Art dealer pleads not guilty in $1 million embezzlement case

LOS ANGELES, Calif. – A prominent Los Angeles art dealer pleaded not guilty Friday to three grand theft counts charging him with failing to pay more than $1 million to former Disney executive Michael Ovitz and another man for paintings he sold for them.

Perry Rubenstein was ordered held on $1 million bail pending a further hearing next Friday. He was also ordered to return to court May 11 for a pretrial hearing.

Prosecutors said Rubenstein sold two Richard Prince paintings for Ovitz in 2013 for more than $1 million, but never paid Ovitz. The former Walt Disney Co. president and co-founder of Creative Artists Agency later sued him.

A year earlier, he is accused of selling a piece by Japanese artist Takashi Murakami for collector Michael Salke for $825,000 but paying Salke only $575,000.

Rubenstein, 62, was arraigned on three counts of grand theft by embezzlement.

“We deny all these allegations and look forward to clearing his name and getting his reputation back,” Rubenstein’s attorney, Stephen Sitkoff, told the Los Angeles Times (http://lat.ms/1SxTHi0 ).

If convicted of all charges, Rubenstein faces a maximum of 15 years in prison.

Salke told police he contracted with Rubenstein in 2011 to sell the Murakami scroll for $750,000, but he agreed to let it go for $630,000 when Rubenstein told him that was the offer he got. Rubenstein eventually paid Salke $575,000, according to the Times.

The Eli and Edythe Broad Foundation bought Murakami’s “The World of Sphere,” and it is now part of The Broad museum collection but is not on display.

Rubenstein, who made his name as a New York art dealer, opened his Los Angeles gallery four years ago to much fanfare on the local art scene.

When he filed for bankruptcy two years ago, creditors he listed included Ovitz, artists Shepard Fairey and Zoe Crosher, German sculptor Georg Herold and Dutch photographer Iwan Baan.