From the beginning, Andy Warhol's reputation as an artist might have been made of smoke and mirrors. So perhaps the Andy Warhol Foundation for the Visual Arts was fated to be engulfed in a rancorous soap opera that's becoming the art world's version of ""Rashomon.'' After all, Andy first made the scene back in the 1960s by pass-ing off crude, hasty photo-silk-screens of Campbell's soup cans, car accidents and Jackie as paintings for serious collectors. Since Warhol cranked out so much art during his career, his death in 1987 created an estate worth, according to the most recent court estimate, more than half a billion dollars. The foundation was the beneficiary of nearly all of Warhol's assets, including a trove of his art that amounted to more than 700 paintings, 9,000 drawings, 19,000 prints and 66,000 photographs. But now the foundation stands accused from within and without of waste and mismanagement detouring it away from its mission of ""the advancement of the visual arts.''
To many observers, the foundation's problems stem from the poisonous chemistry among a trio of principals. Fred Hughes, the estate's executor and a foundation board member, was Warhol's confidant and business manager from the hedonist heyday in the huge studio called The Factory. Now suffering from multiple sclerosis, Hughes, 49, is a mercurial personality. Just after Warhol's death Hughes hired the charming Edward Hayes, a former Bronx prosecutor with little estate experience (he was Tom Wolfe's model for the defense lawyer Tommy Killian in ""Bonfire of the Vanities''). Then, in 1990, Hughes brought in the urbane Archibald Gillies -- who'd run a think tank, the World Policy Institute -- as the foundation's president. It was bad karma: within a year, Gillies says, Hughes's hostility toward him began and then extended to Hayes. Hayes, 46, has no kind words for either Gillies, 60, or Hughes; Gillies's feelings are mutual. Says former Interview editor Bob Colacello, ""It's become a sort of estate class struggle between Arch Gillies who sees himself as the patrician defender of rectitude and Ed Hayes who sees himself as the aggrieved populist. It has nothing to do with Andy Warhol or with art. It has nothing to do with anything but an out-of-control legal battle.''
The first public cannon fire came in 1993, when Hayes sued the estate, asserting it had deliberately undervalued its worth. The lawyer's contract gives him the same 2 percent of the estate's value that Hughes received as executor. This past April New York Surrogate Court Judge Eve Preminger quadrupled the assessment of the art holdings originally made by Christie's to $391 million (the rest of the $510 million estate is land, cash and other assets). The estate countersued, claiming that Hayes had performed so poorly he didn't deserve the $4.8 million he'd already been paid, let alone the additional $11.5 million he seeks.
First-class trips: Gillies had already been working with a formidable foundation board -- including impeccable preservationist and New Yorker critic Brendan Gill and Museum of Modern Art board chairman Agnes Gund -- to bring about order. The foundation, then housed in Warhol's vast studio, at first had the flavor of the old Factory, with lots of the usual hangers-on. Gillies fired a number of them. Before he came on board in 1990, the tales of the Warhol estate's extravagant expenses -- lavish dinners, office redecoration, first-class trips to check out grant proposals -- had circulated in the art world (""Absolute rubbish!'' says Hughes in answer to those rumors). But allegations of mismanagement against the foundation continue to appear, most recently in The New York Times, which reported that in the year ending April 30 the foundation had dispensed a puny $1.1 million in charity while spending $7.2 million to operate.
The foundation's trustees say those bare numbers are misleading. According to Gill, now president of the board, the foundation has made 620 grants in four years totaling $23 million. Among these, adds Gund, were a crucial $50,000 grant for a Museum of Modern Art show of the abstract artist Robert Ryman unable to attract corporate support, and an additional $25,000 for an exhibition by the political installation artist Fred Wilson. Most visibly, the foundation has pledged $30 million worth of art to the new Warhol Museum in Pittsburgh (the rest of the museum's Warhols come from the de Menil Foundation). Oddly, the board subsequently ruled against further ""activities directly related to the art of Andy Warhol.''
Yet some activities of board members are surprising. Hughes and at least one former board member reportedly received commissions for selling Warhol's art on behalf of the estate, but Hughes won't discuss that. Gund was allowed to buy a book of Warhol's drawings of lips for $60,000 -- much less than some experts say it's worth (she's bequeathing the book to MoMA, she says). Answering criticism that the Warhol Foundation gave a $450,000 grant to a pet charity of hers, Studio in a School Association, which sends working artists into impoverished city classrooms, Gund says, ""I wasn't on the board when the grant was made.'' She adds ruefully, ""It's only been since 1990 that I came on the board, but it feels like half a century, like a backache.'' She's now resigned, insisting that she ""pre-resigned'' in January, to join the Getty Foundation's board.
What's tougher to explain is why, after four years of Gillies's guidance, the foundation's cash has dwindled from $25 million to less than $6 million. Gillies attributes $9 million of the high overhead to the expenses of cataloging, conserving, housing and insuring an art collection as large as MoMA's. ""When we took over,'' he says, ""the art was in several different places and some of it was damaged.'' Much of the $171,000 recently spent on furnishing the foundation's new rented offices near Soho, he says, are computers to keep track of the art. John Edie of the Council on Foundations defends that sort of expense: ""A foundation [like that] has a fiduciary duty to know what it has and make sure it's preserved and doesn't rot somewhere.''
Still, the Warhol Foundation's track record doesn't compare favorably with a similar foundation, that of the late homoerotic photographer Robert Mapplethorpe. Before he died of AIDS in 1989, Mapplethorpe handpicked a board consistent with his esthetic, and gave the foundation clear causes to support: contemporary photography and a cure for AIDS. Five years later, with only $200 million in total assets, the Mapplethorpe Foundation is among the most visible in the art world, with a gallery and photography program lodged in the Guggenheim Museum. Why hasn't the Warhol Foundation accomplished something like that?
A big reason, of course, is the drain of the ongoing legal hassles. Hayes, Gillies says, is the real debit. He contends that Hayes screwed up a licensing deal costing the foundation $3 million and botched the sale of Interview -- the foundation has never received the $7 million it's owed for the magazine. Hayes says he can prove that these charges are false. Gillies also believes Hayes is forcing the foundation to spend $2 million (some say the figure is closer to $3 million) on lawyers to keep him from collecting his own whopping legal fee. As far as Hayes is concerned, his suit is more about art history than money: ""It's astonishing that Gillies's position in court is that Warhol was not that great an artist.'' However, the New York state attorney general's office has investigated the suit -- and sided with the foundation in contesting that Hayes earned his fee. The office is also looking into the foundation's grant-making and salaries.
Good intentions: Paul Alexander, whose book ""Death and Disaster: The Rise of the Warhol Empire and the Race for Andy's Millions'' will be published by Random House early in the fall, says the foundation is especially derelict in raising money through selling art. ""[The foundation] won't tell you the particular pieces,'' he says. ""It averages out to about $2 million a year, not a lot, quite frankly. These people are losing money at a rate of $4 million a year . . . [Andy] hated lawyers. And now all this money is being eaten up by perks, favors and legal fees.'' While the charges and countercharges continue, the art world waits to see whether the foundation can unshackle itself from Hayes's lawsuit, and whether -- with all the art now properly cataloged and stored -- Gillies can actually run the show. No one wants to see this charitable road, paved with Andy's good intentions, lead to where smoke is accompanied by something a lot hotter than mirrors.