Civil Action Filed Against Germany for Restitution of Guelph Treasure

Art Law Report 24 February 2015
By Nicholas O'Donnell

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.
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