,000 in back rent.

Following published reports of staff upheaval, a seemingly closed gallery and “nervous consignors,” Auction Central News spoke to the owner and CEO of Ritchie’s Auctioneers, Ira Hopmeyer, in August of 2009. At the time, Hopmeyer rubbished media reports, describing them as “sour grapes,” and “misconstrued information from sore losers…”Hopmeyer, who bought Ritchie’s Auctioneers 16 years ago, said he took the initiative to assume control at the auction house after certain events took place that he says occurred without his knowledge.

Toronto’s Globe and Mail newspaper had reported on Thursday, Aug. 13, 2009, that a small contingent of consignors had congregated in Ritchie’s parking lot the day before, hoping to collect either unsold items or money owed to them by the auction house. Instead, the Globe and Mail newspaper said, they found an unattended gallery and a sign on the door advising that the company was on “summer holiday” until Aug. 17. The sign also indicated that the auction scheduled for that day had been postponed.

Further, the article stated that 27 employees had been laid off for financial reasons and that the company’s president and chief operating officer, Stephen Ranger, had resigned.

At that time, Hopmeyer told Auction Central News, “Yes, former management laid off some staff, and yes, Ranger resigned previous to the layoffs. He had tried to increase his stake in the company and made an offer that was not accepted. He then made a second offer for a lesser share that was accepted, but he later reneged…He wanted [the increased stake] for nothing. I’m not interested in giving it away.”

In an Aug. 13, 2009 blog posting attributed to Stephen Ranger, Ritchie’s former president wrote in part: “The central problem was a liquidity issue that I as a former minority shareholder had no control over, none…Anyone out there who actually believes that I didn’t try repeatedly to fix this situation should examine the logic. Why would someone with as much time, energy and commitment to this business leave if I hadn’t exhausted every avenue to try and make it right? There have been no underhanded machinations here. Everyone knows at this point that I tried repeatedly to buy this business, to fix it, to salvage it, but ultimately could not.”

Hopmeyer – who acted as interim president from 1999 until “2004 or 2005” – said he had considered Ranger to have been “very competent with the auction part” of Ritchie’s operation, “but not the business part.”

On Aug. 3, Hopmeyer stepped in to assume the executive management reins at Ritchie’s. He said a trimmed-down team of “loyal employees” had been reinstated to pick up where they left off before the shakeout.

“The overhead had gotten out of control,” Hopmeyer said in that same interview. “We’re not a New York or London auction house. There will be no more fancy cocktail parties, flying around the country or paying outside consultants exorbitant amounts of money…”

Hopmeyer said that in an effort to maintain transparency and allay misapprehensions, he had been posting updates on Ritchie’s Web site. The final posting, according to The Canadian Press in an Oct. 28, 2009 online article, was “a terse message to consignors and secured and unsecured creditors.”

Those who believe they may have a claim against Ritchie’s can contact the trustee, Grant Thornton Limited, by calling 416-366-0100. Additional information may be found on Grant Thornton’s Web site: http://www.grantthornton.ca.

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