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PRESS

Nixon Peabody Advises Hungary in Efforts to Dismiss Lawsuit Over Long-Resolved International Art Restitution Claims

February 16, 2011
Allison McClain
amcclain@nixonpeabody.com
617-345-1128

Washington, DC. The Republic of Hungary, the Hungarian National Gallery, the Museum of Fine Arts, the Museum of Applied Arts, and the Budapest University of Technology and Economics (collectively “Hungary”) have asked the United States District Court for the District of Columbia to dismiss a complaint filed by United States citizen David L. de Csepel and two Italian citizen-relatives on numerous grounds, including that the claims were long ago resolved by the U.S. government in a 1973 agreement with Hungary.

At the center of the dispute are 44 artworks that were once part of the Herzog Collection, a large collection of art and objects amassed before World War II by Baron Mór Lipót Herzog (1869–1934).

In 1973, Hungary and the United States entered into an agreement settling all WWII and communist-era property claims between the two countries and their respective nationals. Pursuant to the 1973 agreement, Hungary paid an agreed-upon amount in exchange for the United States agreeing to settle and end all claims by U.S. nationals alleging any takings of property by Hungary or the Axis Powers between 1939 and 1973. The United States was tasked with resolving the individual U.S. nationals’ claims and distributing the Hungarian-paid funds. The 1973 agreement provides that jurisdiction over such claims belongs exclusively to the U.S. Foreign Claims Settlement Commission —not to a court. Similar agreements were entered into by Hungary with the Italian government and numerous other European countries. The plaintiffs’ claims were fully resolved by these agreements.

After the fall of communism and in the early 1990s, Hungary voluntarily passed a series of acts which provided that current and former Hungarian citizens (or their successors) could apply for compensation for real and personal property taken by Hungary during the communist regime or claims arising from wartime and post wartime property deprivations that occurred between 1939–1989. All current and former Hungarian citizens were treated equally in the claims process. The plaintiffs’ predecessors applied for, and were awarded, compensation for business and real property, but they never filed any claims for artworks.

In 1999, plaintiff de Csepel’s aunt, Martha Nierenberg, filed a lawsuit in Hungary over artworks from the Herzog Collection. Other Herzog heirs were involved as defendants as the collection had been divided equally in three parts after the death of the Baron Herzog’s wife. In 2008, after more than eight years of litigation, the Capital City Court of Appeals rejected the claims based, in part, on the 1973 agreement. Neither Ms. Nierenberg nor any of the other Herzog heirs sought review of the decision by the Hungarian Supreme Court.

The Hungarian State’s motion to dismiss, which sets out in detail the historical and legal grounds supporting its request, is publicly available from the United States District Court for the District of Columbia or can be obtained by contacting the Hungarian State’s legal counsel Thaddeus J. Stauber or Sarah E. André of Nixon Peabody LLP. The Republic of Hungary, the Hungarian National Gallery, the Museum of Fine Arts, the Museum of Applied Arts, and the Budapest University of Technology and Economics are represented by Nixon Peabody LLP’s international litigation team and Dr. Orsolya Bánki of the e|n|w|c Attorneys at Law.