David Cassirer v. Thyssen-Bornemisza Collection

FOR PUBLICATION

UNITED STATES COURT OF APPEALS

FOR THE NINTH CIRCUIT

DAVID CASSIRER; THE ESTATE No. 19-55616

OF AVA CASSIRER; UNITED

JEWISH FEDERATION OF SAN D.C. No.

DIEGO COUNTY, a California non- 2:05-cv-03459-

profit corporation, JFW-E

Plaintiffs-Appellants,

OPINION

v.

THYSSEN-BORNEMISZA

COLLECTION FOUNDATION, an

agency or instrumentality of the

Kingdom of Spain,

Defendant-Appellee.

Appeal from the United States District Court

for the Central District of California

John F. Walter, District Judge, Presiding

Argued and Submitted December 12, 2022

Pasadena, California

Filed January 9, 2024

2 CASSIRER V. THYSSEN-BORNEMISZA COLLECTION FOUND.

Before: Consuelo M. Callahan, Carlos T. Bea, and Sandra

S. Ikuta, Circuit Judges.

Opinion by Judge Bea;

Concurrence by Judge Callahan

SUMMARY*

Foreign Sovereign Immunities Act

On remand from the United States Supreme Court, the

panel affirmed the district court’s judgment in favor of the

Thyssen-Bornemisza Collection, an instrumentality of the

Kingdom of Spain, in an action under the Foreign Sovereign

Immunities Act, seeking the return of a Pissarro painting

stolen by the Nazis in 1939 Germany.

The Supreme Court vacated the panel’s prior decision

and remanded with instructions to apply California’s choice-

of-law rules, rather than federal choice-of-law rules, to

determine whether California law or Spanish law governed

the disputed claim of title to the painting. Under California

law the plaintiffs would recover the art, while under Spanish

law they would not.

Applying California’s choice-of-law test, the three-step

“governmental interest analysis," the panel first reaffirmed

its prior decision, in which it determined, under Steps One

and Two of the test, that the applicable laws of California

*

This summary constitutes no part of the opinion of the court. It has

been prepared by court staff for the convenience of the reader.

CASSIRER V. THYSSEN-BORNEMISZA COLLECTION FOUND. 3

and Spain differed and that a true conflict existed with

respect to each jurisdiction’s interests in applying its laws to

this case. Addressing Step Three of California’s test, the so-

called “comparative impairment” analysis, the panel

resolved the conflict by applying the law of the jurisdiction

whose governmental interests would be the more impaired

were its law not applied. The panel concluded that, under

the facts of this case, Spain’s governmental interests would

be more impaired by the application of California law than

would California’s governmental interests be impaired by

the application of Spanish law. Thus, Spanish law must

apply.

Applying Spanish law, the panel held that the Thyssen-

Bornemisza Collection had gained prescriptive title to the

painting pursuant to Article 1955 of the Spanish Civil Code.

The panel therefore affirmed the district court’s order

granting judgment in favor of the Thyssen-Bornemisza

Collection.

Concurring, Judge Callahan wrote that she agreed with

the result, but it was at odds with her moral compass, and

Spain should have voluntarily relinquished the painting.

4 CASSIRER V. THYSSEN-BORNEMISZA COLLECTION FOUND.

COUNSEL

David Boies (argued), Boies Schiller Flexner LLP, Armonk,

New York; David A. Barrett, Boies Schiller Flexner LLP,

New York, New York; Stephen N. Zack, Andrew S.

Brenner, and Rossana Baeza, Bois Schiller Flexner LLP,

Miami, Florida; Laura W. Brill and Nicholas Daum, Kendall

Brill & Kelly LLP, Los Angeles, California; Samuel J.

Dubbin, Dubbin & Kravetz LLP, Coral Gables, Florida;

Devin Freedman, Freedman Normand Friedland, Miami,

Florida; for Plaintiffs-Appellants.

Thaddeus J. Stauber (argued), Sarah E. André, Aaron M.

Brian, and Irene Scholl-Tatevosyan, Nixon Peabody LLP,

Los Angeles, California, for Defendant-Appellee.

Patrick Byrne and Bernardo M. Cremades Roman, B.

Cremades & Asociados, Madrid, Spain, for Amici Curiae

Comunidad Judía de Madrid & Federación de Comunidades

Judías de España.

Amelia L.B. Sargent, Willenken LLP, Los Angeles,

California, for Amici Curiae Kingdom of Spain.

Benjamin Conway and Catherine Z. Ysrael, Deputy

Attorneys General; Srividya Panchalam, Supervising

Deputy Attorney General; Michael L. Newman, Senior

Assistant Attorney General; Rob Bonta, Attorney General of

California; Office of the California Attorney General, Los

Angeles, California; for Amici Curiae State of California.

Benjamin G. Shatz, Manatt Phelps & Phillips LLP, Los

Angeles, California, for Amici Curiae 1939 Society, Bet

Tzedek, Center for the Study of Law & Genocide, and

Loyola Genocide Justice Clinic.

CASSIRER V. THYSSEN-BORNEMISZA COLLECTION FOUND. 5

OPINION

BEA, Circuit Judge:

This case is before us after the United States Supreme

Court vacated our prior decision. The Court remanded with

instructions that we apply California’s choice-of-law rules,

rather than federal choice-of-law rules, to determine whether

California law or Spanish law governs a disputed claim of

title to a painting, the Rue Saint Honoré, après midi, effet de

pluie (the “Painting”), by French Impressionist Camille

Pissarro. Cassirer v. Thyssen-Bornemisza Collection

Found., 596 U.S. 107, 117 (2022) (“Cassirer V”).

In 1939 Germany, the Nazis stole the Painting from Lilly

Neubauer (“Lilly”), a Jew who was attempting to flee the

Nazi regime. After a series of transactions, the Painting is

now in the possession of the Thyssen-Bornemisza Collection

(“TBC”).1 TBC had purchased the Painting from the Baron

Hans Heinrich Thyssen-Bornemisza (the “Baron”) in 1993.

TBC has publicly displayed the Painting at the Museo

Nacional Thyssen-Bornemisza in Madrid, Spain, (the

“Museum”) ever since.

In 2000, Claude Cassirer, a California resident and

Lilly’s sole heir, learned that the Painting was on display at

the Museum in Spain. In 2001, Mr. Cassirer filed a petition

with TBC and Spain for the return of the Painting; that

petition was denied. In 2005, Mr. Cassirer brought this suit

under the Foreign Sovereign Immunities Act (“FSIA”), 28

U.S.C. § 1330(a), in the United States District Court for the

1

TBC is an instrumentality of the Kingdom of Spain.

6 CASSIRER V. THYSSEN-BORNEMISZA COLLECTION FOUND.

Central District of California, seeking the return of the

Painting from TBC.2

After nearly two decades of litigation, the disposition of

this case turns on one issue: whether, under California’s

choice-of-law test, Spanish law or California law applies to

determine ownership of the Painting. “[U]nder California

law as it currently stands, the plaintiff would recover the art

while under Spanish law, the plaintiff would not.”3 Cassirer

v. Thyssen-Bornemisza Collection Found., 69 F.4th 554, 564

(9th Cir. 2023) (“Cassirer VI”) (citation and internal

quotation omitted).

On remand from the United States Supreme Court, we

certified to the California Supreme Court the question

whether California’s choice-of-law test requires application

of Spain’s laws or California’s laws to this dispute. Id. at

571–72. The California Supreme Court declined to answer

our certified question. Thus, responsibility falls on us to

apply California’s choice-of-law test—the three-step

“governmental interest analysis”—to determine whether

2

Claude Cassirer died in 2010. David and Ava Cassirer, his children,

and the United Jewish Federation of San Diego County succeeded to his

claims. Ava later died, and her estate is now a substitute plaintiff.

Collectively, we refer to these plaintiffs as “the Cassirers.”

3

We discuss the relevant laws in detail below. In brief, under Article

1955 of the Spanish Civil Code, TBC has acquired prescriptive title to

the Painting because it possessed the Painting in good faith for over three

years before the Cassirers brought suit. In contrast, California has not

expressly recognized adverse possession of personal property, and as a

thief cannot pass title to anyone, including a good faith purchaser, if

California law applied, TBC would not have title to the Painting. The

Cassirers, as successors to Lilly Neubauer and Claude Cassirer, would

have title.

CASSIRER V. THYSSEN-BORNEMISZA COLLECTION FOUND. 7

Spanish law or California law governs. See Kearney v.

Salomon Smith Barney, Inc., 137 P.3d 913, 922 (Cal. 2006).

Applying California’s choice-of-law test, we first

reaffirm our prior decision, in which we determined that the

applicable laws of California and Spain differ and that a true

conflict exists with respect to each jurisdiction’s interests in

applying its laws to this case. Cassirer VI, 69 F.4th at 563,

566. We then evaluate Step Three of California’s choice-of-

law test, the so-called “comparative impairment” analysis,

under which we resolve such a conflict by applying the law

of the jurisdiction whose governmental interests would be

the more impaired were its law not applied. See Kearney,

137 P.3d at 934. We conclude that, under the facts of this

case, Spain’s governmental interests would be more

impaired by the application of California law than would

California’s governmental interests be impaired by the

application of Spanish law. Thus, applying California’s

choice-of-law test, we hold that Spanish law must apply.

Applying Spanish law, TBC has gained prescriptive title

to the Painting pursuant to Article 1955 of the Spanish Civil

Code. Cassirer v. Thyssen-Bornemisza Collection Found.,

824 F. App’x 452, 456–57 (9th Cir. 2020) (“Cassirer IV”).

We therefore affirm the district court’s order which granted

judgment in favor of TBC.

I. FACTS AND PROCEDURAL HISTORY

We discuss only the facts and procedural history relevant

to our decision. A full account of this dispute is detailed in

8 CASSIRER V. THYSSEN-BORNEMISZA COLLECTION FOUND.

the earlier decisions issued by the district court, this Circuit,

and the U.S. Supreme Court.4

A. Lilly’s Ownership of the Painting and The Theft of

the Painting

Paul Cassirer, a member of a prominent German Jewish

family, purchased the Painting in 1900. Lilly inherited the

Painting from Paul. Lilly displayed the Painting at her home

in Berlin, Germany, until 1939.

In 1939, Lilly was forced to “sell” the Painting to Jackob

Scheidwimmer (“Scheidwimmer”), a Berlin art dealer.

Scheidwimmer had been appointed by the Nazi government

to obtain the Painting, had refused to allow Lilly to take the

Painting with her out of Germany, and had demanded that

she sell the Painting to him for 900 Reichsmarks (around

$360 at then-prevailing exchange rates) to obtain an exit visa

to England. Lilly surrendered the Painting to Scheidwimmer

and the 900 Reichsmarks were deposited into a bank account

that Lilly was not allowed to access. There is no dispute that

the Nazis stole the Painting from Lilly.

After the Nazis forced Lilly to sell the Painting to

Scheidwimmer in 1939, Scheidwimmer then forced another

4

See Cassirer v. Kingdom of Spain, 616 F.3d 1019 (9th Cir. 2010) (en

banc) (“Cassirer I”); Cassirer v. Thyssen-Bornemisza Collection

Found., 737 F.3d 613 (9th Cir. 2013) (“Cassirer II”); Cassirer v.

Thyssen-Bornemisza Collection Found., 862 F.3d 951 (9th Cir. 2017)

(“Cassirer III”); Cassirer v. Thyssen-Bornemisza Collection Found., 824

F. App’x 452 (9th Cir. 2020) (“Cassirer IV”); Cassirer v. Thyssen-

Bornemisza Collection Found., 596 U.S. 107 (2022) (“Cassirer V”);

Cassirer v. Thyssen-Bornemisza Collection Found., 69 F.4th 554 (9th

Cir. 2023) (“Cassirer VI”); see also Cassirer v. Thyssen-Bornemisza

Collection Found., 153 F. Supp. 3d 1148 (C.D. Cal. 2015); Cassirer v.

Thyssen-Bornemisza Collection Found., 2019 WL 13240413 (C.D. Cal.

Apr. 30, 2019).

CASSIRER V. THYSSEN-BORNEMISZA COLLECTION FOUND. 9

German Jewish collector, Julius Sulzbacher (“Sulzbacher”),

to exchange three German paintings for the Painting.

Sulzbacher was also seeking to escape Nazi Germany. After

the Sulzbacher family fled Germany, the Gestapo

confiscated the Painting. The exchange and the confiscation

took place in Germany.

After the war, the Allies established a process for

restoring property to the victims of Nazi looting, authorizing

victims to seek restitution of looted property. In 1948, Lilly

filed a timely claim against Scheidwimmer for restitution of,

or compensation for, the Painting. In 1954, the United States

Court of Restitution Appeals published a decision

confirming that Lilly owned the Painting.

Lilly, Sulzbacher, and Scheidwimmer believed the

Painting had been lost or destroyed during the war. In 1957,

after the German Federal Republic regained its sovereignty,

Germany enacted a law, the Brüg, which authorized claims

for Nazi-looted property. Lilly then dropped her restitution

claim against Scheidwimmer and initiated a claim against

Germany for compensation for the wrongful taking of the

Painting. In 1958, the parties reached a settlement

agreement, which provided, in relevant part, that Germany

would pay Lilly 120,000 Deutschmarks (the Painting’s

agreed value as of April 1, 1956), about $250,000 in today’s

dollars after adjusting for inflation. See Cassirer V, 596 U.S.

at 110.

B. The Painting’s Post-War History

After the Nazis confiscated the Painting, it allegedly was

sold at a Nazi government auction in Düsseldorf, Germany.

In 1943, the Painting was sold by an unknown consignor at

the Lange Auction in Berlin, Germany, to an unknown

purchaser for 95,000 Reichsmarks. In 1951, the Frank Perls

10 CASSIRER V. THYSSEN-BORNEMISZA COLLECTION FOUND.

Gallery of Beverly Hills, California, arranged to move the

Painting out of Germany and into California to sell the

Painting to collector Sidney Brody for $14,850. In 1952,

Sydney Schoenberg, a St. Louis, Missouri, art collector,

purchased the Painting for $16,500. The Painting sat in a

private collection in St. Louis from 1952–1976. In 1976, the

Baron purchased the Painting through the Stephen Hahn

Gallery in New York for $275,000. The Baron kept the

Painting in Switzerland as part of his collection until 1992,

except when it was on public display in exhibitions outside

Switzerland.

In 1988, Favorita Trustees Limited (“Favorita”), an

entity controlled by the Baron, and Spain reached an

agreement with TBC that the Baron would loan his art

collection (the “Collection”), including the Painting, to

TBC, an entity created and controlled by the Kingdom of

Spain. Pursuant to this agreement, Spain created TBC to

maintain, conserve, publicly exhibit, and promote the

Collection’s artwork. Spain agreed to display the Collection

at the Villahermosa Palace in Madrid, Spain, and to restore

and redesign the palace as the Museum.

After the Villahermosa Palace had been restored and

redesigned as the Museum, pursuant to the loan agreement,

the Museum received a number of paintings from Favorita,

including the Painting, and in 1992, the Museum opened to

the public. Since October 10, 1992, the Painting has been on

public display at the Museum in Spain.

In 1993, the Spanish government passed Real Decreto-

Ley 11/1993, which authorized and funded the purchase of

the Collection. Spain bought the Collection by entering into

an acquisition agreement with Favorita. TBC paid Favorita

and the Baron $350 million for the Collection. TBC required

CASSIRER V. THYSSEN-BORNEMISZA COLLECTION FOUND. 11

the Baron to provide a $10 million, three-year prenda5 of

certain paintings as a security device for the Baron’s

performance under the terms of his agreement with TBC.

C. Procedural History

Claude Cassirer, Lilly’s sole heir, moved to California in

1980 and resided there until his death in 2010. In 2000, Mr.

Cassirer learned that the Painting was in the Museum. On

May 3, 2001, Mr. Cassirer filed a petition in Spain with the

Kingdom of Spain and TBC, seeking the return of the

Painting. In 2005, after that petition was denied, Claude

Cassirer filed this action, under the Foreign Sovereign

Immunities Act (“FSIA”), 28 U.S.C. § 1330(a), in the United

States District Court for the Central District of California,

seeking the return of the Painting. The litigation noted in

footnote 4, above, proceeded.

In 2015, the Cassirers moved the district court for an

order declaring that the law of California, not the law of

Spain, governed the merits of their action.6 The district court

5

Prenda means “security, surety,” or “pledge” in Spanish. Oxford

Spanish Dictionary 661 (3d ed. 2003).

6

Under Article 1955 of the Spanish Civil Code, ownership in personal

property vests by prescription after either (1) three years of uninterrupted

possession of the property in good faith, (2) or six years of uninterrupted

possession, even absent good faith. However, the six-year prescriptive

period is tolled for the period during which a criminal or civil action can

be brought if the possessor is a principal, accomplice, or accessory

(encubridor) to the theft. See Cassirer III, 862 F.3d at 966. California, in

contrast, has not specifically endorsed adverse possession for personal

property, see Cassirer VI, 69 F.4th at 562, and allows a victim of fine art

theft to recover the stolen art from a museum or similar institution so

long as he brings suit to recover it within six years of his discovery of its

whereabouts, regardless whether the possessor took possession of the

12 CASSIRER V. THYSSEN-BORNEMISZA COLLECTION FOUND.

recognized that before making this determination, it first had

to determine whether it should apply California or federal

common law choice-of-law rules. See Cassirer, 153 F. Supp.

3d at 1154. The district court held that federal choice-of-law

rules governed a case where jurisdiction is premised on the

FSIA.7 Id. Applying federal choice-of-law rules, the district

court concluded that Spanish law applied to determine the

ownership of the Painting. Id. at 1155.

Out of an abundance of caution, the district court also

applied California choice-of-law rules and reached the same

conclusion: that Spanish law applied. Id. at 1160. The court

reasoned that the Painting “was present in California for less

than a year,” whereas “for more than twenty years . . . the

Painting has been in the possession of an instrumentality of

the Kingdom of Spain in Madrid, Spain . . . and that

possession in Spain provides the basis for [TBC’s] claim of

ownership.” Id. at 1155. The court concluded Spain has a

“strong interest in regulating conduct that occurs within its

borders,” and in assuring individuals acting within its

property in good faith. Cal. Code Civ. Proc. § 338(c)(3)(A). Moreover,

under California law, thieves cannot pass good title to anyone, including

a good faith purchaser. Crocker Nat’l Bank v. Byrne & McDonnell, 173

P. 752, 754 (Cal. 1918).

7

The district court’s decision to apply federal-choice-of-law rules in a

case arising under the FSIA was based on then-binding Ninth Circuit

precedent. Cassirer, 153 F. Supp. 3d at 1154 (citing Schoenberg v.

Exportadora de Sal, S.A. de C.V., 930 F.2d 777, 782 (9th Cir. 1991)).

The federal choice-of-law test draws from the Second Restatement.

Under that approach, a court must consider a set of factors to decide

which state has the “most significant relationship” to the case.

Restatement (Second) of Conflict of Laws §§ 6, 222. The Second

Restatement provides that, in cases of adverse possession of chattel, the

local law of the state where the chattel was located at the time of transfer

typically governs. Second Restatement, § 246.

CASSIRER V. THYSSEN-BORNEMISZA COLLECTION FOUND. 13

borders that “their title and ownership of . . . property [is]

certain,” whereas “California’s interest [in facilitating

recovery for one of its residents] is significantly less.” Id.

Applying Spanish law, the district court ruled that TBC

was the rightful owner of the Painting, pursuant to Spain’s

law of acquisitive prescription,8 as stated in Article 1955 of

the Spanish Civil Code. Id. at 1160. The district court

therefore entered summary judgment in favor of TBC. Id.

On appeal in this Court, consistent with our Circuit’s

precedent, we applied federal choice-of-law principles to

conclude that Spanish property law governed this dispute.9

Cassirer III, 862 F.3d at 961 (citing Schoenberg, 930 F.2d at

782).

Applying Spanish law, we considered whether TBC had

fulfilled the requirements for ownership of the Painting set

forth in Articles 1955 and 1956 of the Spanish Civil Code.

Id. at 964–76. We explained that acquisitive prescription

under Article 1955 is modified by Article 1956, which

extends the period of possession necessary to vest title when

the person who has possession was a principal, accomplice,

or accessory (encubridor), see Oxford Spanish Dictionary

323 (3d ed. 2003), to the robbery or theft of the property at

issue. Cassirer III, 862 F.3d at 966. We then held that there

was a genuine dispute of material fact as to whether TBC

knew the Painting had been stolen when TBC acquired the

Painting from the Baron, and therefore whether TBC was an

8

Acquisitive prescription is “a mode of acquiring ownership or other

legal rights through possession for a specified period of time.”

Acquisitive Prescription, Black’s Law Dictionary (11th ed. 2019). The

term is synonymous with adverse possession.

9

In so holding, we did not consider how California’s choice-of-law rules

applied. See Cassirer III, 862 F.3d at 961–64.

14 CASSIRER V. THYSSEN-BORNEMISZA COLLECTION FOUND.

encubridor under Article 1956. Id. at 975. If TBC were an

encubridor, it would not have acquired title to the Painting

through acquisitive prescription until 2019—six years after

the criminal and civil limitations periods had run—long after

the Cassirers brought their action in 2005. Id. at 966.

Therefore, we reversed the district court’s order which

granted summary judgment in favor of TBC, and remanded

for that court to consider whether TBC knew the Painting

had been stolen when it acquired the Painting from the

Baron. Id. at 981.

On remand, the district court conducted an extensive

bench trial. The court concluded that TBC was not an

encubridor under Article 1956 of the Spanish Civil Code,

because TBC did not have actual knowledge that the

Painting was stolen when it purchased the Painting from the

Baron in 1993. Cassirer, 2019 WL 13240413, at *20–22.

Because TBC had possessed the Painting publicly, as an

owner, for over three years in good faith, the district court

held that TBC had fulfilled the requirements of Article 1955

of the Spanish Civil Code and had therefore acquired

prescriptive title to the Painting. Id. at *19. It thus entered

judgment in favor of TBC. We affirmed. Cassirer IV, 824 F.

App’x at 457.

The Cassirers petitioned the Supreme Court for certiorari

on the question whether a federal court hearing state-law

claims as to title of the Painting, brought under the FSIA,

may apply federal common law to determine what state’s

substantive law governs the claims at issue, or whether the

forum state’s choice-of-law provisions govern. The Supreme

Court granted the petition and held that the FSIA “requires

the use of California’s choice-of-law rule—because that is

the rule a court would use in comparable private litigation.”

Cassirer V, 596 U.S. at 115. Because we had applied federal

CASSIRER V. THYSSEN-BORNEMISZA COLLECTION FOUND. 15

choice-of-law rules, the Supreme Court vacated our

judgment and remanded for us to apply California’s

“standard choice-of-law rule.” Id. at 117.

On remand, by majority vote of the panel, we certified

the following question to the California Supreme Court:

Whether, under a comparative impairment

analysis, California’s or Spain’s interest is

more impaired if California’s rule that a

person may not acquire title to a stolen item

of personal property (because a thief cannot

pass good title, and California has not

adopted the doctrine of adverse possession

for personal property), were subordinated to

Spain’s rule that a person may obtain title to

stolen property by adverse possession.

Cassirer VI, 69 F.4th at 571–72.10

On August 9, 2023, the California Supreme Court

declined to answer the certified question by a 6-1 vote. We

thus resumed jurisdiction over the case. We then allowed for

the filing of supplemental briefs and amici briefs. It is now

our responsibility to determine whether, under California’s

choice-of-law test, Spain’s laws or California’s laws apply

to determine title to the Painting.

10

As described below, California’s choice-of-law test involves three

steps. In our order which certified the question to the California Supreme

Court, we concluded that Step One and Step Two were satisfied.

Cassirer VI, 69 F.4th at 563, 566. Thus, our certified question to the

California Supreme Court involved only Step Three. Id. at 561.

16 CASSIRER V. THYSSEN-BORNEMISZA COLLECTION FOUND.

II. JURISDICTION AND STANDARD OF REVIEW

The FSIA, 28 U.S.C. § 1330(a), gave the district court

original jurisdiction. We have appellate jurisdiction under 28

U.S.C. § 1291.

We review the district court’s factual findings for clear

error and its conclusions of law de novo. Kohler v. Presidio

Int’l, Inc., 782 F.3d 1064, 1068 (9th Cir. 2015).

III. ANALYSIS

California applies the “governmental interest approach”

to resolve conflict-of-law disputes. See McCann v. Foster

Wheeler, 225 P.3d 516, 527 (Cal. 2010). That test proceeds

in three steps. At Step One, a court must determine “whether

the relevant law of each of the potentially affected

jurisdictions with regard to the particular issue in question is

the same or different.” Kearney, 225 P.3d at 922. If the

relevant laws are different, the court then moves to Step

Two, under which it “examines each jurisdiction’s interest

in the application of its own law under the circumstances of

the particular case to determine whether a true conflict

exists.” Id. Finally, if there is a true conflict, the court at Step

Three “carefully evaluates and compares the nature and

strength of the interest of each jurisdiction in the application

of its own law to determine which state’s interest would be

more impaired if its policy were subordinated to the policy

of the other state.” Id. (quoting Bernhard v. Harrah’s Club,

546 P.2d 719, 723 (Cal. 1976)). After conducting this

analysis, the court “ultimately applies the law of the state

whose interest would be the more impaired if its law were

not applied.” Id.

CASSIRER V. THYSSEN-BORNEMISZA COLLECTION FOUND. 17

A. Spain’s laws and California’s laws differ with respect

to the ownership of stolen property.

All agree that the relevant Spanish law here is Article

1955 of the Spanish Civil Code. Under that provision, title

to movable goods (chattels) prescribes (is granted) to a

possessor by either (1) “three years of uninterrupted

possession in good faith,” or (2) “six years of uninterrupted

possession, without any other condition.” Spanish Civil

Code Art. 1955 (English translation). As we have explained,

the six-year prescriptive period is modified and extended by

Article 1956. See Cassirer III, 862 F.3d at 966. Applying

Article 1955 of the Spanish Civil Code to this dispute, we

have already held that TBC gained prescriptive title to the

Painting that is superior to the Cassirers’ claim of title to the

Painting under Spanish law. See Cassirer IV, 824 F. App’x

at 455–57.

Meanwhile, three California laws are relevant to this

case. First, unlike Spain, California has not expressly

adopted a doctrine of adverse possession for personal

property. Cassirer VI, 69 F.4th at 557, 562 (noting that

California “has not adopted the Spanish rule ‘that title to

chattels may pass through qualified, extended possession’”);

see S.F. Credit Clearing House v. Wells, 239 P. 319, 322

(Cal. 1925) (declining to consider whether adverse

possession “should be applied to personal property”).11

Second, California employs the common law rule that

11

On the other hand, one scholarly opinion suggests that California law

does allow a possessor to take title to personal property by prescription.

See 13 C. Witkin, Summary of California Law, Personal Property § 133

(11th ed. 2022) (explaining that California Civil Code Sections 1000 and

1007 “seem to establish the right to acquire title to personal property by

adverse possession . . . .”).

18 CASSIRER V. THYSSEN-BORNEMISZA COLLECTION FOUND.

“thieves cannot pass good title to anyone, including a good

faith purchaser.” Cassirer VI, 69 F.4th at 561 (citing Crocker

Nat’l Bank of S.F., 173 P. at 754). Third, § 338(c)(3)(A) of

the California Code of Civil Procedure extends the statute of

limitations under which a plaintiff can bring an action to

recover “a work of fine art . . . against a museum, gallery,

auctioneer, or dealer, in the case of an unlawful taking or

theft.” Although the general statute of limitations for claims

involving the return of stolen property in California is three

years, § 338(c)(3)(A) provides that an action must be

commenced “within six years of the actual discovery” of the

identity and whereabouts of the work of stolen fine art in

which the claimant asserts an interest. Cal. Code of Civ.

Proc. § 338(c)(3)(A).

In turn, the laws of Spain and California differ regarding

the particular issue in question: the ownership of stolen art.

See Cassirer VI, 69 F.4th at 562. Under Spanish law, a

possessor of stolen property can acquire prescriptive title

that is superior to the original owner’s title. In contrast, under

California law as it stands today, a possessor of stolen

property does not acquire possessory rights to stolen

property that are superior to the rights of the true owner until

the statute of limitations expires. Moreover, under Cal. Code

of Civ. Proc. § 338(c)(3)(A), the Cassirers would have a

forum to bring their claim because Claude Cassirer brought

suit in 2005, only five years after he discovered the

whereabouts of the Painting in 2000. Thus, although TBC

has acquired superior title to the Painting under Spanish law,

it has not acquired superior possession rights to the Painting

under California law. The laws of Spain and California as

applied to this case, therefore, differ.

CASSIRER V. THYSSEN-BORNEMISZA COLLECTION FOUND. 19

B. There is a true conflict between Spanish law and

California law.

A true conflict exists where each jurisdiction has a “real

and legitimate interest in having its [laws] applied under the

circumstances presented here.” McCann, 225 P.3d at 531–

32. If a jurisdiction’s interests in its laws would not be served

were its law applied, the court should apply the law of the

jurisdiction that has a real interest in the dispute. See, e.g.,

Reich v. Purcell, 432 P.2d 727, 730–31 (Cal. 1967) (holding

Missouri did not have a real interest in applying its law

regarding damages limitation with respect to an accident that

occurred in Missouri, because the defendant was a resident

of Ohio and Missouri’s interest was to shield Missouri

residents from liability). “Although the two potentially

concerned states have different laws, there is still no problem

in choosing the applicable rule of law where only one of the

states has an interest in having its law applied.” Hurtado v.

Superior Ct., 522 P.2d 666, 670 (Cal. 1974).

We have already concluded that a true conflict exists

between Spain’s and California’s interests in having their

laws applied to this case. Cassirer VI, 69 F.4th at 564.

“[B]oth Spain and California have a legitimate interest in

applying their respective laws on ownership of stolen

personal property.” Id. The property laws of Spain and

California serve each jurisdiction’s real and legitimate

governmental interests, both of which seek to “create

certainty of title, discourage theft, and encourage owners of

stolen property to seek return of their property in a timely

fashion.” Cassirer III, 862 F.3d at 964. Spanish law, for its

part, “assures Spanish residents that their title to personal

property is protected after they have possessed the property

in good faith for a set period of time,” whereas California

law seeks to deter theft, facilitate recovery for victims of

20 CASSIRER V. THYSSEN-BORNEMISZA COLLECTION FOUND.

theft, and create “an expectation that a bona fide purchaser

for value of movable property under a ‘chain of title

traceable to the thief,’ . . . does not have title to that

property.” Cassirer VI, 69 F.4th at 565 (citing Suburban

Motors, Inc. v. State Farm Mut, Auto. Ins. Co., 218 Cal. App.

3d 1354, 1259 (1990)).

Moreover, California’s 2010 enactment of §

338(c)(3)(A) evinces its “strong interest in protecting the

rightful owners of fine arts who are dispossessed of their

property.” Cassirer III, 862 F.3d at 963. California has

demonstrated a real interest in returning stolen art to victims

of theft, such as the Cassirers.

Thus, we encounter a true conflict between the laws of

Spain and California as both Spain and California have a

“real and legitimate interest[]” in applying their respective

laws to this dispute. See McCann, 225 P.3d at 531–32.

C. Spain’s governmental interests would be more

impaired by the application of California law than

would California’s interests be impaired by the

application of Spanish law.

Because such a true conflict exists, we must resolve that

conflict at Step Three of California’s choice-of-law test: the

comparative impairment analysis. Under that analysis, we

determine which jurisdiction’s interest “would be more

impaired if its policy were subordinated to the policy of the

other state.” Offshore Rental Co. v. Cont’l Oil Co., 583 P.2d

721, 726 (Cal. 1978). We then apply the law of the state

“whose interest would be the more impaired were its law not

applied.” Id.

As the California Supreme Court has instructed, our task

in applying the comparative impairment analysis “is not to

CASSIRER V. THYSSEN-BORNEMISZA COLLECTION FOUND. 21

determine whether the [Spanish] rule or the California rule

is the better or worthier rule.” See McCann, 225 P.3d at 534;

Bernhard, 546 P.2d at 724 (cleaned up) (“Emphasis is placed

on the appropriate scope of conflicting state policies rather

than on the quality of those policies.”). Instead, our task is to

decide, “in light of the legal question at issue and the relevant

state interests at stake—which jurisdiction should be

allocated the predominating lawmaking power under the

circumstances of the present case.” McCann, 225 P.3d at

534.

In making this determination, we are directed to measure

the interests of each jurisdiction based on “the circumstances

of the present case”—the facts of this particular dispute—

not the jurisdiction’s general policy goals expressed in the

laws implicated. See id. And we do not look only to the

jurisdiction’s “single subject or rule of law”; rather, we must

“identify the distinct state interests that may underlie

separate aspects of the issue in question.” Kearney, 137 P.3d

at 924; see, e.g., Hurtado, 522 P.2d at 672 (explaining that

where a state limits damages for wrongful death actions,

three distinct state interests should be evaluated under

California’s choice-of-law test: compensation for survivors,

deterrence of conduct, and limitation, or lack thereof, upon

the damages recoverable). Based on the magnitude of the

distinct state interests, as derived from the facts of the

present dispute, we can then compare the extent to which

each jurisdiction’s interests would be impaired were its law

not applied. See Kearney, 137 P.3d at 924.

In sum, our task is to compare, under the facts of this

case, (1) the extent to which Spain’s interests in providing

certainty of title to entities like TBC would be impaired by

the application of California law, and (2) the extent to which

California’s interest in deterring theft and facilitating

22 CASSIRER V. THYSSEN-BORNEMISZA COLLECTION FOUND.

recovery for victims of stolen art, like the Cassirers, would

be impaired by the application of Spanish law.

The California Supreme Court has identified several

factors to evaluate in analyzing the scope of “the distinct . . .

interests” a jurisdiction has in applying its laws to a specific

case. See id. Those factors include the “current status of a

statute,” see Offshore Rental, 583 P.2d at 726–27; the

location of the relevant transactions and conduct, see

McCann, 225 P.3d at 535–37; Offshore Rental, 583 P.2d at

728–29; Kearney, 137 P.3d at 937–38; and the extent to

which one jurisdiction’s laws either impose similar duties to

the other jurisdiction’s laws, or are accommodated by the

other jurisdiction’s laws, such that the application of the

other jurisdiction’s laws would only partially—rather than

totally—impair the interests of the state whose law is not

applied, see Bernhard, 546 P.2d at 725–26. We evaluate

each factor in turn.

1.

First, we analyze whether the policy underlying a state’s

law “is one that was much more strongly held in the past than

it is now.” Offshore Rental, 583 P.2d at 726 (citation

omitted). “[T]he current status of a statute is an important

factor to be considered in a determination of comparative

impairment.” Id. If a particular statute is “infrequently

enforced or interpreted even within its own jurisdiction,” it

has limited application in a conflict-of-laws case. Id.12

12

For example, in Offshore Rental, the California Supreme Court

considered a California cause of action for “negligent injury to a key

employee” brought by a California employer against a Delaware

corporation for an injury to an employee that occurred on the defendant’s

CASSIRER V. THYSSEN-BORNEMISZA COLLECTION FOUND. 23

The Cassirers argue that Spain’s acquisitive prescription

law is archaic, and therefore should be afforded little weight,

because (1) it is out of step with international consensus

supporting the return of Nazi-looted art, including

agreements to which Spain is a party, and (2) Spain’s six-

year acquisitive prescription law for property obtained in bad

faith is an outlier compared to other countries. That

argument fails.

First, TBC does not claim to have taken prescriptive title

under Spain’s six-year acquisitive prescription law, which

vests title after six years regardless whether the possessor

acted in good faith. Cassirer III, 862 F.3d at 966. Were that

law applied, we previously held that, pursuant to Article

1956 of the Spanish Civil Code, TBC would not have

acquired title to the Painting until 2019—six years after the

criminal and civil limitations period had run—and so the

Cassirers would have been entitled to the return of the

Painting. Id. Thus, we find irrelevant the Cassirers’

argument that Spain’s six-year acquisitive prescription for

premises in Louisiana. 583 P.2d at 722. It was unclear whether § 49 of

the California Civil Code recognized such an action. Id. at 724. The court

assumed that California did recognize the action, which it reasoned

“expresse[d] [California’s] interest in protecting California employers

from economic harm.” Id. But in applying the comparative impairment

analysis, the court discounted California’s interest because it had

“exhibited little concern” in applying the law. Id. at 728. “[N]o

California court has heretofore squarely held that California law provides

an action for harm to business employees, and no California court has

recently considered the issue at all.” Id. The court also reasoned that the

law was “archaic and isolated in the context of the laws of the federal

union.” Id (citation and quotation marks omitted). The court thus

discounted California’s interest “in the application of its unusual and

outmoded statute,” as compared to Louisiana’s more “prevalent and

progressive law” that did not recognize the cause of action. Id.

24 CASSIRER V. THYSSEN-BORNEMISZA COLLECTION FOUND.

stolen property is an “outlier compared to all of the other

jurisdictions that had contact with the Painting.” That

provision of the law is not applicable in the “present case.”

See McCann, 225 P.3d at 534. The three-year period of

Article 1955 is the basis for TBC’s claim.

Second, we reiterate the California Supreme Court’s

directive that a court’s task “is not to determine whether the

[foreign jurisdiction] rule or the California rule is the better

or worthier rule.” Id. Rather, the inquiry rests on the “relative

commitment of the respective states to the laws involved.”

Offshore Rental, 583 P.3d at 727. The Cassirers’ argument

strikes at the social worthiness of Article 1955 of the Spanish

Civil Code—an invalid basis upon which to weigh the scope

of Spain’s interests. See id.

As we have recognized, “neither jurisdiction has shown

any lack of interest in seeing its own law applied.” Cassirer

VI, 69 F.4th at 569. Spain has demonstrated a commitment

to enforcing its acquisitive prescription laws and to

legislating on the ownership of property located in its

territory. Id. And California has asserted its strong interest in

seeking justice for victims of art theft. Id. at 569 n.9. Both

California and the Kingdom of Spain filed amicus briefs

expressing their strong interests in the application of their

respective laws to this dispute.

Therefore, the relative commitment of the jurisdictions

to their laws as applied to this dispute does not favor or

disfavor the application of either jurisdiction’s laws under

the comparative impairment approach.

2.

The California Supreme Court has reasoned that the

place where the relevant conduct occurs receives significant

CASSIRER V. THYSSEN-BORNEMISZA COLLECTION FOUND. 25

weight in measuring the interests involved in the

comparative impairment analysis. Indeed, a jurisdiction

“ordinarily has the predominant interest in regulating

conduct that occurs within its borders and in being able to

assure individuals and commercial entities operating within

its territory that applicable limitations on liability set forth in

the jurisdiction’s law will be available to those individuals

and businesses in the event they are faced with litigation in

the future.” McCann, 225 P.3d at 534 (cleaned up). In such

a case, the jurisdiction has a strong interest in “establishing

a reliable rule of law” to promote predictability, to allow

actors operating within the jurisdiction’s borders reasonably

to rely on the jurisdiction’s law, and to facilitate investment

by entities operating within the jurisdiction. Id.; Offshore

Rental, 583 P.2d at 728; Kearney, 137 P.3d at 936–37.

In turn, failing to apply a jurisdiction’s laws that limit

liability with respect to conduct that occurs within its borders

will, typically, significantly impair a jurisdiction’s real and

legitimate interests in promoting reliance on its laws. See

McCann, 225 P.3d at 534–35; Kearney, 137 P.3d at 936–37.

This is particularly so when the failure to apply the

jurisdiction’s law to conduct within its borders is based

solely on the fortuity of the residence or choice of tribunal

of an adverse party. See McCann, 225 P.3d at 534–35.

In contrast, where none of the relevant conduct occurs in

California, a “restrained view of California’s interest” in

facilitating recovery for one of its residents is warranted. Id.

at 535. “[P]ast California choice-of-law decisions generally

hold that when the law of the other state limits or denies

liability for the conduct engaged in by the defendant in its

territory, that state’s interest is predominant, and

California’s legitimate interest in providing a remedy for, or

in facilitating recovery by, a current California resident

26 CASSIRER V. THYSSEN-BORNEMISZA COLLECTION FOUND.

properly must be subordinated because of this state’s

diminished authority over activity that occurs in another

state.” Id. at 536; see also Cooper v. Tokyo Elec. Power Co.

Holdings, Inc., 960 F.3d 549, 560 (9th Cir. 2020)

(“California’s courts have frequently applied foreign laws

that serve to protect businesses by limiting liability, even

when applying that law precludes recovery by injured

California residents.”).

We find McCann particularly instructive here. There, a

former Oklahoma resident was exposed to friable asbestos at

his workplace in Oklahoma. 225 P.3d at 518. The plaintiff

later moved to California and developed mesothelioma

there. Id. Breathing in friable asbestos is a known—perhaps

the only known—cause of mesothelioma. He then sued his

former employer in California state court. Id. Oklahoma’s

statute of repose would have barred the suit, but California’s

statute of limitations would not have barred the suit. Id.

Thus, a “true conflict” existed between California law and

Oklahoma law. Id. at 533.

Applying the comparative impairment analysis of

California’s choice-of-law test, the California Supreme

Court held that Oklahoma law applied and barred the

plaintiff’s suit. Id. at 537. The court concluded that “a failure

to apply Oklahoma law would significantly impair

Oklahoma’s interest,” because all relevant conduct—the

exposure to the asbestos—“occurred in Oklahoma.” Id. at

534. In so reasoning, the court stressed that a jurisdiction

“ordinarily has the predominant interest in regulating

conduct that occurs within its borders.” Id.; see also Castro

v. Budget Rent-A-Car System, Inc., 154 Cal. App. 4th 1162,

1180 (Cal. Ct. App. 2007) (reasoning that a state has a

“presumptive interest in controlling the conduct of those

persons” who engage in relevant conduct in the state and that

CASSIRER V. THYSSEN-BORNEMISZA COLLECTION FOUND. 27

a state has an interest in “not subjecting its residents and

businesses to the laws of other states that expand liability”).

Thus, applying California law would have significantly

impaired Oklahoma’s governmental interests in regulating

conduct within its borders, because doing so “would rest

solely upon the circumstance that after defendant engaged in

the allegedly tortious conduct in Oklahoma, plaintiff

happened to move to a jurisdiction whose law provides more

favorable treatment to plaintiff than that available under

Oklahoma law.” McCann, 225 P.3d at 534. The court

reasoned:

[T]he displacement of Oklahoma law

limiting liability for conduct engaged in

within Oklahoma, in favor of the law of a

jurisdiction to which a plaintiff subsequently

moved, would—notwithstanding the

innocent motivation of the move—

nonetheless significantly impair the interest

of Oklahoma served by the statute of repose.

If Oklahoma’s statute were not to be applied

because plaintiff had moved to a state with a

different and less “business-friendly” law,

Oklahoma could not provide any reasonable

assurance—either to out-of-state companies

or to Oklahoma businesses—that the time

limitation embodied in its statute would

operate to protect such businesses in the

future. Because a commercial entity

protected by the Oklahoma statute of repose

has no way of knowing or controlling where

a potential plaintiff may move in the future,

subjecting such a defendant to a different rule

28 CASSIRER V. THYSSEN-BORNEMISZA COLLECTION FOUND.

of law based upon the law of a state to which

a potential plaintiff ultimately may move

would significantly undermine Oklahoma’s

interest in establishing a reliable rule of law

governing a business’s potential liability for

conduct undertaken in Oklahoma.

Id. at 534–35 (emphases added); see also Kearney, 137 P.3d

at 937 (explaining that “Georgia has a legitimate interest in

ensuring that individuals and businesses who act in Georgia

with the reasonable expectation that Georgia law applies to

their conduct are not thereafter unexpectedly and

unforeseeably subjected to liability for such action” and

holding that “restrain[ing] the application of California law

with regard to the imposition of liability for acts that have

occurred in the past” was necessary “to accommodate

Georgia’s interest in protecting persons who acted in

Georgia in reasonable reliance on Georgia law”).

In contrast, the failure to apply California’s statute of

limitations would create “a far less significant impairment of

California’s interest,” because none of the relevant conduct

occurred in California. McCann, 225 P.3d at 535. Although

California would not be able to “extend its liberal statute of

limitations for asbestos-related injuries or illnesses to some

potential plaintiffs,” “California’s interest in applying its

laws providing a remedy to, or facilitating recovery by, a

potential plaintiff in a case in which the defendant’s

allegedly tortious conduct occurred in another state is less

than its interest when the defendant’s conduct occurred in

California.” Id. In turn, “a restrained view of California’s

interest in facilitating recovery by a current California

resident is warranted in evaluating the relative impairment

of California’s interest that would result from the failure to

CASSIRER V. THYSSEN-BORNEMISZA COLLECTION FOUND. 29

apply California law.” Id.; see also Castro, 154 Cal. App.

4th at 444 (reasoning that a California plaintiff’s “individual

financial circumstance and the possible cost to California

taxpayers and businesses [of an uncompensated loss] are . . .

not sufficient to reallocate” lawmaking power from the

jurisdiction where the conduct occurred to California).

Thus, because all relevant conduct occurred in

Oklahoma—and California’s only connection to the dispute

was the fortuitous residence of the plaintiff in California—

Oklahoma law applied under the comparative impairment

analysis. McCann, 225 P.3d at 537.

Similarly, in Offshore Rental, the California Supreme

Court—applying the comparative impairment approach—

applied Louisiana law over California law to bar a claim by

a California plaintiff relating to a physical injury that

occurred in Louisiana. 583 P.3d at 728–29. There, the

plaintiff, a California corporation, brought a negligence

action against the defendant out-of-state corporation,

seeking to recover damages that the plaintiff corporation

allegedly sustained as a result of an injury that an officer of

the corporation suffered while the officer was on the

defendant’s premises in Louisiana. Id. at 722. The California

plaintiff (the employer) sued for the value of its lost services

under a theory of “negligent injury to a key employee.” Id.

It was unclear whether California law recognized such a

claim, but Louisiana law foreclosed such a claim. Id. at 724.

The California Supreme Court held that Louisiana law

applied and barred the California plaintiff’s suit, in part

because the relevant conduct (the employee’s injury at the

defendant’s workplace) occurred in Louisiana. Id. at 728–

30 CASSIRER V. THYSSEN-BORNEMISZA COLLECTION FOUND.

29. The court affirmed the trial court’s order that had

dismissed the plaintiff’s claim, reasoning:

The accident in question occurred within

Louisiana’s borders; although the law of the

place of the wrong is not necessarily the

applicable law for all tort actions, the situs of

the injury remains a relevant consideration.

At the heart of Louisiana’s denial of liability

lies the vital interest in promoting freedom of

investment and enterprise within Louisiana’s

borders, among investors incorporated both

in Louisiana and elsewhere. The imposition

of liability on defendant, therefore, would

strike at the essence of a compelling

Louisiana law.

Id. at 728.

Based in part on the fact that the relevant conduct

occurred in Louisiana, the California Supreme Court

concluded that Louisiana’s interests would be the more

impaired if its law were not applied and, therefore, held that

Louisiana law applied. Id. at 728–29.13

In sum, California Supreme Court precedent teaches that

the place in which the relevant conduct occurs in the

particular case is a crucial factor in measuring the

jurisdictions’ relative interests under the comparative

13

As explained above, supra note 12, the California Supreme Court also

discounted California’s interest because California had “exhibited little

concern” for applying its outdated law. Id. at 728. But the fact that the

accident occurred within Louisiana’s borders, and not California’s

borders, “provide[d] additional support for our limitation of the reach of

California law in the present case.” Id.

CASSIRER V. THYSSEN-BORNEMISZA COLLECTION FOUND. 31

interest analysis. This is because a jurisdiction has a strong

interest in “establishing a reliable rule of law”—especially

one that may limit future liability—with respect to conduct

that occurs within its borders. See McCann, 225 P.3d at 535.

Furthermore, when California’s sole contact to the dispute

was the happenstance of the plaintiff’s residence there,

California’s interest in facilitating recovery for that resident

was minimal and the extraterritorial reach of its laws was

restrained. See id.

Here, as in McCann, California’s governmental interest

rests solely on the fortuity that Claude Cassirer moved to

California in 1980, at a time when the Cassirer family

believed the Painting had been lost or destroyed. See

McCann, 225 P.3d at 535. Like McCann, none of the

relevant conduct involving the Painting occurred in

California.14 See id. Moreover, although California has

evinced a strong interest in returning stolen art to victims of

theft, see Cal. Code Civ. Proc. § 338(c)(3)(A), a “restrained

view of California’s interest in facilitating recovery by a

current California resident” is warranted. See McCann, 225

P.3d at 535 (“California’s interest in applying its laws

providing a remedy to, or facilitating recovery by, a potential

plaintiff in a case in which the defendant’s allegedly tortious

conduct occurred in another state is less than its interest

when the defendant’s conduct occurred in California.”). In

sum, because no relevant conduct with respect of the

Painting occurred in California, the impairment of

California’s interest that would result from applying Spanish

14

The only conduct connected to the Painting that occurred in California

involved the sale of the Painting there in the early 1950s, when the

Painting was in California for around a year before its sale to a St. Louis

art dealer. But the parties do not claim this sale is in any manner relevant.

32 CASSIRER V. THYSSEN-BORNEMISZA COLLECTION FOUND.

law would be minimal. See id. Claude Cassirer’s decision to

move to California—a move that was unrelated to his claim

for the Painting—is “not sufficient to reallocate” lawmaking

power from Spain to California. See Castro, 154 Cal. App.

4th at 444; McGhee v. Arabian Am. Oil Co., 871 F.2d 1412,

1424 (9th Cir. 1989) (“California courts have rejected

arguments that a party’s contacts with California, unrelated

to the cause of action at hand, create a basis for extending

the reach of California’s law.”).

In contrast, applying California law would significantly

impair Spain’s interest in applying Article 1955 of the

Spanish Civil Code. For one, because the relevant conduct

(TBC’s purchase of the Painting and its display in the

museum) occurred in Spain—or at least not in California15—

McCann teaches that Spain has the “predominant interest”

in applying its laws to that conduct. See 226 P.3d at 534. As

McCann and Offshore Rental both make clear, when the

relevant conduct occurs within a jurisdiction’s borders, that

jurisdiction has a strong “interest in establishing a reliable

rule of law governing a business’s potential liability for

conduct undertaken” there. See id. at 535; Offshore Rental,

583 P.2d at 728–29 (reasoning that a jurisdiction has a “vital

interest in promoting freedom of investment and enterprise

within [its] borders”); Arno v. Club Med Inc., 22 F.3d 1464,

1469 (9th Cir. 1994) (applying French law to a vicarious-

15

Certainly, some of the Painting’s history involves jurisdictions other

than Spain: (1) the Nazis’ theft of the Painting in 1939, in Germany, (2)

the movement of the Painting into California and its sale in 1951, (3) the

sale of the painting to a St. Louis, Missouri art collector in 1952, (3) the

sale of the Painting to the Baron in New York in 1976, and (4) the

Painting’s possession and display by the Baron from 1976-1992 in

Switzerland. But no one claims that Germany, Missouri, New York, or

Switzerland has an interest in applying its laws here.

CASSIRER V. THYSSEN-BORNEMISZA COLLECTION FOUND. 33

liability claim because Guadeloupe’s interest in

“encouraging local industry . . . and reliably defining the

duties and scope of liability of an employer doing business

within its borders” would be more impaired than California’s

interest in “providing compensation to its residents” would

be impaired were its law not applied).

Moreover, applying California law based only on the

Cassirers’ choice of residence would mean that Spain could

not provide any “reasonable assurance[s]” to persons who

possess property within Spain’s borders that Article 1955

would ever protect them from replevin or damages actions

by California claimants. See McCann, 225 P.3d at 534.

Rather, applying California law would mean that Spain’s

law would not apply to property possessed within Spain’s

borders, so long as the initial owner (1) happened to be a

California resident (a fact over which, as in McCann, the

defendant has “no way of knowing or controlling,” see id. at

535), and (2) the California resident did not know where the

property is located and who possessed it—contrary to Article

1955 of the Spanish Civil Code. Applying California law

based only on Claude Cassirer’s decision to move to

California would “strike at the essence of a compelling

[Spanish] law.” See Offshore Rental, 583 P.2d at 728. And it

would contradict the principles from McCann and Offshore

Rental, which recognize the strong interest that Spain has in

ensuring its laws will predictably regulate conduct that

occurs within its borders. See McCann, 225 P.3d at 535

(“[S]ubjecting such a defendant to a different rule of law

based upon the law of a state to which a potential plaintiff

34 CASSIRER V. THYSSEN-BORNEMISZA COLLECTION FOUND.

ultimately may move would significantly undermine

Oklahoma’s interest.”).16

Finally, Spain’s interests in promoting reliance,

predictability, and investment are especially relevant under

the facts of this case, as shown by TBC requiring the Baron

to provide a three-year prenda specifically to align with

Article 1955’s prescriptive acquisition period. Applying

California law to this case would leave entities in Spain, like

TBC, unable to structure and plan their conduct in Spain in

reliance on Spain’s laws. McCann and Offshore Rental

dictate that such an outcome would significantly impair

Spain’s governmental interests.

In sum, applying California law to this dispute would

significantly impair Spain’s interests, whereas applying

Spanish law would relatively minimally impair California’s

interests.

3.

Finally, the California Supreme Court has directed that a

court applying the comparative impairment analysis should

strive for the “maximum attainment of underlying purpose

by all governmental entities.” Offshore Rental, 583 P.2d at

728 (reasoning that a court should look to “the function and

purpose of th[e] laws”). Thus, the court should look to

whether one jurisdiction’s laws accommodate the other

jurisdiction’s interests or imposes duties the other

16

We recognize that McCann and Offshore Rental involved causes of

action involving bodily injury, whereas this case involves an injury that

relates to property. See Cassirer VI, 69 F.4th at 561–62. But as in

McCann and Offshore Rental, which involved tort causes of action, the

Cassirers’ legal interests were also invaded by tortious conduct:

conversion of the Painting by the Nazis in Germany. The principles from

McCann and Offshore Rental are therefore applicable here.

CASSIRER V. THYSSEN-BORNEMISZA COLLECTION FOUND. 35

jurisdiction already imposes. See, e.g., Bernhard, 546 P.2d

at 724–26. A state’s laws can more readily be discarded if

the failure to apply its laws would only partially—rather than

totally—impair the policy interests of the jurisdiction whose

law is not applied. See Offshore Rental, 583 P.2d at 726–27.

Here, the failure to apply California’s laws would only

partially undermine California’s interests in deterring theft

and returning stolen art to victims of theft, which provides

further support for limiting the extraterritorial reach of

California’s laws to this dispute.

An example comes from Bernhard. There, a patron

became intoxicated at Harrah’s Club, a Nevada tavern

located near the California border, and thereafter was

involved in a car accident in California with a California

resident. 546 P.2d at 720. Harrah’s had advertised in

California and solicited customers in California to patronize

its business. Id. The plaintiff sued Harrah’s in California

state court for negligently serving alcohol to the patron. Id.

Nevada had a law which immunized tavern keepers from

civil liability for the negligent actions of their patrons,

whereas California did not have a law so protecting tavern

keepers. Id. Nevada law, however, imposed criminal liability

on tavern owners who served alcohol to obviously

intoxicated patrons. Id. at 725.

The California Supreme Court, applying the comparative

impairment analysis, held that California law applied, in part

because the failure to apply Nevada law would only partially

undermine Nevada’s interests, whereas the failure to apply

California’s law would significantly impede California from

effectuating its policy interests in protecting against the risks

of drunk driving. Id. at 724–26. Although the court

recognized that application of California law would result in

“an increased economic exposure” for Nevada tavern

36 CASSIRER V. THYSSEN-BORNEMISZA COLLECTION FOUND.

keepers, it explained that “Nevada’s interest in protecting its

tavern keepers from civil liability of a boundless and

unrestricted nature will not be significantly impaired when

as in the instant case liability is imposed only on those tavern

keepers who actively solicit California business.” Id. at 725.

Moreover, the California Supreme Court noted that,

since the “act of selling alcoholic beverages to obviously

intoxicated persons is already proscribed in Nevada” by

criminal law, application of California’s rule would not

impose “an entirely new duty” on Nevada tavern keepers. Id.

Because Nevada law already contemplated that tavern

keepers could be punished—albeit criminally—for serving

intoxicated persons, exposing those businesses to civil

liability would only partially undermine Nevada’s interests.

Id. Accordingly, the court concluded that California law

should be applied. Id. at 725–26.

Here too, applying Spanish law would only partially

undermine California’s interests in facilitating recovery of

stolen art for California residents. California law already

contemplates that a person whose art—or other personal

property—is stolen may eventually lose the ability to reclaim

possession: namely, if the person fails to bring a lawsuit

within six years after he discovers the whereabouts of the art.

See Cal. Code Civ. Proc. § 338(c)(3)(A). If the victim fails

to bring a lawsuit within that time, the victim loses the right

of possession because he can no longer use the judicial

process to enforce his ownership interest. See, e.g.,

Harpending v. Meyer, 55 Cal. 555, 561 (1880) (holding that

a plaintiff whose jewelry had been stolen could not recover

from a third party because the statute of limitations had

expired). And in such a case, as in Spain, the possessor

retains possession rights as against all third parties, even if

the property is stolen. See Rosenthal v. McMann, 29 P. 121,

CASSIRER V. THYSSEN-BORNEMISZA COLLECTION FOUND. 37

121–22 (Cal. 1892) (explaining that “one having the

possession, merely, is the owner as against a wrongdoer,”

and that possession “is presumed lawful, and as against a

trespasser, even one who obtained possession wrongfully

was deemed to have been lawfully possessed”); Nat’l Bank

of New Zealand, Ltd. v. Finn, 253 P. 757, 769 (Cal. Dist. Ct.

App. 1927) (noting the “general rule” is that “[a]ctual

possession of a chattel at the time of its conversion will

sustain trover, except as to the true owner or one claiming

under him, even though the title be conceded to be in a third

person” (quoting 24 Cal. Jur. § 19)); Armory v. Delamirie,

93 Eng. Rep. 664 (K.B. 1722) (holding that the finder and

possessor of property has rights superior against all but the

rightful owner).

Even under the most generous interpretation of

California’s no-title-passes-through-theft rule, then, certain

victims of theft (i.e., those who do not bring suit to recover

the chattel before the statute of limitations expires) will not

prevail against subsequent possessors of the chattel. As with

the risk of criminal liability for a tavern keeper under Nevada

law in Bernhard, California law already contemplates the

risk that certain victims of art theft will lose the right to

reclaim property. See Bernhard, 546 P.2d at 725. Thus,

failure to apply California’s laws will not absolutely

undermine California’s interest in returning stolen art to

victims of theft because California law protects the victim

only if a timely suit is filed.

Similarly, Article 1955 of the Spanish Civil Code

accommodates California’s interest in deterring theft. As we

have explained, Spanish law makes it more difficult for title

to vest in an “encubridor,” which includes, “an accessory

after the fact,” or someone who “knowingly receives and

benefits from stolen property.” Cassirer III, 862 F.3d at 968.

38 CASSIRER V. THYSSEN-BORNEMISZA COLLECTION FOUND.

If the possessor is proven to be an encubridor, Spanish law

extends the period in which the property must be possessed

before new prescriptive title is created. Id. Here, had TBC

been an encubridor, the Cassirers would have prevailed in

this action because TBC would not have gained prescriptive

title by the time the Cassirers brought their claim. See

Cassirer III, 862 F.3d at 966 (“[I]f Article 1956 applies,

TBC has not acquired prescriptive title to the Painting.”).

California’s interest in deterring passage of title through

theft has, at least in part, been protected.

In sum, applying Spain’s laws here would only partially

undermine California’s interests in deterring theft and in

returning stolen art to victims of theft.

IV. CONCLUSION

We conclude that the application of California’s laws

would significantly impair Spain’s governmental interests,

whereas the application of Spain’s laws would only

relatively minimally impair California’s governmental

interests. As a result, Spain’s interests would be more

impaired by the application of California law than would

California’s interests be impaired by the application of

Spanish law. Under California’s choice-of-law test, then, we

hold that Spanish law applies to determine ownership of the

Painting. And pursuant to Article 1955 of the Spanish Civil

Code, TBC has acquired prescriptive title to the Painting.

See Cassirer IV, 824 F. App’x at 457.

We therefore affirm the district court’s order which

granted judgment in favor of TBC.

AFFIRMED.

CASSIRER V. THYSSEN-BORNEMISZA COLLECTION FOUND. 39

CALLAHAN, Circuit Judge, concurring:

Sometimes our oaths of office and an appreciation of our

proper roles as appellate judges require that we concur in a

result at odds with our moral compass. For me, this is such

a situation. As we have previously held, the district court’s

“finding that the Baron lacked actual knowledge that the

Painting was stolen was not clearly erroneous,” and thus,

“even if the Baron’s knowledge could be imputed to TBC, it

does not cause TBC to have actual knowledge.” Cassirer v.

Thyssen-Bornemisza Collection Foundation, 824 F. App’x.

452, 456-57 (2020). Furthermore, I fully agree with the

opinion’s application of California law to the facts in this

litigation and the determination that Spain’s interests would

be more impaired if California law were applied than

California’s interests would be impaired by applying

Spanish law.

Nonetheless, I reaffirm the point we made in footnote

three of our opinion in Cassirer, 824 F. App’x. at 457.

Spain, having reaffirmed its commitment to the Washington

Principles on Nazi-Confiscate Art when it signed the Terezin

Declaration on Holocaust Era Assets and Related Issues,

should have voluntarily relinquished the Painting. However,

as we previously held, “we cannot order compliance with the

Washington Principles or the Terezin Declaration.” Id. Our

opinion is compelled by the district court’s findings of fact

and the applicable law, but I wish that it were otherwise.