Toren Amends Complaint Against Bavaria Over Liebermann Seized from Gurlitt, Spotlights Task Force Recommendation of Restitution in Support of Bailment Theory

Art Law Report 27 October 2014
By Nicholas O'Donnell

Two weeks ago, the Federal Republic of Germany and Bavaria moved to dismiss the restitution claims brought by David Toren over ownership of Two Riders on the Beach (Zwei Ritter am Strand) by the German painter Max Liebermann.  Toren’s uncle David Friedmann owned the painting in Breslau before he was targeted for his collection and it was stolen.  Toren had not seen it since adolescence.  The painting is further notable for two (related) reasons: it is among the 1,280 works of art found in Cornelius Gurlitt’s apartment in 2012, and it is one of only two that the Gurlitt Task Force has recommended be restituted (to Toren).  As we noted at the time of the motion, Germany’s tactics seemed odd; Bavaria has committed to complying with the Task Force’s recommendations, and contesting this case seems to make little sense.  The likeliest reason, in our view, is to try to make some jurisdictional law that will weaken other potential claimants to the Gurlitt trove.

In any event, Toren is not taking the maneuver lying down while he waits for the painting.  Last week, he filed an Amended Complaint, which takes note of developments since the initial filing of the case.  Under the Federal Rules of Civil Procedure, once a defendant is formally served with the Summons and Complaint.  The first is to file an Answer, which responds to the actual allegations by admitting or denying them, or stating that the defendant has insufficient information to admit or deny them.  An Answer is what is known as a “responsive pleading” (the Complaint being an opening pleading), a concept that is a holdover from more formal days.  While most court filings are colloquially known as “pleadings,” in fact they are not.

The second option, which Germany chose, is to move to dismiss.  This defers the obligation to respond to the allegations of the Complaint, and instead asks the Court to assume that everything in the Complaint is true, but that it is nonetheless legally insufficient.  This can be for jurisdictional reasons (as Germany argued) or substantive legal ones (i.e., what the plaintiff alleges is a legal wrong actually isn’t one).  one can also file many, though not all, of such motions after having first filed an Answer.

At this point the ball swings back to the plaintiff.  If the defendant has filed an Answer, the plaintiff has only one choice: respond to the motion and defend its case.  But where, as here, the defendant has not filed a responsive pleading, and provided the plaintiff has not previously filed an amendment to the Complaint, the plaintiff may amend “as of right.”  That means the plaintiff can restate, revise, and add allegations to the original case.  A plaintiff may only do so once unilaterally, however, after that it must get the Court’s permission.

This is the route that Toren has chosen.  A great deal has happened, of course, since the case was first filed—most significantly the formation of the Task Force and the specific recommendation concerning this very painting.

This is significant primarily for, and clearly strengthens, Toren’s bailment argument.  The thrust of the original complaint was that Bavaria had seized the paintings without claiming to own them, and had thus committed to hold them for their true owners.  That was a creative theory, but its biggest obstacle would probably have been convincing a court that such an agreement had been created for the benefit of as-yet-unidentified owners (for a third party to be a beneficiary of a contract, including a bailment contract, the beneficiary must be reasonably identifiable).

These amendments bolster that theory considerably because of the Task Force.  Toren, who had become known to Bavaria well before Gurlitt died, was clearly identifiable when the Task Force was created, a creation that was explicitly for the benefit of claimants.  With this express, rather than implied, benefit, the bailment theory is even stronger.

In the end it would probably have not meant the difference because a plaintiff is not obliged to continually re-plead its case as new evidence comes in.  And it still requires Toren to overcome (eventually, if pressed ) Germany’s argument that the original seizure was a sovereign, not a commercial act—which if true would defeat jurisdiction.  The Amended Complaint implies that the bailment is the commercial act, not the seizure, almost certainly in response to the motion.

But the Amended Complaint now puts the question back to Germany: will the painting just be returned, or will the wrangling go on?
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