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ALSDORF v. BENNINGSON

December 2, 2004.

MARILYNN D. ALSDORF, Plaintiff,
v.
THOMAS C. BENNIGSON, Defendant.



The opinion of the court was delivered by: DAVID COAR, District Judge

MEMORANDUM OPINION AND ORDER

Before this Court is Defendant Thomas Bennigson's ("Defendant" or "Bennigson") motion to stay the proceedings in this Court, pending final resolution of an appeal currently pending before the California Supreme Court. For the reasons set forth below, Defendant's motion to stay is GRANTED.

I. FACTUAL AND PROCEDURAL BACKGROUND

  A. The Painting: Picasso's Femme en Blanc

  The current action between the parties arises from a dispute concerning the ownership of "Femme en Blanc," a painting by Pablo Picasso. In 1975, Plaintiff Marilynn Alsdorf, (hereinafter "Plaintiff" or "Mrs. Alsdorf"), along with her late husband, purchased "Femme en Blanc" (the "Painting") from the Stephen Hahn Gallery (the "Hahn Gallery") in New York, New York. (Alsdorf Decl., ¶ 9). Mrs. Alsdorf and her husband purchased the Painting with the understanding that it had been purchased in Paris, France. Id. Since 1975, with several exceptions, the Painting remained in Mrs. Alsdorf's possession in Chicago, Illinois. (Alsdorf, Decl., ¶ 10).*fn1

  In January 2002, the Art Loss Register (hereinafter the "ALR")*fn2 was asked to conduct a search on "Femme en Blanc" by a French art dealer, Didier Imbert ("Imbert"), who was thinking on acquiring the Painting on behalf of a client (Sarah Jackson Decl., ¶ 8).*fn3 At the time, the Painting was held in the Freeport in Switzerland, having been sent there from the United States. Id. In February 2002, the ALR advised the art dealer that the Painting was illustrated in the Répertoire des Biens Spoilés en France durant la Guerre 1939-1945 (List of Property Removed From France during the War 1939-1945), as a war loss, recorded under the name of Justin Thannhauser ("Thannhauser"). Id. at ¶ 9. This prompted research in the archives to determine the sequence of events on the theft, and to confirm the identity of the original owner, who the ALR believed to be Thannhauser. Id.

  Through its research, the ALR discovered that the records of the art dealer, Thannhauser, are retained by the Silva Casa Foundation ("Silva Casa") in Geneva, the charity organized to administer the proceeds from Thannhauser's estate and that of his second wife, Hilde. (Jackson Decl., ¶ 10). The Foundation retains the handwritten diaries of Thannhauser, and photographs from his Paris apartment. Id. A note in his diary mentions that the Painting was "stolen from his Paris house." Id. Also included in the album retained in Geneva is an interior photograph of the Paris apartment showing the Painting in suit, plus a photograph of the painting annotated by Thannhauser on the reverse with "Stolen by the Germans" and "Carlota Landsberg" marked in the upper right corner. (Id.; see also Jackson Decl., Exhibit B). The Silva Casa Foundation also provided a page from a book published in 1927 by Klinhardt & Biermann, showing the Painting, and naming the then owner as Robert Landsberg.*fn4 After the ALR advised Imbert that the painting was published as a war loss, the ALR insisted that it needed to know the identity of the current owner, in order to facilitate future discussions. (Jackson Decl., ¶ 11). Subsequently, Mrs. Alsdorf identified herself as the owner of the Painting, and confirmed that it had been purchased by her and her late husband, James Alsdorf, from the Stephen Hahn Gallery in New York, New York in 1975, for $375,000. (Id.).

  Around the same time that Mrs. Alsdorf's identity was revealed, the Ministére des Affaires Étrangères (the French Foreign Ministry) confirmed to the ALR that according to their files the Painting, while on deposit with Thannhauser, was the property of "Mme de Landzberg [sic]." (Jackson Decl., ¶ 14). The Wiedergutmachungsamt von Berlin agreed to give the ALR the name of the original owner, Carlota Landsberg, and an address in New York. (Jackson Decl., ¶ 15). From this information, the ALR was able to locate Carlota Landsberg's grandson, Tom Bennigson, through the receptionist at the New York apartment building where his grandmother lived, and who remembered his visits. Id. On provision of a power of attorney, the ALR was able to access Carlota Landsberg's compensation file at the Wiedergutmachungsamt von Berlin. Id. The file indicated that in 1969, Carlota Landsberg was paid DM 100,000 for the loss of the picture by actions of the Third Reich, without prejudice to her right to recover the Painting if it was located. Id. Carlota Landsberg's file also revealed correspondence from Thannhauser confirming that the picture had been held in her name and that Thannhauser's apartment had been looted. (Id. at ¶ 16). The letter states (in English translation):
Dear Mrs. Landsberg,
As I remember very clearly, and as I therefore can confirm to you in writing, in 1938 or 1939 you sent your painting by Picasso, of a woman, from the so-called classical period of the artist, to me in my house in Paris, 35 Mirosmenil. At this time, as we were forced to leave our home in Paris in 1939, your Picasso hung in the middle of a narrow wall. Upon the occupation of Paris in 1940, when we were no longer in Paris and the house was closed, the entire contents of the four-story building-and with it your painting-were stolen. This was confirmed to us by the property manager after the end of the war. Further we heard from porter of the house on the occasion of a later visit certain facts, revealing that during the four day long violent German national socialist plundering everything was taken out of the four-story house during the night and placed in trucks.
Your painting is pictured in Christian Zervos' large Picasso work, Volume 4, No. 389, Page 160 with the title "Femme en blanc" 1922, oil painting, 65:54 cm. As you know, I have often tried to find a trace of this oil painting, as well as all of the other property that disappeared at the same time, but until now without success.
In conclusion may I especially state that I have set forth the foregoing to the best of my knowledge and conscience.
(Jackson Decl., ¶ 16). On or about June 7, 2002, Sarah Jackson sent a letter to Bernard, Mrs. Alsdorf's attorney, informing him that the ALR had discovered that Thannhauser had been holding the Painting for another person when it was confiscated by the Nazis. Id. at ¶ 18. Bernard responded with a letter on June 11, 2002, which requested that the ALR remove the Painting from its database, and further stating that if the matter was not resolved, the ALR's actions would be considered "tortious and an interference with my client's lawful right, title and interest in said painting thus creating identified monetary damages to its rightful owner, my client Marilyn [sic] Alsdorf." (Id. at ¶ 19; see also Jackson Decl., Ex.G.).

  B. Bennigson Files Suit Against Alsdorf and Tunkl in the Superior Court of the State of California for the County of Los Angeles

  After Bennigson was identified as the heir to Carlota Landsberg, he retained counsel, E. Randol Schoenberg ("Schoenberg"), with respect to his claims related to the Painting. (Schoenberg Decl., ¶ 3). Bennigson initially attempted to settle his claims with Mrs. Alsdorf; however, those settlement negotiations were unsuccessful. (Id. at ¶¶ 3-5). Consequently, on December 19, 2002, Bennigson filed suit in the Superior Court of the State of California for the County of Los Angeles ("California Superior Court") against Alsdorf and Tunkl, seeking replevin and injunctive relief. (Id. at ¶ 8). On that same day, Schoenberg also applied for an ex parte temporary restraining order to keep the Painting in Los Angeles. Id. However, the presiding judge, Judge David Yaffe ("Judge Yaffe"), directed Schoenberg to provide notice to Mrs. Alsdorf and Tunkl, which Schoeberg subsequently did. Id.

  The following day, December 20, 2002, Bernard and Schoenberg appeared before Judge Yaffe on behalf of their respective clients. (Schoenberg Decl., ¶ 9; see also Schoenberg Decl., Ex. 9). Judge Yaffe granted a temporary restraining order, which directed Mrs. Alsdorf and Tunkl to keep the Painting in Los Angeles. (Id). At the December 20, 2002 hearing however, Bernard informed Judge Yaffe that the Painting had left Los Angeles just a few hours earlier. (Id. at ¶ 10). In order to effect service of process on Mrs. Alsdorf, who was vacationing at the time of the hearing, the parties agreed to modify the temporary restraining order, and allow the Painting to remain in Chicago pending a hearing on the preliminary injunction. (Id. at ¶ 1; see also Schoenberg Decl., Ex. 13). Although Mrs. Alsdorf acknowledged receipt of the summons and complaint, she moved to quash service, as she claimed that the trial court lacked personal jurisdiction over her. (Schoenberg Decl., ¶ 14). Consequently, the preliminary injunction hearing was stayed pending a determination of the motion to quash. (Id). The motion to quash hearing was held before Judge Victor H. Person ("Judge Person") in the Superior Court of the State of California for the County of Los Angeles. (Id. at ¶ 15). While the matter was under advisement, Bennigson filed an additional brief on the motion to quash, a motion to disqualify Judge Person for cause, a motion for leave to amend the complaint, and a motion to conduct jurisdictional discovery. Id. All matters were stayed by Judge Person, pending a determination of the motion to disqualify, which was denied by Judge David T. McEachen of the Orange County Superior Court on May 9, 2003. Id. In addition, all other pending matters were stayed pending Judge Person's ruling on the motion to quash on June 16, 2003. Id.

  On June 16, 2003, Judge Person granted Alsdorf's motion to quash for lack of personal jurisdiction. (Schoenberg Decl., ¶¶ 15-16; see also Schoenberg Decl., Ex. G). In addition, Judge Person denied Bennigson's motion for leave to amend his complaint, and to allow jurisdictional discovery. (Id. at ¶ 16). Further, the preliminary injunction hearing before Judge Yaffe was removed from the court's calendar as moot. Id.

  On June 18, 2003, Bennigson appealed Judge Person's grant of Alsdorf's motion to quash, to the California Court of Appeal, Second District ("California Court of Appeal"). (Schoenberg Decl., ¶ 16). On April 15, 2004, the California Court of Appeal issued its decision, which affirmed Judge Person's decision. (Id. at ¶ 17; see also Schoenberg Decl., Ex. H.). Bennigson filed a Petition for Rehearing on April 19, 2004, which was subsequently denied on May 11, 2004. (Schoenberg Decl., ¶ 17). Bennigson filed a Petition for Review on May 17, 2004, and that Petition was granted unanimously by the California Supreme Court on July 28, 2004. The parties have submitted opening briefs and are awaiting the scheduling of oral arguments in the California Supreme Court. (Id. at ¶¶ 18-20).

  On September 10, 2004, Mrs. Alsdorf filed a complaint in this Court, in an action for declaratory judgment and to quiet title of the Painting. On October 22, 2004, Bennigson, who is the Defendant in the action before this Court, filed, by special limited appearance, a motion to dismiss or stay Mrs. Alsdorf's complaint filed in this Court. On October 28, 2004, the Court directed the Parties to address only the stay issue. Consequently, Bennigson's motion to stay Mrs. ...


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