The Mansion Went to Auction — So Did the Family Drama

Libbie Mugrabi’s Bridgehampton estate sold on the steps of Southampton Town Hall for a fraction of what she once wanted — with her mother, her sister, and the police all making appearances.

Anyone who’s kept an ear to Hamptons real estate has heard wild stories, but they don’t usually play out like they did last Friday on the steps of Southampton Town Hall. That morning, Libbie Mugrabi’s Bridgehampton mansion — her trophy from a messy billionaire divorce — went up for a court-ordered public auction. Out east, this kind of thing is rare. No one expected the show that followed.

What was once a $25 million listing (and once, in a divorce settlement, said to be worth $100 million) got hammered down to $5.864 million. The entire spectacle unfolded as if the universe wanted to slap a dollar sign on the drama that’s trailed the Mugrabis for half a decade. The winning bidder, smartly dressed with his wife alongside him, stayed anonymous and kept quiet. Libbie Mugrabi? She didn’t even bother showing up.

If you follow buzzy articles, you already know the bones of the Mugrabi saga. Back in 2018, David Mugrabi, son of Israeli industrialist Jose Mugrabi, major league art collector, filed for divorce from Libbie after 14 years and two kids together. No prenup. Cue chaos. There were years of headline fodder: Libbie hauled a 25-pound Keith Haring sculpture into a Manhattan courtroom after a tug-of-war over it. Rumors ricocheted: their $3.5 million annual burn rate, affairs, David’s supposed twenty-something girlfriend, and more. The family, among the world’s top Warhol collectors, turned every split-up cliché up to 11.

Libbie kept the Bridgehampton house — one of her bigger prizes — but things soured from there. The place had a $3.5 million mortgage she admits she never paid a penny on. The lender, a shell company out of Great Neck, finally sued to get their money, and the matter landed where it did last week: a foreclosure sale in front of Southampton Town Hall.

The morning was a circus. Ten bidders showed up, including Libbie’s own sister, Mia Rowe, who opened with a bold $7.8 million bid — but she forgot to bring the mandatory certified check. She claimed she’d dash to the bank for a $780,000 deposit. She never came back. The rest of the crowd, who’d all shown up with funds in hand, started howling about fairness. At one point, an onlooker warned that Rowe was there to spike the price for anyone else.

Meanwhile, Libbie’s mother Jane Scher arrived with a dog named Botox and lobbed a loud insult at the lender’s lawyer. That was enough to get the local cops summoned. Officers pulled Jane aside, told her to cool it, then walked her back to her car. One bidder, the seasoned Eddy Bellacera, later told a reporter he’d never seen anything like it. “Most entertaining auction I’ve ever attended,” he said, according to the NY Post.

Even with the house gone, Libbie’s not in the clear. She still owes more than $9 million, counting the mortgage, interest, and legal fees — a stunning predicament for someone once awarded nine figures in a divorce. But anyone familiar with her style — think: frequent trips to Europe, non-stop shopping — wouldn’t be shocked. Her ignoring the loan set off a two-year legal showdown to pry the estate from her grip. Whatever came in at auction goes straight to the debt.

Don’t think she didn’t try to sell the house first. She listed it in May at $25 million, then chopped the ask to $19 million when nobody bit. Even that number seemed optimistic. Libbie herself told a reporter it was an ambitious reach, while her lawyer said in court the home was probably worth $10 to $12 million tops. Only one real offer came in: $7 million from someone claiming to be a Nigerian prince. They passed, given the obvious red flags.

Compared to this, the previous attempt at auction was a total dud. Back in February, the only bidder was the lender, who “won” for $500. That flop led to a deal: Libbie would have until August to sell the house the regular way before the auction would kick in. She didn’t, so the lender pushed ahead.

The Friday sale nearly tanked, too. Libbie’s attorney, Claude Castro, rushed to court the day before to beg for a delay, saying she had a new lender willing to float her an $8 million mortgage so she could buy the house back herself. The appeal landed right before the auction, and flopped. Game on. The lender’s lawyer, Ryan Mitola, warned bidders they’d be stepping into a legal hornet’s nest, not just a fixer-upper.

Libbie even tried to use a $40 million Basquiat as collateral, a tangle that spawned its own legal battle with an art lender. She only just got that painting back, according to court documents.

Is bankruptcy next? Ask her lawyer. Both sides have been talking about it, but as of auction day there’s nothing filed in the right district court. Then again, Libbie actually seems to relish a courtroom. At the height of her split with David, she told a reporter she “enjoys” legal battles.

She’ll get her fill. Libbie’s still entangled in at least six other lawsuits — one from Anthony Haden-Guest, who says she’s got nearly a hundred of his drawings stashed in that very Bridgehampton house. And her own lawyer is trying to dump her, filing to exit their retainer over, in his words, a total breakdown of communication and trust.

Some Hamptons real estate deals go quietly. This one gave the summer crowd exactly what they came for: rich people behaving badly, with the law egging them on.

Ty Wenzel

Ty Wenzel is an award-winning writer, designer, and marketing professional with a career spanning fashion, publishing, media, and digital innovation. A recent breast cancer survivor, she began her career as a fashion coordinator for Bloomingdale’s before serving as fashion editor at Cosmopolitan Magazine. Her work has appeared in numerous national publications, including The New York Times, and she is the author of a memoir published by St. Martin’s Press. In 2020, Wenzel co-founded James Lane Post, where she covers lifestyle, real estate, architecture, and interiors. She previously served as a writer and marketing director for The Independent. Her work in journalism, social media, and design has been recognized with multiple PCLI and NYPA awards, including best website design and best magazine. Wenzel is also the founder of the Hamptons-based social media agency TWM Hamptons Social Media, where she develops high-level branding and digital strategy for luxury clients.