Orrick’s Jean-Pierre Martel, Anne-Sophie Kerfant and Diane Lamarche achieved a tremendous victory last week in a decision that has been hailed as a “surprise verdict” by the New York Times.
Since 2011, Orrick has been assisting Diane and Alec Wildenstein Jr., heirs of the internationally renowned art collector family, with numerous civil, tax and criminal French proceedings in which they are involved alongside their uncle Guy Wildenstein, following the deaths of their grandfather Daniel in 2001 and their father Alec Sr. in 2008.
Jean-Pierre and Diane have been representing the Wildenstein siblings in a complex criminal procedure launched against them (inter alia) alleging tax evasion and/or laundering of tax fraud proceeds. The prosecution and the tax administration alleged that the Wildenstein family, advised by their previous counsels, deliberately excluded some assets from their inheritance tax declaration, including a collection of paintings that were placed in trusts abroad. Daniel and Alec Sr.’s advisors at the time and the trustees were also sued, in addition to the heirs.
This case has generated widespread media coverage globally and was characterized by the French press as the “tax heist of the century,” given that the sums claimed by the French tax administration are in excess of €500 million – the highest tax reassessment ever in France.
After convincing the instructing magistrate to dismiss all charges against Diane Wildenstein, Jean-Pierre and Diane focused their efforts on defending her brother, Alec Jr. They succeeded in convincing the Court that not one of the legal elements required to prove tax evasion under French criminal law was present, and that therefore the Court must dismiss the charges, despite an aggressive prosecution and mounting negative publicity.
Thanks to their defense, and despite the media’s prediction of a historic criminal conviction in the case, a French tribunal of judges decided last week to clear all changes against Alec Jr. and the other defendants.
This victory must now be confirmed on appeal, since the prosecution and the tax administration immediately filed a recourse to challenge this decision.