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01/18/2022

The Stolen Art Case and the Limits of Formalism
Michael Ramsey

Today the Supreme Court hears argument in  Cassirer v. Thyssen Bornemisza Collection Foundation, which involves an effort to recover a painting seized by the Nazis that ended up in the hands of a Spanish Museum.   The question presented is a technical one:

Whether a federal court hearing state law claims brought under the Foreign Sovereign Immunities Act must apply the forum state’s choice-of-law rules to determine what substantive law governs the claims at issue, or whether it may apply federal common law.

To my mind the answer is blindingly obvious.  The Foreign Sovereign Immunities Act (FSIA), Section 1606, directs that:

As to any claim for relief with respect to which a foreign state is not entitled to immunity under section 1605 or 1607 of this chapter, the foreign state shall be liable in the same manner and to the same extent as a private individual under like circumstances...

The  defendant in Cassirer is a Spanish state-owned entity (the museum) that is defined as a "foreign state" under the FSIA.  It is not entitled to immunity as a result of an exception to immunity under Section 1605.  Therefore, by Section 1606, it "shall be liable in the same manner and to the same extent as a private individual under like circumstances."  No one disputes any of this.

Further, no one disputes that under the Court's longstanding decision in Klaxon v. Stentor Electric Manufacturing Co., a similar suit against a private defendant would be governed by the substantive law chosen by the forum state's choice-of-law rules.  That is, a "private individual under like circumstances" would be governed by the choice of law rules where the suit is heard (here, California).  Thus, it seems (to me) necessarily to follow  that the state-owned defendant in Cassirer should also be governed by the choice of law rules where the suit is heard.  (I joined a law professors' amicus brief, principally written by Professor Zachary Clopton of Northwestern, saying basically that.) 

I'm optimistic that the Supreme Court will agree: the Court has been excellent in following the text of the FSIA in a series of recent cases.  But the fact that the case has gotten as far as it has is not encouraging.  An excellent panel of the Ninth Circuit (Judges Callahan, Bea and Ikuta) held instead that federal common law (meaning them making it up) should govern the choice of law question.

I understand their impulse.  California has absurdly broad choice of law rules that in this case might have applied California law to a dispute about a Spanish defendant's title to a painting seized from its rightful owner (a German) by Germans in Germany, and ultimately acquired by the Spanish defendant from a Swiss citizen in Spain.  Moreover, there may well be serious foreign policy implications were a court to force the Spanish defendant -- which wasn't complicit in or likely even aware of the initial theft -- to give up the painting.

In a formalist world, none of this should matter.  The statute says the same rules apply to a private defendant and a non-immune state defendant.  That's all one should need to know.  But it wasn't enough to make this an easy case (at least so far).  

RELATED:  Will Baude has thoughts on the case here.  He may well be right about some larger concerns, but that doesn't affect my view of this particular case.