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Von Saher v. Norton Simon Museum of Art At Pasadena

United States Court of Appeals, Ninth Circuit

July 30, 2018

Marei Von Saher, Plaintiff-Appellant,
v.
Norton Simon Museum of Art at Pasadena; Norton Simon Art Foundation, Defendants-Appellees.

          Argued and Submitted February 14, 2018 Pasadena, California

          Appeal from the United States District Court for the Central District of California, No. 2:07-cv-02866-JFW-SS John F. Walter, District Judge, Presiding

          Lawrence M. Kaye (argued), Howard N. Spiegler, Frank K. Lord IV, and Darlene B. Fairman, Herrick Feinstein LLP, New York, New York, for Plaintiff-Appellant.

          Fred Anthony Rowley Jr. (argued), Justin P. Raphael, Eric P. Tuttle, Mark R. Yohalem, Luis Li, and Ronald L. Olson, Munger Tolles & Olson LLP, Los Angeles, California, for Defendants-Appellees.

          Stanley W. Levy, Benjamin G. Shatz, and Connie Lam, Manatt Phelps & Phillips LLP, Los Angeles, California; Michael Bazyler, Dale E. Fowler School of Law, Chapman University, Orange, California; for Amici Curiae The 1939 Society, Bet Tzedek, and Jewish Historical Museum.

          Owen C. Pell and Lynn Kaiser, White & Case LLP, New York, New York; Agnes Peresztegi, Of Counsel, Soffer Avocats, Paris, France; for Amicus Curiae Commission for Art Recovery.

          Susan J. Kohlmann, Irene M. Ten Cate, and Ava U. McAlpin, Jenner & Block LLP, New York, New York, for Amicus Curiae Professor Leonard F.M. Besselink.

          Thomas R. Kline and L. Eden Burgess, Cultural Heritage Partners PLLC, Washington, D.C., for Amici Curiae Members of Congress E. Engel and J. Nadler and Former Members of Congress M. Levine and R. Wexler.

          Before: M. Margaret McKeown and Kim McLane Wardlaw, Circuit Judges, and James Donato, [*] District Judge.

         SUMMARY [**]

         Act of State Doctrine

         The panel affirmed the district court's summary judgment in favor of the Norton Simon Museum of Art at Pasadena in an action by Marei von Saher to recover two oil paintings that were among a group of artworks taken by Nazis in a forced sale from her father-in-law during World War II.

         Following the war, the Allied Forces returned the paintings to the Dutch government. In 1966, the Dutch government sold the paintings to George Stroganoff-Sherbatoff, who in turn sold the paintings to the Norton Simon Museum in 1971. In the late 1990s, von Saher sought to recover the paintings from the Dutch Government. The Dutch Court of Appeals denied von Saher's petition for restoration of rights in the paintings.

         The panel applied the act of state doctrine, which requires that the acts of foreign sovereigns taken within their own jurisdictions shall be deemed valid. The panel held that von Saher's theory would require the court to invalidate official acts of the Dutch government. Specifically, for van Saher to succeed: the Dutch government's conveyance of the paintings to Stroganoff would need to be deemed legally inoperative; and the panel would need to disregard both the Dutch government's 1999 decision not to restore von Saher's rights to the paintings, and its later statement that her claim to the paintings had "been settled." The panel concluded that the Dutch government's transfer of the paintings and its later decisions about the conveyance were "sovereign acts" requiring application of the act of state doctrine.

         The panel held that exceptions to the act of state doctrine did not apply. The panel also held that the policies underlying the act of state doctrine supported its application in this case.

         Concurring, Judge Wardlaw agreed that the Dutch government's conveyance to Stroganoff was an official act of the Netherlands. Judge Wardlaw wrote that the case should not have been litigated through the summary judgment stage, however, because the district court correctly dismissed the case on preemption grounds in March 2012.

          OPINION

          McKEOWN, Circuit Judge:

         Hanging in the balance are Renaissance masterpieces that have been on display in California for nearly half a century. The dispute over their ownership, however, dates back to World War II, when the Nazis invaded the Netherlands.

         Marei von Saher ("von Saher") seeks to recover two oil paintings that were among a group of artworks taken by Nazis in a forced sale from her father-in-law. Following the war, the Allied Forces returned the paintings to the Dutch government, which established a claims process for recouping Nazi-looted property. Von Saher's family, on the advice of counsel, chose not to file a claim on the paintings within the allotted time. In 1966, the Dutch government sold the two paintings to George Stroganoff-Sherbatoff ("Stroganoff") after Stroganoff filed a restitution claim alleging that he was the rightful owner. Stroganoff then sold the paintings in 1971 to the Norton Simon Art Foundation and the Norton Simon Museum of Art at Pasadena (collectively, "the Museum"). The paintings have been on display ever since.

         In the late 1990s, von Saher tried to recover from the Dutch government all paintings included in the forced sale. The Dutch Court of Appeals issued a final decision, denying von Saher's petition for restoration of rights in the paintings. A few years later, the Dutch government nonetheless decided to return to von Saher the paintings that were still in its possession, but did not return the two paintings it had sold to Stroganoff because they were in California. Von Saher sued the Museum in federal court soon after.

         This marks the third time that we have considered von Saher's case, having most recently remanded for further factual development. The district court granted summary judgment to the Museum, concluding that the Netherlands possessed good title under Dutch law when it sold the paintings to Stroganoff.

         We affirm, but not under Dutch law. Because the act of state doctrine deems valid the Dutch government's conveyance to Stroganoff, the Museum has good title. Holding otherwise would require us to nullify three official acts of the Dutch government-a result the doctrine was designed to avoid.

         Background

         The Paintings

         At the center of this controversy are two Renaissance masterworks- "Adam" and "Eve"-painted by Lucas Cranach the Elder ("the paintings" or "the Cranachs"). In 1931, Dutch art dealer Jacques Goudstikker purchased the Cranachs from the Soviet Union at an auction in Berlin called "the Stroganoff Collection."[1] The paintings became the property of the art dealership in which Goudstikker was principal shareholder ("the Goudstikker Firm" or "the Firm").

         In May 1940, as the Nazis invaded the Netherlands, Goudstikker and his family fled to South America, fearing persecution and leaving behind his gallery of over 1, 200 artworks. Tragically, Goudstikker died on the boat trip. His wife Desi, who acquired Goudstikker's shares in the Firm, maintained a blackbook listing all the paintings in the gallery, including the Cranachs.

         After Goudstikker's death, Nazi Reichsmarschall Hermann Göring and his cohort Alois Miedl "bought" the Goudstikker Firm and its assets through a series of involuntary written agreements with a remaining employee of the Firm.[2] These "forced sales" proceeded in two parts: Miedl acquired the Firm, its showroom, some of its paintings, and the family's villa and castle for 550, 000 guilders ("the Miedl transaction"). Göring purchased other artworks, including the Cranachs, for two million guilders- the equivalent of over 20 million current U.S. dollars ("the Göring transaction").

         After World War II, the Allied Forces in Germany recovered much of the art collection taken from Goudstikker by Göring, including the Cranachs. The Allies turned the paintings over to the Dutch government in 1946.

         The Dutch Restitution System

         During and after the war, the Dutch government created systems of restitution and reparations for losses incurred by its citizens at the hands of the Nazis. The pillars of those systems were established in a series of royal decrees. We provide a sketch of those decrees because they bear on our decision to apply the act of state doctrine.

         Royal Decree A6 and the 1947 CORVO Decision

         The Dutch government enacted Royal Decree A6 in June 1940, shortly after the Nazis invaded the Netherlands. The decree prohibited and automatically nullified agreements with the enemy. A6 vested authority in a special committee (Commissie Rechtsverkeer in Oorlogstijd or "CORVO") to "revoke the invalidity" of such transactions "by declaring the agreement or act still effective."

         In 1947, CORVO revoked the automatic invalidity of agreements with the enemy for property that was recuperated to the Netherlands by the Allies. As CORVO explained, A6 was enacted to protect Dutch property interests from the Nazis. But once property was returned to the Dutch government, "the initial interest of such nullity is eliminated." After property was returned to the Netherlands, the original Dutch owners could petition for a restoration of rights in the property under Royal Decree E100.

         Royal Decree E100

         The Dutch government enacted Royal Decree E100 in 1944. The decree established a Council for Restoration of Rights ("the Council"), with broad and exclusive authority to declare null and void, modify, or revive "any legal relations that originated or were modified during enemy occupation of the [Netherlands]."

         The Council had the exclusive power to order the return of property and to restore property rights to the original Dutch owners. The Council consisted of several departments, including a Judicial Division. The restitution decisions of the other departments were appealable to the Judicial Division, whose judgments were final and non-appealable, and carried the force of a court judgment. Petitioners could bring claims for restoration of rights directly to the Judicial Division, or bring claims to other departments and appeal adverse decisions to the Judicial Division. Upon enactment of E100, the Council supplanted the Dutch common-law courts as the venue for adjudging wartime property rights, as those courts became "incompetent to hear and decide on claims or requests that the Council is competent to handle by virtue of this Decree."

         The Dutch government set a July 1, 1951 deadline for claimants to file E100 restoration-of-rights petitions with the Council. After that deadline, the Council could still order restoration of rights of its own accord, but claimants were no longer entitled to demand restitution. Usually, if an original owner received money or other consideration in exchange for property taken by the Nazis, the original owner was required to return the sale price to the Dutch government in order to obtain restitution.

         Decree E100 also authorized the Council to dispose of property of "unknown owners": "If the owner has not come forward within a period to be further determined by Us, items that have not yet been sold shall be sold . . . ." The Dutch government set the deadline for owners "com[ing] forward" at September 30, 1950.

         Royal Decree E133

         The Dutch government enacted Royal Decree E133 in 1944 to expropriate enemy assets in order to compensate the Netherlands for losses it suffered during World War II. Article 3 of E133 provided that within the Netherlands, all "[p]roperty, belonging to an enemy state or to an enemy national, automatically passes in ownership to the State with the entering into force of this decree . . . ." The expropriation of enemy property was automatic and continued until July 1951, when the Netherlands ceased hostilities with Germany.

         Von Saher's Family Declined to Seek Restoration of ...


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