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Vintage porn collector sues appraiser for overvaluing items

A Las Vegas man who claims to have once owned the largest collection of vintage 16mm pornographic films in the world is suing the woman he hired to appraise certain pieces of his collection after the IRS rejected most of his claimed deductions based on those appraisals. Among other things, the collector accuses the appraiser of fraud for overestimating the value of the items and misrepresenting her credentials.

The plaintiff is the owner of the Déjà Vu and Little Darlings chains of strip clubs, as well as several adult book stores. Over the years, he amassed a large collection of adult films, and around 2005 the plaintiff decided to donate some of his collection to Las Vegas' Erotic Heritage Museum, which presents displays on the history of erotica. The plaintiff is listed as the museum's "grand patron."

According to the lawsuit, the plaintiff hired the defendant to appraise the materials he wanted to donate in order to determine their value so he could deduct the gifts from his federal income taxes. The defendant allegedly told him that she was a graduate of the Institute for the Advanced Study of Human Sexuality and was accredited by the American Society of Appraisers. In fact, the suit says, she was not an accredited appraiser.

The defendant appraised several items for the plaintiff, giving high values to many items. One appraisal put the value of a number of films and promotional items at $5.92 million.

Following the appraisals, the plaintiff donated the items to the museum and claimed their purported value as deductions on his 2005 and 2006 tax returns. But the IRS rejected most of the deductions, saying that the value of the films was "grossly overvalued," the lawsuit claims. The suit also alleges the defendant failed to disclose that she was also being paid by the Exodus Trust, which owns the Erotic Heritage Museum. Deductions based on appraisals made by the gift recipient are not allowed under IRS rules.

The defendant denied the allegations and said the suit was really over a dispute over her termination from her position at the museum.

Source: VegasInc, "Sex industry figure sues over donations to Erotic Heritage Museum," Steve Green, Nov. 4, 2011

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