Supreme Court Nonplussed by Claimant Endeavor to Recover Art in Von Saher v. Norton Simon Museum of Art

Yesterday, on June 27, 2011, the United States Supreme Court denied Marei von Saher's, heir of the famous art dealer, Jacques Goudstikker (1897-1940), petition to review the U.S. Court of Appeals of the 9th Circuit decision invalidating California statute extending time period for Holocaust victims to bring claims for return of Nazi-era looted art.  Von Saher v. Norton Simon Museum of Art, 578 F.3d 1016 (9th Cir. 2009). For details of the Von Saher claim, visit Commission for Art Recovery.

According to Herrick, Feinstein, LLP, firm representing the claimant, Von Saher "immediately moved to have the Court of Appeals reconsider its prior decision in light of an inconsistent ruling by that court in another case." More details are likely to follow.  In the mean time, however, the decision by the Supreme Court to decline review of Von Saher v. Norton Simon, does not bode well for a certiorari petition submitted on behalf of Grosz heirs in Grosz v. MoMA, a New York case. Ray Dowd, attorney for the Grosz heirs is seeking review from the court of the last resort highlighting the "urgent national need for [the Supreme Court] to exercise its supervisory powers" to protect true owners of stolen property. Amicus brief urges the Supreme Court review of Grosz to hear the case and provide  guidance to stop "fundamental constitutional errors" that have recurred in cases seeking restitution of Nazi-era looted property.

The petition for a writ of certiorari for Grosz v. MoMA includes the following language, referencing Republic of Austria v. Altmann, 541 U.S. 677 (2004).

This Court has previously instructed that in a case involving possession and concealment of Nazi-looted art against an Austrian museum, all well-pleaded allegations are to be deemed true on a motion to dismiss. The Second Circuit, by affirming the district court’s consideration of settlement communications to work a forfeiture against the claimants, has created the problematic appearance that U.S. museums will not be subjected to the same standard as foreign museums.

Are the U.S. museums becoming heavens for stolen art (Norton Simon Museum of Art in Pasadena, Toledo Museum, Boston Museum of Art, MoMA)? They seem to be held to a different standard than foreign museums (Belvedere Palace in Vienna, Thyssen-Bornemisza Collection Foundation in Madrid).


Grosz request is urgent and suggestive but whether the Supreme Court finds it (more) worthy is another question all together.

Framing Fiduciary Duty in Marchig v. Christie's

Oral arguments that took place on June 24, 2011 at 500 Pearl Street, a.k.a. 2nd Circuit Court of Appeals could have been dealing with two unconnected cases. Richard Altman, attorney for Mrs. Jeanne Marchig, argued that in certain circumstances auction houses owe fiduciary duty to their regular clients lasting so long as the relationship between the consignor and the dealer continues, a proposition yet unsupported by extant case law on point. The court seemed unconvinced because of the long held belief that while an auction house is a fiduciary with regard to a particular painting during a discrete consignment arrangement, it does not provide continuous service akin to that of trustees and guardians. 

Joe Pattela, of Andrews Kurth LLP, defending Christie's, was peppered with questions regarding the whereabouts of the frame that enclosed La Bella Principessa, a drawing now attributed to Leonard Da Vinci that Mrs. Marchig consigned to Christie's in 1997, almost 15 years ago. The court wished to know when Mrs. Marchig found out that her drawing was sold out of the frame she provided and whether she was ever billed for the new frame. The factual possession of the frame may be a timely question for the jury to decide in a replevin action (as a reminder, the case was dismissed on grounds of statute of limitations in 2010), but the value of the frame is unlikely to exceed $75,000 to permit the case to remain in the federal court system.

Marchig v. Christie's revolves around Christie's alleged negligence and its erroneous attribution of a drawing Mrs. Marchig consigned for sale in 1997. Christie's proffered that it was by an anonymous 19th century German artist. Mrs. Marchig indicated that it might have been an Italian Renaissance work. Ultimately, Christie's attribution carried forward and the drawing was sold by Christie's in 1998 in a frame that the auction house deemed better suited to its attribution instead of the Italian frame it came with from Mrs. Marchig. The original frame seems to have never been returned to Mrs. Consignor, who received $21,850 minus commission charges for the drawing.  

In 2009, Noel Annesley, now Chairman Emeritus of Christie’s, and a long-time acquaintance of Marchigs informed Mrs. Marchig about claims that the drawing was by Leonardo da Vinci. Currently the estimated value of the drawing is over $100 million. The attribution is based on technical analysis, which seems not to have been available in the 1990s.

For more information about attribution of La Bella Principessa read Martin Kemp's account.

Patty Gerstenblith Presidential Appointee to Chair CPAC

On June 24, 2011, Office of The Press Secretary issued an announcement that Patty Gerstenblith, Distinguished Research Professor and Director of the Center for Art, Museum and Cultural Heritage Law at DePaul University College of Law in Chicago is the newly appointed Chairman of the as a member of the United States Cultural Property Advisory Committee (CPAC).

Prof. Gerstenblith is the founding president of the Lawyers’ Committee for Cultural Heritage Preservation and is a director of the U.S. Committee of the Blue Shield. Additionally, she has served as Chair, Senior Advisor, and Vice Chair of the Art and Cultural Heritage Law Committee of the American Bar Association Section on International Law. From 1995 until 2002, she served as editor-in-chief of the International Journal of Cultural Property. The appointment is not the first encounter Prof. Gerstenblith has with the CPAC; she was a member of the Committee from 2000 until 2003. Her publications include the casebook Art, Cultural Heritage and the Law.

Copyright Fees: another riot in Canada?

What if museums had to keep paying fees to display art that they have acquired and art that they have on loan?

Canadian Artists’ Representation/Le Front des Artistes Canadiens (CARFAC) and the Regroupement des Artistes en Arts Visuels du Québec (RAAV), are currently seeking to establish copyright fees for any works by Canadian artists displayed or owned by the National Gallery. This movement rests upon two unique pieces of Canadian legislation regarding rights of copyright owners and collective bargaining.

Canadian artists, as owners of the copyright in the works they have created, enjoy mostly the same rights as American artists do under 17 USC 106. Since 1988, when The Copyright Amendments Bill C-60 was passed, they have enjoyed an additional and unique right to exhibit. Any work created by a Canadian artist after 7 June 1988 cannot be displayed without the copyright holder’s permission. This limits the concept known as the First Sale Doctrine under US law (17 USC 109), which allows purchasers of works to publicly display their lawful copies. In effect, the Canadian right could mean that a fee must be paid to the artist each time a work is exhibited. However, Canadian artists have traditionally accepted a lump sum payment upon sale of the work to a museum to cover future exhibition.

Earlier this year, the Canadian Museums Association sought the abolition of the exhibition right altogether. This is perhaps why the artist groups are now seeking to enforce their rights by way of their collective bargaining power. Enacted in 1992, The Status of the Artist Act [SAA] gives Canadian artists another unique right over and above their US counterparts - the right to collectively bargain. It "recognizes the right of certified groups to bargain collectively on work issues with Canadian 'federal producers', a definition that the museum meets." CARFAC and RAAV are certified under the Act.

The National Gallery is arguing that the collective bargaining power was intended to help artists address services, not intellectual property. This may explain why visual artists have not traditionally wielded this collective bargaining power, unlike performing artists in industries with more services. These negotiations have been underway for awhile, and in 2009 the National Gallery released a statement that, "The breakdown in negotiations with the CARFAC/RAAV under the Status of the Artist Act results from CARFAC/RAAV’s interest in concluding agreement on copyright issues outside the boundaries of their certification."

How should Canadian law weigh the rights of artists against public interest in the traditional institution of the museum?

Read the article at The Art Newspaper

Sound bites: Art Basil 42 and Law

If you have five minutes, take a look at this promotional bit for minding law when dealing with art.

MoMA Down Under

The Museum of Modern Art in New York [MoMA] and the Art Gallery of Western Australia [AGWA] have recently entered into a unique agreement. AGWA will be showcasing items from MoMA's collection in a series of six exhibitions scheduled over three years, as if it were an international outpost.

The two museums have entered into a partnership which officially launches in June 2012. The Modern Masters exhibit, comprised of many items from MoMA's permanent collection, will be the first to travel to Australia next year. According to the Australian, the items in this exhibit have "rarely been seen outside of US."

It is interesting to think of the issues involved in bringing artworks to an underserved location. From a cultural standpoint, one might ask whether or not this would have any real impact. Arts Minister John Day said, "People [in Perth] want high-quality events, including in the cultural sector, and we're certainly making a statement about that." From a legal standpoint, one might wonder what the contract looks like. How is the sensitive issue of transport being handled and who is covering the insurance bills? More importantly, what is MoMA getting in return? According to the Australian, the government of Western Australia allocated $6 million in the recent budget to help with underwriting the cost of the exhibition. However, the details are still unclear.

Why hasn't there been more hype about this, in the US in particular? Judith Dobrzynski speculates, "I'm guessing that MoMA fears it will be accused of renting out its collection and/or of subjecting precious works to the conservation issues that traveling always present -- not to mention absenting these works from MoMA's own visitors[...] And, of course, there's the fee: museums aren't supposed to profit from lending their collections; they're just supposed to cover their costs." Ms. Dobrzynski adds that museums do have to raise money, and lending has actually become very common.

Other creative arrangements between museums include rotating loans of items of cultural property and international touring exhibitions.

Read about the MoMA/AGWA deal at The Australian and Limelight

The Spiral Jetty Lease

Disputes often arise as to title of artwork, but title to the land on which the artwork sits rarely comes into play.

In 1970, Robert Smithson created the "Spiral Jetty", which extends 460 meters into the Great Salt Lake of Utah. The Utah Department of Natural Resources administers a lease for this work, which sits atop state property. In 1999, The Estate of Robert Smithson donated the work to the Dia Art Foundation, also shifting obligations regarding the lease with the Department of Natural Resources. Dia must pay an annual fee of $250.00 to maintain its rights over the work.

At the beginning of June, it was revealed that Dia had failed to pay the annual fee on the lease, and had also failed to respond to a notice that the 20-year lease on the lake bed had run out. Speculation arose that ownership reverted to the State of Utah.

Must the lease be extended? Could Utah pursue plans to drill for oil, potentially destroying the artwork? Would Dia maintain rights over the work as an "improvement" on the land, as per the terms of the lease?

Dia posted an announcement on its website that the Foundation and the Government are working together to rectify the situation. "Maintaining Spiral Jetty is central to Dia’s mission and purpose, and to the history of American art. Both Dia and the Department recognize the immense value and importance of this unique artwork at a local, national, and international level and will continue to work together to ensure its long-term preservation."

Get Back: Arbitration Award Threatens Art Loans

What does a blood plasma business have to do with art law? Well, after a 2008 Czech arbitration court ruling on the verge of enforcement against the Czech Republic for $500 million in compensation for thwarting trading perspectives of Diag Human, a firm dealing in blood plasma, the Czech Republic is rushing to recall its valuable works of art on loan in fear that the property may be seized (again). Diag Human claims that rumors in 1992 that the company was suspected of illegal activities resulted in the company not getting a government contract. The issue of whether the Czech government slandered the business owner was submitted to arbitrators, and now Czech cultural heritage may become a collateral to force the government to pay up.

Human's lawyers are seeking recognition of the award in several EU countries and the U.S. by means of seizing the country's assets. Courts in Vienna and Paris recognized the company's claim in May.  In an effort to enforce the award, two paintings, estimated value $877,000, were seized from Vienna's Belvedere Gallery. Following the Austrian move, the Czechs withdrew paintings from exhibitions in France and other EU countries, including a Manet painting from the Musee D'Orsay in Paris.
 
Diag Human admitted that its claim is "80 times higher" than it was originally because the Czech state did not respect court and arbitration decisions and should pay interests because of the protracted dispute.

According to some officials, these events could affect loans policy for many years. For now, the Czech Culture Ministry said it would not allow any artwork worth more than 100,000 koruna ($6,055) to be loaned abroad.


Read more here and here.

A Pissarro, Stolen and Forfeited

Here is a tale of an art theft gone wrong. Unfortunately, things have actually gone quite well for the thief.

In 1981, “Le Marché”, a work by Camille Pissarro, disappeared from the Museé Faure in Aix-les-Bains. Four years later, Sharyl Davis bought the work from J. Adelman Antiques and Art Gallery, a Texas gallery, which had taken it on consignment from Emil Guelton. In 2003, Ms. Davis put the work in Sotheby’s catalog. The Art Loss Register had it noted as missing, and underwent routine art theft procedures, notifying the parties involved. The French authorities were able to identify Guelton as the thief in question, and demanded that the US return the work to France. The United States brought a forfeiture action against Ms. Davis to recover the artwork.

The Government successfully argued that it was entitled to seize the work as merchandise that had been transported into the country illegally. There is no innocent-owner defense available against the claim. Furthermore, where the Government seizes property pursuant to a forfeiture statute, it is entitled to do so without compensating the owner under the takings clause. Davis lost the case and lost an asset valued at $100,000. Because she was not a prevailing party, Ms. Davis was not entitled to recover attorney's fees either.

Caveat emptor? Barbara Hoffman, representing Ms. Davis, said that her client actually did significant due diligence at the time she bought the print, and even had the work authenticated by an expert. However, because of "the legal parameters of the government’s case," Ms. Hoffman was not allowed to introduce the evidence in court. Ms. Davis said that she went through a period of collecting art, but most of the artists were alive when she bought their works, so there was never any problem with title before. Meanwhile, Guelton is not being prosecuted. “He’s living on a boat in the South of France and has a pied-à-terre in Paris,” Ms. Hoffman told the New York Times.

Read the article at the New York Times

Read USA v Davis here and the June 3, 2011 decision here

Art and Commerce, United in Hong Kong

Hong Kong is known as a great commercial center, but could it become a great cultural center?

"Hong Kong has no facilities that come close to the iconic theater districts, opera houses or museums of New York, London, Paris or Tokyo." To remedy this, the government in Hong Kong has set aside 21.6 billion Hong Kong dollars, or about $2.8 billion, for the creation of the West Kowloon Cultural District.

At least 17 major cultural venues will be constructed for the district. Norman Foster (Foster + Partners) won an international competition to oversee the work. But what will fill these venues? The new contemporary museum, 430,000-square-foot in size, will need to build its collection from scratch. Whereas Lincoln Center was built around major performing arts groups that were already in existence (such as New York City Ballet), who will present on West Kowloon's new stages? Will this district turn into a mere shopping playground?

Indeed, a substantial portion of the government funding will also go towards shopping, dining, and entertainment facilities, and the new District will be connected to the International Commerce Center skyscraper and a luxury shopping mall. We have witnessed shops in museums (see the Vuitton shop in Takashi Murakami's 2008 Brooklyn Museum exhibit), but we have not seen museums actually being linked to shopping malls!

The New York Times refers to the proposed District as an "arts-shopping-dining-luxury-hotel extravaganza." It is an unusual move for state arts funding to be tied to commercial initiatives in this way. “Most art projects in the world basically lose money and require subvention,” Hong Kong's chief secretary told the New York Times. “We have a financing model in which the retail, dining and entertainment income will be under the management of the authority and help fund the arts side.”

At the end of May, Australian Michael Lynch was named as CEO of the District. "This is the biggest and most complex art project in the world," he told the Wall Street Journal. Well, it certainly is a colorful project.

Read the article at the New York Times

Let's Make Law! Proposed Amendment to the NY Arts and Cultural Affairs Law to Protect Consignments

On April 15, 2011, Assembly Member Bing and other members of the New York Senate introduced an Act to amend the NY Arts and Cultural Affairs Law in an effort to protect the artists and their heirs when consigning art to galleries. The amendment was proposed by the Art Law Committee of the New York City Bar Association in the aftermath of the Salander-O'Reilly bankruptcy and other consigning disasters. The proposed amendments are intended "to give teeth to the existing trust property and trust fund provisions of Articles 11 and 12 of Law by ensuring that children and heirs of an artist in certain cases qualify for the protections governing consignments and making it explicit that works of art consigned by artists, craftspeople, their heirs and personal representatives to art merchants are not, and shall not become, the property of the art merchant, or the art merchant’s bankruptcy estate."

See a full copy of the amendment here (A. 7189).

Solomonic Decision In Labor Disputes at the Guggenheim Abu Dhabi Site

"If we build, it they will come," is a motto of the Abu Dhabi and Dubai developers. One of the ambitious projects in the United Arab Emirates (the UAE)is to bring art treasures to the region by collaborating with the small museums like the Louvre, Getty, and the Guggenheim in hopes of attracting more travelers and capitalizing on tourism.

The trouble with building the wonders of the world is that the working conditions are typically appalling. To ensure compliance with basic workers' right and safety measures, the leadership of the Board of Trustees of the Solomon R. Guggenheim Foundation issued a statement in support of the recent appointment by the Abu Dhabi Tourism Development & Investment Company (TDIC) of PricewaterhouseCoopers (PwC) as an independent monitor to ensure that the contractors and sub-contractors working on the Guggenheim Abu Dhabi construction site comply with UAE labor laws and TDIC’s Employment Practices Policy.

Some of the issues of concern are timely payment of wages, accommodation conditions, working hours, withholding personal documents, recruitment fees, contracts of employment, workplace standards, and the ability to report grievances.

The statement included the following: "We look forward to a continuing dialogue with TDIC and recognize that these issues are complex. We remain committed to the workers on the Guggenheim Abu Dhabi construction site, to maintaining the integrity of our joint project with TDIC and to establishing a truly international museum that will reflect and celebrate the cultures of the Middle East while fostering an atmosphere of open, intellectual exchange."

For the full statement, visit Guggenheim Foundation site.

Oy Vey: East and West Split along the Ai Weiwei Line

Chinese artist, Ai Weiwei, remains under arrest more than two months after being detained on his way to Hong Kong last April. He is accused of economic crimes, specifically of tax evasion. However, the charges are unconvincing in light of Weiwei's criticism of the government and defiance of the mainland authorities. Artists and critics around the world have demonstrated their solidarity with Weiwei. Some of those working in China have been detained also.  For example, Lin Bing and Fei Xiaosheng, who reserved a blank gallery wall with a small name tag in support of Weiwei were detained by police and their exhibit was shut down.

In the mean time, the Britain's Royal Academy awarded Weiwei the title of Honorary Academician as "one of the most significant cultural figures of his generation in China and internationally."


In anticipation of the next step by the Chinese government it is disconcerting to see the efforts of using tax law to prosecute dissident artists.


For full stories related to Ai Weiwei read Beijing Artists Detained and UK's Royal Academy of Arts Awards Ai Weiwei Honorary Title.

Photos: Top -- REUTERS/Tyrone Siu; bottom -- AP Photo/Keystone/Steffen Schmidt.

Fashion: Intellectual Property, Good Business, and Human Rights

The month of May saw a number of interesting intersections between fashion and law.

Nathalie Atkinson at the National Post wrote an impassioned argument in favor of 'designer duplication.' She had previously received a note from Chanel's legal department: "A note of information and entreaty to fashion editors, advertisers, copywriters and other well-intentioned mis-users of our Chanel name. ... Although our style is justly famous, a jacket is not ‘a Chanel jacket’ unless it is ours[.]" Atkinson was not against Chanel's enforcement of its intellectual property, but, "Chanel can’t prevent anyone from designing similarly boxy tweed jackets trimmed in anything, anywhere." Atkinson argued that styles should be copied. Such an argument leads us IP lawyers back to the same issue: the idea/expression dichotomy.

"I’ve been thinking about this IP issue a lot in the two years since I discovered that Diane von Furstenberg’s brand had copied, stitch for stitch, the design of a jacket by Canadian niche label Mercy (the former properly acknowledged this and provided undisclosed financial compensation for having done so)."

Von Furstenberg's imitations would be far too up-scale to be properly classed as 'knock-off's or 'counterfeits', which are a common problem for major fashion houses. New York City councilwoman Margaret Chin recently proposed a $1,000 fine for people who buy counterfeits. The New York Post reported that Susan Scafidi, of Fordham's Fashion Law Institute, suggested the law could have a real impact. "There are some consumers who will think twice," Scafidi said.

Ray Fisman, professor of social enterprise and director of the Social Enterprise Program at the Columbia Business School, would argue that such an impact would be a bad thing for the fashion industry. Writing for Slate, he argued that knock-offs actually help the original designer's business. According to Fisman, knock-offs can function as free advertising for the real products —" partly by signaling the brand's popularity, but, less obviously, by creating what MIT marketing professor Renee Richardson Gosline has described as a "gateway" product."

The purpose of any design protection act should be to protect this industry, in balance with other legitimate interests, not hinder it. LA Downtown News reports that the California Fashion Association recently spoke against the Innovative Design Protection and Piracy Prevention Act in DC. The article points out that the law would favor the well-established fashion houses, which are mainly based in New York. Therefore, the Act supposedly pits the West coast against the East.

Under the current laws, trade names and marks of fashion houses receive more clear protection than designs and styles. But there are limits to protection. Defenses to claims of trademark infringement, such as parody and referential use, are significant limitations. Human rights, primarily freedom of expression, can also pose limitations. On May 4, 2011, the Hague threw out a claim by Louis Vuitton that "Darfurnica", a painting of an African child holding a Vuitton bag, violated its intellectual property rights. The Financial Times reports that the artist wanted to draw attention to the crisis in Darfur and Western indifference to it. The court ruled that the artist’s freedom of expression outweighed the importance of Vuitton’s protection of property.

The right balance regarding legal protection of fashion has yet to be found. Meanwhile, Forever21 is suing a fashion blogger at WTForever21.com. See "Today in Irony" ...

Mike Tyson's Face as Art?

It might be unusual to feature "Hangover II" and Mike Tyson on these pages, but it seems impossible to omit the copyright controversy that blew up around the film and the figure.

In 2003, S. Victor Whitmill designed and tattooed Mike Tyson's face. The creators of "Hangover II" thought it would be funny if one of their characters woke up in Bangkok with Tyson's tattoo on his face. In April of this year, Whitmill filed a lawsuit against Warner Brothers at the federal court in St. Louis, alleging that the tattoo in the movie was "virtually exact reproduction" of the tattoo he created on Tyson, and that this reproduction violated his copyright. Accordingly, Whitmill sought an injunction against the release of the film.

The lawsuit has set the academic world buzzing. Warner Brothers tried to call on David Nimmer, a copyright scholar, to testify on the issue of copyrightability of tattoos. According to Wired, Nimmer's position has changed over the years. U.S. District Judge Catherine Perry of Missouri blocked Nimmer from testifying on the basis that his testimony would be a legal opinion rather than expert testimony.

As IP Kitten points out, a similar controversy regarding copyrightability of "faces" arose in England in 1983, in the case of Merchandising Corporation of America v Harpbond. The case concerned the stylized make-up worn by Adam Ant; the make-up design was not found to be copyrightable, due to a lack of fixation. However, fixation is not a problem in the case of tattoos.

Judge Perry herself thinks that tattoos can undoubtedly be copyrighted. “They are not copyrighting Mr. Tyson’s face, or restricting Mr. Tyson’s use of his own face, as the defendant argues, or saying that someone who has a tattoo can’t remove the tattoo or change it, but the tattoo itself and the design itself can be copyrighted, and I think it’s entirely consistent with the copyright law.”

Despite Judge Perry's dicta, and although it seemed likely that Whitmill would prevail on the merits, the injunction was not granted. "Hangover II" was released as scheduled on May 26. The decision was made on the basis of "public interest"; The harm that would be caused to Warner Brothers and other businesses around the country would outweigh the harm caused to Whitmill. Indeed, "Hangover II" was the second highest-grossing film this weekend.

The matter of copyright infringement, however, is yet to be determined. Whitmill's lawyers expressed intention to pursue further action in court.

Read the article at the New York Times.