USA – CALIFORNIA Trends and Developments Contributed by: Steve Coopersmith, Ashley Rastegarpour and Philippa Grumbley, The Coopersmith Law Firm, LLP
Where do we go from here? As a direct result of AB 2867 Courts have taken an assertive step to address choice-of-law barriers that have been plaguing heirs for decades. This shift is sig - nificant but does not eliminate the deeper challenges that Holocaust restitution cases face. AB 2867 also has significant implications for forum selection in Holocaust-era restitution litigation. By mandating application of California substantive own - ership law, the statute creates a strong incentive for claimants to file suit in California whenever jurisdiction can plausibly be established. This shift may concen - trate restitution litigation in California courts, particu - larly in cases involving foreign museums or collections with even minimal contacts with the state. While crit - ics may characterise this effect as forum shopping, supporters argue that it reflects a deliberate legislative effort to ensure that claims rooted in Nazi-era perse - cution are adjudicated under legal principles that do not validate coerced transfers. In practice, the disputes reaching courts are rarely about newly uncovered theft. Instead, they involve art - works that museums or other institutions have long- held, despite histories rooted in Nazi-era persecution. AB 2867 addresses legal barriers to restitution, but it does not – and cannot – resolve the ethical divide between lawful title and moral legitimacy that increas - ingly confronts museums. The Emil Bührle Collection at the Kunsthaus Zurich illustrates this dilemma. The collection is closely linked to its founder, Emil G. Bührle, whose wealth was large - ly derived from arms exports to Nazi Germany during World War II, and later to the post-war West. Several works in the collection were later identified as having been looted by the Germans during the war. In 1948, the Chamber for looted property of the Swiss Federal Supreme Court in Lausanne required the restitution of certain paintings, and Bührle later repurchased sever - al of the returned works. More recently, the Kunsthaus Zürich has revised the presentation of the collection to address artworks, provenance, historical context, and social responsibility together, explicitly situating the works within their wartime history. (E.G. Bührle Collection Foundation, The Bührle Collection: One of the Great Modern Art Collections (1936–1959) )
AB 2867 is highly unusual in the American legal land - scape because it represents a rare instance in which a state legislature has intervened directly in the choice- of-law analysis governing historical property disputes. Rather than adjusting procedural access to courts, the statute mandates application of California sub - stantive ownership law in a defined class of cases, displacing foreign property regimes that would oth - erwise control under ordinary conflicts principles. In doing so, California has departed from the prevailing judicial reluctance to legislatively override choice-of- law outcomes, particularly in cases involving foreign sovereign interests and extraterritorial conduct. AB 2867 has already impacted the Cassirer litigation. After the Ninth Circuit applied Spanish law and con - cluded that the museum had acquired valid title under that framework, the Supreme Court vacated the judg - ment and remanded the case for further proceedings. (Parsa Zaheri, Rehearing with a Chance of Restitution: The Effects of Rainfall and Recent Developments on Rue Saint Honoré ) AB 2867 thus represents a deliberate shift in how Holocaust-era ownership disputes are resolved. Rather than allowing foreign doctrines to control the outcome, the statute leans the analysis toward Cali - fornia’s substantive property rules. Notwithstanding its remedial purpose, AB 2867 is likely to invite constitutional scrutiny. Critics may argue that the statute impermissibly applies Califor - nia substantive law to conduct and transactions that occurred entirely outside the state, raising due pro - cess concerns regarding the requisite nexus between California and the disputed property. Others may con - tend that the statute interferes with foreign relations or burdens interstate and international commerce by displacing foreign ownership regimes through state legislation. While California has articulated a strong interest in ensuring that claims rooted in Nazi-era persecution are resolved under principles that do not legitimise coerced transfers, the statute’s durability will ultimately depend on how courts balance that interest against constitutional limits on extraterritorial application of state law.
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