WASHINGTON (CN) – A 70-year dispute over an art collection stolen from a Jewish family by the Nazis will proceed in U.S. courts without the lead defendant, the country of Hungary, the D.C. Circuit ruled.
A Hungarian state university and several museums must defend themselves from the claims of the Herzog family, but the Republic of Hungary was dropped as a defendant, under the Foreign Sovereign Immunities Act.
Baron Mor Lipot Herzog was a Jewish Hungarian industrialist who assembled a collection of art that included a major work of El Greco, “The Agony in the Garden,” and works by Lucas Cranach the Elder and Francisco de Zurbaran. The baron employed more than 100,000 Hungarians, his family says, earning him the title of Baron of Csepel through the emperor. He died in 1934 with his collection intact.
His son, Andrew was sent to a forced labor camp by Hungarian authorities during World War II, where he eventually died. His daughters, Angela and Julia Herzog, escaped to Latin America and settled in Italy after the War. Before their escape they had hidden the art collection in one of the family factories.
It was plundered by the Nazis and their Hungarian collaborators, passing through Adolf Eichmann, then split between Germany and Hungary. Since then, the family has managed to recover all but 42 pieces that remain in Hungary’s possession.
Hungary claimed that the statute of limitations and the Foreign Sovereign Immunities Act bar the lawsuit from proceeding in U.S. courts.
The family’s claims were dismissed by a Hungarian appellate court in 2008, which ruled that the dispute should be resolved via a treaty-based mechanism required for individuals under Hungarian jurisdiction who seek restitution. But the plaintiffs in this case are U.S. and Italian citizens.
The D.C. Circuit ruled in 2013 that the case could continue in U.S. courts, with Hungary continuing to appeal immunity based on the treaty provisions.
Writing for a three-judge panel Tuesday, U.S. Circuit Judge David S. Tatel rejected the appeal in part, finding that because the art in question was retaken by the Hungarian government after World War II ended, the treaty plays no role. Hungary itself, however, retains FSIA immunity, as the exception clearly distinguishes foreign states from their agencies, in this case Hungary and its universities and museums.
“The family would be unable to pursue its claims against the very entities that actually possess the Herzog collection because the collection … is not owned by an agency of the museums and the university,” Tatel wrote. “Collapsing the well-worn distinction between foreign states and agencies … would likewise lead to odd results.”
Tatel said the family should be able to amend their complaint in light of the newly passed Holocaust Expropriated Art Recovery Act, which does away with statutes of limitation for the families of Holocaust victims seeking stolen property and restitution.
“‘Justice’ obviously requires that the family be given leave to amend their complaint,” Tatel wrote.
U.S. Circuit Judge Karen Henderson joined Tatel’s majority opinion. Senior U.S. Circuit Judge A. Raymond Randolph dissented in part, saying the Republic of Hungary should not be immune from the suit.
The family is represented by Alycia Regan Benenati and Sheron Korpus with Kasowitz Benson Torres, and by Michael Shuster of Holwell Shuster & Goldberg.
Neither Shuster nor representatives for the Hungarian government have returned requests for comment.
The ruling did prompt applause by Ronald Lauder, head of the World Jewish Congress and the Commission for Art Recovery. “For far too long, Holocaust victims and their families have faced an undeniable injustice as they seek to recover art, of which they are the rightful owners, that was stolen from them by the Nazis during World War II," Lauder said in a statement. "The goal of the HEAR Act, signed into law in December of 2016, was to enable these victims and their families to have their day in court, and their cases judged on the merits rather than obfuscatory technicalities. The court’s decision upholds that law, and I hope that the plaintiffs will be successful in recovering their family heirlooms. This case has been going on for over seven years in the U.S. courts alone and I hope that justice is served soon.”
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