Heirs’ Secrecy in Settlement Over Picassos Baffles Judge

New York Times 24 March 2009
By Benjamin Weiser

A federal judge in Manhattan said on Monday that he was deeply troubled by the secrecy of a settlement concerning two Picasso paintings purportedly sold under duress in Nazi Germany.

In the settlement announced last month, the Museum of Modern Art and the Solomon R. Guggenheim Museum said they would continue to own the Picassos, and would pay a confidential sum to the heirs of the paintings’ original owner, Paul von Mendelssohn-Bartholdy, and his wife, to resolve the case.

The judge said that the heirs were demanding the terms remained confidential.

The works included “Boy Leading a Horse,” which was donated to MoMA in 1964 and “Le Moulin de la Galette,” which was given to the Guggenheim in 1963. In 2007, lawyers for Julius H. Schoeps, a great-nephew of Mr. Mendelssohn-Bartholdy, a German Jewish banker who died in 1935, told the museums that they believed the banker had sold the works to an art dealer against his will because of the Nazi regime, and demanded their return.

When the settlement was announced on the eve of trial, the judge, Jed S. Rakoff of Federal District Court, expressed dismay at the secrecy, and asked whether the parties would disclose the terms, given the museums’ role as quasi-public institutions and the gravity of the plaintiffs’ accusations.

In his order late Monday addressing the secrecy issue, the judge said that the museums had agreed to disclosure, but the plaintiffs, “for reasons wholly unexplained and seemingly no more compelling than concealing the amount of money going into their pockets, remain opposed.”

He added: “The fact that the plaintiffs, who repeatedly sought to clothe themselves as effectively representatives of victims of one of the most criminal political regimes in history, should believe that there is any public interest in maintaining the secrecy of their settlement baffles the mind and troubles the conscience.”

Without the plaintiffs’ consent, the judge said, he could not make the agreement public, but he said he hoped the plaintiffs, after reflection “on their public responsibilities,” would change their position.

It is not unusual for civil lawsuits to be resolved secretly, but Judge Rakoff made clear that he did not consider the case to be typical, saying the issues were of considerable public importance.

A lawyer for the plaintiffs, John J. Byrne Jr., said he had no comment on Monday night.
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