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Saher v. Norton Simon Museum of Art at Pasadena

United States Court of Appeals, Ninth Circuit

June 6, 2014

MAREI VON SAHER, Plaintiff-Appellant,

Argued and Submitted, Pasadena, California: August 22, 2013.

Page 713

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

Lawrence M. Kaye (argued), Herrick, Feinstein LLP, New York, New York; Donald S. Burris, Burris, Schoenberg & Walden, LLP, Los Angeles, for Plaintiff-Appellant.

Fred A. Rowley, Jr. (argued), Munger, Tolles & Olson LLP, Los Angeles, California, for Defendant-Appellee.

Catherine Z. Ysrael, Deputy Attorney General, for Amicus Curiae State of California.

Before: Harry Pregerson, Dorothy W. Nelson, and Kim McLane Wardlaw, Circuit Judges. Opinion by Judge D.W. Nelson; Dissent by Judge Wardlaw.


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D.W. NELSON, Senior Circuit Judge:

This case concerns the fate of two life-size panels painted by Lucas Cranach the Elder in the sixteenth century. Adam and Eve (collectively, " the Cranachs" or " the panels" ) hang today in Pasadena's Norton Simon Museum of Art (" the Museum" ). Marei Von Saher claims she is the rightful owner of the panels, which the Nazis forcibly purchased from her deceased husband's family during World War II. The district court dismissed Von Saher's complaint as insufficient to state a claim upon which relief can be granted, and that dismissal is before us on appeal. We have jurisdiction pursuant to 28 U.S.C. § 1291, and we reverse and remand.

I. Background

In reviewing the district court's decision, we must " accept factual allegations in the complaint as true and construe the pleadings in the light most favorable to" Von Saher. Manzarek v. St. Paul Fire & Marine Ins. Co., 519 F.3d 1025, 1031 (9th Cir. 2008). We therefore hew closely to the

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allegations in the complaint in describing the facts.

A. Jacques Goudstikker Acquires the Cranachs

For the 400 years following their creation in 1530, the panels hung in the Church of the Holy Trinity in Kiev, Ukraine. In 1927, Soviet authorities sent the panels to a state-owned museum at a monastery and in 1927 transferred them to the Art Museum at the Ukrainian Academy of Science in Kiev. Soviet authorities then began to arrange to sell state-owned artworks abroad and held an auction in Berlin in 1931 as part of that effort. This auction, titled " The Stroganoff Collection," included artworks previously owned by the Stroganoff family. The collection also included the Cranachs, though Von Saher disputes that the Stroganoffs ever owned the panels. Jacques Goudstikker, who lived in the Netherlands with his wife, Desi, and their only child, Edo, purchased the Cranachs at the 1931 auction.

B. The Nazis Confiscate the Cranachs

Nearly a decade hence in May 1940, the Nazis invaded the Netherlands. The Goudstikkers, a Jewish family, fled. They left behind their gallery, which contained more than 1,200 artworks--the Cranachs among them. The family boarded the SS Bodegraven, a ship bound for South America. Days into their journey, Jacques accidentally fell to his death through an uncovered hatch in the ship's deck. When he died, Jacques had with him a black notebook, which contained entries describing the artworks in the Goudstikker Collection and which is known by art historians and experts as " the Blackbook." Desi retrieved the Blackbook when Jacques died. It lists the Cranachs as part of the Goudstikker Collection.

Meanwhile, back in the Netherlands, high-level Nazi Reichsmarschall Herman Gö ring divested the Goudstikker Collection of its assets, including the Cranachs. Jacques' mother, Emilie, had remained in the Netherlands when her son fled to South America with his wife and child. Gö ring's agent warned Emilie that he intended to confiscate the Goudstikker assets, but if she cooperated in that process, the Nazis would protect her from harm. Thus, Emilie was persuaded to vote her minority block of shares in the Goudstikker Gallery to effectuate a " sale" of the gallery's assets for a fraction of their value.

Employees of the Goudstikker Gallery contacted Desi to obtain her consent to a sale of the majority of the outstanding shares in the gallery, which she had inherited upon Jacques' death. She refused. Nevertheless, the sale went through when two gallery employees, unauthorized to sell its assets, subsequently entered into two illegal contracts. In the first, the " Gö ring transaction," Gö ring " purchased" 800 of the most valuable artworks in the Goudstikker collection. Gö ring then took those pieces, including the Cranachs, from the Netherlands to Germany. He displayed Adam and Eve in Carinhall, his country estate near Berlin.

In the second illegal contract, the " Miedl transaction," Nazi Alois Miedl took over the Goudstikker business and properties. Miedl began operating an art dealership out of Jacques's gallery with the artwork that Gö ring left behind. Miedl employed Jacques's former employees as his own and traded on the goodwill of the Goudstikker name in the art world.

C. The Allies Recover Nazi-Looted Art, Including the Cranachs

In the summer of 1943, the United States, the Netherlands and other nations signed the London Declaration, which " served as a formal warning to all concerned, and in particular persons in neutral

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countries, that the Allies intended to do their utmost to defeat the methods of dispossession practiced by the governments with which they [were] at war." Von Saher v. Norton Simon Museum of Art at Pasadena (" Von Saher I" ), 592 F.3d 954, 962 (9th Cir. 2010) (internal quotation marks and citation omitted). The Allies " reserved the right to invalidate wartime transfers of property, regardless of whether" those transfers took the form of open looting, plunder or forced sales. Id.

When American forces arrived on German soil in the winter of 1944 and 1945, they discovered large caches of Nazi-looted and stolen art hidden in castles, banks, salt mines and caves. Von Saher I, 592 F.3d at 962. The United States established collection points for gathering, cataloging and caring for the recovered pieces. Id. At a collection point in Munich, Allied forces identified the Cranachs and other items from the Goudstikker Collection.

In order to reunite stolen works of art with their rightful owners, President Truman approved a policy statement setting forth the procedures governing looted artwork found in areas under U.S. control. Von Saher I, 592 F.3d at 962. These procedures had two components--external restitution and internal restitution. Under external restitution, nations formerly occupied by the Germans would present to U.S. authorities " consolidated lists of items taken [from their citizens] by the Germans." Id. These lists would include " information about the location and circumstances of the theft." Id. American authorities would identify the listed artworks and return them to their country of origin. Id. The United States stopped accepting claims for external restitution on September 15, 1948. Id. at 963. Under internal restitution, each nation had the responsibility for restoring the externally restituted artworks to their rightful owners. Id.

In 1946, the Allied Forces returned the pieces from the Goudstikker Collection to the Dutch government so that the artworks could be held in trust for their lawful owners: Desi, Edo and Emilie.

D. Desi's Postwar Attempt to Recover the Cranachs

In 1944, the Dutch government issued the Restitution of Legal Rights Decree, which established internal restitution procedures for the Netherlands. As a condition of restitution, people whose artworks were returned to them had to pay back any compensation received in a forced sale.

In 1946, Desi returned to the Netherlands intending to seek internal restitution of her property. Upon her return but before she made an official claim, the Dutch government characterized the Gö ring and Miedl transactions as voluntary sales undertaken without coercion. Thus, the government determined that it had no obligation to restore the looted property to the Goudstikker family. The government also took the position that if Desi wanted her property returned, she would have to pay for it, and she would not receive compensation for missing property, the loss of goodwill associated with the Goudstikker gallery's name or the profits Miedl made off the gallery during the war.

Desi decided to file a restitution claim for the property sold in the Miedl transaction, so that she could recover her home and some of her personal possessions. In 1952, she entered into a settlement agreement with the Dutch government, under protest, regarding only the Miedl transaction. As part of that settlement, Desi repurchased the property Miedl took from her for an amount she could afford. The agreement stated that Desi acquiesced to the settlement in order

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to avoid years of expensive litigation and due to her dissatisfaction with the Dutch government's refusal to compensate her for the extraordinary losses the Goudstikker family suffered at the hands of the Nazis during the war.

Given the government's position that the Nazi-era sales were voluntary and because of its refusal to compensate the Goudstikkers for their losses, Desi believed that she would not be successful in a restitution proceeding to recover the artworks Gö ring had looted. She therefore opted not to file a restitution claim related to the Gö ring transaction. The Netherlands kept the Gö ring-looted artworks in the Dutch National Collection. Von Saher alleges that title in these pieces did not pass to the Dutch Government.

In the 1950s, the Dutch government auctioned off at least 63 of the Goudstikker paintings recovered from Gö ring. These pieces did not include the Cranachs.

E. Von Saher Recovers Artwork from the Dutch Government

In the meantime, Desi and her son Edo became American citizens, and Desi married August Edward Dimitri Von Saher. When Emilie died in 1954, she left all of her assets, including her share in the Goudstikker Gallery, to her daughter-in-law, Desi, and her grandson, Edo. Desi then died in February 1996, leaving all of her assets to Edo. Just months later, in July 1996, Edo died and left his entire estate to his wife, Marei Von Saher, the plaintiff-appellant. Thus, Marei is the sole living heir to Jacques Goudstikker.

In 1997, the State Secretary of the Dutch Government's Ministry of Education, Culture and Science (the " State Secretary" ) announced that the Dutch government had undertaken an investigation into the provenance of artworks recovered in Germany and returned to the Netherlands following Word War II. Related to that investigation, the government began accepting claims for recovered artworks in its custody that had not been restituted after the war.

Around the same time, a Dutch journalist contacted Von Saher and explained to her the circumstances regarding Gö ring's looting of the Goudstikker gallery, Desi's efforts to obtain restitution and the Dutch government's continued possession of some Goudstikker pieces in its national collection. This conversation was the first time Von Saher learned about these events.

In 1998, Von Saher wrote to the Dutch State Secretary requesting the surrender of all of the property from the Goudstikker collection in the custody of the Dutch government. The State Secretary rejected this request, concluding that the postwar restitution proceedings were conducted carefully and declining to waive the statute of limitations so that Von Saher could submit a claim. Von Saher made various attempts to appeal this decision without success.

While Von Saher pursued various legal challenges, the Dutch government created the Ekkart Committee to investigate the provenance of art in the custody of the Netherlands. The committee described the handling of restitution in the immediate postwar period as " legalistic, bureaucratic, cold and often even callous." It also criticized many aspects of the internal restitution process, among them employing a narrow definition of " involuntary loss" and requiring owners to return proceeds from forced sales as a condition of restitution.

Upon the recommendation of the Ekkart Committee, the Dutch government created the Origins Unknown project to trace the original owners of the artwork in its custody. The Dutch government also set up the

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Advisory Committee on the Assessment of Restitution Applications for Items of Cultural Value and the Second World War (" the Restitutions Committee" ) to evaluate restitution claims and to provide guidance to the Ministry for Education, Culture and Science on those claims. Between 2002 and 2007, the Restitution Committee received 90 claims.

In 2004, Von Saher made a restitution claim for all of the Goudstikker artwork in the possession of the Netherlands. The Committee recommended that the government grant the application with respect to all of the artworks plundered in the Gö ring transaction, which the Committee deemed involuntary. The State Secretary adopted the Committee's recommendation.

Unfortunately, the Dutch government no longer had custody of the Cranachs. In 1961, George Stroganoff Scherbatoff (" Stroganoff" ) claimed that the Soviet Union had wrongly seized the Cranachs from his family and unlawfully sold the paintings to Jacques Goudstikker thirty years earlier at the " Stroganoff Collection" auction in Berlin. Thus, Stroganoff claimed that the Dutch government had no right, title or interest in the panels. In 1966, the Dutch government transferred the Cranachs and a third painting to Stroganoff in exchange for a monetary payment. The terms of this transaction, including the amount Stroganoff paid for the artworks, are not in the record before us. The Dutch government did not notify Desi or Edo that Stroganoff made a claim to the panels or that the panels were being transferred to him. In 1971, New ...

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