The economics of restitution battles

In an ideal world, the cost of seeking restitution of a Nazi-looted art object should not be a hindrance to achieving justice. The government, writ large, a State agency, a non-profit organization, domestic or international, would take on the burden of recovery of a looted cultural object, from the first notification to the current possessor that she holds title to property stolen during the Nazi era, to the final act of recovery, the physical transfer of the object to the rightful owner’s heirs complete with a transfer of title.

In the real world, the aforementioned scenario simply does not exist, and, if it does, it is as rare as the Hope Diamond.

There are no public or charitable organizations which have the resources to manage the restitution of a looted object from a to z, soup to nuts, from identification to recovery or settlement. However, there are many consultants both in the Americas and in Europe who are available to assist you in the recovery process, for a fee and not an insignificant one at that.

The Washington Conference on Holocaust-Era Assets of December 1998 failed to put in motion the procedures by which to assist claimants in their bid to recover their looted cultural assets at little or no cost. There was no political will amongst the participants at the conference to go beyond speeches and do the heavy lifting, as we call it, to convince their kinsmen back home to pass laws that would establish the appropriate mechanisms for expeditious and systematic restitution of looted assets. It never really happened. Austria might be an exception since it did pass a restitution law in 1999, partly as a reaction to the physical seizure of two paintings by Egon Schiele on display at the Museum of Modern Art of New York. Their possessor at the time was the Leopold Foundation, based in Vienna.

With no structure, no organization to fall back on, claimants have had few places to turn to. The Holocaust Claims Processing Office in New York is the only viable State-level agency (not Federal, a big difference!) which facilitates the claims process for Holocaust victims and their families.

The restitution process is a tedious and laborious affair fraught with emotions and riddled with obstacles. Hence the tendency among lawyers to recommend financial settlements that, in their view, at least address the moral dimension of the claim while leaving the object and title to the claimed object in the hands of the current possessor whose sole defense rests on arguing that she acted in good faith when purchasing the claimed object. In today’s parlance, this approach to the resolution of a cultural claim for Holocaust-era thefts and all of its variants is referred to as a “just and fair” solution, something that presumably should work for everyone but really does not.

In a world where most attorneys command high fees, there is little chance that, at those rates, a claimant can receive a modicum of legal advice unless the value of the object(s) that she wants returned exceed the hundreds of thousands or even reach millions of dollars or euros. And if she does recover, she needs to sell the object in order to settle her debts for legal representation predicated on a contingency fee arrangement, which usually runs at about one third of the market value of the claimed object.

The failure of the public sector to create effective, credible, and humane legal and administrative mechanisms to provide a forum for some form of justice for victims of cultural plunder, has relegated the resolution of these claims to the market place.

Technically, there is nothing wrong with that concept, except that the price tag is steep and out of reach for most people seeking restitution. The most popular works earning legal representation in restitution proceedings through private firms are works by Egon Schiele and Gustav Klimt which were at the bottom of the art world’s food chain until the 1970s and those produced by German Expressionists (Kirschner, Grosz), Impressionists and their progeny (from Monet and Pissarro to Cézanne and van Gogh), and, yes, Cubists (Pablo Picasso and Braque, most notably) and its variants (Fernand Léger). There is some room, of course, for top-flight Old Masters. When it comes to value, why discriminate?

The absence of political solutions to restitution claims—in the form of laws passed by national legislatures aimed at simplifying and/or fast-tracking claims for looted cultural objects, eliminating technical defenses (latches, statutes of limitations) used by possessors not to return claimed objects, thus driving legal expenses through the roof—has helped drive up the cost of justice, hence, the price of restitution of an object stolen during the commission of an act of genocide.

If the value of the claimed object falls below several hundred thousand dollars or euros, it complicates a lawyer’s commitment to achieve restitution (yes, this is an unfair statement but it is close to the reality that many claimants encounter) since mounting legal fees will quickly surpass the value of the object and thus drive into the negative the cost-benefit of restitution. Thus, if your family lost works and other objects now scattered across the globe, whose individual value may not rise past 50,000 to 100,000 dollars or euros, you might not be able to find a top-ranked lawyer to represent you. If your family lost a substantial collection of more than 50 or so “secondary” works produced in 17th century Europe, a lawyer might consider representing you to obtain restitution for those objects—they would be viewed as a “lot”– that have been identified in present-day collections. Hence, we fall into the same logic—cost and benefit. Rightfully, a lawyer must ask: what’s in this for me besides the ephemeral headlines tied to “doing the right thing”? She runs a business, not a charity, so the saying goes. Mouths to feed, people to pay, rent, insurance and other costs add up. Time is also a factor: these cases tend to take an average of three to ten years to resolve, some stretching out over several decades, others ending miraculously quickly, as in two years or less.

Since the vast majority of objects stolen during the Nazi years were not “treasures” worth hundreds of thousands or millions in today’s currencies, the vast majority of the victims have not obtained restitution of their objects. As the years and decades go by, their stolen object are sold at auctions, displayed in galleries or museums, or, worst of all, hanging in a stranger’s living room.

The postwar restitution machinery was never designed to help the average victim. It was designed to recover treasures and high-end cultural objects thus restoring a country’s “greatness” from which those “treasures” were forcibly removed while offering substantial returns to their possessors and handlers. Is it mere coincidence why so much emphasis has been placed on the recovery of paintings by Egon Schiele, Gustav Klimt, Camille Pissarro, Pablo Picasso, Fernand Léger, Georges Braque, Henri Matisse, Antonio Canale, Caspar Netscher, Romanino, Amedeo Modigliani, Max Liebermann, Georg Grosz, Ernst Wilhelm Kirchner, etc., etc.?

The press, incidentally, is partly to blame for this state of affairs because it is so quick to respond to restitution claims involving big name artists fetching hefty price tags on the global art market. If you peruse the few public looted art databases that are currently available for consultation, such as lostart.de and www.errproject.org, you will note that there are thousands of artists whose works have been stolen and yet the world only focuses on a handful.

The chances of recovering 90 per cent of the world’s stolen art are close to zero because the world in which we live rewards only the “great ones,” those who produce “masterpieces” which become a nation’s “cultural treasures” coveted by those who can afford them. The rest?

Our collective loss, someone’s private gain.