The Art Law Report

Providing timely updates and commentary on legal issues in the museum and visual arts communities

Full Ninth Circuit to Review California Resale Royalty Act En Banc

Posted in Copyright, Legislation, Moral Rights

Several weeks ago, the parties to the appeal over the constitutionality of the California Resale Royalty Act (CRRA) briefed the question about whether the Ninth Circuit Court of Appeals should hear the case, rather than a three-judge panel that would otherwise be assigned to the case. The Ninth Circuit granted the petition yesterday, meaning the appeal will now go before the full court.

The issue in the case is a California law that requires royalties on secondary sales of art, something that is not part of U.S. copyright law and is more common in civil law countries as “droit de suite.” In 2012, after several artists (including Chuck Close) sued Christie’s, Sotheby’s, and eBay over royalties that they alleged were unpaid, the auction houses defended on the grounds that the law itself was unconstitutional pursuant to the Commerce Clause of Article I of the U.S. Constitution. The argument follows a concept known as the “Dormant Commerce Clause,” which is not actually an explicit clause of the Constitution. Rather, it is a way of describing the negative implications of the Constitution’s exclusive grant of authority to Congress to legislate interstate commerce. That is to say, the Dormant Commerce Clause describes the extent to which states are prohibited, by virtue of the Commerce Clause, from passing laws that regulate or unduly burden interstate commerce because that is Congress’s job.

The lawsuit challenged the CRRA as just such an infringement on interstate commerce, and the District Court agreed, striking the law down. The present appeal followed.

Ordinarily, an appeal to the full circuit court follows an adverse decision from a three-judge panel. Typically, the dissatisfied party asks the entire court, which can be several or dozens of judges, to consider the matter as a whole. Here, the Court itself took notice an initiated the en banc question before a panel decided it.

The question to the parties was framed as a question about a possible conflict in earlier caselaw, and likely explains why the Court took the case en banc, not that it foretells anything specific about the likely outcome.

The potential conflict in Ninth Circuit law is between two recent cases. Rocky Mountain Farmers Union v. Corey concerned California’s fuel standards and efforts to regulate carbon dioxide output, California’s Low Carbon Fuel Standard (Cal. Code Regs. tit. 17, §§ 95480–90 (2011)). In Rocky Mountain, the Ninth Circuit held that the law’s provisions were not facially discriminatory to out of state ethanol, nor discriminatory in purpose or effect against either that ethanol or against crude oil.

By contrast, Ass’n des Eleveurs de Canards et d’Oies du Quebec v. Harris affirmed the District Court’s denial of a motion to preliminarily enjoin the State of California from enforcing California Health & Safety Code § 25982, which bans the sale of products that are the result of force feeding birds to enlarge their livers beyond normal size. The plaintiffs, non-California entities that raise ducks for slaughter, argued that the law discriminated against them as out of state actors, but the Ninth Circuit allowed the law to be enforced.

Dormant Commerce Clause issues fall into different categories. There are those that claim disparate treatment of in-state versus out-of-state actors, and there are those that take issue with more regulatory impositions on commerce that crosses state lines. This case is more of the latter.

As a regulatory scheme that seems to mean to apply itself throughout the Constitution, my initial take has always been that the law would fail constitutional scrutiny, and I was not surprised when the District Court did just that. From another perspective, when one considers the prerogative of Congress to pass a law like the American Resale Royalties Too Act, currently pending in the Congress (and whose sponsor Jerrold Nadler will be at Art Law Day next week), the negative implication is that states may not given the space that Congress occupies in that subject area.

Now the full Ninth Circuit will have its say. Oral argument has been initially scheduled for the week of December 15.

Museums in Bamberg and Karlsruhe Recognize a Sale Under Duress For What it Was, Seek to Do Right Thing

Posted in Gurlitt Collection, Museums, Restitution, World War II

Restitution policy at the federal and state level in Germany in recent months seems to have taken a certain direction that has been cause for criticism.  Whether it is the recent decisions by the Limbach Commission that ignore longstanding law about sales under duress, the odd decision by the Federal Republic of Germany to resist a lawsuit over the Max Liebermann painting found in Cornelius Gurlitt’s apartment that the Gurlitt Task Force has already recommended be restituted, or the resistance to the claims by the Mendelssohn-Bartholdy heirs to Picasso’s Madame Soler, the trend has been towards obstruction and resistance rather than transparency and reconciliation.  Notwithstanding the recent announcement of the Center for Cultural Property losses (the Deutsches Zentrum für Kulturgutverluste about which the jury is still out), this is cause for concern.

This week, there is happier news at the local level.  Two museums have, of their own initiative, stepped up to recognize and address looted art.  The first is in Bamberg in Upper Franconia, an ancient Roman city, one-time center of the Holy Roman Empire, and today a UNESCO World Heritage site.  The so-called Schönborn Lion Cup (Schönborn’sche Löwenpokal) was a victory trophy at the Bamberg Free and Knightly Art of Shooting (Freien Kunst- und Ritterschießen) in 1712. 

Lothar Franz von Schönborn—Prince-Elector of Mainz, and Elector-Bishop of Bamberg, in personal union, commissioned the cup to depict the heraldry of his family (a lion).  Many years later, two Jewish collectors, Heinrich and Emma Budge, acquired the cup.  After recent research, however, it was discovered that the cup had been sold at auction on May 4, 1937 for a price far below its value.  This combination of Jewish collectors, a sale in the late 1930s in Germany, and an obviously low price, can support only one conclusion: a sale under duress.  The museum, it seems, did not need to be told that, but instead it took action of its own initiative, and reached out to the heirs.  Commendably, they reached an agreement by which the museum legitimized its acquisition.  The cup will now remain in the city museum, legitimately.

Similarly, but still in progress, the Badische Landesmuseum in Karlsruhe announced last week that it had identified six paintings and a late Gothic sculpture that had been looted and that have been in the museum’s collection for more than 70 years.  Provenance researcher Katharina Siefert discovered that the paintings had belonged to a Jewish collection in Mannheim.  Siefert uncovered a listing of objects of “non-Aryan ownership” on a receipt from 1943.  Then-Director of the Karlsruhe Kunsthalle, Kurt Martin, as an expert for the Reich Ministry for Art- and Museum Objects (Reichserziehungsministerium für Kunst- und Museumsgut) confirmed the receipt of the objects from Jewish property.  Martin decided whether such objects were to go into the museum or onto the market.  Apparently, in this case, he chose the former.

Armed with this new information, the museum has placed the seven objects on the www.lostart.de database (including Woman in a Theatre Balcony, artist unknown, pictured), and is actively seeking heirs of the original owners.   This too, is commendable.  The challenge will be finding those heirs; it is not clear from the public reports whether the 1943 receipt offered any more information and thus, whether the collectors or any of their heirs survived persecution. 

These are only two stories, but they represent the best sort of case study when it comes to looted art.  Namely, they symbolize a recognition of the obvious that is unfortunately far too seldom: no transaction in that time and place involving Jewish owners could be legitimate.  Sometimes the simplest answer is the right one.  If the new national center empowers more museums to be informed and take this path, it will be good news indeed. 

REMINDER—Art Law Day Next Friday, November 7, 2014

Posted in Antiquities, Appraisal, Authentication, Copyright, Detroit Bankruptcy, Events, Resale Royalties, Restitution

Art Law Day at the Appraisers Association of America’s annual conference is next Friday, November 7, 2014 at NYU’s Kimmel Center.  Sullivan & Worcester LLP will be sponsoring the event as a Friend of Art Law Day this year, about which we are very excited.

The keynote address has been changed to focus on the American Royalties, Too Act of 2014, an effort to incorporate resale royalties into copyright law (particularly as state-level efforts have run into constitutional problems).  Rep. Jerrold Nadler (D-NY) will speak, so it will be interesting to hear his thoughts on the prospects for success as the legistlative session winds down. The remaining schedule is below, and the presenters are all of the first order. 

Hope to see you there!  Please say hello if you attend.

Welcome—Betty Krulik, AAA President, Betty Krulik Fine Art Limited; Terry Shtob, Director Liberal Arts and Writing Programs, NYU SCPS

Keynote Address: The American Royalties Too (ART) Act of 2014—Judith Bresler, counsel, Withers Bergman LLP, and Rep. Jerrold Nadler (D-NY).

The Changing Laws for the Sale of Endangered Species—Craig Hoover, Chief, Wildlife Trade and Conservation Branch, U.S. Fish & Wildlife Service; Lark Mason (moderator), President, iGavel Auctions/Lark Mason Associates; Michael McCullough, partner, Pearlstein & McCullough LLP; and Monica Kreshik, Associate Attorney, Department of Environmental Conservation.

Restitution—Christopher Marinello (moderator), Director & Founder Art Recovery International Ltd.; Monica Dugot, International Director of Restitution, Christie’s; Marianne Rosenberg, attorney and granddaughter of Paul Rosenberg; and Ulf Biscof, partner, Biscof & Paetow Rechtsanwälte.

IRS/Tax Free Exchange—Suzanne Goldstein Baker, Executive Vice President & General Counsel, Investment Property Exchange Services; Randi Schuster, principal, Baker Tilly Virchow Krause, LLP; Elizabeth von Habsburg (moderator), managing director, Winston Art Group; and Diane Wierbicki, partner, Withers Bergman LLP.

Bankruptcy and the Detroit Institute of Arts—Ford W. Bell, President & CEO, American Alliance of Museums; Amy Goldrich (moderator), of counsel, Cahill Partners LLP; Richard Levin, partner, Cravath Swaine & Moore LLP; and Samuel Sachs II, Pollock-Krasner Foundation, Director Emeritus, the Frick Collection, former Director, Detroit Institute of Arts.

Toren Amends Complaint Against Bavaria Over Liebermann Seized from Gurlitt, Spotlights Task Force Recommendation of Restitution in Support of Bailment Theory

Posted in Foreign Sovereign Immunities, Gurlitt Collection, Restitution, World War II

Two weeks ago, the Federal Republic of Germany and Bavaria moved to dismiss the restitution claims brought by David Toren over ownership of Two Riders on the Beach (Zwei Ritter am Strand) by the German painter Max Liebermann.  Toren’s uncle David Friedmann owned the painting in Breslau before he was targeted for his collection and it was stolen.  Toren had not seen it since adolescence.  The painting is further notable for two (related) reasons: it is among the 1,280 works of art found in Cornelius Gurlitt’s apartment in 2012, and it is one of only two that the Gurlitt Task Force has recommended be restituted (to Toren).  As we noted at the time of the motion, Germany’s tactics seemed odd; Bavaria has committed to complying with the Task Force’s recommendations, and contesting this case seems to make little sense.  The likeliest reason, in our view, is to try to make some jurisdictional law that will weaken other potential claimants to the Gurlitt trove.

In any event, Toren is not taking the maneuver lying down while he waits for the painting.  Last week, he filed an Amended Complaint, which takes note of developments since the initial filing of the case.  Under the Federal Rules of Civil Procedure, once a defendant is formally served with the Summons and Complaint.  The first is to file an Answer, which responds to the actual allegations by admitting or denying them, or stating that the defendant has insufficient information to admit or deny them.  An Answer is what is known as a “responsive pleading” (the Complaint being an opening pleading), a concept that is a holdover from more formal days.  While most court filings are colloquially known as “pleadings,” in fact they are not. 

The second option, which Germany chose, is to move to dismiss.  This defers the obligation to respond to the allegations of the Complaint, and instead asks the Court to assume that everything in the Complaint is true, but that it is nonetheless legally insufficient.  This can be for jurisdictional reasons (as Germany argued) or substantive legal ones (i.e., what the plaintiff alleges is a legal wrong actually isn’t one).  one can also file many, though not all, of such motions after having first filed an Answer.

At this point the ball swings back to the plaintiff.  If the defendant has filed an Answer, the plaintiff has only one choice: respond to the motion and defend its case.  But where, as here, the defendant has not filed a responsive pleading, and provided the plaintiff has not previously filed an amendment to the Complaint, the plaintiff may amend “as of right.”  That means the plaintiff can restate, revise, and add allegations to the original case.  A plaintiff may only do so once unilaterally, however, after that it must get the Court’s permission.  

This is the route that Toren has chosen.  A great deal has happened, of course, since the case was first filed—most significantly the formation of the Task Force and the specific recommendation concerning this very painting. 

This is significant primarily for, and clearly strengthens, Toren’s bailment argument.  The thrust of the original complaint was that Bavaria had seized the paintings without claiming to own them, and had thus committed to hold them for their true owners.  That was a creative theory, but its biggest obstacle would probably have been convincing a court that such an agreement had been created for the benefit of as-yet-unidentified owners (for a third party to be a beneficiary of a contract, including a bailment contract, the beneficiary must be reasonably identifiable). 

These amendments bolster that theory considerably because of the Task Force.  Toren, who had become known to Bavaria well before Gurlitt died, was clearly identifiable when the Task Force was created, a creation that was explicitly for the benefit of claimants.  With this express, rather than implied, benefit, the bailment theory is even stronger. 

In the end it would probably have not meant the difference because a plaintiff is not obliged to continually re-plead its case as new evidence comes in.  And it still requires Toren to overcome (eventually, if pressed ) Germany’s argument that the original seizure was a sovereign, not a commercial act—which if true would defeat jurisdiction.  The Amended Complaint implies that the bailment is the commercial act, not the seizure, almost certainly in response to the motion. 

But the Amended Complaint now puts the question back to Germany: will the painting just be returned, or will the wrangling go on?

“Saving Africa’s Elephants Changing the Art Scene” last Tuesday with VLA New York

Posted in Customs, Events

I enjoyed a terrific panel discussion organized by Volunteer Lawyers for the Arts in New York Tuesday evening at Herrick, Feinstein LLP. Entitled “Saving Africa’s Elephants Changing the Art Scene,” the panel addressed the ramifications of this year’s Director’s Order that banned the import of African Elephant ivory for any commercial use, and restricted even further non-commercial use.

The panelists were Frank Lord of Herrick, Feinstein LLP, who moderated; David Freudenthal, Director of Government Relations, Carnegie Hall; Craig Hoover, Chief, Wildlife Trade & Conversation Branch, US Fish and Wildlife Service; Lark Mason, President, iGavel; Michael McCullough, Partner, Pearlstein and McCullough; and Hartley Waltman, Senior Counsel, Art Business, Christie’s.

Hoover began the discussion by addressing the policy behind the recent order. After two decades of population resurgence, elephant poaching has returned to record levels. His comments raise hard questions about how economics and law can, or can’t effect that kind of change, particularly so far away.

Michael McCullough, who is as knowledgeable about these issues as anyone I’ve encountered, talked about the problems that have followed the order’s enforcement and the proposed regulations under discussion. He was complimentary of Hoover and the Fish & Wildlife’s receptiveness to comments, but wondered if the comments shouldn’t have preceded the administrative action. He also discussed New York’s efforts to enact even more stringent laws, which raise serious preemption issues both because of the text of the Endangered Species Act, and the field preemption that those laws create.

The other speakers addressed the commercial side of the ban from their perspective.

It was an interesting evening. The Observer has some coverage here, too.

Conflicting Reports About Possible Acceptance of Gurlitt Bequest by Kunstmuseum Bern

Posted in Gurlitt Collection, Restitution, World War II

There have been multiple and conflict reports in the last 48 hours about whether the Kunstmuseum Bern had reached a decision to accept the inheritance from and appointment as heir by Cornelius Gurlitt. Gurlitt, who died in early May shortly after reaching an agreement with the Bavarian prosecutor concerning the 1,280 works of art seized from his apartment on suspicion of Nazi-looting connections, unexpectedly named the Swiss museum as the sole beneficiary of his will, and as his heir and representative.  Just last week, the news was that the Kunstmuseum had resolved to decide by late November, no later than six months after being advised of Gurlitt’s bequest.

Then yesterday the Sonntagszeitung reported that the museum had indeed reached a decision to accept the collection and the role (which would, presumably, extend beyond the 1,280 works taken from his Schwabing apartment in Munich, and also to the several hundred objects in Austria, which are beyond the reach of the Bavarians). Reuters took up the story in English, with the headline that “Swiss art museum to accept German hoarder’s paintings: paper.”

Today, the museum walked the story back in multiple Swiss publications (all in German, from what I have found so far). The Tages Anzeiger in Zürich has an article today entitled “Bern Kunstmuseum Denies Gurlitt Decision.” The article describes the Sonntagszeitung article as “premature and partially incorrect.” The museum stated that the foundation’s board (responsible for the museum) declined to comment, citing ongoing confidential conversations with both Germany and Bavaria about the handling of the case. Foundation President Christoph Schäublin was cited as fearful of being “overrun,” and therefor declined to make a public announcement, according to museum spokeswoman Ruth Gilgen Hamisultane in her communication to the TA. The Berner Zeitung followed suit in confirming the lack of an actual decision.

So as of today, the deadline remains November 26, 2014. We shall see as events develop.

 

Bavaria and Germany Move to Dismiss Gurlitt Litigation, But Raise Questions About Why They Are Resisting a Lawsuit Over Painting that Task Force Recommended They Restitute to David Toren

Posted in Gurlitt Collection, Restitution, World War II

To date, only one lawsuit has been filed in the United States related to the seizure from Cornelius Gurlitt’s apartment of some 1,280 works of art, a story that broke a year ago with the concern about the objects’ Nazi-looting connections via his father Hildebrand Gurlitt (the view here last winter was that the longer Germany failed to address the situation comprehensively, the more likely such U.S. litigation became).  That lawsuit, brought by David Toren, seeks the return of Two Riders on the Beach (Zwei Ritter am Strand), by Max Liebermann.  Germany and Bavaria moved to dismiss the case yesterday, which is particularly puzzling given that among the very few determinations made by the Gurlitt Task Force (in August), it is that the Liebermann should be returned.  The cynical view is that they are looking to forestall future claims, but it is past time for the painting to be returned.

Toren, a resident of New York, left Germany at age 14 in 1939.  His great uncle David Friedmann lived in Breslau, Silesia (now Wrocław, Poland).  The Nazis sought out and seized Friedmann’s art collection in 1939-40, including the Liebermann painting.  Toren seeks recovery under several theories, but they fall into two groups: the first is bailment, the other is wrongful possession.  The latter claims that he is the true owner, and that Germany is wrongfully in possession of the work.  Under common law, he could recover the painting, its value, or some combination.  In other words, if the work was his uncle’s, and he is his uncle’s heir, whoever has it now is wrongfully in possession.  The bailment argument rests on the idea that when Bavaria seized the paintings from Gurlitt—but without any assertion that Germany or Bavaria is the owner—it did so for the benefit of the true owners.  Thus, Toren argues, the seizure was a bailment that was breached when Toren demanded the painting back but was refused.

The recent motion to dismiss targets Toren’s assertion of jurisdiction under the Foreign Sovereign Immunities Act.  Countries, states, and other sovereigns are generally immune from lawsuits unless they either consent, or a statute abrogates that immunity.  28 U.S.C. § 1605(a) lists those potential exemptions from immunity.  Many art restitution cases rely on the “expropriation exception,” of § 1605(a)(3), where the property at issue was taken in violation of international law, and the sovereign is also engaged in commercial activity in the U.S.  The Altmann, Malevich, and Cassirer cases all rely on this, for example.

Toren relied on a different provision, § 1605(a)(2), which exempts the sovereign from immunity in a case:

(2) in which the action is based upon a commercial activity carried on in the United States by the foreign state;

or upon an act performed in the United States in connection with a commercial activity of the foreign state elsewhere;

or upon an act outside the territory of the United States in connection with a commercial activity of the foreign state elsewhere and that act causes a direct effect in the United States.

Toren alleged in the Complaint that Bavaria’s act of seizure was just such an “act outside the territory of the United States in connection with a commercial activity of the foreign state elsewhere and that act cause[d] a direct effect in the United States,” specifically, that Toren was damaged in the United States when Bavaria refused to honor its bailment.

Germany and Bavaria have now challenged this assertion in three primary ways.  One, they argue, the Gurlitt seizure, while obviously an act outside the United States, was not “in connection with a commercial activity.”  Rather, they say, the seizure was a sovereign act in connection with Gurlitt’s currency and tax investigation.  Second, they dispute that Toren’s presence in the United States is sufficient to constitute the necessary “direct effect in the United States.”  Lastly, the defendants contend, the assertion of a bailment agreement is insufficiently pleaded to warrant further litigation. 

These arguments were hardly a surprise in an FSIA case, but one can’t help but wonder what it is all for in this case.  That is because nearly two months ago, the Gurlitt Task Force issued only its second public recommendation—specifically, that the Liebermann be returned to Toren.  Bavaria, for its part, agreed to follow the Task Force recommendations as part of its agreement with Gurlitt shortly before his death.  So even if, hypothetically, the Kunstmuseum Bern accepts its appointment as Gurlitt’s heir but then accuses Bavaria of having given back its (via Gurlitt) property, it would have no argument because it does no more than stand in Gurlitt’s shoes.  That is not to suggest that the Kunstmuseum is even entertaining such a thing, but it would be the only person or entity with standing to challenge any restitution by Germany.  So why is Germany—having just announced its Center of Cultural Property Losses with great fanfare—delaying that restitution simply to contest this lawsuit?

The guess here is that Germany knows more lawsuits are coming.  And if it can make some favorable law in a case that, in effect, it’s going to lose anyway, it may have something to fall back on if challenged over something it does not want to restitute. 

The easiest, and best, thing to do would simply be to return the painting.  Toren would presumably drop the lawsuit at that point, and if not, it would likely be moot.  It’s been at least 75 years since he’s seen the painting.  That seems quite long enough. 

Germany Announces “Center for Cultural Property Losses”: Real Progress or Window Dressing?

Posted in Gurlitt Collection, Restitution

After numerous intimations by German Minister of Culture Monika Grütters, the German federal cabinet announced on Wednesday the official formation of the German Center for Cultural Property Losses (Deutsches Zentrum Kulturgutverluste).  Citing its “awareness of the special responsibility for the reworking of Nazi art theft,” the ruling CDU coalition issued this statement (my translation):

The Foundation for the German Center for Cultural Property Losses will raise the [] of provenance research into Nazi-looted art to a new level.  Its goal is to coordinate, strengthen, and expand the countless activities and facilities of provenance research.  In this way, it will be ensured that wrong will be punished through the strengthened state support. 

Perhaps because of this description, English language coverage has referred to the new center as the Bureau for Provenance Research, despite the actual name. 

The announcement stated that the Federal Republic of Germany will contribute 4 million Euros per year, while the 16 Bundesländer will collectively add about 600,000 more. 

This is a positive development, and should be acknowledged as such.  For many years, well-meaning German museum professionals have simply lacked material support to research their own collections, leaving them with the choice to do it on their own time and nickel, or not do it at all.  Even with the will and the time, the scope of the task is daunting.  Coordinated, national-level support is important.

But 5 million Euros is not as much as it sounds.  The intention is to build out the existing Lost Art coordination center in Magdeburg, and anyone involved in a non-profit budget knows that even a thin staff with a physical plant to attend to costs a great deal of money. 

It has not been a good year for Germany, as the anniversary of the Hildebrand and Cornelius Gurlitt story approaches.  The Task Force’s progress is unknown, with a small handful of announcements so far.  The last two Limbach Commission decisions were fiascos.  Minister Grütters deserves praise for charting this course early on in the Gurlitt saga, when most of the focus was on the still-stalled “Lex Gurlitt” to extend the statute of limitations. 

The flip side, however, is that this announcement, and the center itself, could provide cover for continued inaction, or only a slightly increased pace of research.  That would be a shame.  Here’s to hoping it’s the first step towards progress. 

Rep. Jerrold Nadler, American Royalties, Too Act Sponsor, Added to Speakers at Appraisers Association of America Art Law Day on November 7, 2014 at NYU

Posted in Appraisal, Authentication, Detroit Bankruptcy, Events, Legislation, Resale Royalties, Restitution

Art Law Day at the Appraisers Association of America’s annual conference is now less than a month away.  Held at the NYU Kimmel Center, this year’s event will be held on Friday November 7, 2014.  Sullivan & Worcester LLP is excited to be a Friend of Art Law Day this year.

The scheduled that was first released is below, but the AAA also announced yesterday that Rep. Jerrold Nadler (D-NY) will also speak.  Rep. Nadler is the sponsor of the American Royalties, Too Act of 2014, an effort to incorporate resale royalties into copyright law (particularly as state-level efforts have run into constitutional problems).  The ART seemed promising, and was reportedly set for a vote this summer, but there has been no movement since, and only a month away from the election and a lame duck session at the end of the year (after which any pending bills will expire), it will be interesting to hear his thoughts on the prospects for success.

Hope to see you there!

Welcome—Betty Krulik, AAA President, Betty Krulik Fine Art Limited; Terry Shtob, Director Liberal Arts and Writing Programs, NYU SCPS

Keynote Address: New Legislation for Authentication Experts—Judith Bresler, counsel, Withers Bergman LLP

The Changing Laws for the Sale of Endangered Species—Craig Hoover, Chief, Wildlife Trade and Conservation Branch, U.S. Fish & Wildlife Service; Lark Mason (moderator), President, iGavel Auctions/Lark Mason Associates; Michael McCullough, partner, Pearlstein & McCullough LLP; and Monica Kreshik, Associate Attorney, Department of Environmental Conservation.

Restitution—Christopher Marinello (moderator), Director & Founder Art Recovery International Ltd.; Monica Dugot, International Director of Restitution, Christie’s; Marianne Rosenberg, attorney and granddaughter of Paul Rosenberg; and Ulf Biscof, partner, Biscof & Paetow Rechtsanwälte.

IRS/Tax Free Exchange—Suzanne Goldstein Baker, Executive Vice President & General Counsel, Investment Property Exchange Services; Randi Schuster, principal, Baker Tilly Virchow Krause, LLP; Elizabeth von Habsburg (moderator), managing director, Winston Art Group; and Diane Wierbicki, partner, Withers Bergman LLP.

Bankruptcy and the Detroit Institute of Arts—Ford W. Bell, President & CEO, American Alliance of Museums; Amy Goldrich (moderator), of counsel, Cahill Partners LLP; Richard Levin, partner, Cravath Swaine & Moore LLP; and Samuel Sachs II, Pollock-Krasner Foundation, Director Emeritus, the Frick Collection, former Director, Detroit Institute of Arts

Vienna Natural History Museum Restitutes Botanical Drawings to Nazi Victims’ Heirs, Acknowledges the Too-Often-Ignored Reality of Persecution and Coerced Sales

Posted in Museums, Restitution, World War II

Vienna’s Natural History Museum (Naturhistorisches Museum) has restituted 177 botanical drawings and prints to the heirs of Dr. Ernst Moritz Kronfeld.  The restitution, while somewhat delayed following a 2011 recommendation by Austria’s Advisory Council under the country’s Law for the Restitution of Artworks from the Austrian National Museums (Bundesgesetz über die Rückgabe von Kunstgegenstände aus den Österreichischen Bundesmuseen), highlights the increasing sophistication of that Advisory Council, particularly compared to recent steps backward by the Limbach Commission in Germany.  Austria, once a lightening rod for criticism about confronting wartime and Nazi provenance issues, returned these drawings because of the clear problems with trying to portray any 1941 conveyance by a Viennese Jew as an arms’ length transaction—even without direct evidence of coercion.  Just as importantly, it brushed away the defense that the drawings had been acquired in good faith as an excuse to continued possession, a dramatic change from the perspective usually taken by civil law countries. 

The Advisory Council’s opinion (available only in German, here), portrays Kronfeld as a classically—if tragically—fin de siècle Austrian Jewish figure.  He was born in Lemberg in Galicia in 1865, then part of the Austro-Hungarian empire.  Lemberg was the German-language name for what is now know as Lvov, Ukraine, and the capital of the increasingly autonomous region/kingdom of Galicia.  It was host to a thriving Jewish community by the time of Kronfeld’s childhood in the late empire.  In adulthood, Kronfeld was editor of several magazines in Vienna, a garden historian, and botanist, best known for his collections and knowledge of the palace at the Hapsburg summer palace of Schönbrunn (another first-rate state museum in Vienna).  

The works reflected the work of botanist Nikolaus Joseph von Jacquinn and gardener Ryk van der Schot (who was later the court director of gardens and menagerie).  Von Jacquinn and van der Schot had participated in an Austrian expedition to the West Indies between 1754 and 1759, and the illustrations reflected their representations of the flora that they saw there.  The exhibition had been commissioned by Franz Stefan von Lothringen, husband of Austria’s iconic Empress Maria Theresia. 

By 1938, the Advisory Council noted, Kronfeld was one of Austria’s largest collectors of books, pictures, documents, and plans of the park at Schönbrunn.  After the Anschluss in March of 1938, Kronfeld was required to submit the infamous standard inventory of all his property, which as for many other Viennese Jews simply provided a handy list of prized objects for Nazis to seek out.  Kronfeld offered his collection to the National Library (Nationalbibliothek) in 1940, via the antique dealer Dr. Rudolf Engel.  The only surviving record of this seems to be a letter from Engel to the National Library dated January 2, 1941, which rejected the offered price of 100 Reichsmarks (a paltry sum), and asking that the manuscripts be returned to Kronfeld.

Kronfeld died in his apartment in Vienna on March 16, 1942.  According to the documentation accompanying his death, he had property worth less than 300 RM, and a few clothes, in his possession.  Barely two months later, 14 pictures once in the Kronfeld collection were received by the Vienna municipal collections, transmitted by Baldur von Schirach, longtime head of the Hitler Youth and, later, Gauleiter (District Leader) of Vienna (Schirach was convicted of war crimes at Nuremberg, and sentenced to 20 years in prison.  He died in 1974).  Those 14 pictures were restituted in an earlier proceeding.  Kronfeld’s wife, his sole heir, was deported to Theresienstadt in August, 1942, and murdered at Treblinka in September, 1942. 

In November, 1942, Engel offered a renewed portion of the Kronfeld collection (described as such) to the National Library.  The fate of the balance of the collection during and after the war is unclear.  The 177 objects resurfaced in 1988, offered again to the National Library by antiques dealer “W.K.”  That dealer’s archives indicate that the objects arrived there in 1980, of unknown provenance.

The Advisory Council acknowledged that it could not determine exactly what happened to the collection between 1942 and 1988, but concluded nonetheless (my translation):

These questions can be left open, because the sale by either Dr. Kronfeld or his widow would have been sales by persons in a persecuted group, and would also be void as an appropriation in connection with the deportation of Rosalia Kronfeld within the meaning of § 1 of the Annulment Acts (the determination of Rosalia Kronfeld as the sole heir and legal successor of her husband need not be analyzed further in this determination of restitution). 

The Advisory Council determines, therefore, that the collection of Ernst Kronfeld eventually of his widow Rosalia Kronfeld, was seized. 

The works were thus restituted to surviving heir Mario Lanzer, as well as the Israeli Cultural Society as representative for any other heirs. 

This decision, as noted above, is more than three years old, and is one of many issued by the Advisory Council.  But it is important for the manner of its analysis.  First, it acknowledges that it cannot be determined with certainty who took Kronfeld’s collection, whether by “sale” or outright seizure.  Most commendably, however, it refuses to hide behind that fact and engages in inferential analysis that should be obvious to anyone: there is simply no possible way that Kronfeld could legitimately have disposed of his collection given his circumstances.  Quite unlike this summer’s ludicrous decision by the Limbach Commission in Germany over the claim by heirs of Clara Levy to The Three Graces (Drei Grazien) by Lovis Corinth (in soon-to-be-occupied Luxembourg), or last winter’s ruling in the Welfenschatz case (Jewish dealers targeted by Hermann Göring himself in 1935), this Austrian panel was not looking for a away to avoid the only real conclusion: Kronfeld was persecuted to the point of either selling the collection out of necessity, or it was stolen from him.  Perhaps most welcome, the Advisory Council implicitly acknowledges that it does not matter which to conclude that the works must be returned.  The decision nonetheless had the courage simply to say what was so clearly the case.  Circumstantial inferences take a bad rap, but as Henry David Thoreau said, “Circumstantial evidence is occasionally very convincing, such as when there is a trout in the milk” (as evidence of the dairy’s negligence, whether or not anyone observed the fish being put there).  Circumstantial evidence is indeed very convincing, especially when the collection of a recently deceased Viennese Jewish man turns up on the art market in 1942 (also after his wife and sole heir was murdered).  

Equally welcome is the decision not to punish Kronfeld’s heirs for the NHM’s later good faith acquisition.  This is more typically in line with the Anglo-American property concept that a thief cannot convey good title.

In a broader sense, it is a reminder of the continued evolution of the Advisory Council.  Austria was once widely derided for willful blindness to its national collection’s Nazi-looting problems.  The Advisory Council is not perfect, and has issued decisions before that made people very upset.  But as I said a year ago in defending the decision over the Portrait of Amalie Zuckerkandl by Gustav Klimt from collateral attack (a defense over which I took some pointed comments), it is a system that is trying, and that is clearly developing its sophistication.  That is cause for celebration, and an example that the Limbach Commission (among others) would do well to follow.