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Author Topic: Barrett-Jackson lawsuit  (Read 27853 times)
MMMM_ERT
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« on: January 29, 2007, 01:35:38 PM »

Thought some of you may find this of interest...I jacked it from another board.   It's somewhat long, but interesting. 


http://fourwheeldrift.wordpress.com/

 

Barrett-Jackson’s Westworld Tent Turns Out to be a House of Cards
January 27th, 2007 by fourwheeldrift


As a collector car journalist, I have been watching the Barrett-Jackson auction for years. For the last five or so years, it has been very apparent that the Scottsdale auction is at best a bastion of gross consumption…but now some hobbyists are claiming a worst: fraud.

I’ve discussed B-J with collectors, dealers and enthusiasts, many of whom would be considered “insiders,” meaning they’ve bought and sold cars at B-J and other auctions, or are well-known in the collector car hobby. For some reason, it is this year that people are all finally grumbling and passing rumors in unison.

The bottom line is that Craig Jackson and the B-J company seem to have really screwed themselves this year. Apparently, a well-known judge (legal, rather than concours) selling a vehicle at B-J this year has filed papers with the court, because B-J contracts specifically promise every car three minutes on the stand. Evidently, he was one of the sellers who had his car short-timed. He communicated the story, which got broadcasted via the Classic Thunderbirds List. According to the grapevine, this is already being discussed as translating into class-action status for the benefit of other sellers.

According to this judge and other sources, it appears Barrett-Jackson was operating a bit on the same level as an evangelical healing show. Allegedly they had assistants milling around asking what specific sellers thought their cars would bring. Armed with this information at the control desk, if a lot passed the value at which a seller indicated he’d be happy, the car would be rushed off and the gavel would fall – even if bidding was still very much alive.

Because the event was televised on live television via the Speed TV network, the plaintiff(s) now have video/audio proof that buyers were signaling increased bids before the three-minute marks, but were denied by a too-fast last call and hammer.

While this all might cause Barrett-Jackson to have to pay money to sellers in the form of a judgment or settlement, it is something else that might land Craig Jackson in jail.

It is no secret that Barrett-Jackson owns many cars that are run through the auction – it was something I suspected many, many years ago. This was proven when they started maintaining a showroom of cars in Arizona. This is not illegal, but stay with me.

Along with many collectors, I’ve always suspected that the cars owned by Craig Jackson and the B-J company were often driven up by shill bidders working for the company. Essentially, the strategy works in the sense that ever since the auction focus moved from classics like Packards and Duesenbergs to muscle cars, B-J has been able to shill, say a Hemi Cuda or mid-year Corvette 427 they own, which causes the value of the 10 other identical cars to increase. They wind up “buying” their own car back, but the others go on to regular buyers, who now are paying higher because of the perception the market has moved up.

This suspicion has been supported by at least one auction attendee this year that says he witnessed cars sold at auction headed in trailers back to B-J’s warehouse. The lawsuit allegedly points out that these cars also spent significantly more time on the block than others.

If this isn’t all interesting enough, during this year’s auction, fellow collector car journalist, Keith Martin of Sports Car Market, was booted from the Westworld premises and his media credentials revoked for voicing loud, specific concern regarding the event while sitting in the media room. Barrett-Jackson accused Keith Martin of “holding court” and attempting to send VIPs and journalists to the competing RM and Russo and Steele auction events. Among the alleged opinions included that the cars at B-J were of inferior quality (and had quality misrepresented,) as well as that the bidders were significantly over-bidding cars, which shouldn’t come as a surprise to anyone who has witnessed people paying six figures for cars they could have bought for under $50,000 any other day of the year!!!

This is somewhat of an interesting twist. Keith Martin’s publication has marketed the B-J events and has helped fuel its popularity. Keith is definitely one of the great “insiders” of the hobby, and has been a friend to Craig Jackson. In past years, Keith nor his publication have been critical of the goings-on and rumors, while other collector car journalists screamed that something stunk.

It makes sense, since Sports Car Market really only tracks the value of vehicles and other items sold at auction, rather than via private sales (which really has skewed SCM’s values for years!) So without kissing-ass to B-J, Keith would have missed insider info on the largest events covered by his mag. So we can only guess that Keith and Craig had a falling out of some type.

I applaud Keith for turning the corner on his view of B-J, but I’m with others I’ve talked to about this: I hate to say this about a colleague, but I believe his behavior was a bit unprofessional. As journalists, it is our responsibility to write what we think, but going to the show for years, then promoting RM and Russo+Steele while at Westworld is somewhat unkosher. I agree that Keith, a true hobbyist who started out by writing an Alfa Romeo newsletter, was for a long time too much a part of the “circus” about which he finally rejected, and that SCM has to a significant degree helped to fuel misinformation and a house of cards regarding specific auction prices and bidding behavior. Keith, by all accounts, is a really good guy — an enthusiast, who maybe just needed to take a step back and a big breath and reacquaint himself with those outside of the very insulated collector car “in crowd” — and spend time with some car people who are not trying to exploit the collectors. There are plenty of guys who have dug themselves too deep into this little crowd, and are no longer fun to deal with, because they’ve put personal greed well ahead of the cars and the collectors. Keith will rebound — he has a great internal staff of really fantastic people, who hopefully will help him return to his roots.

And Keith got his chance at revenge today, when his piece in the New York times said: “the red-hot market was cooling a bit.” He likened the high auction prices to the Dot.com craze, then went on to say: “While the prices of some types of cars remain strong, primarily low-production muscle cars with their original engines (“numbers matching” is the trade term) or sports racing cars like Ferraris, other more common cars produced in larger numbers, or cars whose engines have been replaced, are holding their values, at best.”

If you want to get back at someone who owns an auction house, the best way, I suppose, is to tell everyone that prices are too high. Ouch!

While I’ve never met him, the buzz among those in the hobby — both collectors and journalists, is that Craig Jackson is quite arrogant, so don’t expect many to come to his rescue. He inherited his father’s company, and has fueled B-J’s admirable growth with a combination of intelligence, drive, ego, and greed. While there is nothing wrong with that combination, if it results in unethical and possibly illegal activities, that’s inexcusable.

Like many surrounding the hobby, I will be watching the events unfold. Will the Westworld tents come down like a house of cards, or will everything just go away with an exchange of a little money? It’s happened before, like the 2006 event’s Futurliner debacle when investor Ron Pratt allegedly negotiated a $3.0M price (after B-J staff admitted to mistaking the high bid), but the reported sale was for $4.0M.

It’s hard to predict the outcome. None of us have all the facts. Craig Jackson has become a very powerful man, and his company has pumps an estimated $96M dollars into the Arizona economy annually. He’s allowed his say, and the appropriate judge/jury might very well decide he personally has done nothing wrong.

This all being said, there’s no doubt that Barrett-Jackson “jumped the shark” this year. Unlike when Fonzi did it, this story has Craig Jackson driving his allegedly shill-bid Hemicudas over the tank and down a ramp that could lead to six years in a minimum security prison-issued orange jumpsuit. If that’s the case, maybe he can get Sports Car Market in the slammer to keep-up on Russo and Steele, RM and Kruse auction results.
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« Reply #1 on: January 29, 2007, 11:06:18 PM »

All should read this.  It's important.  I was there.

Jerry
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dab67
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« Reply #2 on: January 30, 2007, 06:09:36 AM »

So what are we saying here??  :-\That when money and  particularly large amounts of money are involved, that no manner who you are or what your reputation is, you still have to know your stuff when comes time to buying?  Was wondering why in particular, some of the Hemi Cuda's that were selling on Sunday didn't even come close to getting the bids and dollars that was spent on Saturday.
What a shame Sad

Dave
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camaronut
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« Reply #3 on: January 30, 2007, 09:36:53 AM »

It's about time.......

Im amazed at the prices some of these cars get, and always wonder how they got that way....

Now I think we know.....

I was always suspicious about that auction, and it's popularity....but it's just my opinion that the combination of popularity and money always turns to unselfish greed.


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Adz28
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« Reply #4 on: January 30, 2007, 11:32:52 AM »

Is anyone able to validate this story? I did some searching and I don't see any other articles about this. The story posted is from a Blog (opinions/editorials) by Apex Marketing Strategy / Four Wheel Drift.

With all the lucrative endorsements, television contracts, sponsorships, etc... Why on earth would BJ risk their entire enterprise on something that is clearly fraudulent and even criminal, and so easily exposed. I hope the story is not true, because if it happening there, it is probably happening at all the other auctions.

I would not put it passed Craig Jackson to come up with a scheme like this, but the story seems a bit fishy to me. So, if you come across a "news" article, please post it.



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dab67
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« Reply #5 on: January 30, 2007, 12:36:35 PM »

Ad:

What do any of these endorsements, contracts or what not have to do with anything? If it is true and I am not saying it is, people and corporation (Enron comes to mind) will sacrifice their own familes to make a buck if the buck is big enough. So don't kid yourself that this could not happen.

Dave
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Adz28
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« Reply #6 on: January 30, 2007, 12:52:54 PM »

Don't get me wrong... I agree, it can totally happen here (and does happen all the time in the corporate world). All I am saying is that it would be such blatant fraudulent activity, it raises questions if it is true since there is little being reported. It would be nice to get some more info outside of a blog.
« Last Edit: January 30, 2007, 12:59:11 PM by Adz28 » Logged
MMMM_ERT
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« Reply #7 on: January 30, 2007, 01:14:56 PM »

Before I posted this thread, I tried to find more on the lawsuit to verify it...but could not find anything.    I will certainly post more info if it comes available.
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« Reply #8 on: January 30, 2007, 01:29:43 PM »

Just for giggles, I sent the text of the article as an e-mail both to the Speed Channel's main address as well as to the e-mail address for Wind Tunnel , which is a viewer call in / participation show also on the Speed Channel.  Wanted to see if they would in any way respond to the article since the BJ auction is on the Speed Channel.  Haven't received anything and really don't expect to.  In the spirit of fairness, though, wanted to give them a chance to comment if they wanted to.
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Richard Thomas
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« Reply #9 on: January 30, 2007, 02:42:37 PM »

Lot of funny stuff going on, from what I hear.
I had also heard that the 2 Boss 429's were part of the Craig Jackson collection.
They hit record prices, and went back to his collection???

Also that the "Last Corvette" is still owned by it's seller Proteam.
It will be on display at the Corvette museum, but it is stll available for sale.
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« Reply #10 on: January 30, 2007, 04:25:51 PM »

I've never been to a BJ auction in person.  I have been to a few RM auctions.  Sometimes, all those events look a little suspicious  --not just the prices, but also how cars move.  When you are talking that kind of money, it seems like "mystery" often surrounds it.
For what it's worth, I searched the recent articles of the Scottsdale Examiner and found nothing.  Surely, they would have an article on it, if there was anything known.
I'd love to know what Jerry and others who were there felt about how the auction was conducted.  It's hard to tell from TV.
The really sad thing is this cannot help but hurt the hobby for car lovers "big and small"...  Cry  Cry  Cry
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Phillip
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« Reply #11 on: January 30, 2007, 04:38:07 PM »

Quite a few of my friends go to AZ each year.
I keep hearing these types of terms used describe what goes on...

Dog and pony show
Smoke and mirrors
A fool and his money
big top circus
Silicone city Smiley

I just can't go to those big auctions anymore.
The fraud and misrepresentation made me very mad.
This had nothing to do with the auction houses.
Just a lot of dishonest sellers, and uneducated buyers.

My buddies just kept telling me to not take it seriously, and just enjoy the show.
I just hate it when sellers lie right to your face.
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paceme
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« Reply #12 on: January 30, 2007, 05:02:07 PM »

Just for giggles, I sent the text of the article as an e-mail both to the Speed Channel's main address as well as to the e-mail address for Wind Tunnel , which is a viewer call in / participation show also on the Speed Channel.  Wanted to see if they would in any way respond to the article since the BJ auction is on the Speed Channel.  Haven't received anything and really don't expect to.  In the spirit of fairness, though, wanted to give them a chance to comment if they wanted to.


Its amazing there were a bunch of people complaining how BJ was ruining the hobby because of the astronomical prices last year, and now another group is complaining how low prices, and how some bidders weren't given and opportunity to bid...hence the low prices..

My take is that the fourwheel drift fella has zero credibility. Most if not all his statments are unfounded or have been proven to be false. With such a big event you can't please everyone. And my take is that it is great entertainment, but you won't see me purchasing a car at an auction anytime soon.
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« Reply #13 on: January 30, 2007, 07:25:47 PM »



Dog and pony show
Smoke and mirrors
A fool and his money
big top circus
Silicone city Smiley


That pretty much sums up my experience two weeks ago at my first Barrett-Jackson event.   I personally can't stand an auction and the "be bwah biddle dee bee" speak, that gets on my  nerves within 5 minutes.   I'm just glad I went to see some of the most beautiful cars I've ever seen in person and likely  never will again.  I think people are idiots buying a car at auction when you could buy that car for less private party.   The seller may make more money by doing an auction...or some may not with the no reserve.  I can't believe some of the beautiful cars I saw go for dirt cheap.

Honestly, the vendors we spoke with were making fun of most of the bidders calling them dot commers with too much money and they're not true collectors.
The vendors are getting tired of being ripped off to have a display tent/booth there too.    Some don't even need the exposure BJ gives them, so they're likely not going to return.
BJ won't even let vendors bring in their own food and water, they make them buy from the food vendors putting more money in BJ's greedy little fists.

A local guy that we walked into the show from the parking lot told us a few years ago people were putting "for sale" signs on their car in the parking lot and BJ had them ALL towed.  Hows that for greed?  Does Jackson really think cars for sale in a public parking lot is going to hurt his precious auction?

If you ever go to the BJ event...just go to see the beautiful cars and ignore the crazed frenzy around you.   Do it once if you can.    I won't ever go back...which is too bad because it's nice to see those cars.  Just not worth the crazy price of admission anymore.
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« Reply #14 on: January 30, 2007, 08:06:26 PM »

Actually - that is what everyone says. You have to see it just once.
It is a chance to see more beautiful cars in one place, then you will ever in your life.

$500 to get into the bidders area.
Includes free drinks - I will be trying to get my moneys worth.

Better hope I just fall down, before I get silly enough to actually buy something.
The wife is coming with next time - she is "all original" equipment.  Wink
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