(Photo: Nick Papanania/SIPA Press/Newscom)

“Are you interested in making a cruel and offensive offer?” e-mailed Deborah McLeod, of Larry Gagosian’s L.A. gallery, to client Thompson Dean, about a 1964 Roy Lichtenstein work. The son of the owner, Jan Cowles, was “now in terrible straits and needs cash,” McLeod wrote. “Come on, want to try?”

When the gallery got an offer of $2 million, Cowles’s lawsuit against the gallery alleges, it was $1 million less than the price Gagosian had all but promised Cowles’s son, but Gagosian took the offer, told Cowles’s son he could give him only $1 million, and pocketed the difference. Never mind that Cowles says she hadn’t given permission to sell the painting.

But let’s not pick on Gago: Art is the last billion-dollar unregulated market, a vast ethical gray area. Things get particularly squirrelly in the secondary market. Whoever brokers a deal like the Lichtenstein one has no obligation to disclose to the first collector what the second is paying, and none to tell the second how much is going to the original owner. The only new rule might be: Try to avoid e-mail.

Related:

• Archive: “Features”
• Articles by Alexandra Peers
• Table of Contents: Apr 30, 2012 issue of New York | Subscribe!