By  on April 15, 2008

Collectors hoping to snatch up some of the marquee jewels and gems from Ralph Esmerian's storied collection might have to wait a little longer.

Christie's was prepared to auction off a 115-piece lot of Esmerian's collection, dubbed "Rare Jewels and Gemstones: The Eye of a Connoisseur," tonight, but legal wrangling between the collector and Merrill Lynch put the auction in doubt.

Esmerian acquired Fred Leighton in 2006 in cooperation with a lending partner that is a division of Merrill Lynch. Esmerian owes Merrill Lynch about $180 million.

"The auction cannot go forward," Esmerian's attorney, Helen Davis Chaitman, said on Monday.

Chaitman, an attorney with Phillips Nizer, pushed for a stay before a panel of appellate court judges last week.

"The panel has decided to stay the auction," said Chaitman.

Financial giant Merrill Lynch is holding out hope that the auction will go forward.

"The appellate court has allowed further proceedings at the lower court," said a Merrill Lynch spokesman. "We anticipate getting further guidance from [New York Supreme Court] Judge [Helen] Freedman on Tuesday, as to whether an auction can move forward."

In February, Esmerian failed to get a full stay of the auction from the New York State Supreme Court.

Esmerian has been battling Merrill Lynch in court since January over the $183.3 million the financial giant said it is owed on two loans. Esmerian, who used the financing to acquire Fred Leighton, has since paid down $10 million of the loan, on which interest is still accruing.

The collector has more than his business interests on the line.

In court papers last month, Esmerian said he had a buyer who might pay $10 million for a piece that Christie's was valuing at $4 million to $6 million, though auction prices are never truly known beforehand.

"This one item, recklessly sold at the auction, could mean the loss of my home because I have personally guaranteed the debt," said Esmerian.

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