Governor Newsom Signs Holocaust Art Bill

Yesterday, California Governor Gavin Newsom signed AB 2867 into law. The bill provides that California law applies in suits brought by a California resident involving the theft of art or other personal property during the Holocaust or other political persecutions.

Assemblymember Jesse Gabriel introduced AB 2867 in response to the Ninth Circuit’s decision earlier this year in Cassirer v. Thyssen-Bornemisza Collection Foundation. In 2005, Claude Cassirer sued a state-owned museum in Spain to recover a painting by Camille Pissarro that the Nazis stole from his grandmother. Under Spanish substantive law, a person who possesses moveable goods acquires title to them after a certain period, whereas under California substantive law, a thief can never convey good title.

The U.S. Supreme Court held that state rather than federal choice of law rules apply in cases under the Foreign Sovereign Immunities Act (FSIA). On remand, the Ninth Circuit panel held that, under California’s choice of law rules, Spanish law applies. In July, the Ninth Circuit denied rehearing en banc over a strong dissent from Judge Susan Graber, leaving the plaintiffs 90 days to file a petition for cert with the U.S. Supreme Court.

The legislation just signed should change the outcome in Cassirer. Courts must follow legislative direction with respect to choice of law and, as the Supreme Court held, federal courts must follow state choice of law rules even in cases under the FSIA. The bill expressly states that, “[n]otwithstanding any other law or prior judicial decision … California substantive law shall apply” in cases such as this. The bill goes on to say: “This paragraph shall apply to all actions pending on the date this paragraph becomes operative … including any action in which the judgment is not yet final or the time for filing any appeal, including a petition for a writ of certiorari in the United States Supreme Court, has not expired, or, if filed, has not been decided.”

As I have previously explained, I believe the Ninth Circuit misapplied California’s choice of law rules in the first place. It is also perfectly appropriate for the California legislature to correct this error by amending the law. It is a shame that this case required legislative intervention. But it is good that the correct result may finally be reached.