Paying For Nazi Art Crimes at London Auction – and in NY in the fall

In London on June 22, a landscape by Egon Schiele set a world auction record price for the Austrian artist (1890-1918), bringing 22 million pounds (approx. $40 million). The painting, House with Laundry (Suburb II), was sold by the Rudolf Leopold Museum in Vienna, which will use the proceeds to cover costs in settling claims by Jewish families who were the original owners of works in the museum’s collection that were seized by the Nazis after Hitler annexed Austria in 1938.

Now there’s more coming to market. Sotheby’s has announced that it will sell “Litzlberg am Attersee” (Litzlberg on the Attersee – featured image), a 1915 landscape by Gustav Klimt, in its evening sale in New York on November 2. The $25 million estimate for the picture restituted from an Austrian museum to the heir of a Jewish collector who died in the Holocaust was described as “prudent” and “conservative” by the dealer Jane Kallir, whose gallery, Galerie St. Etienne, presented the first one-man Klimt show in New York in 1959.

The Klimt is being consigned to Sotheby’s by Georges Jorisch of Montreal, the grandson of Amalie Redlich, who owned the painting until it was seized by the Nazis, who deported her in 1941 to Poland, where she was killed.  Redlich’s family had built its pre-war fortune in Austria on steel.

Klimt, Portrait of Adele Bloch-Bauer I

New fortunes could fuel the bidding in November. Russians are said to have discovered Klimt and Egon Schiele – lured by record prices if not by the mystique of early 20th century Vienna. In 2006, the collector Ronald Lauder spent $135 million to acquire Portrait of Adele Bloch Bauer I, by Klimt, which had been restituted by the Belvedere Gallery in Vienna to the heirs of the once-wealthy Bloch-Bauer family, Jews who fled Austria after the Nazis seized their property.  In January 2010, another Klimt landscape restituted to Georges Jorisch sold at Sotheby’s in London for $43.4 million, a record for a Klimt landscape.

That’s big money for bright colors, but there’s grey area in the rising market for Klimt and Schiele. The June auction in London was confusing to watch. The Schiele picture was guaranteed at its low estimate of 20 million pounds (about $33 million), which meant that someone, the guarantor, had already bought it.  During the bidding, a dealer in the room seemed to be bidding against someone who was speaking to a Christie’s employee on the telephone. Did this mean that the person who guaranteed the painting was willing to pay more than the guarantee that he or she offered? Such are the mysteries of the art market.

As for the identity of the buyer who got the painting,  no one at Sotheby’s would disclose that, but market insiders noted that the dealer who was bidding at Sotheby’s tended to represent Russian buyers. Some added that only a Russian awash in cash and new to the Schiele market would have paid such a high price for a cityscape that held little interest for veteran Schiele collectors.

But there was another Viennese drama in London. In front of Sotheby’s, on busy chic New Bond Street, protesters in what looked like police uniforms wore hats with the logo “Kunstraub” – “Art Theft” in German. They wore sandwich boards that read – “True Lies” or “Catch Me If You Can”. It wasn’t a movie promotion. The demonstrators handed out cards – about twice the size of a postcard – that urged whoever read the message not sell art that had been looted by the Nazis. Don’t sell, restitute,” the cards read.

The demonstration was also confusing. The protest didn’t target the Schiele on the wall behind the auctioneer that night, but another painting at the Leopold Museum in Vienna that isn’t for sale, at least not yet. The painting is Houses by the Sea (Haeuser am Meer), a Schiele landscape that once belonged to Jenny Steiner, from another Jewish family in Vienna.

There’s no dispute over whether the painting was stolen under the Nazis. And some of Steiner’s heirs are willing to settle with the Leopold Museum for a fraction of the market price, which was in the $35 million range – although the June 22 auction  may have pushed it upward. There are two other sets of Steiner heirs, and those heirs want the painting to be handed back to them. They are represented by the Jewish Community of Vienna (IKG), the official Jewish organization of Austria. The IKG rejects compromise (i.e., settlement) on the return of looted Jewish property. Hence the dispute.

The Leopold Museum says that selling the painting would break up its collection. The IKG notes that the record-setting painting Schiele on June 22 was also part of the collection, and that the Leopold Foundation was willing to part with it to raise cash. Last fall, the Leopold Foundation proposed selling it and divide the proceeds, giving half to the Steiner heirs and using half to help fund the settlement with the Bondi family. The IKG and others rejected the idea of using proceeds from the sale of one looted work to compensate the owners of another.

The $40 million from the June 22 auction will cover $19 million that the Leopold Foundation paid the heirs of a Jewish dealer from Vienna to keep “Portrait of Wally,” a 1912 painting that Schiele, then 22, made of his mistress Valerie Neuzil. The picture was seized in 1939 from the Viennese art dealer Lea Bondi as she was about the flee Vienna for London. It ended up at the Austrian Gallery (a national museum) after the war, and the young art collector Rudolf Leopold bartered some other paintings to acquire it. Before making that deal, Leopold met in London with Lea Bondi, who asked him to keep an eye on the painting, lest it disappear.  Leopold acquired it for himself. Bondi went to her deathbed – literally – hoping to recover Wally.

Back in 1997, after the Austrian government created the Rudolf Leopold Foundation by buying Leopold’s collection, a traveling show of Leopold’s Schieles went to the Museum of Modern Art, where members of Lea Bondi’s family saw it.  It was subpoenaed in New York State Court.  MoMA and the Leopold Foundation fought the subpoena, and the case transmuted into a war of attrition in US District Court.

It was the subpoena that launched a thousand claims, including the claim to the Klimts from the Bloch-Bauer collection that led to the return of valuable pictures that had been at the Belvedere Castle. Thirteen years later, the Leopold Foundation settled, agreeing to pay $19 million to Lea Bondi’s heirs. Wally is now back a the Leopold Museum in Vienna.

For pictures of the “Kunstraub” demonstration in Vienna, where the state-financed Leopold Museum is part of the Museumsquartier cultural district, see coverage in Der Standard, the Viennese daily newspaper.

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