The Art Law Report

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

Fox News Seeks to Take Fair Use Questions Over 9/11 Photo to the Second Circuit

Posted in Copyright, Fair Use

Fox News has petitioned the Second Circuit Court of Appeals to overturn an adverse ruling over use of the iconic photograph from September 11, 2001, known as “Raising the Flag at Ground Zero.”  Rightly taking issue with the mostly unhelpful guidance left by Cariou v. Prince, Fox News and personality Jeanine Pirro (recently in the news for the interviews with her as part of HBO’s The Jinx about Robert Durst) have asked for the extraordinary step of appealing the denial of their motion for summary judgment.  While that motion probably won’t succeed in the short term for reasons discussed below, the issue will likely end up in the Court of Appeals at some point.  The application that the defendants suggest, however, seems like an exception that would swallow the rule.

The suit concerns a photograph taken by Thomas E. Franklin, a photographer who was working for the publisher of the New Jersey papers The Record and Herald News.  Franklin was assigned to cover the September 11 attacks, and he took a picture of three firefighters raising a flag near the ruins of the World Trade Center.  The intensive powerful image struck a chord amid the tragedy, and after being initially published in The Record, it gained considerable fame and the publisher registered a copyright in the photograph.

Jeanine Pirro, now the host of “Justice with Judge Jeanine,” has a Facebook page managed by Fox News.  On September 11, 2013, the Franklin picture appeared on that Facebook page, juxtaposed with the iconic Raising the Flag on Iwo Jima, a (staged) image that depicted the actual planting of the flag by U.S. Marines after capturing the island of Iwo Jima in World War II at enormous cost.

The production assistant who had posted the picture testified that she assumed the pictures were “everyone’s,” and while she did not articulate the legal basis for that nor talk to Fox’s legal department, she was essentially saying that she understood the image to be in the public domain.  The publisher disagreed, and sued for copyright infringement.  The publisher has rigorously enforced its asserted copyright in other lawsuits, and has licensed the image for more than $1 million collectively since its first publication.

The defendants moved for summary judgment on the question of fair use.  This means that after the exchange of documents, depositions, and other information in discovery, Fox News asserted that no facts material to the legal questions were in dispute, such that the result should follow as a matter of law.  To put it another way, if I agree with the plaintiff that the light was red when I ran it, summary judgment will probably result regardless of whether we agree if it was sunny or cloudy.  The former is a material fact, the latter, even if disputed, is immaterial.  Fox argued that the undisputed material facts compelled a finding of fair use.  The statutory fair use factors from 17 U.S.C. § 107 are:

(1) the purpose and character of the use, including whether such use is of a commercial nature or is for nonprofit educational purposes;
(2) the nature of the copyrighted work;
(3) the amount and substantiality of the portion used in relation to the copyrighted work as a whole; and
(4) the effect of the use upon the potential market for or value of the copyrighted work.

As has been commented to death since Cariou, these analyses have almost always devolved into treating the first factor as dispositive, depending on the degree of “transformativeness.”

In this instance, the District Court was un-persuaded.  It framed the defendants’ argument thusly:

Defendants argue that the first factor favors a finding of fair use because the connection drawn between the events of September 11, 2001 and Iwo Jima can be “comfortably categorized as ‘comment.’” Defs. Mem. L. 14. According to Defendants, Tanner’s use of the phrase “#neverforget” connoted remembrance of, and signaled Fox News’ participation in an ongoing, global discussion concerning, the events of September 11, 2001.

This did not succeed first with respect to the copying of the Franklin image in and of itself:

As Plaintiff asserts—accurately in the Court’s view—the alterations to the Work are “barely discernable” unless the viewer is specifically prompted to look for them. Pl. Opp. Mem. L. 13-14. The Work is the clearly predominant feature of the Combined Image. Thus, a casual observer may believe that he is simply viewing the Work with only the hashtag added. Second Circuit authority suggests that more is required to “transform” an image.

The Court justified this reasoning by discussing the Cariou decision at length, as to the ways in which the Cariou photographs were physically altered in particular.  The Court did think that the combination of the images was a closer call, however:

Wholly apart from the image itself, there is also an issue as to whether the commentary Fox News wished to convey created anything new at all, much less anything transformative. On the particular facts of this case—as it involves the secondary use of a secondary use—it can be argued that no part of the Combined Image constitutes an original idea on the part of Defendants; some other person first thought to combine the two photographs, and the phrase “#neverforget” was a ubiquitous presence on social media that day. Thus Fox News’ commentary, if such it was, merely amounted to exclaiming “Me too.”

In a nutshell, if the Fox News use of the combined images had a message, it was essentially the same as the original photograph, namely, to honor the victims of September 11 and the first responders who came to the scene.

Ordinarily, when a party files a motion that will end the case if successful, there can only be an appeal if the motion is allowed.  That is because appeals courts favor allowing appeals only of final judgments, to prevent piecemeal issues from going up and down over the life of the case.  There are exceptions, but in most instances a party that moved for dismissal or summary judgment that is disappointed must ask the trial court for permission to appeal.  The defendants have now done so.  The odds are certainly against it, but one never knows.

From here, however, it feels like the District Court got the question right, regardless of how one feels about Prince.  This was a news photograph, clearly copyrightable and later registered as such.  I think the Court’s summation of the “transformation” as “me, too” is right, and not pejoratively.  But if an iconic photo can be copied just because it is famous, then the copyright protection loses all meaning.

The case is important in a different sense, because of the testimony from the production assistant.  She was quite clear that it never occurred to her that she could not do this; in a culture of Instagram and Twitter, the implication of this testimony is not so much “everybody does it” but “this is how expression happens now.”  Be careful of this.  As long as there has been copyright, we have heard about how changing cultural mores and technology threaten to make copyright obsolete.  It is not.  If you are combining existing copyrighted material, you are out on a limb.  It may yet be fair use, but that is not a panacea.  Perhaps if the Second Circuit takes the case we’ll get more guidance, but I wouldn’t count on it in the short term, anyway.

Annual Gardner Heist Coverage Is More Constructive This Year

Posted in Museums

Last year we called shenanigans on the seemingly-random, but actually predictable “updates” about March 18 1990 theft of paintings by Rembrandt, Manet, and others from the Isabella Stewart Gardner Museum in Boston.  Our point last year was simple: the manufactured stories about what the FBI claims to know (“confirmed sightings” and the supposed identity of the supposed thief) are worse than no news.  The FBI has no idea where those paintings are, and I am highly skeptical of the FBI’s claims to know who did it.  It’s theoretically possible that protecting the identity of a dead thief would be important to an ongoing investigation, but that presupposes that there is anything going on.  I am unpersuaded that anything new has happened in years.

But we’re not going to beat that drum again today, because by contrast they are some far more interesting stories this year.  The first actually came out two weeks ago in the New York Times.  Entitled “Isabella Stewart Gardner Heist: 25 Years of Theories,” the article comes with an inherent credibility because it was written by Tom Mashberg.  Mashberg is the reporter who was led to a dark warehouse in 1997 and told he was being shown Remdbrandt’s Christ in the Storm on the Sea of Galilee.  Later tests called that into question, and the episode is considered inconclusive.  Mashberg’s main point now (and he’s also written an excellent book on the topic) is to trace, Zodiac style, the various theories and explanations that have emerged over the years, critically. It’s thorough, and essential, reading.

The second and happier development is the announcement by the Gardner itself of a virtual tour of the stolen art.  It’s uncomplicated, but the initiative restores to prominence why the theft matters: because you can no longer see these paintings in a museum.  It’s also an interesting evolution, because since the theft the museum has left empty frames where the art was, a powerful statement of loss.  But the recent move takes a different, and important step.  The loss is important and devastating, but the art was once there and holds meaning—both in and of itself, and because of the unique atmosphere of the museum and the idiosyncratic placement and hanging.  The virtual tour includes historic photos showing where the art used to be.  It’s worth a visit.

Claim for Pissarro Painting Could be Heading to Oklahoma

Posted in Museums, Restitution, World War II

An interesting development happened last week in the case seeking restitution of a Camille Pissarro painting held by the University of Oklahoma.  The plaintiff Leone Meyer appealed the May 14, 2014 judgment that found that the courts of New York lacked jurisdiction over the Oklahoma-based defendants affiliated with the University of Oklahoma (the painting is in the Fred Jones, Jr. Museum of Art).  Without ruling on the jurisdictional basis for dismissal, the 2nd Circuit Court of Appeals remanded the matter back to the trial court for consideration of whether the case should be transferred to Oklahoma.  It seems likely that it will be, or even if not, that she will file a new case there and the matter will continue.  It’s splitting hairs, but many of the headlines suggesting that the Court of Appeals had revived Meyer’s claims are not quite right; Meyer’s claims have still never been addressed on the merits (so they were never dead) and, as discussed below, another forum remains available to her.  The larger point is that a second round is likely coming in Oklahoma.

The claim concerns an oil painting by Pissarro, La bergère rentrent des moutons.  Meyer alleged that the painting was stolen from her father Raoul in France by the Vichy regime in cooperation with the occupying Nazi forces.  After the war, she alleges that Raoul located the painting in the possession of a Christoph Bernoulli in Switzerland.  Meyer sued the Oklahoma defendants, claiming that she is the rightful owner of the painting.  Meyer also sued my client (the David Findlay, Jr. Gallery) and others, in New York, alleging that the painting had been sold at the David Findlay Galleries in 1956 to Aaron and Clara Weitzenhofer, the couple who eventually bequeathed it to the Fred Jones, Jr. Museum.  My client and the other New York defendants were dismissed from the case by agreement or as defunct entities.

The Oklahoma defendants then successfully convinced the trial judge that they are not sufficiently present in New York to justify being sued there, and Meyer appealed.  But after the judgment entered, Meyer submitted a request to the trial court that the case be transferred to the Western District of Oklahoma, where the defendants are.  The trial court declined, stating that the case had already been closed and there was nothing more to be done.  The parties briefed the jurisdictional questions on appeal and the docket seems to indicate that oral argument was held on March 6, 2015.
Last week, however, the remand order came.  It does not address the jurisdictional appeal, but states:

We defer to the district court’s judgment concerning whether transfer serves the interest of justice, and review only for abuse of discretion. In this case, however, the district court has not had an opportunity to consider Meyer’s transfer request, since the case was dismissed before the question of transfer could be argued. A district court may transfer a case even where it lacks personal jurisdiction over the defendants.

Even if Southern District judge Colleen McMahon does not transfer the case, Meyer may file a new civil action in Oklahoma (as she could have done in the first instance, and likely faced a challenge from the New York defendants to jurisdiction over them).  Interestingly, the 2nd Circuit noted that she had requested transfer because of concerns over the statute of limitations. That is to say, while as a jurisdictional matter a plaintiff can always file in a new district if there is no jurisdiction in the first one, she may not file the second case if the claims are tim- barred.  In our view, if the claims were timely when she filed them in New York, she should be safe, because unless there is a wrinkle of Oklahoma law with which I’m not familiar, the statute of limitations can usually be tolled for the pendency of the first action.

To illustrate the issue, imagine I file a lawsuit in State A on January 1, six months before the statute of limitations expires.  On December 1, my case is dismissed for lack of personal jurisdiction.  While in an absolute sense I am now beyond the statute of limitations by six months, if there were tolling, I would still have until May 31 the following year to file in State B.  If the statute of limitations were not tolled because of the first case, I would be out of luck.

Her lawyers are wise to be prudent (since a transferred action will be considered to have been filed when the initial case was brought), but unless the first case was filed the day before the statute expired and even one more day between the closing of the New York case and the opening of a new case would be dispositive, I would be surprised if the matter ultimately turned on that question.

A bigger problem for Meyer remains the Swiss chapter.  In their motion to dismiss, the Oklahoma defendants produced a copy of a Swiss judgment over title to the painting, a judgment which acknowledged the likelihood that the painting had been stolen, but finding that Bernoulli was a good faith purchaser and therefore the true owner.  That is a critical difference between U.S. and Continental law (the good faith purchaser prevails there, while the true owner prevails here), and the subject of much discussion and controversy.  Meyer may have to contend with that judgment at some point.

For now the case heads back to the District Court to see if it will be transferred or re-filed.

Authentication Lawsuit Against Keith Haring Foundation is Dismissed

Posted in Authentication

The lawsuit arising out of the Keith Haring Foundation’s refusal to authenticate a painting a Haring work, and the Foundation’s related efforts to prevent the exhibition of works it did not consider to be authentic, has been dismissed. The case is the latest in a series of civil cases related to the authentication of art—contemporary art in particular. While this case is resolved pending any appeal, the high-stakes nature of contemporary art assures that it will not be the last.

Keith Haring died in 1990, and bequeathed his collection of his own art, and all copyrights and trademarks in his case, to the Keith Haring Foundation. Haring’s work is valuable, and has clearly created a temptation for forgery that has proven too hard for some to resist. As a result, most auction houses will not sell a work as a Haring without a certificate of authentication, but the blessing of the Foundation will often suffice.

Plaintiff Elizabeth Belinksi owns over 100 works that she has asserted were made by Keith Haring. In 2007, through an art dealer (Lucas Schoormans), Bilinksi submitted documentation concerning 41 of them to the Foundation, seeking confirmation of their authenticity. The Foundation swiftly rejected the paintings as not authentic. Bilinski submitted additional evidence of the provenance, but the Foundation was unconvinced. Furthermore, the Foundation demanded that Bilinksi stop selling the work as a Haring.

Bilinksi brought the works to Sotheby’s and the Gagosian Gallery, according to the opinion, but they declined to market the paintings. She then returned to the Foundation, which agreed at least to review and reconsider its earlier opinion. During this same interval, Guernsey’s expressed the opinion that the works were genuine, and from the mid-1980s.

In 2013, the plaintiffs displayed the paintings at a Miami exhibition. Two days after the show began, the Foundation filed suit and sought a temporary restraining order and injunction. That Complaint unequivocally declared the works to be forgeries. A press release accompanied a subsequent agreement between the exhibition and the Foundation, which continued to declare is mission to prevent forgeries from being sold as Haring works (but which not mention the plaintiffs or their paintings by name).

As a result of the publicity surrounding the lawsuit, the plaintiffs claimed to have lost opportunities to sell the works, and sued the Foundation under a variety of theories. In this week’s opinion, the Court dismissed all of them. Fundamentally, the Complaint alleged that the defendants had colluded to deprive the plaintiffs of the value of the paintings. But the Court did not consider the allegations to state a claim for anti-trust violations, focusing on the Sherman Act’s requirements of an “unreasonable restraint” on trade:

Plaintiffs describe the conspiracy, formed sometime in the early 90s, as being between “Defendants and their allies,” specifically art galleries, dealers, and major auction houses who “severely restrict the supply of Haring artwork in the marketplace.” All named defendants are employees of, or associated with, the Foundation. The only “ally” identified by name is Deitch, an art dealer who sold two Harings at a Sotheby’s auction in 2014. Under the theory advanced in the Complaint, any refusal by an auction house, dealer, or gallery to sell a Haring without authentication by the Foundation could be a conspiratorial act. Such broad allegations do not give the defendants fair notice of the claim against them.

Interestingly, the Court went to great lengths to distinguish the 2009 Simon-Whelan case against the Andy Warhol Foundation. The Court here made much of the absence of a Haring catalogue raisonnée. From there it characterized the factual context of the two cases as “so dissimilar.” I’m not so sure. If alleging a conspiracy to limit the market for Warhol is sufficient, why is publication of a catalogue essential? Most artists don’t have catalogues raisonnée. Nor should the fact that the Foundation ceased authentication in 2012 matter; the plaintiff has a duty to mitigate but as a matter of pleading, her damages wouldn’t be erased by the end of authentications by the Foundation. To be clear, none of this should be read to suggest that I believe there was any conspiracy, but I found the reasoning on this issue in the opinion assessing the adequacy of the allegations to state a claim to be a little puzzling.

The Court made quick work of the plaintiffs’ trademark and Lanham Act claims, noting the absence of a connection between the press release and any proposed transaction.

The plaintiffs also brought several state law claims, mostly alleging injury from the Miami publicity. Having dismissed all the federal law claims, the court was first faced with the question of whether to continue to exert jurisdiction over the state law claims that ordinarily could not be brought in federal court. Interestingly, the court chose to do so—and then proceeded to dismiss the claims on the merits. That means they cannot be brought again in a state court.

The defendants asserted the litigation privilege in defense. The litigation privilege, which exists in some form everywhere and is required in some sense by the First Amendment, holds that “statements made in the course of legal proceedings are absolutely privileged if pertinent to the litigation.” It’s an extremely important principle that allows parties and their attorneys to vindicate their rights. I have had to invoke it more than once against litigation opponents. The Court here held that the statements in the Complaint were absolutely privileged (meaning that they cannot form the basis for liability, even if stated with malice).

The press release stands on different legal footing, and required analysis of the “fair reporting” privilege, which protects anyone reporting the course of a judicial proceeding so long as it is substantially accurate. Critically, while the press release noted the goal of removing fake works, it did not describe the plaintiffs’ works specifically as fake. The Court also relied on the general nature of the press release in dismissing the disparagement claims, concluding that a reasonable person would not conclude that the press release was about the plaintiffs’ paintings.

This is not a case that will necessarily cast a long shadow in the authentication wars, since it related so specifically to the Miami show lawsuit and press release, and the questions of privilege that came from them. And, even if the proposed New York law had been passed, it’s debatable whether it would even have applied to this fact pattern.  The antitrust theory was certainly novel, but short of evidence of an actual agreement to suppress the market for a specific artist, probably not one that will be repeated elsewhere. If anything, the case will likely accelerate the trend of foundations declining to issue opinions at all, since this matter was surely more trouble than it was worth for the Foundation.

Austrian Committee Recommends Against Restitution of Klimt Beethoven Frieze

Posted in Foreign Sovereign Immunities, Guelph Treasure, Restitution, World War II

As expected, the Austria’s Advisory Committee (Der Beirat gemäß § 3 des Bundesgesetzes über die Rückgabe von Kunstgegenständen aus den Österreichischen Bundesmuseen und Sammlungen, BGBl. I Nr. 181/1998 i.d.F. BGBl. I Nr. 117/2009, (Kunstrückgabegesetz)) issued a decision on Friday with respect to the Lederer family’s claim to the famous Beethoven Frieze. In a lengthy opinion, the Committee recommended against restitution, prompting widespread speculation about what the claimants would do next.  The mural is installed at Vienna’s iconic Secession Museum (my photograph of the museum exterior, taken today, is below), and is one of the icons of fin-de-siècle Vienna.

image

Austria’s immediate post-war restitution law provided for the return of artwork that had been stolen or taken under duress by the Nazis, but with a catch: certain artwork could not physically leave Austria.  So, for a survivor living in Zurich, London or New York, this was of limited use.  What it created, of course, was the opportunity for buyers to “take it off their hands,” and thus to create an inherently unfair and inequitable bargaining situation. In an op-ed right before the decision was issued, Jane Kallir of Galerie St. Etienne wrote persuasively about the extent to which the then-government used the law.

In the Lederer case, the frieze was actually formally restituted, but without an export license.  According to the family, Austria would only grant an export license for the family’s other art if they agreed to sell the frieze to Austria at a bargain rate.  Eventually, a sale was consummated in 1973 for $750,000, which the family asserts was a fraction of its value.

The Committee focused at length on the correspondence between the Lederer family and Austrian officials. Ultimately, the Committee was unpersuaded that the Austrian government had actually forbidden (as opposed to discouraged) the export of the painting. So, even though Austria revised its laws in 2009 (in addition to the 1998 amendments, to be more precise than my post last week) to recognize that the export prohibition could justify restitution, the Committee would not deem it to be sufficiently coercive to recommend restitution.

The claimants wasted little time in challenging the decision, and declaring it wrongly decided. Marc Weber, an attorney for some of the family, blasted the reasoning of the recommendation. Weber, an attorney in Zurich at Lanter Rechtsanwälte, issued a press release (available only in German as far as I know), declaring the case to be one for international courts. In the release, Weber questioned whether he and his clients had received all relevant documents, and went on (my translation):

We question whether something secretive may have happened. The Republic of Austria has delivered its verdict without giving those concerned a chance to review the files and give an opinion. The rules of the proceeding and the current execution of the Art Restitution Law violated several aspects of fundamental rights. We plan to ask the European Court of Human Rights in Strasbourg to review these severe legal defects. Moreover, we want to explore opportunities that are offered by U.S. jurisdiction.

Perhaps most interesting is that Weber specifically recited the prospect of U.S jurisdiction. It was, after all, a case against Austria that laid the questions to rest and paved the way for the Foreign Sovereign Immunities Act to provide jurisdiction in U.S. federal courts for restitution claims (such as the recent claims against Germany for the Welfenschatz). This story is almost certainly not over.

image

Guelph Treasure Claims—Coverage and Analysis

Posted in Foreign Sovereign Immunities, Guelph Treasure, Restitution, World War II

It has been almost two weeks since I filed my clients’ claims for restitution of the Guelph Treasure (Welfenschatz).

Nicholas M. O’Donnell, Anwalt der amerikanischen Kanzlei Sullivan & Worcester LLP, Rechtsanwalt Markus H. Stötzel, re. (Stoetzel), Pressekonferenz: WELFENSCHATZ-Coup der Nazis: Deutschland wird vor US-Gericht verklagt

(photo by Detlev Schilke)

Coverage of the case was fast and widespread in English and German.  You can watch the entire press conference here. A representative list of the most thorough articles is below, and my firm has compiled a comprehensive list here.  A few reflections on the early coverage:

The Stiftung Preussischer Kulturbesitz and Germany have persisted in their refusal to restitute the Welfenschatz.  They claimed immediately to the press that my clients had agreed to accept the recommendation of the Advisory Commission, and that their own “extensive” provenance research had established that the collection was not stolen.  Both are incorrect.  My clients never agreed that the  recommendation of the Advisory Commission would be binding; they appeared before the Commission in the hopes that the SPK would do the right thing.  That turned out not to be the case, unfortunately, but it does not affect my clients’ rights.  The SPK and Germany go to great lengths elsewhere to stress that the Advisory Commission is not an adjudication of any rights, it certainly was not binding arbitration in this case.

Equally wrong is the assertion that the SPK had researched and somehow established that the Nazi provenance of the collection was legitimate.  Whatever research the SPK did is unknown, since it presented no evidence to the Advisory Commission.  But there is little question that if there were evidence of a fair transaction, my clients would have seen it by now.  A secret investigation whose results are not substantiated or explained will carry little weight before any fair-minded tribunal.  It certainly bodes ill for the defendants carrying the burden of proof that they will have.  And it does not comport whatsoever with the Washington Principles.  Indeed, this unilateral, opaque approach is antithetical to the Washington Principles.

The other recurring red herring is the focus on a so-called absence of “new evidence.”  This is not an appeal; the Advisory Commission established nothing and no evidence is required to make my clients’ claims in the first instance.  To put it bluntly: the Advisory Commission got it wrong in a recommendation that has no effect.  Why would there be any new evidence?

It bears noting that some of the coverage, regrettably (and all of it in German, none of it below) has perpetuated long-promulgated stereotypes with references about Jews and money, or questioned why my clients would want “Christian” art, or challenging their victimhood because they were in the business of selling art.  These should be beneath any serious discourse in 2015; no one would challenge the persecution of a factory owner who had to sell his or her inventory under duress.  Some reports even challenge the good faith of our case by relying on “experts” who refuse to identify themselves.

My clients want justice, and they would not have come this far if they could be dissuaded by name-calling.  Their quest will continue.

Media of note:

English

Germany is Sued in U.S. Court Over Medieval Treasure Acquired by Nazis,” The Wall Street Journal

Heirs Seek Return Of Medieval Art From GermanyHere & Now/NPR and Robin Young

Jewish Heirs Sue Germany in U.S. Over Medieval Art Treasure,” The New York Times

NM man sues German government over medieval treasure,” KRQE News 13, Santa Fe

Jewish Heirs Sue Germany Over Nazi Medieval Hoard,” BBC News Europe

Jewish Heirs Sue Germany in U.S. Over Nazi-Looted Guelph Treasure,” the Observer

Jewish Dealers’ Heirs Turn to U.S. to Recover German Art Trove,” Reuters

Heirs of Nazi-Era Jewish Art Dealers Sue for Return of Treasure in U.S. Courts,” The Guardian

Descendants Sue Germany and Prussian Cultural Heritage Foundation for $250 Million Welfenschatz,” PrivateArtInvestor

Germany sued in United States over Nazi-era sale of Guelph Treasure or ‘Welfenschatz,’” artdaily.org

Claimants to $276 Million Guelph Treasure Once Gifted to Hitler Sue German State,” artnet News

Heirs of Jewish dealers file suit in US for the return of Guelph Treasure,” The Art Newspaper

Jewish Heirs Sue Germany to return Art Sold to Nazis,” Haaretz

Guelph art heirs want recognition from Germany,” Deutsche Welle

Germany Sued Over Medieval Artifacts Sold To NazisPrivate Wealth

German

“Erben Fordern Welfenschatz Zurück,” (“Heirs Seek the Guelph Treasure Back”) Süddeutsche Zeitung and Deutschlandradio (via Deutsche Presse Agentur)

Kunsthändler-Erben verklagen die Bundesrepublik,” (“Art Dealer Heirs Sue the Federal Republic”), Frankfurter Allgemeine Zeitung

Noch mal: wie freiwillig war dieser Verkauf?” (“Once Again: How Free-Willed was this Sale?”), Frankfurter Allgemeine Zeitung

Deutschland soll zur Herausgabe des Welfenschatzes gezwungen werden” (“Germany Should be Compelled to Surrender the Guelph Treasure”), Die Erle

Welfenschatz: Nachfahren melden Ansprüche an” (“Guelph Treasure: Descendants Submit Claims”) 3SAT/ZDF (with video)

Immunity from Seizure in Focus—Loans from Cuba for Exhibitions on Hold

Posted in Foreign Cultural Exchange Jurisdictional Immunity Clarification Act, Foreign Sovereign Immunities, Immunity from Seizure Act, Legislation, Museums

A recent story in The Art Newspaper spotlights a number of lingering issues related to stolen art, the power of U.S. courts to seize property to satisfy liability, and the role of the Immunity from Seizure Act, 22 U.S.C. § 2459 (IFSA). As we discussed recently, the prospect of a material change in U.S.-Cuba relations, which as a commercial matter haven’t existed for more than 50 years, has broad implications for the art market. Just as importantly, there are many, many unanswered questions about the fate of property in Cuba that changed hands or was nationalized as part of the Cuban Revolution in the late 1950s and onward. Simply put, there are thousands of claims worth billions of dollars for all sorts of property that exiles left behind or had taken from them. While it is still a long way off, one impact of potentially normalized relations is the prospect of sorting through those claims.

In this context art is no different than other property with regard to its ownership, but it differs in a critical way with regard to potential cultural exchange. Any object, no matter how clear the case for recovery, cannot be seized by a U.S. court if it has been brought into the country with a grant of immunity from seizure under IFSA. That does not mean that the owner cannot be sued, or even that the fact of the import may subject the owner to suit (something that has been the subject of proposed, but never enacted, legislation). But it does mean that the object itself will be allowed to come into the U.S. and then be removed, regardless of an ongoing dispute. For counter-examples, consider the Portrait of Wally affair, in which there was no immunity from seizure and the painting was held in the U.S. for more than ten years, and the Malevich case, in which the painting was immune from seizure but created the possibility for the plaintiffs to sue the City of Amsterdam under the Foreign Sovereign Immunities Act.

So what of all this now and Cuba? According to The Art Newspaper:

Another outstanding issue between Cuba and the US involves the claims made by US citizens for industrial, commercial and private property seized in Cuba after Castro came to power. According to some estimates, this property could be worth around $7bn. These claims now serve to block museum loans between the US and Cuba. The exhibition “Wifredo Lam: Imagining New Worlds” (14 February-24 May) at the High Museum, Atlanta, will show paintings and works on paper by the late Afro-Chinese-Cuban artist. The director and curator of the McMullen Museum at Boston College, the show’s initial venue, travelled to Havana to secure loans of works by Lam from the Museum of Fine Arts. The Havana museum agreed to send a group of pictures, but the loans were never made. The US State Department discouraged the Boston museum from applying for immunity from seizure for the pictures, citing Cuba’s status as a country that “supports international terrorism”. Even with immunity from seizure from the State Department, that stigma put the pictures at risk of being held to satisfy outstanding legal claims against US property seized by Cuba.

There is a lot going on here. Full disclosure, I graduated from Boston College Law School, but I have no other connection to the case. The involvement of the State Department is important, because it is that agency that decides whether to grant immunity. So it is certainly interesting that the State Department—which could simply say “no” to immunity from seizure if it chose—asked the museum not even to request immunity from seizure. The second major point relates to the ongoing (and going, and going…) exhibition loan boycott by Russia related to the judgment in the Chabad case. Even though any painting loaned from Cuba, if immune from seizure, would never be seized, the practical fact is that many countries simply do not believe it. The principle of judicial independence in the U.S., which is absolute, is simply hard for many people to believe.

In the meantime, no one is happy. The claimants for this painting are looking for a forum for their grievance, and an exhibition and museum goers don’t have the painting that would provide cultural enrichment. Clearly there is still work to be done.

Development May be Coming Soon In Klimt Beethoven Frieze Case

Posted in Restitution, World War II

Der Standard in Austria reported this week that a recommendation is expected on Friday in the claim by the heirs of Erich Lederer to the famous Klimt Beethoven Frieze in the Secession Museum in Vienna.  The issue in this case is not a Nazi-era theft per se, but the effect of Austria’s post-war restitution law, which returned ownership to the Lederer family (it was looted from Erich Lederer under the Nazi) but forbade export, leading to a sale.  The Lederer family has argued that that amounts to a second taking.  As I made no secret last week with regard to Germany’s intended National Cultural Property Designation for the Welfenschatz that my clients have sued to recover, this kind of export prohibition is now recognized for what it is: an effort to hinder restitution.  The same kind of claim was made against the Leopold Museum in Vienna for Portrait of Wally, namely, the allegation that the post-war sale was not valid under the circumstances because of the export prohibition.  That case settled in 2010, the painting remains in Vienna.

It is, to be clear, not at all the current position of Austria.  That country’s 1998 law eliminated the last vestiges of this outdated approach.  The current dispute focuses on transactions under the old law.

As we have discussed previously, Austria’s Advisory Committee (Der Beirat gemäß § 3 des Bundesgesetzes über die Rückgabe von Kunstgegenständen aus den Österreichischen Bundesmuseen und Sammlungen, BGBl. I Nr. 181/1998 i.d.F. BGBl. I Nr. 117/2009, (Kunstrückgabegesetz)) has performed reasonably well on balance since its formation in 1998 (unlike some others in neighboring countries).  The Austrian Committee has handled questions of flight goods and sales under duress admirably.  On the other hand, this is a work of art greatly treasured in Vienna, and bound up in the fin-de-siècle image that is so beloved there.  How the Committee handles it will bear close watching.

Civil Action Filed Against Germany for Restitution of Guelph Treasure

Posted in Guelph Treasure, Restitution, World War II

I filed yesterday a new civil action against the Federal Republic of Germany and the Stiftung Preussischer Kulturbesitz (the SPK, which is responsible the administration of the Berlin museums, among other things) in the United States District Court in Washington, DC. You can read the Complaint here.  The lawsuit seeks the immediate restitution to my clients of the collection held by the SPK known as the Welfenschatz, or as it is referred to in English, the Guelph Treasure. My clients Gerald Stiebel and Alan Phillip are the blood relatives and successors to the consortium of Jewish art dealers who were threatened and forced by the National Socialist government into selling the Welfenschatz in 1935.

A little quick background that the court documents we have submitted will verify: The Welfenschatz was sold to the Consortium by its previous owners in 1929. After selling about half the collection of their own free will before 1933, the situation for the Consortium changed quickly and drastically after the Nazi seizure of power. The Consortium was suddenly targeted by a concerted campaign of the National Socialists to acquire property they believed was of German heritage and not fit to be owned by Jews, though of course those Jews were until then German citizens too. There were many, many recorded instances in which the Jews of Germany were stripped of their property. And in this case, it was an organized effort that ran from the mayor of Frankfurt (where they lived) all the way up to Goering and Hitler personally. Eventually, the Consortium relented under intense pressure and sold the collection under duress for a fraction of its actual value. The proceeds were paid into accounts that were in actuality blocked, and the Consortium’s members were subjected to further intimidation and the infamous flight taxes, which are described in a Gestapo document included in yesterday’s court filing. After the acquisition, Goering made a great public gesture of presenting the Welfenschatz to Hitler as a personal gift, and was even featured in news reports at the time. It has remained in Berlin ever since, now held by the SPK.

Quite simply, the Welfenschatz belongs to my clients. The transaction forced upon the Consortium was illegitimate as a matter of German and international law, and it had and has no validity whatsoever. My clients attempted in good faith to obtain the return of the collection by participating in mediation with the Advisory Commission, but despite presenting conclusive and unopposed evidence of the oppression that they faced and the inadequate sum they received, the Advisory Commission refused last year to recommend restitution, and the SPK likewise refused to return it.

As a result of a failure of justice here in Germany, my clients have asked me to vindicate their rights in the federal courts of the United States of America. The availability of the U.S. courts to address our claims is clear and longstanding. Pursuant to the Foreign Sovereign Immunities Act (FSIA), our courts have jurisdiction over this case and will confront the SPK precisely because these claims concern rights in property taken in violation of international law, and since these defendants, Germany and the SPK, engage in commercial activity within the United States. Since 2004, when the United States Supreme Court allowed Maria Altmann’s lawsuit for the return of her paintings to proceed against Austria pursuant to the FSIA, it has been well established that our courts are the proper place to seek restitution. Our courts—including the Supreme Court—have consistently held that sales under duress constitute property taken in violation of international law, and that jurisdiction will follow from it. This is nowhere more true than in cases where property ended up in the hands of the Nazi government of the Third Reich.

The SPK can only contest our claims by arguing that the 1935 sale was legitimate, a tactic that it regrettably has employed in the past. Since the Allied victory in 1945 the law has been clear, however: any sale by a Jewish owner after 1933 was presumptively under duress. That is to say, unless Germany proves otherwise, my clients win. But Germany cannot prove, and it should not try to prove, that a conspiracy to take the Consortium’s property—a conspiracy spearheaded by Hermann Goering—was in any way a non-coerced, normal marketplace transaction. It was not.

Lastly, two things about the announcement made over the weekend that the Welfenschatz has received a national cultural heritage designation. The first thing is that the mere fact of the designation shows that the SPK knows full well that the collection belongs to my clients. If the SPK were so sure that title to the collection had been resolved, then the designation would serve no purpose. Instead, it confirms that the SPK knows full well that the 1935 transaction was void, and it’s nothing less than an effort to thwart restitution that neither changes the ownership, and frankly is an insult to the Washington Principles and the Collective Declaration of 1999. It is a desperate tactic, and it will not work. Any suggestion that the designation settles the question of my clients’ rights is incorrect.

Second, that designation, even on its face, has no effect whatsoever on my clients’ ownership rights. At most, and if the designation is even valid, it could affect the physical movement of the collection once my clients ownership of it is confirmed. They will cross that bridge when they have to.

The Welfenschatz is my clients’ property and has been for decades and we now intend to use the full weight of the American justice system to prove that. We look forward to the day when it is back in their rightful possession.

 

Sullivan & Worcester LLP Press Release Concerning Claims For Guelph Treasure

Posted in Foreign Sovereign Immunities, Guelph Treasure, Restitution, World War II

FOR IMMEDIATE RELEASE

 

U.S. COURT ASKED TO ACT AGAINST GERMANY IN NAZI ART ACQUISITION NOW VALUED AT $250 MILLION

Collection Once Presented to Hitler as “Surprise Gift”

Current Owners Insist 1935 Jewish Owners Freely Sold To Nazis

Diminishing of Germany’s Restitution Policy Seen

Washington, D.C.–February 24, 2015–American and British descendants of Jews who escaped from Nazi Germany, and whose joint art collection included precious medieval works worth an estimated $250-300 million today, have asked the United States District Court for the District of Columbia to restitute that collection from Germany and from the current possessor of the collection, Germany’s Prussian Cultural Heritage Foundation (SPK).

This is the first time U.S. Courts have been asked to intervene in Germany’s refusal to recognize the claimants’ ownership of these works, known as The Guelph Treasure, which were stolen in what the claimants say was a “sham transaction” forced upon their predecessors in 1935.

The Prussian Cultural Heritage Foundation’s refusal to recognize these restitution claims followed a March 20, 2014 opinion by a German government advisory commission that had no binding authority. The decisions of that advisory board have shown, according to today’s complaint, a disturbing tendency in recent years to ignore longstanding principles of international law that such transactions in Nazi Germany were by definition coercive, voidable and should not be considered valid.

“Germany advances the pretense that it has enacted procedures to address Nazi-looted art, but the reality is quite different,” said Nicholas M. O’Donnell of Sullivan & Worcester LLP, an attorney for the descendants of the art owners, who filed the Complaint.  “The German government’s refusal to recognize the losses incurred by these victims, who survived with their lives but lost their livelihoods and property, does not square with Germany’s historical approach and responsibility.”

The U.S. law that the descendants are turning to is the Foreign Sovereign Immunities Act (FSIA), which confers jurisdiction because the claims concern rights in property taken in violation of international law, and Germany and the SPK do business within the United States through exhibitions and other activities. The case also points to the 1998 Washington Conference Principles, which established standards of restitution for Nazi-confiscated art, and to which Germany previously agreed in a 1999 German resolution.

Today’s filing is filled with accounts of how the owners escaped from Germany in the 1930’s, what was happening around them to other Jews in Germany, and how their art collection landed in the possession of top figures in the Nazi government. The collection, housed in the Kunstgewerbemuseum in Berlin, is widely regarded to be worth more than $250,000,000, according to expert testimony in court documents.

BACKGROUND:

The Guelph Treasure, also known in Germany as the Welfenschatz, includes dozens of gilded and jeweled reliquary art from the 11th to 15th centuries that long belonged to Prussian aristocrats from the House of Brunswick-Luneberg. In 1929, the Duke of Brunswick sold off the collection, with part of it going to a consortium of art dealers owned by the plaintiffs’ ancestors and predecessors: J.&S. Goldschmidt, I. Rosenbaum, and Z.M. Hackenbroch.

In the 1930’s the Jewish ethnicity of those dealers brought them to the attention of Hermann Goering, whose titles as one of Adolf Hitler’s top Nazi deputies included not only Commander of the Luftwaffe and President of the Reichstag, but also Prime Minister of Prussia.

The works were obtained by Goering’s emissaries through a pressured transaction at a fraction of their worth, paid into blocked accounts to the members of the art owners’ consortium.  Some of the owners had already begun preparations to flee Germany, others followed soon after. Fees demanded by Nazi authorities as the escapees fled were then stripped from the accounts through harsh “flight taxes,” as described in a Gestapo document included in today’s filing

Coerced selling of property was a common tactic of the Third Reich during the period historians are now calling Early Nazi Terror. Germany’s SPK has claimed that the transaction was done at the owners “free disposal.” But so pleased with the Guelph acquisition was Goering that, according to a 1935 report in the Baltimore Sun, he personally presented the collection as a “Surprise Gift” to Hitler.

Other documents show the then-Mayor of Frankfurt, shortly after the Nazi takeover, boasting in a letter to his “most revered” leader, “Reichskanzler (Chancellor Hitler),” about the potential to take advantage of the Welfenschatz’s owners and seeking Hitler’s personal assistance in setting the stage for the forced transaction. Another letter, concerning how to obtain the Welfenschatz from the Jews, is addressed to Paul Körner, a Nazi leader who later participated in the infamous Wannsee Conference in which Hitler’s “Final Solution” was formalized to oversee the extermination of all remaining Jews in Europe.

“The Jewish people who owned this art had their property squeezed out of them while their lives and the lives of their families were at risk,” O’Donnell said. “The value of that collection was four to six times as much as these victims were paid. But no matter what the price was, it’s an absolute outrage for the Prussian Cultural Heritage Foundation to state, as it did in reply to the finding of the advisory commission, that any sale under these circumstances in 1935 was done at ‘free disposal’ by Jews being persecuted.”

The plaintiffs’ longtime German attorney, Markus Stötzel, added, “The historical record is clear. After being publicly denounced as ‘traitors’ and targeted for their Jewish heritage, the members of the consortium had no real choice when they came up against Goering’s henchmen.”

In an apparent attempt to further its position, the Prussian Cultural Heritage Foundation is in the process of having the Welfenschatz collection designated as German national cultural heritage, which would restrict its physical movement. The plaintiffs dismissed the designation as a semantic ploy that has no effect on their ownership rights. “The unilateral nationalization of the collection by Germany doesn’t change the facts we have provided that show it was obtained, like so many other confiscations of Jewish property, through forced manipulation by the Third Reich,” said Mel Urbach, another attorney representing the descendants of the owners. “It is a shameful move that in actuality advances the illicit work of the Nazis. This is a clear violation of international accords on looted property that call for a fair and just resolution,” added Urbach.

The descendants of the art owners include Gerald Stiebel of Santa Fe, New Mexico, whose ancestor was to Isaak Rosenbaum, mentioned in today’s filing. “My great-uncle Isaak was fortunate to make it to Amsterdam, but my father always talked about how the family had to leave so much behind.” said Stiebel. “We’ve been looking for justice for years from today’s German government. They claim the Nazis bought it in a fair marketplace. How is that possible? We hope we can find justice now in the United States Court system.”

###

The U.S. District Court filing against the Federal Republic of Germany and the Prussian Cultural Property Foundation can be found here: (LINK)

The “Washington Conference Principles” on Nazi-Confiscated Art can be found here: http://m.state.gov/md122038.htm

For further information please contact:

Jeff Roberts 646-761-2795 jroberts@sloweymcmanus.com

Tara Goodwin 617-338-2465 tara@goodwinpr.com

Dominic Slowey 781-710-0014 dslowey@sloweymcmanus.com