Louise Blouin, an art mogul and socialite, lost her Hamptons mansion, La Dune, in bankruptcy court earlier this week. She attempted to contest the sale because the $89 million price tag was not enough to cover her debts.
The scene in the courtroom was unique. Blouin represented herself, despite acknowledging that she had no experience practicing law. She attempted to use emails that had not been submitted into evidence to support her claim that Sotheby’s Auction House had rejected better offers on the property. The documents had handwritten annotations in the margins that confused witnesses and presiding Judge Alan S. Trust.
Judge Trust appeared unmoved by the proceedings and ruled that the sale was fair. Blouin’s claim that there had been offers on the property of over $100 million seemed unfounded and primarily based on a neighboring property on Meadow Lane fetching $112 million in a recent sale. Harald Grant, the broker for the property, said the price stalled out around $77 million during its auction in January. Unfortunately for Blouin, this was well under the debt she still owes on the home.
Blouin originally put La Dune on the market in 2016 with an asking price of $140 million. She was in the midst of several legal issues and was accumulating a large amount of debt. Her businesses, ArtInfo, Art + Auction Magazine, and Louise Blouin Media, were not performing well. Blouin was sued by multiple employees. These included those who claimed wrongful termination after they complained of not being paid, employees who said their social security benefits and federal taxes weren’t paid to the government despite being taken out of their paychecks, and the company who printed her magazines who claimed they were not paid.
Amid these legal and financial troubles, Blouin leveraged La Dune. The property features two houses including a main house and a guest house. In 2011, the main house received a $15 million loan from Morgan Stanley and the guest house received an $8.5 million loan from Wells Fargo. When she was unable to sell the house for $140 million in 2016, Blouin took out an additional $26 million in loans from JBG Management. The company sued her in 2021 for failure to pay interest and attempted to put La Dune into foreclosure.
The IRS caught up with her soon after, claiming her unpaid taxes and penalties from companies Louise Blouin Media and ArtNow totaled approximately $10 million. She responded in an affidavit, saying, “At some point in time, I was a shareholder. While one of the companies bears my name, I was never a director, manager, or employee.”
In an interview with the New York Times, Blouin claimed she was a victim of “predatory lending,” that the FBI is investigating her case, and that she is, “one of the most successful women in the world.”
Painter and long-time friend of Blouin, Ross Bleckner, also spoke to the New York Times regarding Blouin’s case. He said that he never understood where her money was coming from while attending Blouin’s lavish parties that were packed with the stars of the art world. “There are people who can live with a crushing level of debt and it doesn’t seem to bother them, because they just keep borrowing other people’s money to make more money,” he commented. “But in this case, that didn’t happen.”
