What the Levys Learned from Disaster
One of America's premier family-owned antiques firms split apart in the 1970s. Out of the wreckage was born a successful new father-son partnership.
The business started out as a junk shop on New York City's Lower East Side, founded by two brothers-in- law, John Ginsburg and Isaac M. Levy. It grew into one of the nation's most distinguished antiques galleries, with wealthy clients like Henry Ford, Henry Francis du Pont, and Richard Loeb. Through 72 years the founders and then their sons managed to work together. Ginsburg & Levy Inc. was the country's oldest antiques firm selling Americana when a running argument in the families broke it apart in 1973.
The dissension had come to a head one morning in 1969, when Dean Levy, the only third-generation member in the business, arrived at the gallery to find that his relatives, the Ginsburgs, had taken down an A. F. Tate painting worth about $20,000 along with two other works that he had recently bought. "They were propped up like trash, waiting to be hauled away," he says.
According to Dean, Benjamin and Cora Ginsburg had decided the gallery should not sell paintings. "We don't like your paintings," Ben had said. "They don't look good in the gallery. The only way we would want American art is if we would become as big as the Kennedy Galleries." (Kennedy is among the most eminent galleries for 19th century American paintings.)
Dean, who had wanted the firm to buy and sell more art through a separate department that he would run, got the message. His relatives weren't interested in his contribution.
He and his father, Bernard Levy, stayed on with the firm for a short time. The clash over Dean's paintings, however, contributed to the eventual breakup of Ginsburg & Levy. The two families negotiated a settlement, split inventory 50-50, and dissolved the corporation in a process that took three long years and made headlines in New York newspapers and the antiques journals.
Ben, then in his seventies, retained the Madison Avenue building and renamed his business Benjamin Ginsburg Antiquary. By 1983, he and Cora, who also worked there, had retired and closed the shop.
After trying unsuccessfully to buy out the Ginsburgs, Bernie and Dean Levy started a competing firm in 10 enormous rooms they leased on the second floor of the Carlyle Hotel on Madison Avenue. Seventeen years later, now situated in a six-story Georgian brownstone on Madison, Bernard & S. Dean Levy Inc. has a client roster of more than 2,500 and sales of between $3.5 million and $6 million a year.
What unraveled Ginsburg & Levy was more than a disagreement over taste and the direction of the business, although the argument about Dean's art crystallized some of the issues. A combination of factors caused the split in the family, according to several members who agreed to be interviewed. Some simply didn't like each other, they admitted. Others resented the third generation's entering the firm.
On a few critical points in the history, memories are cloudy after so many years, and there is little or no consensus. But this much is certain: The founders had been so busy buying and selling antiques and trying to cement their reputation that they never planned for continuation of their firm. The second generation never resolved who would lead the company, whether a third generation would fit in, and how the business would change as it grew. Lack of planning and communication proved to be the company's undoing.
The founders also made other, more specific mistakes. By leaving equal shares of one class of stock to each of their heirs, they almost guaranteed a clash between those who were full participants in the firm and those who were less active, One awkward result of the arrangement was that Bernard Levy's two sisters, Beatrice Gaerth and Ruth Geller, were later allied with the Ginsburgs against him in the battles over the firm's ownership.
"Selling antiques is such a personal business that I find it hardly surprising that it's often passed on and shared by families," says Clement Conger, a curator of antiques at the U.S. State Department, which has one of the country's preeminent collections of American furniture and paintings.
Yet some of the best family firms seem to become endangered species in later generations (see below). The family connection seems to aggravate rivalries and tensions in a highly volatile field that requires fine discernment and subtle matters of taste. Those tensions shattered a 72-year-old partnership at Ginsburg & Levy Inc. Bernie Levy, now 73, and his son Dean, 47, are determined not to make the same mistakes.
Hundreds of New Yorkers were in the junk business when John Ginsburg and Isaac Levy opened their shop near the Bowery in 1901. These two, however, soon began specializing in finer furniture and art, and moved the business uptown to Manhattan's antiques center on Fourth Avenue between 26th and 27th streets.
"Most dealers remained in the same area, sold the same merchandise — not our family," says Bernie, a thick-set man, who seems more gregarious and less conservative than his son. "Our fathers had different types of minds. They weren't just merchants. They were interested in the history of antiques, finding out about each piece: who owned it; why the marks and nails were in the way they were; why finishes were done just so; what made a piece good or better."
In those days, there were few authoritative published sources to guide them. Ginsburg and Levy became antiques detectives who studied construction, checked whether wormholes were original or drilled in later to simulate age, and learned to recognize the distinctive styles of individual craftsmen.
During World War I, American interest in handcrafted furniture soared, partly out of national pride and partly because European goods were harder to obtain. The partners prospered and moved again, to a fancy address on Madison Avenue. By then, the founders had fine-tuned their partnership: Ginsburg was the buyer, Levy the salesman.
The wealthy and famous were beating a path to their door. Henry Ford asked them for a collection of Chippendale and Hepplewhite furniture and American pewter. The Rockefellers began buying for the Colonial Williamsburg restoration. Collectors began amassing pieces for the museums they would later fund, such as Henry Ford's Greenfield Village in Dearborn, Michigan.
The stage was set for the second generation to come into the business. Benjamin Ginsburg studied engineering but came into the firm at age 23 in 1927 because he felt his poor eyesight would hamper him in a career outside the family business. Bernard Levy joined the firm part-time, while he was in college, in 1936, and full-time a year later.
People weren't buying antiques during the Depression, and for several years the Ginsburgs and Levys paid themselves minimal salaries. To maintain cash flow, they set up a separate cabinet shop where they made reproductions that were easier to sell than the high-priced originals. Their principal competitor, Israel Sack, came close to bankruptcy, but Ginsburg & Levy survived unscathed.
Bernie Levy hadn't planned to stay in the business, but when he met New Yorker Laura Redfield in the late thirties, his plans changed. He and Laura wanted to get married, and Bernie decided he had better not risk starting another career.
With fathers and sons working together, Ginsburg & Levy bought more and sold more. They produced the first of many catalogs and shows to attract and educate collectors. Isaac Levy died in 1944, and John Ginsburg in 1952. By then the sons were in charge, with Ben Ginsburg, the inside man, concentrating on sales, and Bernie Levy, the outside man, doing most of the buying for the gallery.
A wave of home-buying in the fifties spurred sales of furniture of all kinds, modern and antique. But as interest in antiques continued to build in the sixties, competition among dealers intensified. Along with more collectors, there were many more dealers. Prices escalated and customers shopped around.
But more than competition from other dealers, the arrival of third-generation member Dean Levy brought out the underlying tensions in the families. Dean originally expressed no interest in a permanent position. During his junior year at Yale, however, the history major took an art course with a professor who introduced him to 19th-century American paintings.
Dean loved the field and tried to switch his major, but it was too late. After graduating in 1964 he wanted to return to work in the family business, but trouble was roiling the firm. Even though Bernie Levy felt Dean was "a natural-born salesman, like his grandfather," he thought the young man would have trouble getting along with his aunts and with Ben. One of Bernie's sisters, Beatrice Gaerth, worked occasionally in the gallery, as did Ben Ginsburg's sister, Ruth Kline. Bernie recalls that the three sisters were demanding greater dividends and cutbacks in buying. But Beatrice Gaerth recalls that the quarreling "focused more on the general management of the firm and business, but there was certainly constant fighting."
Nevertheless, Dean persisted in his desire to join Ginsburg & Levy, and his father gave in. Almost immediately, Bernie's judgment proved to be correct. Dean and Ben disagreed over just about everything, although Cora Ginsburg attributes their disputes to "youth having too much of its own ideas."
After a year, Dean left and went to work for the prestigious art firm of Hirschl & Adler for about eight months. He subsequently went out on his own, but after he made a major sale of six Sheraton chairs to Ginsburg & Levy, which immediately sold them to the White House, the family firm lured him back, with a good salary.
The problems quickly resurfaced when Dean proposed the separate department to buy American paintings. "It will set our firm apart," Dean told his relatives. The Ginsburgs and Dean's two aunts vetoed the idea, but agreed to let him sell art only if he bought it with his own funds. In the first two weeks, Dean sold two paintings valued in excess of $10,000, a coup at the time. One was an Alfred T. Bricker, which went for $3,500; it is now worth more than $35,000.
When the Ginsburgs took down the A.F. Tate and the other two paintings, according to Dean, the sparks began to fly. Cora Ginsburg disagrees with Dean's assessment of the incident. "The fact that Dean brings it up after all these years is ridiculous," she says. "It doesn't mean anything that we took the paintings off the wall. They might have been off the wall for another reason- — I can't remember why."
But, Cora adds: "My husband was against having paintings in the place. He never liked the idea. This was an established business. Dean came in and wanted to establish his niche, but it wasn't consistent with what we wanted. We never had paintings before, and we didn't want them then."
At about the same time as the incident, Ginsburg & Levy was beginning to lose sales. The relatives were continuing to demand bigger dividends and less buying, which had a boomerang effect on profits: The stock of antiques wasn't being replenished, and less inventory meant fewer sales and smaller dividend checks.
The arguments between Ben Ginsburg and the Levys escalated, Beatrice recalls. "Ben was a very difficult person," she says. "Bernie was much younger." It was a classic clash between different dispositions and generations.
With the business at an impasse, Bernie and Dean began to think about buying out their relatives. In 1970 they made an offer. Ben would join them in buying out the sisters and he would stay on as a full partner. Their second offer — a simple buyout — proved more palatable. At first, Ben and Cora considered agreeing to it, with the proviso that Ben be allowed to stay on at the gallery as an adviser. But then they turned it down, as did the sisters, who felt the money offered was not enough.
Since they had only Bernie's one-sixth share of the business, the Levys could not very well initiate a sale to an outsider. On July 18, 1973, the family assembled once again at the gallery to try to resolve their differences. Nobody budged, and the meeting was about to be adjourned. Suddenly Bernie stood up and announced he was resigning. The rest of the family was delighted, he recalls: "They didn't have to pay my salary. They would be able to run the business their own way."
Bernie and Dean realized that it was time to go forward on their own, in a new business. With an accountant and lawyer, they drafted a document that split common shares 50-50 between father and son. Under a buy-sell agreement, if either decided to sell his shares, the other would have first option to buy them; when one of them died, his stock would be bought by the corporation with the proceeds of an insurance policy, thus leaving the other in full control. The other family members were given no equity.
Bernie and Dean went on a buying spree to build up inventory. Dean sold some of his paintings to raise capital. A month later they rented space on the second floor of the Carlyle and began filling it with furniture. The store opened on Oct. 23, 1973, with a gala premier party. "We sold a lot of furniture off the floor that night," says Dean.
The Ginsburgs and Bernie's sisters immediately resented the competition. Bernie says that the three sisters came to him and begged him to buy them out. Bernie sums up what they said this way: "We want out. Ben isn't running the business the way we want him to." With Bernie and Dean gone, the remaining family members had turned on each other. "They needed a new enemy," Dean says.
The Levys again offered to buy out their relatives. Ben flatly refused, but the three sisters agreed. Bernie's sisters sold their Ginsburg & Levy shares to Bernie and Dean, which gave the Levys a 50 percent stake in the business.
It took from 1973 to 1976 to complete a settlement. In the end, the two sides split, about 1,500 pieces according to assessed value. Those that went to Ben and Cora Ginsburg were later auctioned off by Christie's and brought them in excess of $2 million.
The settlement signaled a final break in family ties. Ben and Cora rarely speak to Bernie. Ben is too old to work, though Cora continues to sell textiles from the couple's home in Tarrytown, New York. Bernie and his sisters also have little contact, occasionally seeing each other at family functions, mostly funerals. Neither of the sisters was invited to Bernie and Laura's 50th anniversary celebration last summer.
Entering the Levys' antiques shop on New York City's Upper East Side, one is promptly immersed in the past — and the family's success. A Federal doorway from the old Griffith House in New Jersey hangs above the front door. Inside, period American paneling and colors, gleaming wood floors topped by Oriental carpets, and wall-to-wall highboys, lowboys, tallcase clocks, and corner chairs are crowded into homey parlor style rooms that quickly transport visitors back to elegant homes of long ago.
Discreetly placed price tags quickly bring visitors back to the reality of what it costs to buy a treasured antique. A 1780 New England Windsor settee of hickory, maple, and pine costs $32,500. It has an impressive provenance, owned by the Abercrombie family of Old Deerfield, Massachusetts, a cachet that can add as much as 30 percent to its value. A circa 1720, cherry William & Mary desk is also set at $32,500, although the Levys are sometimes willing to let customers negotiate.
The Levys usually have between 400 and 800 pieces usually on exhibit or in a warehouse, ranging in price from $100 for a brass box or tiny piece of porcelain to $1.5 million for an extremely rare ball- and-claw-foot Chippendale sofa. E. J. Nusrala of St. Louis, president of the Famous Brand Shoes chain, is one major collector who likes to buy from them. "They've been in the business more than 89 years," Nusrala says. "If they've owned an item, I know it's quality and authentic."
For the Levys, the shop is a six-day-a-week business, with the gallery closed to customers on Monday. Each workday they drive to their Long Island City warehouse, which employs six people. For about an hour and a half, the Levys inspect pieces that have been refinished or upholstered before they're crated and shipped in large handmade wooden cartons across the country. They then head into the city, arriving at the gallery at about 10 a.m.
The gallery is opened by officer manager Shari Erdman, a former member of the production staff at Antiques magazine who has helped to professionalize the firm. She sets priorities for the family and structures their day. "They tend to go off on tangents when talking about a piece or dealing with a client," she says. "I bring them back to the business at hand."
As Bernie spends more time during the winter at his condominium in Palm Beach, Dean gets the feel of running the business by himself. Father and son chat daily by phone. Dean often calls to report, "So and so wants to get your opinion of that Connecticut highboy. Please, give him a call." Bernie is especially delighted to share his expertise with celebrity collectors, like Ted Simmons, the former St. Louis Cardinals catcher, and Steve Martin, the actor.
The Levys believe they've worked out a strong and loving partnership and a good business venture in a field that's highly unpredictable. Antiques dealers know they may have three terrible months followed by three great months. Prices are difficult to set and are determined by what the dealers have had to pay, what the market will bear, and what styles are chic in a particular year.
As a result, Dean says, their markup varies tremendously, from 10 percent to 1,000 percent. A new record price at auction can throw the whole market into a tizzy, which is what happened when the Nicholas Brown secretary sold for $12.1 million at Christie's last year. High prices can also bring more pieces out of hiding from cash-hungry sellers.
When inventory dries up, it's not uncommon for the Levys and other dealers to sell their own home furnishings. Dean's wife, Janice, recalls the time she and a friend were having lunch on an antique Chippendale drop-leaf table with splendid ball-and-claw feet in their Scarsdale, New York, home. Dean marched in with a client and announced, "Janice, I need that table, but I don't have another one you can use." He took the table, while Janice and her friend sat dumbfounded.
Dean's younger brother, Jonathan, remembers furniture disappearing on a regular basis from his parents' home. "Every time you turned around," he recalls, "something was gone."
The business requires persistence and courage. Bernie claims he has plenty of both. Family members say Dean worries more than his father. "If my dad and Dean buy a piece for $100,000," says Jonathan, "Dean will obsess that they probably could have gotten it for $95,000, and he'll think about that every time he passes by the piece. Dad will walk by it and never let the price bother him."
But Bernie's and Dean's different traits are complementary. They know they're on the same side, even when they fight. "We don't fight over emotions or issues," Bernie says, "but about objects — about how good a piece is, whether we should buy it or not, how big the markup should be."
They talk their problems out — sometimes loudly, Bernie adds, chuckling. Jonathan Levy says his brother and father scream and yell, but have never not spoken as a result "I'll hear Dad say, 'Dean drives me nuts.' But then he'll quickly add, 'But he's the best."'
The rest of the family is comfortable with the father-son combination. When the children were young, Marcia Levy was the one who most frequently accompanied their father on his rounds. The stories she'd heard from her dad and collectors stimulated her interest in history, which was her major in college. After graduating in 1969, she thought about joining Ginsburg & Levy, but she got the message that she wasn't especially welcome. Because of the trouble at the firm, she concluded there wasn't room for a second sibling. "Dad is also of that generation that thinks women shouldn't work," says Marcia, now Marcia Levy Roesch and assistant director of admissions at the Day School in Manhattan.
She is content with the ownership arrangement between her father and brother. "Dean works in the business, so he's entitled to the spoils," she says. "We've been taken care of in the buy-sell agreement. At times I was angry, and felt it wasn't fair — mostly when I got married and we had to struggle. But I'd rather have my brother's friendship than money and ill will."
Brother Jonathan, who is nine years younger than Dean, feels the same way. "I didn't need two fathers, which might have happened if I went into the firm," he says. "I liked engineering better. But I always knew I would have been welcome if I wanted to work there. I would have made more money if I had — the business is worth more now. But that's a decision I made."
Will the business survive beyond Bernie and Dean? They both think it's highly probable. Dean's older son, Frank, a graduate of Carleton College, is a Fellow in the Henry Francis du Pont Winterthur Museum's program on early American culture. He may teach or work in a museum, but he could possibly join the business one day.
Dean is delighted at the prospect, as is the rest of the family. Marcia says: "Frank would make a wonderful addition. He's got a great personality and would work well with his father and grandfather." Dean's other son, Jason, is a pre-med at Washington University in St. Louis. Dean thinks Jason has a keen eye for spotting value in antiques and would also make a fine addition to the business.
Marcia accepts that Dean's children may take over the business eventually and that, as a result, there may not be room for her son and daughter. But Dean says he is very open to any of the third-generation members coming into the business. He wants only to assure that an orderly succession takes place.
The most important legacy that this father and son can pass on is their experience in making a family partnership work. Through love and camaraderie, open discussion, and good planning, Bernie and Dean and the rest of the Levys have side-stepped the problems that caused the rift in the earlier partnership. They have achieved wisdom in family matters in much the same way that, as antiques dealers, they inspect a piece to determine if it is authentic. As Bernie explains it:
"You try not to make the same mistake twice. You think, 'Ah, I've seen this before. But now I can judge it better.' It's the same with the family business and family relationships."
Other Looming Heirs in the Business
Age contributes to value in the antiques business, but doesn't always guarantee wisdom in succession. Here is what four other top American antiques dealers are doing about the future.
Nathan Liverant & Son Antiques, Colchester, Conn.
A three-page ad in the January issue of Antiques magazine tells of the successful transition in this 70- year-old firm. Nathan's grandson, Arthur, 40, a member of the third generation, took control in 1983 after his mother died and left her shares to him. Arthur has a controlling interest, and his father, Israel, holds one third of the stock.
Authur joined the business in 1971 after graduating from college. His father had instilled in him a love of the family enterprise. Though he trained his son, he had help from a nonfamily member, a cabinetmaker who had been with the firm since 1948 and served as a tutor and buffer between the generations.
His father never pushed him to join the firm, Arthur says. "We also get along very well. We love to go together to University of Connecticut basketball games or Red Sox baseball games. I have other interests as well. For example, because my wife's an artist, we've started to sell 18th- and 19th-century art."
Arthur likes having his father around, and isn't about to nudge him out the door. "Dad has no plans to retire," the son says. "I don't think most furniture dealers do. We need him here."
David Stockwell Inc. Wilmington, Del.
"Obviously, I'd like to pass things on," says the spry, 82-year-old Stockwell, whom many consider the dean of American antiques.
Stockwell's son became a banker and. his daughter, a physical therapist. So he has chosen a nonfamily successor, Ronald C. Bauman, a collector who is now president of the firm.
Twenty years ago Bauman, a horticulturist by training, wanted a change of career and signed on with Stockwell.
Stockwell says of his protegé, "He's developed a great eye." Bauman now holds 51 percent of common stock, but doesn't own the company. The senior Stockwell took all of the preferred stock and gave almost half of the common to his son in order to keep open the possibility that his grandson, a recent college graduate, would be able to enter the business some day. Stockwell's daughter will receive part of his estate on his death.
Joe Kendig Jr. & Son York, Pa.
This is a family firm that has done no estate or succession planning. The future of the company is up for grabs. Joe Kendig III, who took over from his father 18 years ago, doesn't expect any of his three college-age children to join him in the business.
Even if his children want to take over, Kendig doesn't think that's plausible now. "I'm 67," he says. "There will be no time to train them properly. I started helping my father and learning the trade during summers in high school. I joined after World War II, though I was never pressured to come to work. It's what I wanted to do."
Another reason for Kendig's reluctance to plan might be his dislike of the way the business has changed. "The prices have soared so high, and some collectors don't share the same passion and intellectual interest in what makes a piece good," Kendig says. "They're more interested in values and status."
What will happen to Kendig's large inventory when he dies? For now, he's not concerned, or doesn't care to think about it.
Israel Sack Inc. New York City
The future is cloudy for what is often referred to as the most famous antiques firm in the country.
The only third-generation member who was active in the business, Donald R. Sack, left the company two years ago. He and his wife, Dale, who worked as a manager at Israel Sack for 17 years, have opened a shop in Buck Hill Falls, Pennsylvania. With their hideaway location, and a leaner and less valuable inventory, they are not in direct competition with their relatives' 85-year-old company.
What caused the break in the family chain? Donald says he had asked several times for an equity position in the company, but was repeatedly turned down by his two uncles and his father, who together own it. He was shocked that the second generation did not want to plan for continuation of the business.
Israel Sack was a Lithuanian immigrant cabinetmaker who founded the company in Boston in 1905. After it became the leading gallery in that city, Sack opened a New York branch, which is now its headquarters (the Boston gallery was closed after the Depression).
Upon Sack's death in 1959, control passed to his three sons, Harold, Robert, and Albert (Donald's father). When Donald joined the firm as an eager 21-year-old in 1968, it seemed to outsiders that it would glide gracefully into a third generation. He had traveled with his father extensively, visited museums and collectors' homes, and attended auctions. He loved the business, and none of his cousins had the same passion for it.
The family crisis struck when Donald concluded that the three second-generation brothers, who held equal shares, would never share ownership. The parting was less than amicable, and Donald now has little contact with his father, his uncle, and his two sisters.
Albert refuses to discuss the rift: "Our business is private, and we don't care to talk about it. We'll survive in the future."
Donald has tried to understand why he was denied. "I don't think my uncles could envision their legacy controlled by a nephew. My father wasn't the oldest, so he didn't have the greatest — or final — say." -B.B.B. & M.C.