Michael McKenzie, one of the central figures in the legal saga surrounding the late-artist Robert Indiana, wants to continue to make “HOPE” prints and sculptures under Indiana’s name and is suing Indiana’s estate for the right to do so.

Robert Indiana poses at his studio in Vinalhaven in 2009. Associated Press/Joel Page

In the latest maneuvering in a complicated legal case that involves allegations of art fraud and elder abuse, McKenzie is asking a Maine judge to weigh in on a dispute that surfaced after McKenzie and the Indiana estate apparently reached a settlement late last year. Through his attorney, John J.E. Markham II of Waldoboro and Boston, McKenzie filed a request for a preliminary injunction in federal court in Portland on Friday, asking U.S. District Judge D. Brock Hornby to halt costly arbitration proceedings in New York between McKenzie and Indiana’s estate, represented by Rockland attorney James Brannan, until a Maine court can decide whether terms of prior mediation between the parties are binding.

McKenzie, a longtime collaborator with Indiana, contends the items under dispute were settled by binding mediation in Portland, with both parties signing the agreement Nov. 26, 2019, after two days of mediation. That agreement allows him to continue to make artwork under Indiana’s name, including prints and sculptures of Indiana’s “HOPE” image, for 10 years. Brannan and the estate say it’s not binding because McKenzie broke the agreement days after agreeing to it and before the final settlement could be written and signed.

Markham wants a court in Portland to stop the arbitration process and settle the question, because the mediation occurred in Portland and most of the key players in the dispute reside here. Brannan concurred that the agreement was intended to be binding – he sent a note to the New York arbitrators to that effect, informing them “the parties have signed a term sheet that resolves all claims and counterclaims in this action.” But before a final settlement could be produced and signed, McKenzie broke the agreement by sending inflammatory emails, he said. “We all signed a term sheet outlining the agreement, but then he went off on his own,” Brannan said.

McKenzie sued Brannan and the Indiana estate in federal court in Portland in late July seeking to enforce the terms of the agreement reached in mediation. Friday’s action would stay the arbitration process in New York so a Maine court can decide if the term sheet both parties agreed to last November is binding.

Brannan could not be reached Friday, but in a previous interview he said the term sheet they signed wasn’t final and that McKenzie violated their agreement soon after both signed it. “Within days, McKenzie refused to honor it,”Brannan said, by sending an email on Dec. 5, 2019, to media outlets and others with the subject line “finally the dirtbags lose.” In that email, McKenzie affirmed his right to produce Indiana artwork and argued for the authenticity of other art that he said he and Indiana produced together and whose authenticity has been questioned. The term sheet of the agreement included confidentiality and non-disparagement clauses.

Rather than continue with arbitration that could last into 2021, McKenzie is suing so he can continue to publish and sell artwork related to the image “HOPE,” which he and Indiana agreed to produce and market together beginning in 2008. McKenzie said he paid Indiana more than $10 million between 2008 and his death in 2018, and he wants to continue producing “HOPE”-related work, which he says will benefit the Star of Hope Foundation. Indiana created the foundation, which takes its name from the massive former Odd Fellows lodge that he bought and restored on Vinalhaven island and where he lived for 40 years, to operate a museum for his art after his death.

“McKenzie really hopes to continue promoting Indiana’s great artwork, as he has done in the past,” Markham said on Friday. “And that was the point of term sheet that we contend is binding and should be enforced. It will certainly benefit the Maine charity and Vinalhaven.”

The fate of the foundation is tied to the value of Indiana’s estate, which is estimated to be worth close to $90 million.

Indiana, who became famous in the 1960s and 1970s when his “LOVE” was widely reproduced in pop culture, died at age 89 at his Vinalhaven home in May 2018 after he, McKenzie and Indiana’s caretaker, Jamie Thomas, were sued in federal court in New York by another Indiana art partner, the Morgan Art Foundation. In its civil suit, which continues in federal court in New York, Morgan alleges that Thomas and McKenzie conspired to create numerous fraudulent artworks under Indiana’s name and without his knowledge by isolating him in his home and turning away visitors. Indiana, who was alive when the suit was filed and had no known heirs, was named in the suit to protect unauthorized artwork from being made in his name and to protect his legacy, Morgan lawyers have said.

Maine Attorney General Aaron Frey, who is named in McKenzie’s Maine suit because of the attorney general’s supervisory authority over charitable nonprofit organizations in Maine, urged the parties to settle in November, because of the rising cost of litigation. Nearly $4 million in legal fees had been billed to the Indiana estate by January, according to court filings. In an interview, Brannan said legal fees “are in the vicinity” of $6 million now, and McKenzie guessed that figure was low. “I bet they are closing in on $10 million now,” he said.

Brannan settled disputes with Thomas and McKenzie, although the McKenzie settlement is in question, and the litigation with Morgan continues. Brannan has said he does not intend to settle with Morgan. Depositions in the primary case are expected to continue through August.

Frey and other litigators from the attorney general’s office would not comment on the case or related matters.

Sigmund D. Schutz, who is representing Brannan in the Maine matter, said McKenzie’s latest filing is an attempt at “forum shopping” to shift the venue from an arbitration hearing in New York to a courtroom Maine. “In our view, the New York arbitration is the appropriate forum to answer all the issues he is raising,” Schutz said, who also represents the Portland Press Herald in First Amendment cases. He blamed McKenzie for the mediation failure. “It didn’t pan out because of McKenzie, so we have proceeded forward to address the merits in an appropriate forum, which is arbitration.”

Under the terms of the agreement reached between McKenzie and Brannan in November, McKenzie’s company, American Image Art, would pay the Indiana estate 25 percent of American Image Art’s gross proceeds from the sale of authorized “HOPE” prints and sculptures, which were to be produced and sold based on specifications included in the original “HOPE” agreement between McKenzie and the artist. The estate retained rights of approval for aesthetic and production decisions.

The agreement spells out many other details that offer insight into both the complexity of the legal case and the central issue of authenticity of some of Indiana’s late-career art. The agreement stipulates that American Image Art would destroy or deliver to the estate an autopen machine that it used to sign Indiana’s name to artworks, and that the parties would agree to retain a neutral third-party expert to determine if disputed artworks are authentic. It also says the estate would take no position on a key sculpture produced late in Indiana’s life that has come into question, a piece called “BRAT” that was made for Johnsonville Foods, a Wisconsin sausage maker.

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