Best Practices for Nazi-Era Art

Art Law Report 5 March 2024
By Nicholas O'Donnell

Good morning. My thanks to the World Jewish Restitution Organization, the U.S. Department of State, and all the delegates who have organized this event and contributed to the best practices document. Thank you as well to the U.S. Holocaust Memorial Museum for hosting today’s event. Like the Washington Conference Principles on Nazi-Confiscated Art, and the Terezin Declaration, this document is an important statement. I am here to reflect on those groundbreaking past events and today’s publication from my perspective as a practicing American lawyer. I have represented and do represent Holocaust survivors and their heirs, collectors, museums, and art market participants. I have made claims, defended claims, filed and defended lawsuits. Based on my experience, I believe access to justice, consistency, and accountability are essential to build on thoughtful collaborations like the one that brings us here today.

What comes next very much depends on the extent to which all of us engage with these concepts. Are we interested in a framework that provides true accountability, not the assertion of state power to retain preferred objects? Are we interested in research and analysis that can be meaningfully compared, with standards that can be applied internationally? Or are we looking for a Potemkin village of process to obscure substance, of diplomatic convenience over historical truth? How each of us answers those questions is what comes next in continuing this important progress.

Access to justice is a human right. The policy behind the Washington Principles, the Terezin Declaration, and today’s guidance are all laudable examples of this. Here in the United States, we passed two key pieces of legislation in 2016 that contribute to this legacy, but which need critical updates.

The Holocaust Expropriated Art Recovery Act of 2016 addressed the patchwork of statutes of limitations around the United States that are a function of our federalist system. Where personal property claims are normally governed by the substantive law of the fifty states, the District of Columbia, and the territories, the results were inconsistent and put claimants to a burden of constructive notice that was effectively impossible to overcome.

The HEAR Act federalized that standard, extended the period to six years from the three years customary in most states, and used a burden of actual knowledge of the facts and circumstances necessary to bring a claim to begin the limitations period. It also contained important exceptions for claims that were known and could have been brought, and preserved the equitable defense of laches to allow current owners to defend ownership.

The HEAR Act contains a sunset provision of ten years, however, a deadline now only two years away. This makes no sense. If, as Congress stated, the purpose of the HEAR Act is “To provide the victims of Holocaust-era persecution and their heirs a fair opportunity to recover works of art confiscated or misappropriated,” and to relax “the time constraints imposed by existing law,” how is any of that served by reverting to the pre-2016 patchwork? If actual knowledge is the right test, then there is no reason to apply an arbitrary time limit to a law intended to make time limits fair and just. The HEAR Act must be extended by removing the sunset, and the United States government must make that a priority, now. The HEAR Act passed unanimously. There’s no excuse not to enlist the Administration’s Congressional allies and get this done, now.

We also, with respect, need engagement from other countries to allow similar access to courts there. It has been more than ten years since the Gurlitt case prompted discussion of a new restitution law in Germany, with no results. What about elsewhere? Whether we like it or not, access to justice creates the possibility of consequence, and with it accountability that drives action.

There are important examples of this since 1998. The Art Restitution Advisory Commission in Austria’s very first decision was the Altmann case. Yet since then, as I’ve written for years, the panel’s hundreds of decisions since then have been careful, thoughtful, and important. Accountability.

By 2014, the Advisory Commission in Germany was itself adrift. In the Behrens claim, the commission actually recommended against restitution by suggesting that Jewish bankers’ fortunes had improved in 1935. In the Welfenschatz case, the commission blamed without analysis the Great Depression for a sale price that the Nazi conspirators themselves described explicitly as only a third of the real value. Yet in response to the outcry—and our lawsuit—the commission has been overhauled. Its decisions are now reasoned and principled. Minister of Culture Claudia Roth’s announcement this year that any federally funded museum must participate in the Advisory Commission is incredibly important. To compare the recent Grawi case—which recommended restitution of Fuchse by Franz Marc because a sale in New York was caused by flight from prosecution—to the Welfenschatz case is to see progress as a result of access, consistency, and accountability.

That brings me to what I believe is the critical frontier of accountability: sovereign immunity and the assertion of state power. Today’s best practices document does not mention this, but to me it is the most important question (and is addressed implicitly in Paragraph K of the best practices document). The aspirations of the Washington Principles and Terezin Declaration are clear: do not retreat to standard legal principles simply because you can. Yet even statutes of limitations have some substantive defensibility—current owners are put to a disadvantage where evidence goes stale or witnesses die. Assertion of a statute of limitation or equitable defense like laches is not necessarily avoiding the merits.

By contrast, what is the possible excuse for asserting sovereign immunity to a claim for Nazi-spoliated art? Sovereign immunity is the opposite of accountability, it is itself the absence of accountability. Here I’m afraid you will have to indulge me a personal example, with some historical context. Before I do, remember that I advise clients on both sides of claims, victims and their heirs on one side, museums and collectors on the other. I am not saying a state or current must surrender any object subject to any claim. I am saying we have to make a choice about getting to the facts on the merits.

I filed a case against Germany and the Stiftung Preussischer Kulturbesitz in 2015 with respect to the Welfenschatz, 40-odd medieval reliquary objects that my clients’ ancestors sold to cabal of Nazis and the Prussian State fronted by the Dresdner Bank in 1935 at the ultimate direction of Hermann Goering and his henchmen. This followed the Advisory Commission proceeding and recommendation I referenced earlier.

When we filed suit, it had been more than 10 years since the United States Supreme Court allowed the claim by Maria Altmann to go forward against Austria—and which Austria to its credit agreed to submit binding arbitration on the merits after the Supreme Court ruling. Our Foreign Sovereign Immunities Act strips foreign states of immunity where the claim “concerns rights in property taken in violation of international law,” and certain commercial nexus requirements are met. After Altmann, cases against the Netherlands, Hungary, and Spain took it on faith that the Nazis’ coordinated theft and acquisition of art under duress violated international law. And our federal courts agreed, not least because genocide violates international law, and the Genocide Convention of 1948 explicitly treats as genocide the deprivation of the means to exist, i.e., property. Just three years before my case, in a dispute involving Venezuela, the Supreme Court had noted that there were important reasons to set aside the usual deference to sovereigns’ internal affairs in some exceptional circumstances. What circumstance is more exceptional than the Holocaust? And in 2016, at the same time as passing the HEAR Act, Congress enacted the Foreign Cultural Exchange Jurisdictional Immunity Clarification Act, which expressly amends the FSIA to define “Nazi takings” in a law about sovereign immunity as those takings of artwork by the German government or its allies between January 30, 1933 and May 8, 1945. Not after the passage of the Nuremberg Race Laws. Not after Kristallnacht or the opening of the death camps. Not “several years after 1935.” January 30, 1933.

Germany then made a choice. Rather than defend the 1935 sale on the facts, it argued that a taking by the State of Prussia in 1935 was a “domestic taking” immune from scrutiny under international law. That principle was not invented out of whole-cloth. But Austria, Spain, Hungary, and the Netherlands had never argued that victims’ heirs had to prove how not-German their ancestors were. Spain, whose own defense of Lilly Cassirer’s claims has been disgraceful in its own right, never seriously challenged that Jakob Scheidwimmer’s extortion from her in 1939 was somehow a domestic affair, dependent on the vagaries of whether or not she had lost her technical citizenship. That forced sale was exactly what it appeared to be: a part of the greatest international art crime in history.

When Germany lost in the trial court and the court of appeals, my own government made a choice. It chose to side with Germany in this odious argument, against my clients—most of whom are Americans. It chose to fret that our own nation might be held accountable. That “it would also place the United States at odds with consistent international practice, under which a sovereign’s immunity is not disturbed even in the face of alleged human-rights violations abroad.” In addition to being utter sophistry by the way, this is also demonstrable untrue. Germany proudly proclaimed the conviction in 2021 of an Iraqi member of ISIS for his brutal violation of the Yazidi population, a crime with no connection whatsoever to Germany or German territory. Quoting The New York Times, “ISIS Fighter Convicted in Death of Enslaved 5-Year-Old Girl,” Nov. 30, 2021 (“Even though neither the victim nor the killer were German, and the crime occurred in Falluja, Iraq, the trial was held in Germany on the principle of universal jurisdiction, which German courts have been using to try people accused of war crimes in countries like Iraq and Syria.”). Who deserves universal jurisdiction more than Holocaust victims?

This argument was recognizably abhorrent at the time, as important voices like the Claims Conference recognized—without taking a side in my particular case. Holocaust historians similarly chided the Administration, noting the ahistorical interpretation of the Genocide Convention.

At oral argument, Justice Breyer complained that if we held Germany accountable: “I mean, what about Japanese internment, which involved 30,000 people in World War II who were not American citizens but were of Japanese origin? And the first time we’d sue China for the Rohingyas or whatever, you know, what do you think they're going to say about the [] railroad workers who came in in the 19th century?”

Think about that. “The Rohingyas or whatever.” (who are in Myanmar, of course).

And as you probably know, in the face of this united front of the U.S. and Germany, the Supreme Court agreed with Germany and the SPK. The court ruled that notwithstanding the 2016 Clarification Act I mentioned earlier, Congress actually meant Nazi takings that weren’t domestic takings. Who, exactly, were the Nazis taking art from or subjecting to forced sales in 1933, 1934, 1935,1936, and 1937? It wasn’t Austrians, Czechs, or Poles, the French, Belgians, or the Dutch. It was the Jews in Germany, and that’s exactly who Congress would have had in mind when it made that amendment. That’s an objective fact. Instead, the Chief Justice glibly noted that “we do not look to the law of genocide, we look to the law of property.” To that I say that the members of my country’s Congress in 1976 when the FSIA was passed knew a thing or two about genocide; fully half of them had served in the war to defeat it.

The effects from there are predictably worse. On remand in my case and the companion cases against Hungary, the sovereign defendants leaned in further. Now, they said, even Nazi victims who had become de facto stateless were without remedy because international law only cares about injury to the nation who is insulted by the taking, not its subjects who suffer the taking. If a person has no nationality, international law does not care about them. Rather like the Jews from Germany in the 1930s until the world united to enact the Genocide Convention.

In another case against Germany by the heir to an Austrian man about a property in Berlin, Germany now claims he fails the domestic takings test set in my case because Nazi Germany declared that Austrian Jew to be German after the Anschluss. To repeat: the Federal Republic of Germany is arguing, as of today, that no international law violation occurred when Nazi Germany annexed Austria, declared Austria’s Jews to be subject to its anti-Semitic laws and persecution, and stole their property. How can that be defended? How many people here even knew that argument had been made? How people here will say something now that you do know?

Put simply, the assertion in 2024 of sovereign immunity and state impunity despite the demands of the Washington Principles and Terezin Declaration and today’s best practices guidance is a repeat of the disgraceful conduct of the nations of the world in the 1930s: German Jews were too German to interfere with Germany, and too Jewish to expect any mercy from their German persecutors.

If the Holocaust is different, then treat the Holocaust differently. The whole point is to do the right thing not merely when it is difficult but precisely because it is difficult. To help another country avoid accountability for fear of one’s own accountability is inexcusable. Among other things, if true accountability is out of reach, then all that’s left is noblesse oblige. If there is no consequence for Spain retaining the painting taken from Lilly Cassirer just because it can by arguing that being forced to return a painting would injure its own laws, then there is no consequence. If we behave this way, what do we say to the Syrias, the Irans, or the Talibans of the world who yield sovereign authority? Silence is complicity, impunity is license.

I am not here to lecture other countries. I am an American, and proud of it. I’m proud of the leadership my country took in winning the war, in addressing Nazi-spoliated art right after the war, and of course in convening the Washington Conference itself. But leadership means telling people what they do not always want to hear.

Incredible progress has been made. But in any endeavor, the moment we tell ourselves we have done enough is the moment there is no more progress. Search for the facts. Be willing to reach across the table in the hard cases.

I’ll close with a bit of Scripture from the Gospel of Matthew. “Nor do they light a lamp and then put it under a bushel basket, it is set on a lampstand, where it gives light to all in the house.”

You have set a light, the Washington Principles and today’s best practices are that light. Put it on a lampstand. And hold each other to account.

Thank you.
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