IFAR Vol. 22, Nos. 1 & 2 2023
The Long-Running “Guelph Treasure” Case Ends - Not Happily For The Plaintiffs
By Polina Ivko
The complicated case concerning valuable medieval ecclesiastical relics, generally known as the Guelph Treasure, housed in the Prussian Cultural Heritage Foundation (SPK) in Germany but claimed by the heirs of a consortium of German-Jewish art dealers who said the works were sold under duress in the 1930s at below market value, is now over. The case is familiar to IFAR Journal readers, as we have published multiple stories about it since 2017 (see, e.g. Vol. 20, nos. 1&2, 2019). It raised nuanced issues involving the Foreign Sovereign Immunities Act, international law and jurisdiction, as well as decisions from multiple courts, including the U.S. Supreme Court in 2021, which upheld Germany’s sovereign immunity and sent the case back to the lower court. Germany was dismissed from the case, but not the SPK. The case worked its way through various courts again. On July 14, 2023, the D.C. Circuit Court upheld the lower court’s ruling to dismiss the case, and the heirs chose not to petition the Supreme Court again. Their attorney, Nicholas O’Donnell, confirmed to IFAR in November that, with the decision not to petition SCOTUS, the “U.S. federal court proceedings are therefore over.”
Avant-Garde Fakes on View at Amherst
By Polina Ivko
As a timely coda to an article on the “Scourge of Avant-Garde Fakes” by Konstantin Akinsha in the last IFAR Journal, a new exhibition at the Mead Art Museum at Amherst College highlights fake artworks of the Russian Modernists. Titled Art in Doubt this exhibition, on view until March 1, 2024, is the first of a two part exhibition which examines authenticity issues surrounding several Russian avant-garde forgeries from the museum’s Thomas P. Whitney Collection of over 600 artworks, specifically, the narratives behind suspected fakes of the Soviet avant-garde said to be by the likes of Mikhail Larianov, Alexandra Exter and Alexander Rodchenko, amount others. It is curated by Dr. Maria Timina, with contributions from Akinsha, Although Whitney took precautions to prevent purchasing forgeries, a handful of dubious works slipped through. Along with the suspected fakes, the exhibition showcases falsified archival records, certificates of authenticity, and bogus exhibitions, all aimed to validate artworks whose suspicious stories of paintings found in storerooms behind the Iron Curtain.
One case in point is Theater-Cinema, a paper and photographic collage formally attributed to Rodchenko, now exposed as a fake. A 1987 auction catalog listed it in the collection of German dealer Kurt Benedikt, who allegedly left a large number of Russian artworks in his basement in Berlin when he fled the Nazis. Eventually, doubts about the provenance, including how so many works survived the war, exposed the so-called Benedikt Collection as fraud.
The second part of the exhibition will focus mainly on figurative works in the collection, formerly attributed to artists such as Leon Bakst, Natalia Goncharova and Ilia Repin, among others. Some of these paintings have been downgraded while the attributions of others are as yet unresolved.
Part two of the exhibition will run from March 26 to June 28, 2024.
Artist Forgoes Supreme Court Hearing, Cementing Second Circuit’s Take on VARA
By Polina Ivko
When artist Samuel Kerson chose in November not to escalate his case against Vermont Law School (VLS) to the U.S. Supreme Court, he effectively etched the Second Circuit’s interpretation of the Visual Artists Rights Act of 1990 (“VARA”) into legal precedent. At issue was whether the law school’s decision to permanently conceal Kerson’s two murals, jointly titled The Underground Railroad Vermont and the Fugitive Slave, which were commissioned by the law school 30 years earlier, constituted “modification” or “destruction” under VARA.
In 1993, VLS commissioned Kerson to create two large-scale murals commemorating Vermont’s significant role in the Underground Railroad and its stance against slavery. Depicting scenes from America’s history of slavery and highlighting Vermont’s active participation in the abolitionist movement, the murals draw from an important historical narrative. The first panel, Slavery, for example, portrays the harrowing journey of slavery, from the capture of people in Africa to their sale in the U.S., and the brutal reality of slave labor.
By 2020, the perception of the murals at VLS had shifted significantly. Once celebrated, the representations, particularly of the African Americans, came under scrutiny and were deemed caricaturistic and offensive by members of the school community. This change in sentiment was notably influenced by the Black Lives Matter movement. In response to this evolving perspective, VLS made the decision to permanently conceal the murals with acoustic panels.
In August 2020, then VLS President Thomas McHenry reached out to Kerson, informing him of the school’s intentions and extending an offer to Kerson to personally remove the murals. Additionally, President McHenry proposed returning full ownership of the murals to Kerson. It was in the wake of this communication, and the subsequent failure to find a mutually agreeable solution, that Kerson initiated his lawsuit in the Federal District Court of Vermont.
Kerson contended that Vermont Law School’s decision to cover the murals infringed upon his rights under VARA, which safeguards the rights of artists to the attribution and integrity of their work. He argued that the act of concealing the murals was tantamount to modifying and destroying them, actions that are explicitly restricted under VARA.
The law school argued that their action to cover the murals with acoustic panels was a necessary response to the changing sensitivities within the school community, and moreover, was not a modification or destruction of the artwork. Covering the murals was within their rights as the owner of the artwork and did not violate VARA, as it did not physically alter or damage the murals.
The District Court sided with VLS, clarifying that within the context of VARA, “modification” is typically understood to refer to direct, incremental changes made to the artwork itself, that merely obscuring a piece of art behind a barrier, as was the case with acoustic panels, does not qualify as modification. Nor did such concealment meet the definition of “destruction,” as it involved no physical alteration or damage to the murals. Therefore, VLS’s actions to cover the murals did not constitute either modification or destruction under VARA.
The Second Circuit echoed this interpretation, explaining that VARA’s use of “modification” implies a change that affects the viewing experience of a work, presupposing some visibility, albeit altered. Therefore, simply concealing an artwork, as was the case here, did not fall under VARA’s definition of modification. The Second Circuit also clarified that “destruction” in the context of VARA means to damage something so thoroughly as to render it unusable or nonexistent, which was not the case with the murals, as they remained intact behind the panels.
Kerson’s claim also failed because he did not fulfill the dual criteria for liability as outlined in §106A(a)(3)(A) of VARA, which demands proof of both an intentional modification of the work and subsequent damage to the artist’s honor or reputation. The court, adhering closely to the statutory language and traditional interpretations, determined that the essential condition of “intentional modification” had not been satisfied. Consequently, it deemed it unnecessary to evaluate the second condition – whether the action prejudiced Kerson’s honor or reputation.
In the aftermath of the Second Circuit’s ruling, Samuel Kerson opted not to pursue further legal avenues, including an en banc appeal or a writ of certiorari to the Supreme Court of the United States.
One of his attorneys, Steven Hyman of McLaughlin Stern, told IFAR that while “they were disappointed in the approach and analysis of the circuit court,” they were dealing with a narrow issue of the definition of “modification,” and the Supreme Court had never taken a VARA case. Moreover, they had reached out to the art community, but heard nothing back. This impacted their decision about the Supreme Court. He added, “We were seeking to preserve art to be seen, not to be abstractly hidden away.”
This marks the end of the legal journey for Kerson v. Vermont Law School, solidifying the appellate court’s interpretation of “modification” and “destruction” under VARA.
Florida Court’s Banana Decision Results In “A Peel”
By Polina Ivko
When a banana duct-taped to a flat surface sold at the December 2019 Art Basel Miami Beach art fair for $120,000, the world wondered, “Is it art?” The Federal District Court for the Southern District of Florida recently avoided this debate and instead focused on the elements of copyrightability within the work.
Before delving further, it’s important to understand two key legal concepts crucial in this case: copyright infringement and the “abstraction-filtration-comparison” test. Copyright infringement involves illegally copying or using another’s original work, while the “abstraction-filtration-comparison” test is a method used by courts to determine if one artwork illegally copies the core elements of another.
Los Angeles based artist Joe Morford sued Italian conceptual artist Maurizio Cattelan (of gold toilet fame) in January 2021 for copyright infringement of Morford’s 2000 abstract wall structure, Banana & Orange. Both Banana & Orange and Cattelan’s 2019 wall sculpture, Comedian, depict a banana duct-taped to a wall. Morford, who filed a pro se (without an attorney) claimed that Cattelan stole his idea because, in essence, Banana & Orange was publicly available to view online. In response, Cattelan argued that he drew inspiration from his own 2019 sculpture depicting a banana affixed to a wall with red duct tape.
Cattelan sought to dismiss the case, but the district court denied the motion in July 2022, saying that Morford had sufficiently alleged a similarity between the works for the case to proceed. Despite the fact that an “idea” of a banana taped to a wall is not copyrightable and that Morford’s concept didn’t in the view of the court, “espouse the highest degree of creativity" the court decided that “its absurd and farcical nature [met] the minimal degree of creativity needed to qualify as original.” Morford insisted that he had a valid copyright; the two works were substantially similar; and Cattelan had sufficient access to and, therefore, knowledge of Banana & Orange.
Both parties filed motions for summary judgment. The District Court analyzed them based on two critical elements of copyright infringement claim: ownership of a valid copyright and copying of original elements of the work. This analysis required assessing factual and legal copying, encompassing the need for proof of the defendant’s access to the work and substantial similarity between the works. The court ultimately found that Morford did not provide sufficient evidence demonstrating that Cattelan had a reasonable opportunity to view Banana & Orange. Despite Morford’s argument that his work was available online for several years, the court ruled that mere online availability does not suffice to prove access, requiring more direct evidence of a nexus between the works.
To determine the similarity between the two artworks, the court used the “abstraction-filtration-comparison” test, a method akin to peeling layers off an onion to see what remains at the core. Just as an onion has multiple layers, this test strips down the artwork to its essential elements. The court concluded that Comedian is not substantially similar to Banana & Orange. It’s like comparing two recipes for a fruit salad; while both may use bananas, the choice of additional fruits, presentation, and dressing can make each recipe distinct. Similarly, the court found the key elements like the arrangement and presentation in Morford’s work were unique and not replicated in Cattelan’s work. The differences in background, border, and placement further emphasized their distinctiveness, much like how different garnishes and bowl choices set apart two fruit salads.
The court granted summary judgment to Cattelan in June 2023, which Morford appealed, once again on a pro se basis, to the Eleventh Circuit in July 2023. Morford contends that the court ignored evidence supporting his claims and erroneously applied legal doctrines like merger, which led to the dismissal of his case. Morford maintains that the material evidence he provided justifies a trial rather than a summary judgement. The evidence Morford continues to rely on includes website analytics and metadata showing that his sculpture was widely viewed, as well as articles and reports on Cattelan suggesting that he has a history of plagiarism and unconventional practices. Morford also continues to insist on his arguments regarding the similarities between the works.
Cattelan’s attorneys responded in November noting that this lawsuit does nothing more than attempt to prevent Cattelan from using a banana and duct tape in artwork, which already were ruled as not copyrightable elements of the artworks, and to assert Morford’s allegedly exclusive rights to such an arrangement.
The outcome of this case and the upcoming ruling in the Eleventh Circuit could have significant implications for how copyright law is applied in the art world, particularly in cases involving conceptual and minimalist art.
On an unrelated but amusing note, Comedian has proved to be too appetizing to museum-goers. The work was eaten in 2019 by a Georgian national who declared his snack break was performance art. Comedian was eaten again in 2023 by a South Korean student who had “skipped breakfast.” Cattelan did not pursue damages after either incident, and the bananas were promptly replaced.
Turkey's Claim For Guennol Stargazer Quietly Ends
By Polina Ivko
Another long-running case ended recently, and quietly - the ownership claim by the Republic of Turkey (now Turkiye) against Christie’s and Michael Steinhardt for an ancient and valuable marble sculpture, known as the Guennol Stargazzer. The sculpture was part of an enormous and controversial collection of antiquities owned by Steinhardt, a financier and philanthropist. Steinhardt lent the Stargazer to the Metropolitan Museum of Art several times over a period of 25 years, including one 8-year period, where it was on view from 1999-2007, but the work wasn’t claimed by Turkey until it was put up for auction at Christie’s in 2017. IFAR has written about this case, too, multiple times (see, for example, IFAR Journal, Vol.19, no. 4). This case, too, worked its way back and forth through the courts, with conflicting opinions concerning issues such as the validity of the 1906 Ottoman era cultural property law on which Turkey based its claim; the statute of limitations, given that the object had been on public view for many years; and which side bore the burden of proof. Ultimately, the District Court ruled against Turkey and the Second Circuit affirmed in March 2023. It denied Turkey’s request for a rehearing en banc, and Turkey did not file for a review by the Supreme Court; and with that, the case quietly ended this summer.
Dutch Supreme Court Rules That The Crimean Gold Should Go Back to Ukraine, Not Museums In Russian-Annexed Crimea
By Polina Ivko
IFAR Journal readers might remember the story of the so-called Scythian gold objects from Crimea (IFAR Journal, Vol. 18, no. 1, 2017), which got stranded in the Allard Pierson Museum in Amsterdam after the annexation of Crimea by Russia. The artifacts, sent on loan for an exhibit in 2014, became the subject of a legal battle involving the Crimean museums, Ukraine, and the Allard Pierson. At the end of the exhibit, the Dutch Museum had a dilemma: whether to return the objects (more than 500 in all, including precious ancient gold objects) to the Ukrainian State OR to the Crimean institutions that lent them, although those museums were in a territory that had since been annexed by the Russian Federation. Various courts ruled differently.
In June of 2023, all these years later, the Dutch Supreme Court mandated the return of the “Crimean treasures” to Ukraine, adhering to Ukrainian cultural heritage law and the European Convention on Human Rights (“ECHR”). Ukrainian law, in this context, safeguards cultural heritage, and the ECHR’s First Protocol reinforces the right to property, which played a crucial role in the court’s deliberation. The ruling concluded the legal dispute, imposing the costs on the Crimean museums.
IFAR Vol. 21, Nos 3 & 4
Dispute Over Van Gogh Lent To Detroit Ends With Immunity From Seizure Law Intact
By Polina Ivko
Vincent Van Gogh, an artist whose popularity keeps growing, factors into several current legal cases, such as the claim for one of his Sunflowers, discussed earlier in this Journal issue.
Another Example is the just-ended dispute over his 1888 oil painting, The Novel Reader, which was lent to the Detroit Institute of Arts (DIA) for the blockbuster Van Gogh in America exhibition (October 2022 - January of 2023), and was claimed, while there, by Brokerarte Capital Partners LLC, a Florida entity solely owned by a Brazilian collector, Gustavo Soter. The lawsuit came to a close on April 10, and when it did, the U.S. museum community breathed a collective sigh of relief, as the Federal Immunity from Seizure Act of 1965 (22 U.S.C. 2459), which appeared to be in jeopardy as a result of the case, was left intact. The Act (see below) allows museums to borrow artworks from foreign countries for temporary exhibit without fear of seizure while they are in the United States.
Unlike many ownership suits today, this one did not concern the Nazi era. The painting - also known as Une liseuse de romans - was lent to the exhibition anonymously; the owner identified in the exhibition catalogue as “Private Collector, Sao Paolo.” Brokerarte claimed ownership of the painting, however, and on January 10, 2023 filed suit in federal court in Michigan against the museum and, consequently, the unidentified lender, to recover the painting. The museum denied any wrongdoing and filed a motion to dismiss the case. The Brokerarte appealed, and on February 6, the Sixth Circuit granted Brokerarte’s emergency motion for an injunction pending the appeal. It ordered the museum to retain possession of the painting in the interim.
After the Brokerarte and the unidentified lender came to a confidential settlement in March it asked the Sixth Circuit court to dismiss the case, and it “seemed” to be over (and was announced as over in many news articles). BUT the DIA opposed the request, arguing that to leave the part of the February 6 decision that pertained to Federal Immunity from Seizure Act (FISA) unaddressed, might appear to favor Brokerarte, and, moreover, would have a chilling effect on all U.S. museums borrowing works from foreign lenders in the future. The DIA had applied for protection under the Act before borrowing the painting. Many in the museum community agreed. The Association of Art Museum Directors (AAMD), American Alliance of Museums (AAM), and dozens of individual U.S. art museums large and small requested to intervene and file a joint amicus (friend of the court) brief in support of the DIA.
On April 10, the court granted the DIA’s motion to vacate its earlier order when it also granted Brokerarte’s motion to dismiss the case. When the Sixth Circuit dissolved its previous order for the DIA to hold onto the painting, it cited the “many amici museums” who pushed it to do so.
The Court Battle
The contested Van Gogh, depicting a young woman reading a French 19th century novel (identifiable as such by its cover) while seated at a brightly lit table, was last sold publicly at auction at Christie’s New York on November 3, 2010 for more than $3 million to an unidentified purchaser. The painting had a robust provenance that included distinguished collectors such as John Hay Whitney. The Detroit exhibition was not the first time it was exhibited in a major American exhibition. The painting was exhibited at MoMA in New York in 2008 and also at the Art Institute of Chicago's Van Gogh and Gauguin exhibition in 2001-02, the same exhibition where the contested Sunflowers discussed elsewhere in this Journal issue was also exhibited.
In its suit, Brokerarte said that it bought the painting from a Cayman Islands company Torrealba Holdings Ltd. in May 2017 for $3.7 million, and that it [somehow] kept the painting in the hands of a third party in Brazil and that it eventually went missing. (As this may be difficult to fathom, the words in the Complaint were, “Since Plaintiff [Brokerarte] purchased the Painting in May 2017, Plaintiff has not known the location of the Painting.”) Brokerarte allegedly discovered the painting’s whereabouts only when it was on view at the DIA.
As already noted, the DIA had obtained immunity for the painting under the Federal Immunity from Seizure Act (FISA) from the U.S. Department of State, which determined that the inclusion of 27 foreign loans, including this Van Gogh, into the DIA’s exhibition was in the national interest of the U.S. and published the notice of determination in the Federal Register (which is accessible to the public). Brokerarte argued that the painting was unlawfully obtained by the unidentified lender, and that the DIA should have known or suspected its allegedly murky provenance. Brokerarte further claimed that the DIA’s inclusion of the painting in the exhibition constituted conversion, negligence, and breach of bailment. The DIA denied any wrongdoing and argued in its motion to dismiss the case that, in essence, it had obtained immunity for the painting and had no duty to disclose the identity of the lender.
The case hinged, in part, on the scope of immunity afforded to museums by the FISA, which was enacted in 1965, at the height of the Cold War, to allay fears that cultural objects on loan from outside of the U.S. might be seized while in the U.S. A particular concern was potential seizures by communist regimes, such as the Soviet Union. Museums must apply for immunity under FISA in advance. Once granted immunity, an artwork cannot be seized even by the U.S. government and even if there is a genuine dispute over ownership or possession.
The Act received overwhelming bipartisan support from both chambers of the Congress and was passed unanimously in the House and the Senate. President Lyndon B. Johnson, recognizing its importance in promoting cultural exchange and protecting American interests, signed it into law the same day it was passed - July 19, 1965. Since then, the Act has been amended several times to strengthen and expand its protections. It has also been interpreted and applied in a variety of legal cases over the years as courts and attorneys have grappled with the complex issues surrounding ownership and transfer of cultural objects.
In this Detroit case, the Federal District Court for the Eastern District of Michigan, Southern Division, ruled in favor of the DIA in January 2023, denying Brokerarte’s motion for possession while the case was pending (filed concurrently with the complaint) and dismissing the case. Applying a four-factor balancing test used by Michigan courts in similar instances, the district court concluded that the DIA met the FISA requirements to enjoy its protections, and had even gone beyond the requirements by performing due diligence to determine the painting’s provenance. Presiding Judge Steeh cautioned that mandating museums to bear the burden of such claims would be against the intent of the Act and would have a chilling effect on cultural exchanges with the U.S. He also opined that Brokerarte had no likelihood of success on the merits anyway, as there was no legal basis for its claims.
Brokerarte filed an appeal and submitted an emergency motion for immediate injunction pending an appeal with the Sixth Circuit, which was promptly granted, ordering the DIA to retain possession of the Van Gogh. The DIA opposed this motion, arguing that Brokerarte had no likelihood of success on the merits and that the injunction would harm the museum and other similar institutions engaged in cultural exchanges. Brokerarte countered that it would succeed, as the U.S. administration’s decisions are not owed total deference under the Act. In February, the Sixth Circuit granted the injunction, reasoning that Brokerarte would be irreparably harmed if the painting were returned to the anonymous lender.
Despite having already filed its appellate brief in support of its appeal, Brokerarte submitted a motion for a voluntary dismissal of the case on March 13, 2023, informing the court that it had entered into a confidential settlement agreement with the individual who was believed to be the lender of the painting, and, therefore, Brokerarte no longer wished to pursue the claims.
This settlement could have brought the legal battle to a close right then and there; however, the museum opposed the motion, asserting that Brokerarte was seeking dismissal to avoid an unfavorable ruling and preserve the uncertainty caused by the earlier injunction. The museum asked the court to deny Brokerate’s motion and enter a judgement affirming the district court’s ruling, or, in the alternative, enter an order vacating the injunction pending appeal and declaring it null and void without any precedential or persuasive authority. The DIA refreshed its previous argument that Brokerarte filed the litigation in direct contravention of the FISA and the way that FISA had been interpreted for nearly 60 years. Moreover, the museum said, the court forcing it to act as an escrow agent for the painting caused it to incur significant time and legal fees (which the museum said, exceeded $100,000). Lastly, the DIA stressed that an outcome to the contrary would impair the interests of the U.S. and discourage foreign lenders from lending culturally significant objects to American institutions. As mentioned above, the U.S. government along with the Association of Art Museum Directors (AAMD), the American Alliance of Museums (AAM), and dozens of individual art museums asked to intervene and filed a joint amicus brief in support of the DIA. These requests were granted by the court on March 28.
In April, the Sixth Circuit granted Brokerarte’s motion for dismissal of the case with prejudice (i.e., Brokerarte cannot bring the claims again) and granted the DIA’s motion to vacate the court’s February 6 order, finding that leaving it unvacated could significantly affect the operations of the museums. The court also added that “the DIA bore no responsibility whatsoever for rendering the case moot” when justifying the grant of their motion. So, Brokerarte was made whole in the settlement and the museum, in essence, helped eliminate a potentially ominous opinion.
Court Rules For Howard University Over Charles White’s Centralia Madonna
By Polina Ivko
Howard University, a Historically Black College and University (HBCU) in Washington, DC, recently won a legal battle against a North Carolina couple, Larry and Virginia Borders, to reclaim a lost artwork by Charles White, who was an artist-in-residence at Howard in 1945. The case revolved around White’s 1966 colored pen and ink drawing Centralia Madonna (also known as African American Madonna), which had gone missing from Howard in the 1970s and reappeared in 2020 when it was consigned for sale at Sotheby’s, New York. The court not only had to balance the equities, but also take into consideration the difference between the statute of limitations in New York, North Carolina, and Washington, DC.
Charles White (1918-1979) was a prominent Black artist and educator from Chicago. Educated at the Art Students League in New York, he frequently depicted African American figures in large-scale drawings and prints, as well as in easel and mural paintings. Relatively unknown outside of the art world until recently, White’s works have appeared in major museums, including the Museum of Modern Art in New York and the Smithsonian American Art Museum in Washington, DC, and prices of his works have escalated.
White’s Centralia Madonna was acquired by Howard University in 1947 after White completed his artist residency. The University did not report the loss at the time it went missing. More than forty years later, Larry and Virginia Borders consigned it to Sotheby’s for a June 26, 2020 sale, where it was estimated at $300,000-$500,000. The couple claimed to have received the work as a gift early in their marriage and later said they had no knowledge of its importance until they saw similar works on the PBS television program Antiques Roadshow.
Sotheby’s discovered the ownership problem in the course of its pre-sale due diligence, pulled the work from sale, and alerted the university, which then requested the work from the Borders, alleging that it had been stolen from the Howard Gallery of Art sometime between 1974 and 1976. The Borders refused, and Howard subsequently filed suit in June 2020 in the U.S. District Court for the Southern District of New York. The Borders denied all allegations claiming that the university knew of the missing artwork long before, and that they themselves were unaware of the provenance issues until Sotheby’s contacted them. The Borders argued that Howard’s delay in reporting the drawing as missing or stolen and its failure to take any action over all these years constituted laches, a legal doctrine that prevents a party from bringing a claim that prejudices the opposing party due to an unreasonable delay in asserting. The Borders also asserted their own claims against Howard, including slander of title and tortious interference with contract.
Howard filed a motion to dismiss the counterclaims, arguing that the Borders could not provide evidence that the university acted with malice or reckless disregard in its statements to Sotheby’s, which were privileged anyway. Additionally, Howard claimed that Borders failed to provide specific contractual terms that had been breached – as required by New York law – and thus, could not show tortious interference with the Sotheby’s consignment agreement.
After some initial back-and-forth between the parties, the court ordered Howard to produce documentation pertaining to the drawing and the full extent of communications with the auction house in response to the Borders’ motion to compel discovery.
In May 2021, Howard filed a summary judgment motion, arguing that its claims were timely under New York law governing the statute of limitations in the context of art law cases. Howard further contended that its actions in relation to the drawing were reasonable. The Borders opposed the motion, citing the statute of limitations for replevin in North Carolina and the District Columbia, which would have run, and reasserting their laches defense.
In March 2022, the court found Howard’s claims timely under New York’s Demand and Refusal Rule, where the statute of limitations does not start running until a demand for return is made and is then refused. The court also found that the university had established a threshold showing of a claim to ownership, thereby shifting the burden of proof to the Borders to show that the drawing had left the university’s possession lawfully. The court allowed the claim of laches to move forward with the bench trial, which occurred in the fall of 2022.
Ultimately, in October 2022, the district court judge, Lewis Liman, ruled in favor of Howard, finding that the Borders’ defense of laches did not bar the university’s replevin claims and to quiet title in the work. Judge Liman also found that although there were equities on both sides, and the Borders’ situation was not unsympathetic, the balance of equities tipped “ever so slightly in favor of Howard.” He acknowledged that there was no evidence that the Borders’ knew or believed the artwork to have been stolen. Therefore, Howard prevailed on each of the claims, and its title was affirmed. The Borders did not appeal, and the case has been closed.
Cassirer Case Returns to the Lower Court After Supreme Court Ruling
By Polina Ivko
Some restitution claims seem to go on forever. The Cassirer family’s fight to recover Rue Saint Honoré, après-midi, effet de pluie by Camille Pissarro from the Thyssen-Bornemisza Foundation (“Foundation”) is one of them. IFAR has written about this dispute on many occasions as the case has bounced between the Federal District Court for the Central District of California (“District Court”) and the United States Court of Appeals for the Ninth Circuit (“Ninth Circuit”) over issues related to the Foreign Sovereign Immunities Act (“FSIA”), choice-of-law rules, and the definition of a single Spanish word–encubridor.
Since IFAR Journal’s last report on this case (Vol. 19 no. 4), the Cassirer heirs appealed the District Court’s May 2019 “take nothing” order to the Ninth Circuit. The parties resumed arguing over the existing issues, including the Baron Thyssen-Bornemisza’s knowledge of the painting’s provenance when he acquired it, whether to impute that knowledge to the Foundation (which received the Pissarro from him in 1993), the definition of willful blindness under Spanish law, whether the plaintiffs’ claim is time-barred or precluded by laches, and the choice-of-law itself.
In August 2020, the Ninth Circuit upheld the District Court’s findings concerning the actual knowledge of Baron Thyssen-Bornemisza and the Foundation, and declined the Cassirer request to revisit the Ninth Circuit’s own decision from 2017 regarding the choice-of-law, the HEAR Act, the Spanish Heritage Historical Law, the European Convention on Human Rights, and adverse possession. Additionally, while the Ninth Circuit agreed that compliance with the Washington Principles was voluntary and unenforceable by a U.S. court, the court was frustrated with the defendants not meeting their moral obligations under these Principles. The court denied the Cassirer heirs’ petition to rehear the case and the District Court subsequently entered the appellate decision in December 2020, which terminated the case on the date of its dismissal – May 17, 2019.
Still unsatisfied with the outcome, in May 2021, the Cassirer heirs turned to the United State Supreme Court, requesting a review of the decision on the choice-of-law issue (a determinative factor with respect to what substantive law shall ultimately govern the case). In September 2021, the Supreme Court agreed to review it. (IFAR readers will recall that the Foundation had previously asked the Supreme Court to take a look at this case and received a denial. See IFAR Journal Vol. 19, no. 4.)
What was at stake? If the Supreme Court held that federal common law applied with respect to the choice-of-law, then the painting would stay in Spain. If the Supreme Court held that California’s choice-of-law rule applied, the case would be remanded to the lower court for re-adjudication. The latter is exactly what happened.
During the proceedings, the cassirer heirs reiterated their view. Under California law, the Foundation, as the holder of stolen property, could not acquire good title (a well-established principle under U.S. Common Law). Under Spanish law, which has been applied, an adverse possession rule protected the Foundation’s title. Allowing the court to use Spanish law was squarely against the choice-of-law principles regularly relied on in other FSIA cases.
On April 21, 2022, the Supreme Court unanimously vacated the Ninth Circuit’s decision and remanded the case to the lower court for re-adjudication. In a relatively short opinion and relying on section 1606 of the FSIA, the Supreme Court held that one a plaintiff overcomes the jurisdictional hurdles of foreign sovereign immunity, the foreign sovereign has to be treated like any other private litigant and to rule otherwise would not only create unfair outcomes for litigants, but would also be contrary to the to the long-established application of state choice-of-law rules in other FSIA suits. Justice Kagan, who delivered the opinion, concluded with a simple and somewhat ominous statement: “A foreign state or instrumentality in an FSIA suit is liable just as a private party would be.”
So, the Cassirer heirs will have another day in court and perhaps a chance to win back the painting. As IFAR Journal went to press, a court date had not been set.
IFAR Vol 21. Nos 3 & 4, 2022/2023
Was Van Gogh’s Sunflowers A Nazi Force Sale? Mendelssohn-Bartholdy Heirs Say “Yes” For The Version in Japan
By Polina Ivko
An ownership claim for one of several versions of Vincent van Gogh’s iconic Sunflowers took a dramatic turn in December 2022 as thirty heirs of Paul von Mendelssohn-Bartholdy, a prominent banker in pre-WWII Berlin, challenged the legitimacy of the painting’s 1987 sale to the Japanese insurance giant, Yasuda Fire and Marine Insurance Company. Yasuda, the heirs say, engaged in fraudulent and willful misconduct by purchasing and then exploiting the painting despite knowing its purported problematic provenance as the product of what they describe as forced Nazi-era sale. They seek return of the painting from Yasuda’s successor, Sompo Holdings, Inc., as well as approximately $750 million dollars!!! in punitive damages, along with another $690+ million for unjust enrichment and other alleged offenses. If the painting cannot be returned, they seek its fair market value, which they say is “not less than $250 million,” including interest. In their 98-page complaint filed in U.S. District Court for the Northern District of Illinois, the heirs justify filing in Illinois by citing, among other things, Yasuda’s commercial activities in the state and the temporary exhibition of the painting twenty years ago in the blockbuster 2001-02 Van Gogh and Gauguin exhibition, co-organized by the Art Institute of Chicago and the Van Gogh Museum in Amsterdam, neither of which is a party to the suit.
THE CLAIMS
Mendelssohn-Bartholdy acquired the Van Gogh in 1910, and consigned (or sold) it in October 1934 to the Paris art dealer Paul Rosenberg, with whom he had a long relationship. Rosenberg, who was Jewish and subsequently fled France for the U.S. to escape the Nazis, sold Sunflowers soon thereafter to the American collector, Edith Beatty (Mrs. Alfred Chester Beatty), who lived in London. The work remained in the Beatty family for more than 50 years and was eventually put up for auction by the executors of the estate of Helen Chester Beatty, Alfred Chester’s daughter-in-law, at Christie’s, London in 1987, where Yasuda purchased it (in a phone bid) for a hammer price of ￡22.5 million then equivalent to $36,292,500 USD, the highest price for any work sold at auction up to that time (and considerably above the ￡14 million reserve). The sale was a media sensation. It was said at the time that Yasuda wanted it in order to replace another Van Gogh Sunflowers that was owned by a Japanese businessman, Koyata Yamamoto, and was destroyed by bombs during WWII. Mendelssohn-Bartholdy died of natural causes in May 1935, less than a year after he transferred the painting to Rosenberg for an as yet unknown (or unspecified) price. The legal documents do not assert that Mendelssohn-Bartholdy wasn’t paid, although the heirs do say that he relinquished the painting at a time when the market was saturated with similar artworks and prices were depressed (no doubt also due to a worldwide Depression). They describe the Mendelssohn-Bartholdys as early targets of the Nazis, citing family’s banking business, Mendelssohn & Co., which was severely impacted by the Nazis and eventually closed in 1938, and other financial hardships he and his family endured after Hitler came to power in 1933.
Mendelssohn-Bartholdy was of Jewish descent, although not Jewish himself. He belonged to a distinguished family that included the noted German-Jewish Enlightenment philosopher and theologian, Moses Mendelssohn, and Moses’ grandson, the great composer and prodigy, Felix Mendelssohn, who, as a child was baptized a Lutheran. Paul von Mendelssohn-Bartholdy was Felix’s nephew, and his branch of the family converted to Christianity (Protestantism) more than 100 years before Hitler came to power. Paul’s second wife, Elsa, who lived until 1986, was a non-Jew, and his gravestone in Brandenburg Germany is topped by a cross. Hitler, however, thought of Judaism as much in racial terms as religious, and banned Felix’s music, and the Mendelssohn family, including Paul, which was prominent in the German-Jewish community, and the family bank, do appear to have been financial targets of the Nazis. It was these financial losses in the early years of the Nazi regime, the heirs assert, that led (or “forced”) Paul to sell off parts of his extensive art collection, including Sunflowers, which he consigned to Rosenberg along with five other Van Gogh paintings (a sixth was later challenged as non-authentic). According to the heirs, the banker had never sold or attempted to sell any significant artwork prior to the Nazis in 1933, which, they say, supports their claim of a duress sale. No doubt, the question as to whether the price was fair at the time will be an issue in the case. There is no evidence – or even suggestion – that the Van Gogh was seized by a Nazi or was ever in Nazi hands.
Not the Family’s First Court Foray
The Mendelssohn-Bartholdy name is familiar to longtime readers of the IFAR Journal. This is not their first lawsuit for works they say were sold under duress. In 2007, the same heirs, led again by Julius Schoeps, a Berlin resident, former professor, and great-nephew of Paul von Mendelssohn-Bartholdy, made a claim for two prominent Picasso paintings – The Boy Leading a Horse (1905-06) and Le Moulin de la Galette (1900) in New York’s Museum of Modern Art and Solomon H. Guggenheim Museum, respectively. The museums filed for summary judgement. When the court ruled that there was enough preliminary evidence for the claim to go forward to trial so a jury could decide on the facts, the parties reached a confidential pre-trial settlement in 2009, under which both paintings remained in the museums’ collections, in return for an undisclosed payment.
Another claim around that time was made by the Mendelssohn-Bartholdy heirs against the Andrew Lloyd Webber Foundation, on the eve of a November 2006 Christie’s New York auction for a 1903 Blue Period Picasso painting, which was expected to be one of the stars of the sale. The court ruled that Julius Schoeps, the lead plaintiff in that case as well, did not have standing to file the claim and that the auction could proceed, but the painting was withdrawn from the sale anyway. The parties eventually settled out of court.
In the case of the Van Gogh Sunflowers, the Mendelssohn-Bartholdy heirs allege that both Paul Rosenberg and Edith Chester Beatty were aware of the painting's problematic provenance, which Yasuda would have known too had it conducted due diligence before the purchase. There was nothing much in the provenance listed in the Christie’s 1987 catalogue, however, that would have stood out at the time as a red flag, although the information concerning the transfers from Mendelssohn-Bartholdy to Rosenberg to Beatty is sketchy. According to the complaint, this lack of due diligence was “reckless if not purposeful” and motivated by subsequent branding opportunities for the insurance conglomerate, all of which amounted to various counts of fraud and ultimately resulted in unjust enrichment. The complaint cites former Yasuda CEO Yasuda Goto’s acknowledgement that the phenomenal publicity brought to the company through its ownership and display of Sunflowers would have cost them four times the price of the painting. Indeed, the heirs discuss in great detail how Yasuda’s association with the painting positively influenced the company’s corporate identity.
The claim relies heavily on the circumstances surrounding the 2001-02 exhibition at the Art Institute of Chicago (“AIC”) and Van Gogh Museum in Amsterdam. Attached to the complaint are emails between the employees of the Yasuda Museum of Arts (its successor is also a defendant), the AIC and the Van Gogh Museum, in which the Yasuda representative tells the museums about Yasuda’s desire to check the provenance of the painting and concerns about seizure. This was, perhaps, not surprising, given that a WWII-related ownership claim for an Egon Schiele painting lent to MoMA in New York was making headlines at that time. While Yasuda’s representative makes clear that he had no reason to think there was a Nazi-era taint, the company understandably requested loan agreement terms designed to protect its interests.
The heirs accuse the AIC (with no evidence) of submitting a false report to the U.S. Department of State as part of its application for immunity from seizure under the Foreign Immunity from Seizure Act, while the painting would be on loan. The AIC allegedly has refused to provide the heirs with the report attached to their application.
The Painting
Sunflowers in vases are among Van Gogh’s most iconic and recognizable images. He painted numerous versions while he was in Arles, in the South of France, in 1888-1889. The painting at issue is one of only three versions with a yellow background – yellow on yellow. Two of the versions are signed: one executed in August 1888, is now in the National Gallery, London; another painted in late January 1889, is in the Van Gogh Museum. The third, the Yasuda painting, is unsigned and has generally been dated as January 1889. The authors of the 2001-02 AIC exhibition catalogue, however, argue that the painting was executed in early December 1888. Unfortunately, there are no corresponding letters to his brother Theo or others to substantiate either date. Unlike the August 1888 and late January 1889 versions, which are painted on canvas, the yellow on yellow Yasuda Sunflowers is painted on jute – a burlap-like support used by both Gauguin and Van Gogh, when the two artists were living together in the Yellow House in Arles in autumn 1888. When the painting was auctioned in 1987, the absence of a signature, along with the fading of the chromium yellow paint, initially raised concerns, but it clearly didn’t affect the price.
The Motion to Dismiss
The heirs’ rationale for filing the claim in Illinois, which included the temporary exhibit at the AIC twenty years before, was seized upon by Sompo in its response. On April 27, 2023, Sompo sought to have the case dismissed, challenging subject matter jurisdiction, specific personal jurisdiction, and the convenience (or inconvenience) of the forum. Its arguments at this dismissal stage are procedural and jurisdictional, with barely a mention of the event in 1934. Julius Schoeps, the company argues, lacks standing. Under Illinois law, Sompo says, survival claims of the heirs must be brought by an executor or administrator representing the estate, and the Mendelssohn-Bartholdy heirs lack the necessary “letters of office issued in Illinois” to qualify as such representatives. Sompo cites the 2006 Andrew Lloyd Webber Foundation case, in which the New York court found that the individual heirs of Mendelssohn-Bartholdy (essentially the same heirs as in this case) did not have standing; Illinois law, they note, is similar to New York law on this point.
The insurance giant also contends that the court lacks specific personal jurisdiction over the company’s entities, which, they say, have no substantial connection with Illinois and should not be subject to the state’s long-arm statute. The crux of the company’s argument lies in the fact that neither the heirs’ alleged conversion claims, nor their exploitation claims stem from any of the insurance company's activities in Illinois. Sompo Holdings and Sompo Bermuda maintain that they do not possess or control Sunflowers; the painting is currently on display at Tokyo's Sompo Museum of Art, which is managed by the Sompo Fine Art Foundation. The company claims that the Foundation’s oversight of the museum is not enough to establish control over the painting.
Nor do the specific contacts alleged by the heirs meet the threshold for jurisdiction. Only an indirect subsidiary of Sompo Bermuda sells insurance from a Chicago office, and these activities are unrelated to the claims. Moreover, Sompo says, its advertising in the U.S. is not targeted specifically to Illinois residents nor does it conduct any business activities within the state. According to Sompo, general or national advertisements alone do not establish specific personal jurisdiction in Illinois.
The company also argues that using the Sunflowers image as part of its corporate identity or branding is not sufficient grounds for jurisdiction, since the heirs’ claims pertain to the physical painting rather than the image. Any potential claim to the image, moreover, is moot, as the painting has been in the public domain since at least 1960. Sompo asserts in addition that the temporary, brief exhibition of Sunflowers at the AIC does not create a substantial connection to Illinois.
Sompo additionally maintains that, should Illinois attempt to exercise personal jurisdiction over the company, it would infringe upon the due process clause for several reasons. Primarily, subjecting the foreign-based Sompo entities to jurisdiction in Illinois would prove inconvenient and burdensome, and the state’s interest in Sunflowers is minor, stemming only from its brief exhibition. Lastly, securing relief for the heirs may not be convenient or even effective, given that Sompo is located in Japan.
Sompo pleads that, in the alternative, the case is subject to the common law doctrine of forum non conveniens, which allows a federal district court to dismiss a case over which it has jurisdiction to better serve the convenience of the parties and the ends of justice. In this case, the company argues, Japan is the appropriate forum to hear the dispute, as most of the alleged bad acts were committed in Japan by Japanese persons, and nearly all the Witnesses and documents are there.
The conglomerate adds that Japan is an available and adequate forum and that its legal system blends the American trial equivalent with the American discovery equivalent, and Japanese courts recognize civil causes of action for damages. Sompo even cites the Seventh Circuit decision in In re Factor VIII or IX Concentrate Blood Products Litig., 484 F.3d 951 (7th Cir. 2007), which has recognized that the investigatory powers of judges in a civil law system, such as Japan, are significant.
In sum, considering private and public interest factors, Sompo argues that Japan is a more suitable forum for this case; and that both private and public factors favor dismissal in favor of Japan's courts. As it happens, the heirs’ complaint specifically requests that Japan be ruled out as the forum (Japan is generally viewed as a less favorable forum to plaintiffs in an ownership claim).
WHAT IS NEXT?
During the scheduling conference call on May 1, 2023, the heirs indicated that they will amend the claim and add Sompo Japan Insurance, Inc. as a defendant since this entity was identified by Sompo as the current owner of the painting. While Sompo has not objected to this request, the conglomerate responded that another motion to dismiss will follow the amended complaint. The next day, the court granted the parties requests and noted that Sompo’s first motion to dismiss shall be terminated as moot upon the heirs’ filing of the amended complaint.
Two Schiele Works on Paper To Be Sold At Auction After Decision in Title Dispute
By Polina Ivko
Readers of the IFAR Journal are familiar with the long legal battle between the heirs of Fritz Grunbaum and British art dealer Richard Nagy over title to two Egon Schiele works on paper: Women in a Black Pinafore (1911) and Woman Hiding Her Face (1912), said to have been sold to Nazis under duress. After nearly seven years of litigation in New York state courts, Reif v. Nagy has come to a close, with ownership going to the Grunbaum heirs.
In 2019, the New York Appellate Division affirmed a lower court’s holding that Mr. Grunbaum’s heirs had a superior claim to the Schiele works; the heirs had not waited too long to bring a title claim; and Mr. Nagy had not been prejudiced by any delay. The IFAR Journal had already reported on the surprising nature of the 2019 ruling (Vol. 20, nos. 1 & 2), as some thought that the Appellate Court’s decision conflicted with Bakalar v. Vavra, a 2012 deferral court ruling on another Schiele work from the collection. In that case, other heirs of Mr. Grunbaum, a successful cabaret artist and art collector, who died in Dachau in 1941, unsuccessfully sued art collector David Bakalar to recapture title to Seated Woman with Bent Leg (Torso) (1917), which the Nazis also allegedly stole from Mr. Grunbaum. That court held that the heirs waited too long to sue for the painting, as the necessary witnesses had long passed away and allowing the case to proceed would be prejudicial to Mr. Bakalar.
Mr. Nagy had the opportunity to take a “second bite of the apple” and so he appealed the 2019 ruling directly to the New York Court of Appeals. While Mr. Nagy’s appeal was pending, the parties litigated the amount of damages that the heirs would receive. In March 2022, the New York Supreme Court awarded the heirs a total of $700,964 in damages, costs, and prejudgment interest. In May, the Court of Appeals denied Mr. Nagy’s appeal, without an accompanying opinion. In other words, the court did not provide Mr. Nagy any future opportunities to challenge the previous rulings. The May 31, 2022 issue of the New York Post reported that Timothy Reif, one of the Grunbaum heirs who prevailed in the case said that the two Schiele artworks would be sold at Christie’s in fall 2022, with the proceeds going towards a foundation that supports young artists. Christie’s confirmed to IFAR that both works will come up for sale on November 17, 2022 at the 20th Century Evening Sale.