According to researchers and writers in the field of reclaiming Nazi-looted art, the number of artworks in Europe stolen, plundered or confiscated in the decade leading up to 1945 is staggering. Estimates seem to settle on the theft of some one-fifth of all European artwork. The figure usually touted is some 550,000 paintings, sculptures, drawings, books and other works taken from museums, churches and private collections. See S. Gilbert, “The Persistent Crime of Nazi-Looted Art,” The Atlantic (March 11, 2018). Many of the private collectors throughout Europe were Jews who suffered calamitously under Nazi dominion.

Artworks included numerous classics and items of value. Michaelangelo's Madonna and Child and Vermeer's The Art of Painting, for example, along with some 12,500 other paintings and objects were stashed by the Nazis in an Austrian salt mine that was rigged with explosives to deny them to the enemy should the Nazi war of conquest fail. Author Gilbert describes the discovery by German authorities in February 2012 of some 1,500 works by artists including Picasso, Matisse, Monet, Liebermann, Chagall, Durer and Delacroix in the Munich apartment of Cornelius Gurlitt, son of one of the most notorious art dealers employed by the Third Reich, Hildebrand Gurlitt.

Movies have publicized some of the challenges in locating and reclaiming the stolen items. The 2014 film, The Monuments Men, starring George Clooney and Matt Damon, illustrated the efforts of the Monuments Fine Arts and Archives Program established by the allied armies. The 2015 movie, Woman in Gold, starring Helen Mirren was based on a true story. Books have been written about the breathtaking scope of the plunder and efforts to reclaim the looted items. See S. Ronald, Hitler's Art Thief: Hildebrand Gurlitt, the Nazis, and the Looting of Europe's Treasures; L. Nicholas, The Rape of Europa; N. O'Donnell, A Tragic Fate: Law and Ethics in the Battle Over Nazi-looted Art; B.L. Hay, Nazi-Looted Art and the Law: The American Cases) (Both O'Donnell, a lawyer specializing in restitution cases, and Hay, a Harvard law professor, discuss some of the litigations seeking to reclaim plundered artworks). In the limited space of this column, it is not feasible to reconstruct painstaking details about protracted individual cases already developed by devoted researchers. Rather, the objective here is to acquaint the reader with some of the thorny legal issues presented by lawsuits seeking restitution, as reflected in recent court cases—several of them in New York.

Despite the passage of time—some 70 to 80 years from Nazi looting episodes—restitutional litigation proceeds apace, captures headlines, and involves persons, firms and entities far removed from the Nazis of World War II—for example, museums, government entities abroad, private collectors who ostensibly claim they purchased artworks in good faith (not knowing they were stolen), and so on. With the opening up and digitization of Europe's war-era records, family descendants and relatives of original owner-victims of Nazi plunder also are awakening to the possibility that they may have restitutional rights in valuable artworks held by others. In short, there has been and can be a thriving branch of litigation of which lawyers (and judges) should be aware.

Challenging Litigation

Experience shows that lawsuits to reclaim artworks (or their value) can be expensive and last for many years. Defendants, such as museums and institutional “owners” such as universities, often “dig in” and press an array of defenses usually hurled at plaintiffs when they urge old claims. See, e.g., I. Kaplan, 3 Cases That Explain Why Restituting Nazi-Looted Art Is So Difficult; L. Carron, On Law, Museums and Nazi-era Looted Art in France and the United States; see also A.R. Bickford, “Nazi-Looted Art: Preserving A Legacy,” 49 Case Western Reserve J. Int'l Law 115 (2017) (litigation involving looted art donated to the University of Oklahoma).

So, for example, normal statutes of limitations may have expired; or the equitable defense of laches (too much delay) may be asserted. Or, for example, since much of the predicate acts (theft, illicit sales, transfers) occurred outside the United States, there may be daunting issues of jurisdiction to overcome; or choice-of-law principles that favor application of the law of a foreign state to one's ability to recover; or, perhaps, a defense in the Act of State doctrine when a foreign government agency or commission would deny the claim. Or, maybe, the claimant's recollection of events is fuzzy or proof of an ancestors' ownership or entitlement is hard to come by for practical reasons caused by the passage of time.

And, yet, this genre of litigation goes forth with notable successes. Claimants have been given a big shot in the arm, namely, some relief from statute-of-limitations defenses by the federal HEAR Act (The Holocaust Expropriated Art Recovery Act of 2016), effective Jan. 1, 2017. Congress established a national statute of limitations whereby original owners or their heirs have six years from enactment in which to sue to reclaim artwork after discovery of its origins. The new law thus allows people who lost art between 1933 and 1945 due to Nazi persecution to sue within six years of the time they locate where the art is and who possesses it.

The HEAR Act has its ambiguities (see S. Frankel and S. Sharoni, More Uncertainty On Nazi-Era Restitution Claims, Law 360, Oct. 4, 2017), but nevertheless improves claimants' litigation prospects in the United States. For litigation abroad, however, the foreign law may be an impediment. Institution of such lawsuits has publicity impact so museums, art businesses and institutions may well seek to mediate or settle the dispute. After all, one fighting to keep Nazi-stolen art from its rightful, persecuted victims (or their heirs) may not make a defendant look like he or she is on the side of the angels. Yet, some defendants do choose to do battle regardless of bad publicity.

Illustrative Cases

In Reif v. Nagy, 2018 N.Y. Misc. LEXIS 3560 (Sup. Ct., N.Y. Co., April 6, 2018), Supreme Court Justice Charles E. Ramos adjudicated title rights of heirs to two works of art by artist Egon Schiele called “Woman in a Black Pinafore” and “Woman Hiding Her Face.” The plaintiffs were declared heirs of the original owner, Grunbaum, a cabaret performer of Jewish descent, by a Vienna court. Grunbaum was arrested in 1938 and murdered in the Dachau Concentration Camp in 1941. Prior to his arrest, he owned hundreds of works of art, including many by Schiele.

Defendants were a professional art dealer and his gallery, asserting good title to the works via a series of transactions originating with Grunbaum's sister-in-law. Justice Ramos held that the dispute was governed by New York law. He also held that the HEAR Act “compels us to help return Nazi-looted art to its heirs.” The HEAR Act also instructs “to be mindful of the difficulty of tracing artwork provenance due to the atrocities of the Holocaust era, and to facilitate the return of property where there is reasonable proof that the rightful owner is before us.”

Because plaintiffs had a prima facie case of both replevin and conversion, the burden of proof shifted to defendants. They, however, could not discharge that burden. Under New York law a thief cannot convey good title even if the property is in the possession of a good faith purchaser for value. Justice Ramos then proceeded to analyze defendants' 18 defenses and rejected them. Plaintiffs' motion for summary judgment was granted.

In Gowen v. Helly Nahmad Gallery, 2018 N.Y. Misc. LEXIS 1625 (Sup. Ct., N.Y. Co., May 8, 2018), Supreme Court Justice Eileen Bransten denied defendants' motion to dismiss a complaint involving Amadeo Modigliani's painting, Seated Man With a Cane, 1918, an artwork allegedly taken by the Nazis from Oscar Stettiner, a Jewish art dealer who lived and worked in Paris and who was the original owner. Plaintiff Gowen was the Ancillary Administrator for the Stettiner estate.

In 1946, forced sales of property were declared null and void by the French government. French courts allegedly granted Stettiner an order granting return of the painting but all attempts to locate the Modigliani work failed. Stettiner died in 1948. Around 2005-2006, the defendants exhibited the painting at their gallery. In 2008 the artwork was offered for auction at Sotheby's in New York City. However, the painting did not sell then so defendants moved it to a warehouse in Switzerland. In 2011, an Oscar Stettiner heir wrote the defendants via counsel demanding return of the painting. Defendants did not respond.

The heir commenced suit in New York federal court but, because federal subject matter jurisdiction was lacking, the case was filed in New York Supreme Court. Justice Bransten noted the “complexity of the issues involved” including defendants' claims that no personal jurisdiction over them existed, that the statute of limitations barred the claim, and that foreign law and the Act of State doctrine foreclosed the suit. Justice Bransten divided her analysis into sections A to L addressing defendants' arguments. Readers are urged to read the Justice's discussion. At the end of the day, the defendants' motion to dismiss was denied. The court also ruled that, while the court takes judicial notice as to the laws of Switzerland and France, “the laws to be applied during the pendency of this action are New York's laws … .” Justice Bransten also rejected defendant's limitations defense and cited the HEAR Act which provided a six-year statute of limitations period from the date of actual discovery.

In Hulton v. Staatsgemaldesammlungen, 2018 U.S. Dist. LEXIS 169626 (S.D.N.Y. Sept. 28, 2018), U.S. District Court Judge Richard J. Sullivan had to decide defendants' motions to dismiss a case seeking the return of several paintings. Plaintiffs Michael and Penny Hulton were the sole heirs of Alfred Flechtheim, a renowned German art dealer and collector during the 1920s and 1930s. The defendants in possession of the paintings were the “Free State of Bavaria” (or “Bavaria”) and the “Bavarian State Paintings Collections” (or “BSGS”).

Flechtheim, a pioneer collector and promoter of modern art in pre-war era, operated galleries in Dusseldorf and Berlin and represented a range of notable artists including Max Beckmann, Paul Klee and Juan Gris. The paintings contested in this case included six works by Beckmann, one by Gris and one by Klee. Flechtheim was forced to flee to Paris in May 1933. He never returned to Germany, dying in London in 1937.

The defendant BSGS “oversees Bavaria's public collections of artworks on display in its museums both in and outside Munich.” The defendants' motion to dismiss was based on lack of subject matter jurisdiction and the Foreign Sovereign Immunities Act (FSIA). Judge Sullivan analyzed Bavaria's and BSGS' governmental status and assessed whether any of the exceptions to the FSIA applied, for example, whether the paintings were “taken in violation of international law.” Although it was “morally unsatisfying,” the court concluded that the FSIA provided foreign states with a broad grant of immunity. Judge Sullivan was “sympathetic to plaintiffs' moral claim to the paintings” but was constrained to grant the defendants' motion to dismiss and “to close this case.”

Conclusion

The foregoing recent decisions (there are others) illustrate that litigation to reclaim Nazi-looted art is a struggle but not a hopeless one. The usual technical defenses to old and stale claims somehow seem to clash with moral and ethical imperatives to right horribly monstrous wrongs. In the meantime, perhaps ghosts of yesteryear may lurk to see how we, as a moral society, will find the right balance.

Michael Hoenig is a member of Herzfeld & Rubin.