Amicus Curiae Brief — Von Saher v. Norton Simon Museum of Art

No. 09-1254

In the Supreme Court of the United States

M AREI VON SAHER, PETITIONER

v.

NORTON SIMON MUSEUM OF ART AT PASADENA,

ET AL.

ON PETITION FOR A WRIT OF CERTIORARI

TO THE UNITED STATES COURT OF APPEALS

FOR THE NINTH CIRCUIT

BRIEF FOR THE UNITED STATES AS AMICUS CURIAE

NEAL KUMAR KATYAL

Acting Soiictior General

Counsel of Record

TONY WEST

Assistant Attorney General

EDWIN S. KNEEDLER

Deputy Solicitor Genera!

JEFFREY B. WALL

Assistant to the Solicitor

General

MARK B. STERN

SHARON SWINGLE

Attorneys

HAROLD HONGJU Kon Depariment of Justice

Legal Advuser Washington, D.C. 20530-0001

Department of State SupremeCtBriefs@usdo).gov

Washington, D.C. 20520-6310 (202) 514-2217

QUESTION PRESENTED

Whether the court of appeals correctly held that fed-

eral law preempts a California state statute that creates

a cause of action for the recovery of Nazi-confiscated

artwork, with an extended statute of limitations for any

such action to December 31, 2010.

(I)

TABLE OF CONTENTS

Page

interest of the United Sintes:. «.....scis ce. asaeheae eee l

CANOE og oc i cecdis eaesns ree l

DCURIION 5 6.6.50 80h5 05 c5onseeo eee 9

A. Application of Section 354.3 in this case

intrudes upon substantial foreign policy

authorities of the United States ................. 10

B. Review by this Court is not warranted

oS GE 6a i eee 20

COmeNO onc ic to's aes cnc cweaeei eee 23

TABLE OF AUTHORITIES

Cases:

Amerwan Ins. Ass'n v. Garamendi,

B59 U.S. TOG Gs) ov icddaticceae, 10, 12, 13, 14, 15, 16

Banco Nacional de Cuba v. Sabbatino,

t0 UF. DOO UO sini oder eben ee ee 12

Brotherhood of Locomotive Firemen & Enginemen

v. Bangor & Aroostook R.R., 389 U.S. 327 (1967) .... 22

Casstrer v. Kingdom of Spain, 616 F.3d 1019

(9th Cir. 2010), petition for cert. pending,

No. 10-786 (filed Dec. 10,2010) ..............0...0.. 21

Dames & Moore v. Regan, 453 U.S. 654 (1981) ...... 12,13

Deutsch v. Turner Corp., 324 F.3d 692 (9th Cir.),

cert. denied, 540 U.S. 820, and 540 U.S. 821

(BUGS). «iu vbeecyicaseetaage eel eee ete 8, 12

Diorinou v. Mezitis, 237 F.3d 133 (2d Cir. 2001) ........ 20

Dunbar v. Seger-Thomschitz, 615 F.3d 574 (5th Cir.

2010), cert. denied, 13) S. Ct. 1511 (2011) ........... 22

(IIT)

IV

Cases—Continued: Page

Hainilton-Brown Shoe Co. v. Wolf Bros. & Co.,

a 22

Japan Line, Lid. v. County of L.A, 441 U.S, 434

es yaaa paseacsseseencnesces 12

Major League Baseball Players Ass'n v. Garvey,

Ee ook sos secede rsereees seceens 22

Movsesian v. Victoria Versicherung AG:

629 F.3d 901 (9th Cir. 2010) .................... 20, 21

578 F.3d 1052 (9th Cir. 2009), withdrawn on reh’g

by 629 F.3d 901 (9th Cir. 2010) .................. 21

Museunt of Fine Arts v. Seger-Thomschitz,

623 F.3d 1 (Ist Cir. 2010), cert. denied,

I ccc ct isescerssecees 22

United States v. Pink, 315 U.S. 203 (1942) ............. 12

Ware v. Hylton, 3 U.S. (3 Dall.) 199 (1796) ............. 12

Wisniewski v. United States, 353 U.S. 901 (1957) ....... 21

Statutes:

Foreign Sovereign Immunities Act of 1976, 28 U.S.C.

ee eee ee

Cal. Civ. Proc. Code (West 2006):

Cea ia yt sin see vsdb beers ericeons

Ts cae descc sven cctererrievssecoereeens

Statute—Continued: Page

Holocaust Victim Insurance Relief Act of 1999,

Cal. Ins. Code §§ 13800-13807 (West 2005) .......... 13

Miscellaneous:

Advisory Comm. on the Assessment of Restitution

Applications for Items of Cultural Value and the

Second World War, Report 2009 ...............005. 18

Prague Holocaust Era Assets Conference:

Terazin Declaration (June 30, 2009),

http:/Avww.state.gov/p/eur/ris/or/126162.htm......... 6

Presidential Advisory Comm’n on Holocaust Assets in

the U.S., Plunder and Restitution: The U.S. and

Holocaust Victims’ Assets in the U.S. (2000) ...... 5,16

1 Restatement (Third) of Foreign Relations Law

of the United States (1987) ......... 0.00... cee. 20

Washington Conference Principles on Nazi-

Confiscated Art (Dec. 3, 1998), http://

www.state.gov/p/eur/rt/hicst/122038.htm .........05. 6

In the Supreme Court of the United States

No. 09-1254

MAREI VON SAHER, PETITIONER

Vv.

NORTON SIMON MUSEUM OF ART AT PASADENA,

ET AL.

ON PETITION FOR A WRIT OF CERTIORARI

TO THE UNITED STATES COURT OF APPEALS

FOR THE NINTH CIRCUIT

BRIEF FOR THE UNITED STATES AS AMICUS CURIAE

This brief is submitted in response to this Court’s

invitation to the Acting Solicitor General to express the

views of the United States. In the view of the United

States, the petition for a writ of certiorari should be de-

nied.

STATEMENT

1. Petitioner brought this action to recover two

paintings by Lucas Cranach the Elder (the Cranachs).

Those paintings were purchased around 1971 by the

Norton Simon Art Foundation, and they are currently

on display in the Norton Simon Museum of Art at Pasa-

dena (Norton Simon). Because the Cranachs’ post-war

history and the previous efforts by petitioner and her

predecessor to recover them matter to this case, the

government recounts that background in some detail.

(1)

2

a. The United States’ external restituiion. Peti-

tioner is the sole heir of Jacques Goudstikker, a Dutch

art dealer who purchased the paintings from the Soviet

Union in 1931. Goudstikker and his family fled the

Netherlands in 1940, following the Nazi invasion. Sub-

sequently, all of Goudstikker’s assets were forcibly sold

in two transactions: Alois Mied|, a German banker living

in the Netherlands, acquired Goudstikker’s art dealer-

ship and certain real and personal property for 550,000

guilders (or about $4.5 million today); and Hermann

Goring, Reichsmarschall of the Third Reich, acquired

the bulk of Goudstikker’s art collection, which contained

over 1,000 artworks and included the Cranachs, for 2

million guilders (or about $16.5 million today). In May

1945, the Cranachs and Goudstikker’s other paintings

were recovered by the United States Army. In 1946, the

United States returned all of the paintings to the Dutch

government, pursuant to a policy of “external restitu-

tion.” Under that policy, the United States returned

property taken by the Nazis and recovered by Allied

forces, including artworks like the Cranachs, to their

countries of origin rather than directly to particular

claimed owners. Pet. App. 5a, 8a-10a; see C.A. E.R. 45.

The policy of external restitution was an outgrowth

of the London Declaration of January 5, 1943, in which

the Allied nations—including the United States and the

Netherlands—reserved the right to invalidate wartime

transfers of property. In November 1943, the State De-

partment established an Interdivisional Committee on

Reparations, Restitution, and Property Rights, which

determined that property taken by the Nazis should be

turned over to its country of origin, with the expectation

that the country of origin would return the property to

its lawful owners. The Committee foresaw that once the

3

external restitution had been made, the United States

would play no further role in disposition of the property.

On July 29, 1945, President Truman approved that pol-

icy at the Potsdam Conference, and thereafter American

occupying forces implemented the policy under the or-

der of General Eisenhower. The United States set a

three-year deadline for filing claims, and it declined to

accept any claims for external restitution after Septem-

ber 15, 1948. Pet. App. 15a-18a.

b. The Netherlands’ interna! restitution. In 1946,

Goudstikker’s widow returned to the Netherlands and

began attempting to recover her family’s property. Un-

der Dutch law, claimants were given until July 1, 1951,

to file a restitution petition, and claimants who had re-

ceived money in forced sales generally were required to

turn over those proceeds to the Dutch government as a

condition of receiving their property. C.A. E.R. 23, 48.

After negotiating with the Dutch government for several

years, Ms. Goudstikker filed a timely petition in 1951

and subsequently entered into a settlement agreement

on August 1, 1952. Jd. at 47-48. Under that agreement,

Ms. Goudstikker received most of the real and personal

property acquired by Mied! in exchange for returning a

portion of the money paid by MiedI and relinquishing

claims to the remaining property transferred in the

Mied] transaction. /d. at 48, 52-53. The agreement did

not, however, encompass the artworks acquired by

Goring, and the Dutch-imposed deadline for filing resti-

tution claims lapsed. /d. at 48-49; see C.A. Supp. E.R.

151-152.

In 1961, George Stroganoff-Scherbatoff (Stroganoff),

heir to the Stroganoff family, instituted a restitution

proceeding in the Netherlands for the Cranachs and

other paintings. C.A. E.R. 282. Stroganoff asserted

4

that the paintings had been seized from his family by the

Soviet Union and unlawfully auctioned to Goudstikker.

Id. at 279, 282. In July 1966, the Dutch government

transferred the Cranachs and another painting to Stro-

ganoff in settlement of his claim and in exchange for a

monetary payment. /d. at 282. Around 1971, Stroganoff

sold the Cranachs to the Norton Simon Art Foundation.

Id. at 283.

c. Petitioner's 1998 restitution proceeding. In 1996,

after Ms. Goudstikker and her son had died, petitioner

(her daughter-in-law) was left as the sole heir. C.A.

E.R. 283. In 1998, petitioner filed a claim with the

Dutch State Secretary for Education, Culture, and Sci-

ence, in which petitioner requested two things: “all

properties that Hermann Goring obtained from [Goud-

stikker] and over which the State has gained control,”

and the “sales prices” for any such property sold by the

State. C.A. Supp. E.R. 147-148. Petitioner’s claim thus

included the Cranachs, which had been sold to Stroga-

noff in 1966 in settlement of his claim. C.A. E.R. 282.

The State Secretary rejected petitioner’s claim as

barred by the Dutch statute of limitations on restitution

claims, which he declined to waive, finding that “directly

after the war—even under present standards—the res-

toration of rights was conducted carefully.” C.A. Supp.

fe.R. 147.

Petitioner sought review of that decision in the Court

of Appeals for the Hague, which likewise declined to

grant relief. See C.A. Supp. E.R. 145-153.' The court

' Petitioner contends that the Court of Appeals decided the case only

on procedural and jurisdictional grounds. That does not appear to be

correct. The court did hold that it could not decide petitioner's claim as

an appeal from the State Secretary’s decision (because the State Sec-

retary was not a judicial division), see C.A. Supp. E.R. 148-150, or as a

“{took] into consideration that nearly 50 years have now

elapsed since the last moment that an application for the

restoration of rights could be submitted.” /d. at 150. In

addition, the court concluded, Ms. Goudstikker “made a

conscious and well considered decision to refrain from

asking for restoration of rights with respect to the

Goring transaction.” /d. at 151. The court rejected peti-

tioner’s argument that Ms. Goudstikker’s failure to seek

restoration of rights should be excused because she had

been misled by Dutch authorities about the nature of the

Goring transaction and the value of the paintings. The

court pointed out that Ms. Goudstikker had “expert Je-

gal advisors” who could have argued that the transaction

was involuntary and that she could have requested her

own expert appraisal. /d. at 152. Finally, the court

found that the original restitution proceedings did not

violate international law, because “[t]he Netherlands

created an adequately guaranteed procedure for han-

dling applications for the restoration of rights.” /bid.

d. The United States’ modern policy. A number of

problems emerged with post-war restitution policy,” and

as a result, impetus developed for a more equitable ap-

proach to recovery of Nazi-looted art. In response, the

direct restitution proceeding (because the claim was filed after July 1,

1951, and was thus time-barred), see id. at 15). The court then further

held, however, that it would not exercise its power ‘to grant ex officio

restoration of rights.” /d. at 152. In that portion of its opinion, the

court made clear that it could grant petitioner relief, id. at 151, although

it declined to do so on the ground that Ms. Goudstikker had voluntarily

forgone the claim in the early 1950s. See td. at 151-152; see also C.A.

E.R. 61.

* See Presidential Advisory Comm'non Holocaust Assets in the US.,

Plunder and Restitution: The U.S. and Holocaust Victims’ Assets at

SR-140 (2000) (PCHA Report).

6

United States convened a Conference on Holocaust-Era

Assets in Washington in 1998. At that Conference, rep-

resentatives of 13 nongovernmental organizations and

44 governments, including the United States and the

Netherlands, reached consensus on the Washington

Conference Principles on Nazi-Confiscated Art (Wash-

ington Principles). That set of 11 “non-binding princi-

ples” is designed “to assist in resolving issues relating to

Nazi-confiscated art,” “recogniz[ing] that among partici-

pating nations there are differing legal systems and that

countries act within the context of their own laws.”

Washington Conference Principles on Nazi-Confiscated

Art (Dec. 3, 1998), http://www.state.gov/p/eur/rt/hlest/

122038. htm. In general, the Washington Principles en-

courage national efforts to identify art taken by the Na-

zis and not subsequently restituted, to publicize the exis-

tence of such art, and to restitute it to its pre-war own-

ers.

In June 2009, representatives of 46 governments,

including the United States and the Netherlands, reaf-

firmed the Washington Principles in the Terezin Decla-

ration. That “legally non-binding” Declaration “urge([d]

all stakeholders to ensure that their legal systems or

alternative processes * * * facilitate just and fair solu-

tions with regard to Nazi-confiscated and looted art, and

to make certain that claims to recover such art are re-

solved expeditiously and based on the facts and merits

of the claims.” Prague Holocaust Era Assets Confer-

ence: Terezin Declaration (June 30, 2009), http://www.

state.gov/p/eur/rls/or/126162.htm. Thus, as more fully

elaborated below, see p. 18, infra, contemporary U.S.

policy supports the fair and just resolution of claims

involving Nazi-confiscated art, while also respecting the

ov

f

bona fide internal restitution proceedings of foreign gov-

ernments.

e. Petitioner’s 2004 restitution proceeding. From

2000 to 2001, in part in response to the Washington

Principles, the Dutch government “decided to depart

from a purely legal approach [to] the restitution of ‘war

art’ and to choose a more moral policy approach,” and on

that basis it adopted an extended restitution policy.

C.A. E.R. 60. In 2004, petitioner filed an application for

the return of all artworks formerly owned by

Goudstikker that were then in the Dutch government's

possession. See id. at 41. After referring the matter to

the Restitutions Committee, the State Secretary deter-

mined that petitioner’s application involved “a matter of

restoration of rights which has been settled,” because

“{iJn 1999 the Hague Court of Appeal * * * gavea final

decision in this case.” /d. at 62. For that reason, the

State Secretary explained, “this case is not included in

the [Dutch government's} current restitution policy.”

Ibid.

The State Secretary nevertheless dec.ded “that in

this special case there are grounds that justify a restitu-

tion” of artworks still in the Dutch government’s posses-

sion, based on “the facts and circumstances surrounding

the involuntary loss of property and the manner in

which the matter was dealt with in the early Fifties.”

C.A. E.R. 62. The State Secretary therefore ordered

the transfer to petitioner of more than 200 artworks.

The State Secretary did not require petitioner to repay

any portion of the two million guilders received from

Goring. /d. at 62-63. And the State Secretary did not

address paintings, like the Cranachs, that were no lon-

ger in the government's possession.

8

2. In 2002, California enacted Section 354.3 of its

Code of Civil Procedure, which provides:

Notwithstanding any other provision of law, any

owner, or heir or beneficiary of an owner, of Holo-

caust-era artwork, may bring an action to recover

Holocaust-era artwork from any entity.

Cal. Civ. Proc. Code § 354.3(b) (West 2006). The stat-

ute defines an “[e]ntity” as “any museum or gallery

that displays, exhibits, or sei!s any article of historical,

interpretive, scientific, or artistic significance.” /d.

§ 354.3(a)(1). It defines “Holocaust-era artwork” as

“any article of artistic significance taken as a result of

Nazi persecution during the period of 1929 to 1945." 7d.

§ 354.3(a)(2). Finally, the statute provides that “[aJny

action brought under this section shall not be dismissed

for fatlure to comply with the applicable statute of limi-

tation, if the action is commenced on or before Decem-

ber 31, 2010.” /d. § 354.3(c).

3. In 2007, petitioner, a resident of Connecticut,

brought this action in federal district court in California,

seeking recovery of the Cranachs from Norton Simon.

See C.A. E.R. 276-288.

a. The district court granted Norton Simon's motion

to dismiss. Pet. App. 75a-83a. The court held that “by

enacting Section 354.3, ‘California seeks to redress

wrongs committed in the course of the Second World

War’—a legislative act which ‘intrudes on the federal

government's exclusive power to make and resolve war,

including the procedure for resolving war claims.’" /d.

at 8la (quoting Deutsch v. Turner Corp., 324 F.3d 692,

712 (9th Cir.), cert. denied, 540 U.S. 820, and 540 U.S.

821 (2003)). The court further held that in the absence

of Section 354.3’s extended statute of limitations, peti-

9

tioner’s claim was untimely under California's general

three-year statute of limitations governing “actions for

the specific recovery of personal property.” /d. at 82a

(quoting Cal. Civ. Proc. Code § 338(c) (West 2006)).

b. The court of appeals affirmed in part and re-

versed in part. Pet. App. la-38a. The court concluded

that Section 354.3 does not conflict with “the federal gov-

ernment’'s policy of external restitution,” because that

policy “ended in 1948” and “Section 354.3 cannot conflict

with or stand as an obstacle to a policy that is no longer

in effect.” Jd. at 18a-19a. The court held, however, that

Section 354.3 is preempted because “the power to legis-

late restitution and reparation claims(] is one that has

been exclusively reserved to the national government by

the Constitution.” /d. at 28a. The court further held

that petitioner's claim might be timely under the statute

of limitations for actions seeking recovery of personal

property, and it remanded to determine when petitioner

“discovered or reasonably could have discovered her

claim to the Cranachs.” /d. at 33a.

Judge Pregerson dissented in part, concluding that

Section 354.3 is not preempted by the federal govern-

ment’s foreign affairs powers. Pet. App. 36a-38a.

DISCUSSION

The court of appeals correctly held that the invoca-

tion in this case of California Code of Civil Procedure

§ 354.3, which creates a cause of action with an extended

statute of limitations for recovery of Nazi-confiscated

art wherever it is located, impermissibly intrudes upon

the foreign affairs authorities of the federal government.

Review of that decision is not warranted, esrecially at

this interlocutory stage of the case. No other court of

appeals has addressed whether a State may create a

10

cause of action with an extended statute of limitations

specifically for the recovery of Nazi-confiscated art.

Section 354.3’s limitations period expired on December

31, 2010, and the parties identify only one other pending

case brought under Section 354.3. And the decision be-

iow may not matter even in this case, because the case

was remanded to determine whether petitioner's claim

is timely under another statute of limitations. If peti-

tioner does not prevail on remand, she may seek this

Court's review after a final judg:nent.

A. Application Of Section 354.3 In This Case Intrudes Upon

Substantial Foreign Policy Authorities Of The United

States

This case does not involve the application of a state

statute or common law of general applicability that ad-

dresses matters of traditional state interest and only

incidentally touches on foreign affairs prerogatives of

the United States Government. Rather, this case in-

volves a state statute that is specifically and purpose-

fully directed at claims arising out of transactions and

events that occurred in Europe during the Nazi era, that

in many cases were addressed in the post-War period by

the United States and European Governments, and that

in this case have been further addressed by the Nether-

lands in restitution proceedings in recent years. In

these circumstances, petitioner cannot now rely on Sec-

tion 354.3 in an effort to recover the Cranachs.

1. a. The court of appeals rejected petitioner's argu-

ment that Section 354.3 concerns a “traditional state

responsibility,” Pet. App. 20a (quoting American /ns.

Ass'n v. Garamendi, 539 U.S. 396, 419 n.11 (2003))

—namely, “the establishment of a statute of limitations

for actions seeking the return of stolen property,” 7d. at

1]

21a. As the court explained, “(Section] 354.3 cannot be

fairly characterized as a garden variety property regula-

tion. Section 354.3 does not apply to all claims of stolen

art, or even all claims of art looted in war. The statute

addresses only the claims of Holocaust victims and their

heirs.” /bid. Thus, the court observed, although Section

354.3 “purports to regulate property, an area tradition-

ally left to the [S}tates,” its “real purpose is to provide

relief to Holocaust victims and their heirs.” /d. at

21a-22a.

The court of appeals emphasized in this regard that

Section 354.3 is not limited to regulating museums and

galleries in California. Pet. App. 23a. As petitioner ac-

knowledges (Pet. 17-19), that geographic limitation was

eliminated from the provision prior to enactment for the

specific purpose of extending its reach to any museum

over which California courts could obtain jurisdiction,

regardless of whether the artwork at issue had entered

California. Pet. App. 23a. Indeed, in what is apparently

the only other pending case under Section 354.3, the

museum and artwork are both located in Spain. See

p. 21, infra. Nor is Section 354.3 limited to suits

brought by California residents. In fact, petitioner is a

resident of Connecticut. See C.A. E.R. 277.

The court of appeals therefore reasonably deter-

mined that Section 354.3’s broad scope “belies Califor-

nia's purported interest in protecting its residents and

regulating its art trade,” and instead “suggests that Cali-

fornia’s real purpose was to create a friendly forum for

litigating Holocaust restitution claims, open to anyone in

the world to sue a museum or gallery located within or

without the [S]tate.” Pet. App. 23a. That, the court ex-

plained, “is not an area of ‘traditional state responsibil-

ity.’” Jd. at 25a. The court of appeals then concluded

12

that, in thus moving beyond its traditional responsibili-

ties and enacting a measure specifically directed at

claims arising out of transactions and events in Europe

during the Nazi era—by providing its own means of

“restitution for injuries inflicted by the Nazi regime,”

id. at 28a—California had impermissibly intruded on the

United States’ foreign affairs prerogatives. Jd. at

25a-30a.

b. As this Court has emphasized, “[i]n international

relations * * * the people of the United States act

through a single government with unified and adequate

national power.” Japan Line, Ltd. v. County of L.A.,

441 U.S. 434, 448 (1979) (citation omitted). It necessar-

ily follows that “[pJower over external affairs is not

shared by the States,” but instead “is vested in the na-

tional government exclusively.” United States v. Pink,

315 U.S. 203, 233 (1942); see Garamendi, 539 U.S. at

413; Banco Nacional de Cuba v. Sabbatino, 376 U.S.

398, 427 n.25 (1964).

The federal government has traditionally exercised

its foreign relations and war powers with respect to the

resolution of private parties’ claims arising out of inter-

national disputes. See, e.g., Dames & Moore v. Regan,

453 U.S. 654, 679 (1981) (“[T}he United States has re-

peatedly exercised its sovereign authority to settle the

claims of its nationals against foreign countries.”); Pink,

315 U.S. at 240 (Frankfurter, J., concurring) (“That the

President’s control of foreign relations includes the set-

tlement of claims is indisputable.”); Ware v. Hylton,

3 U.S. (3 Dall.) 199, 230 (1796); Deutsch v. Turner Corp.,

324 F.3d 692, 712-714 (9th Cir.) (“(T]he Constitution

allocates the power over foreign affairs to the federal

government exclusively, and the power to make and re-

solve war, including the authority to resolve war claims,

13

is central to the foreign affairs power in the constitu-

tional design.”), cert. denied, 540 U.S. 820, and 540 U.S.

821 (2003).

There accordingly is considerable force to the court

of appeals’ view that, by targeting the claims of Holo-

caust survivors and their heirs to Nazi-confiscated art,

rather than merely applying to such claims a law of gen-

eral applicability, California has impermissibly intruded

upon foreign affairs prerogatives of the federal govern-

ment. The President and Congress have the sole au-

thority to resolve (or to establish mechanisms to resolve)

the claims of U.S. nationals when their claims are sin-

gled out precisely because they arise out of such interna-

tional incidents. See, e.g., Dames & Moore, 453 U.S. at

679. The same would seem to be true of singling out for

resolution the claims of foreign nationals (or the heirs of

foreign nationals) because they arise out of international

incidents.

2. There is no occasion in this case, however, to con-

sider the preemptive force of the foregoing general prin-

ciples standing alone, because petitioner's present suit

under Section 354.3 raises particular inconsistencies

with implementation of restitution policies to which the

United States has adhered.

a. In Garamendi, this Court considered California’s

Holocaust Victim Insurance Relief Act of 1999 (HVIRA),

Cal. Ins. Code §§ 13800-13807 (West 2005), which re-

quired any insurer doing business in the State to dis-

close certain information about Holocaust-era insurance

policies. See 539 U.S. at 401. The Court regarded as

beyond dispute that “at some point an exercise of state

power that touches on foreign relations must yield to the

National Government's policy,” in light of the Constitu-

tion’s allocation of the foreign relations power to the

14

United States rather than the several States. /d. at 413.

The Court further observed that, “[hJistorically, war-

time claims against even nominally private entities have

become issues in international diplomacy,” because

“diplomatic action settling claims against private parties

may well be just as essential in the aftermath of hostili-

ties as diplomacy to settle claims against foreign govern-

ments.” /d. at 416.

In recognition of the various contexts in which issues

concerning preemption of state laws affecting foreign

affairs may arise, the Court questioned whether it is

necessary to make “a categorical choice between the

contrasting theories of field and conflict preemption.”

Garamendi, 539 U.S. at 419. Rather, the Court sug-

gested that those theories “can be seen as complemen-

tary,” depending on whether a State has acted within an

area of traditional responsibility. /d. at 419 n.11. “Ifa

State were simply to take a position on a matter of for-

eign policy with no serious claim to be addressing a tra-

ditional state responsibility,” the Court indicated, “field

preemption might be the appropriate doctrine.” /bid.

But if a State has acted in an area of traditional respon-

sibility in a way that affects foreign relations, “it might

make good sense to require a conflict, of a clarity or sub-

stantiality that would vary” with the strength and na-

ture of the asserted state interest and possibly also the

federal interest. /bid.

The Court did not, however, decide any question of

field preemption, because it found “a sufficiently clear

conflict” between HVIRA and “express foreign policy of

the National Government.” Garamendi, 539 U.S. at 420.

The Court recognized that “[t)he issue of restitution for

Nazi crimes has in fact been addressed in Executive

Branch diplomacy and formalized in treaties and execu-

15

tive agreements over the last half century, and * * *

securing private interests is an express object of diplo-

macy today.” /d. at 420-421. After surveying how that

federal foreign policy has treated disclosure by insurers,

the Court determined that “California has taken a dif-

ferent tack of providing regulatory sanctions to compel

disclosure and payment, supplemented by a new cause

of action for Holocaust survivors if the other sanctions

should fail.” /d. at 423. The Court concluded that even

“{i]f any doubt about the clarity of the conflict remained,

* * * it would have to be resolved in the National Gov-

ernment'’s favor, given the weakness of the State’s inter-

est * * * in regulating disclosure of European

Holocaust-era insurance policies.” /d. at 425.

b. Somewhat similar considerations are present

here. Unlike in Garamendi, the United States has not

entered into Executive Agreements with foreign govern-

ments to resolve contemporary claims for Holocaust art,

and it has supported the just and equitable resolution of

claims from that era. But as the court of appeals noted,

like HVIRA in Garamendi, Section 354.3 is not a statute

of general applicability directed to matters of traditional

state interest. Pet. App. 21a-25a. Although petitioner

asserts (Pet. 19) that Section 354.3 is directed to a state

interest in regulating entities that currently avail them-

selves of the privilege of transacting business in Califor-

nia, the provision in fact is expressly targeted at claims

to artworks that were seized prior to and during World

War II (including, as here, artworks that later were the

subject of restitution proceedings by European govern-

ments). In Garamendi, the Court rejected California's

similar effort to justify HVIRA as a regulation of the

current business activities of insurers in the State, ex-

plaining that “quite unlike a generally applicable ‘blue

16

sky’ law, HVIRA effectively singles out only policies

issued by European companies, in Europe, to European

residents, at least 55 years ago.” 539 U.S. at 425-426.

Accordingly, Section 354.3 is reasonably viewed as an

effort by California to “create a friendly forum for liti-

gating Holocaust restitution claims, open to anyone in

the world to sue a museum or gallery located within or

without the [S]tate.” Pet. App. 23a. And by providing

“a new cause of action,” Garamendi, 539 U.S. at 423,

with an extended statute of limitations for claimants of

Holocaust-era artwork, California has, as in Garamendi,

“expressed its dissatisfaction with the federal govern-

ment’s resolution (or lack thereof) of restitution claims

arising out of World War II.” Pet. App. 24a.

Notably, moreover, this case concerns artworks and

transactions that, consistent with U.S. policies, have

already been the subject of both external and internal

restitution proceedings, including recent proceedings by

the Netherlands in response to the Washington Princi

ples. This case does not involve artwork whose exis-

tence or provenance has only recently been discovered

and has never been the subject of restitution proceed-

ings. The Cranachs were transferred by the United

States to the Netherlands in 1946 pursuant to the policy

of external restitution. Pet. App. 5a, 9a-10a; see C.A.

H.R. 45. One of the purposes of that policy at the time

was to prevent the United States from becoming entan-

gled in difficult ownership questions regarding confis-

cated property. See PCHA Report at SR-140. That pol-

icy judgment demonstrates that, from the perspective of

the United States, it was the particular nation concerned

(here, the Netherlands) that was to have the immediate

responsibility for determining issues of ownership and

17

restitution of, or restoration of rights in, works like the

Cranachs.

The court of appeals erred in dismissing the external

restitution policy as irrelevant to this case because it

“ended” on September 15, 1948—the deadline set by the

United States for filing restitution claims. Pet. App.

18a. The United States established a deadline to ensure

prompt submission of claims and achieve finality in the

wartime restitution process. The United States has a

continuing interest in that finality when appropriate

actions have been taken by a foreign government con-

cerning the internal restitution of art that was exter-

nally restituted to it by the United States following

World War IT.°

In this case, Ms. Goudstikker settled with the Dutch

government in 1952, and that settlement did not provide

for the return of artworks like the Cranachs that had

been acquired by Goring. C.A. E.R. 47-49. When peti-

tioner brought a Dutch restitution proceeding in 1998,

the State Secretary found that “directly after the

war—even under present standards—the restoration of

rights was conducted carefuliy.” C.A. Supp. E.R. 147.

Petitioner sought review of that decision in the Court of

Appeals for the Hague, which found that at the time of

the 1952 settlement Ms. Goudstikker “made a conscious

and well considered decision to refrain from asking for

restoration of rights with respect to the Goring transac-

tion.” /d. at 151.

oo

* The United States does not contend that the fact that the Cranachs

were returned to the Dutch government pursuant to the externa) resti-

tution policy would be sufficient of its own force to bar litigation if, for

example, the Cranachs had not been subject (or potentially subject) to

bona fide interna] restitution proceedings in the Netherlands.

18

Petitioner correctly observes (Pet. 24-25) that there

are other relevant aspects of federal policy regarding

Nazi-confiscated art that the court of appeals did not

discuss. In 1998 and 2009, respectively, the United

States endorsed the Washington Principles and the

Terezin Declaration. See p. 6, supra; Pet. App. 29a.

The Washington Principles generally encourage the re-

turn to its pre-war owner of art that was confiscated by

the Nazis and not subsequently restituted or available to

be restituted through bona fide proceedings. And the

Terezin Declaration encourages those restitution pro-

ceedings to be conducted expeditiously, based on the

facts and merits of the Holocaust victims’ claims.

Petitioner is thus correct that it is United States pol-

icy to support both the just and fair resolution of claims

to Nazi-confiscated art on the merits and the return of

such art to its rightful owner. But that policy does not

support relitigation of all art claims in U.S. courts. Nei-

ther the Washington Principles nor the Terezin Declara-

tion takes an explicit position in favor of or against the

litigation of claims to Nazi-confiscated art. Rather, they

encourage resort to alternative dispute resolution, so

that such claims may be resolved as justly, fairly, and

expeditiously as possible.

The recent expanded restitution policy in the Neth-

erlands is an example of a non-adversarial mechanism

developed by a foreign nation in light of the Washington

Principles. The Dutch government “decided to depart

from a purely legal approach [to] the restitution of ‘war

art’ and to choose a more moral policy approach.” C.A.

E.R. 60. But even under that approach, the Dutch gov-

ernment has not provided for damages claims for art-

work that it previously sold or transferred to third par-

ties. See Advisory Comm. on the Assessment of Restitu-

19

tion Applications for Items of Cultural Value and the

Second World War, Report 2009, at 71 (May 2010),

http://www. restitutiecommissie.nl//images/stories/files/

report2009-met%20wijz.b6.pdf (providing for restitution

only of items in the Dutch government’s possession).

Nor does the Dutch government otherwise review claims

for artwork that is in private possession, unless both the

claimant and the current possessor submit a joint re-

quest to the State Secretary. See ibid.

In 2004, petitioner brought another restitution pro-

ceeding in the Netherlands, and the State Secretary

determined that the case was “not included in the

[Dutch government’s] current restitution policy” be-

cause it involved a “matter of restoration of rights which

has been settled” and “[i]n 1999 the Hague Court of Ap-

peal * * * gavea final decision in the case.” C.A. E.R.

62. The State Secretary nonetheless decided “that in

this special case there [were] grounds that justified} a

restitution,” based on “the facts and circumstances sur-

rounding the involuntary loss of property and the man-

ner in which the matter was dealt with in the early Fif-

ties.” /bid. The State Secretary therefore ordered the

return to petitioner of more than 200 artworks in the

Dutch government’s possession.

As both the 1998 and 2004 restitution proceedings

reflect, the Dutch government has afforded petitioner

and her predecessor adequate opportunity to press their

claims, both after the War and more recently. Whena

foreign nation, like the Netherlands here, has conducted

bona fide post-war internal restitution proceedings fol-

lowing the return of Nazi-confiscated art to that nation

under the external restitution policy, the United States

has a substantial interest in respecting the outcome of

that nation's proceedings.

20

c. The act of state doctrine and considerations of

international comity, although not directly applicable at

this stage of the proceedings, also weigh in favor of giv-

ing effect to the Dutch government’s actions in this case

See, e.g., Diorinou v. Mezitis, 237 F.3d 133, 140-141 (2d

Cir. 2001); 1 Restatement (Third) of Foreign Relations

Law of the United States, §§ 481-482 (1987) (providing

for recognition in certain circumstances of foreign judg-

ments denying recovery of monetary sums). Recogni-

tion of the actions of the Dutch government is a defense

distinct from preemption, cf. 7d. § 481, comment b, but

the existence of a defense based on such actions shows

that petitioner’s suit under Section 354.3 implicates sub-

stantial foreign affairs interests of the United States.

B. Review By This Court Is Not Warranted At This Time

The court of appeals’ decision does not warrant re-

view at this time for four reasons. First, no other court

of appeals has addressed whether a State may create a

cause of action (with its own extended statute of limita-

tions) for the recovery of Nazi-confiscated art, including

art that has been the subject of bona fide internal resti-

tution proceedings. Petitioner does not contend other-

wise. Petitioner does argue (Pet. 9-16) that the court of

appeals’ decision conflicts with Garamendt's analysis of

field preemption. But as explained above, this case does

not present a suitable occasion for addressing that broad

question in light of the inconsistencies between this suit

under Section 354.3 and the implementation of restitu-

tion policies to which the United States has adhered.*

* Petitioner argues in a supp!emental brief that the court of appeals’

decision in Movsestan v. Victoria Versicherung AG, 629 F.3d 901

(9th Cir. 2010), supports review by this Court. Movsesian concerned

Cal. Civ. Proc. Code § 354.4 (West 2006), which creates a cause of action

a |

Second, the question whether Section 354.3 is pre-

empted is not of any continuing importance. Section

354.3’s extended statute of limitations expired on De-

cember 31, 2010, and the parties identify only one other

pending case brought under Section 354.3, Cassirer v.

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

banc), petition for cert. pending, No. 10-786 (filed Dec.

10, 2010). In Casstrer, neither the Kingdom of Spain nor

the Thyssen-Bornemisza Collection Foundation thus far

has raised a preemption defense. See id. at 1022.°

Third, the court of appeals’ preemption holding may

not be decisive even in this very case, because that court

and extends the statute of limitations for California residents with

insurance claims amsing out of the “Armenian Genocide.” /did The

court of appeals initially found Section 354.4 invalid as a matter of

conflict preemption, see Movsesian v. Victona Versicherung AG, 578

F.3d 1052, 1059 (9th Cir. 2009), but on rehearing the panel reversed

course and held that there is no clear federal policy with respect to

recognition of that event in Armenian history, see 629 F.3d at 907.

Regardless of whether there is a federal policy in that context, here the

artworks that are the subject of petitioner's claim have already been

subject to both external and internal restitution proceedings, consistent

with United States policy. But to the extent there is any intracircuit

disagreement between the decision below and Movsesian, that issue

does not merit this Court's review. See Wisniewski v. Unued Slates,

353 U.S. 901, 902 (1957) (per curiam). Both the decision below and

Movsestan are interlocutory, and the en banc court of appeals can

resolve any tension between those decisions.

* The petitioners in Cassi7er have asserted sovereign immunity, but

the Ninth Circuit allowed the action to proceed under the “expropria-

tion” exception in the Foreign Sovereign Immunities Act of 1976,

28 U.S.C. 1605(a)(3). 616 F.3d at 1022. Thus, if this Court were to

grant certiorari in Casstrer, it would not affect the decision below. On

March 2], 2011, the Court invited the Acting Solicitor General to file a

brief as amicus curiae expressing the views of the United States in

Casstrer

Oy

ees toe

remanded to determine whether petitioner’s claim is

timely under another California statute of limitations for

actions to recover persenal property. Pet. App. 34a-35a.

It is thus possible that on remand petitioner's action wil!

be deemed timely. Two courts of appeals have held that

application of general state statutes of limitations to

claims seeking recovery of Holocaust-era artwork does

not impermissibly intrude upon federal foreign affairs

authorities. See Museum of Fine Arts v. Seger-

Thomschitz, 623 F.3d 1, 12-13 (1st Cir. 2010), cert. de-

nied, 1381 S. Ct. 1612 (2011); Dunbar v. Seger-

Thomschitz, 615 F.3d 574, 578-579 (5th Cir. 2010), cert.

denied, 131 S. Ct. 1511 (2011).

Fourth and finally, the interlocutory posture of this

case “alone furnishe[s] sufficient ground for the denial”

of certiorari. Hamilton-Brown Shoe Co. v. Wolf Bros. &

Co., 240 U.S. 251, 258 (1916); see Brotherhood of Loco-

motive Firemen & Enginemen v. Bangor & Aroostook

R.R., 389 U.S. 327, 328 (1967) (per curiam). Even if is-

sues concerning the preemption of Section 354.3 might

otherwise warrant review at some point, the Court, in

the interest of judicial economy, should postpone any

review until after the conclusion of the proceedings on

remand, thereby permitting the Court to consider all of

petitioner’s contentions, including any that might arise

on remand, in a single petition. See Major League Base-

ball Players Ass'n v. Garvey, 532 U.S. 504, 508 n.1

(2001). Review by this Court would be premature at this

juncture.

CONCLUSION

11 - . « . :

nO TY .euf m 7 ss | ULF 7 , v2) rArarTry) r " +

1 bak DeCvuiL on 1LOF c Wil of certi ae A Ja) 4 A wt

¢f 1} +¢ }

.° rr ry)

rmespectiully OTT Lea

. Adi nen pp? © an wen

Assistant Altorney Generu

JEFFREY B. WALL

Assistant to the Solrct

General

HAROLD HONGJU A MARK B. STERN

Legal Adutser SHARON SWING!

- ; ; / ‘ Pe | + 4

Department of ota Attorneys

, >

MAY ,