Foreign Cultural Exchange Jurisdictional Immunity Clarification Act Reintroduced in House of Representatives, Would Ban Use of Exhibition Loan as Basis for Federal Court Jurisdiction

Art Law Report 31 March 2014
By Nicholas O'Donnell

Steve Chabot (R-OH) has reintroduced the Foreign Cultural Exchange Jurisdictional Immunity Clarification Act  (H.R. 4292), after a previous attempt to amend the Foreign Sovereign Immunities Act with regard to the loan of cultural objects failed to become law in 2012.  The text of the March 25, 2014 bill is identical to the version that passed in the House in 2012.  Its co-sponsors are John Conyers (D-MI) and Bob Goodlatte (R-VA), and it has been referred to the House Judiciary Committee. 

As readers will recall from our coverage here, in 2012 a bill of the same name was passed by the House of Representatives, and introduced in the Senate as Bill 2212 by Orrin Hatch (R-UT) and Dianne Feinstein (D-CA).  The bill attempted to resolve the tension between the Foreign Sovereign Immunities Act (FSIA, 28 U.S.C. § 1605) and the Immunity from Seizure Act (IFSA, 22 U.S.C. § 2459).  The FSIA has provided the jurisdictional basis for many restitution lawsuits since Altmann v. Republic of Austria, through to the recent lawsuit filed by David Toren against the Federal Republic of Germany for paintings found in Cornelius Gurlitt’s apartment.  The FSIA allows foreign sovereigns to be sued in U.S. federal court when certain exceptions are met.  Most commonly restitution plaintiffs allege that the property at issue was taken in violation of international law (28 U.S.C. § 1605(a)(3)), or that the claims are based on commercial activity in the United States, or on acts with a commercial effect in the United States (28 U.S.C. § 1605(a)(2)).  IFSA, for its part, allows mmuseums and similar institutions to apply to the State Department for a declaration that regardless of any other debts or obligations on the part of the lending country, a particular work of art may not be seized or attached to satisfy a money judgment or otherwise compel compliance with a court order.  Particularly since the Portrait of Wally case in 1998 (a painting that did not have such immunity from seizure and was seized and warehoused for 12 years until the dispute was settled), applying for this immunity is standard course.  Where it is not obtained, as with the Girolamo Romano “Christ Carrying the Cross Dragged by a Rogue,” customs laws—in both the Romanonand Portrait of Wally cases, a customs law (19 U.S.C. § 1595a) targeting he importation of stolen property—often provided a swift vehicle for seizure and restitution. 

The issue when the U.S. District Court in Washington, DC decided Malewicz v. City of Amsterdam, 517 F.Supp.2d 322 (2007).  In that case, plaintiffs (heirs of Kasimir Malewicz sought restitution of several paintings by invoking the FSIA, arguing that the loan of the paintings themselves into the United States for temporary exhibition was sufficient to constitute commercial activity under the FSIA.  The paintings, however, had been given immunity from seizure by the State Department under IFSA.  Thus, the question was whether a lawsuit could be commenced based on the loan of paintings whose return was sought by the plaintiffs, but which themselves could not be seized for any reason.  The District Court answered that the two were not mutually exclusive, and the loan could be used to satisfy the elements of the FSIA.

The bill would amend the FSIA to clarify that where an object has been granted IFSA immunity, its loan (in and of itself) cannot be the “commercial activity” necessary to satisfy § 1605(a)(3).  Nazi-era claims are specifically exempted.  It is, in the simplest terms, a legislative overruling of Malewicz, something easily within Congress’s power with respect to the scope of a law.  The question, of course, is whether it is a good idea.

I made no secret here that I believed the bill to be a positive development.  A lawsuit that, by definition, can be commenced but which necessarily will never return in the seizure of the object that it seeks is a pointless exercise.  It does not mollify the many, justifiable frustrations with the state of restitution law, but the Malewicz world does claimants no favors.  As a logical proposition, the Nazi-era claim exception is and was itself vulnerable to criticism: why are those claims, but not claims for cultural property, for example, exempt?  The prior bill had many articulate critics, whose voices should be considered and whose perspective I can appreciate, but on balance I considered the bill to be an improvement on the status quo.  I have no doubt that many readers will disagree. 

Expect a similar, sharp debate to ensure.  The previous bill gained a number of sponsors in the Senate, seemingly presaging passage, but then the 2012 session of Congress expired. With more than a year and a half to go in this session, this bill may get a definitive answer from Congress.
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