LEOPOLD MUSEUM PAYS $19 MILLION IN PAINTING SETTLEMENT CASE

A 12 YEAR DISPUTE THAT ILLUSTRATED THE DIFFICULTY OF PROVING ART WAS STOLEN BY THE NAZIS IN WORLD WAR II ENDED TUESDAY WITH AN AGREEMENT THAT A 1912 OIL PAINTING ENTITLED 'PORTRAIT OF WALLY' WILL BE RETURNED TO A VIENNA MUSEUM AND DISPLAYED WITH AN ACKNOWLEDGMENT THAT IT WAS STOLEN FROM A JEWISH ART DEALER BY A NAZI AGENT. THE SETTLEMENT CALLS FOR THE LEOPOLD MUSEUM TO OWN THE PAINTING BY AUSTRIAN EXPRESSIONIST EGON SCHIELE AFTER PAYING $19 MILLION TO THE ESTATE OF LEA BONDI JARAY AND ALLOWING IT TO BE DISPLAYED FOR THREE WEEKS AT THE MUSEUM OF JEWISH HERITAGE IN LOWER MANHATTAN. THE PAINTING HAS BEEN THE SUBJECT OF COURT PROCEEDINGS IN NEW YORK CITY SINCE IT WAS LENT 12 YEARS AGO TO THE MUSEUM OF MODERN ART BY THE LEOPOLD MUSEUM. AT LEAST THREE TIMES, A JUDGE HAD ORDERED IT RETURNED TO AUSTRIA WITHOUT ACKNOWLEDGMENT IT HAD BEEN STOLEN. US ATTORNEY, PREET BHARARA SAID IN A STATEMENT THAT THE SETTLEMENT AMONG THE US GOVERNMENT, JARAY'S ESTATE AND THE LEOPOLD MUSEUM 'MARKS ANOTHER SMALL STEP TOWARD JUSTICE FOR VICTIMS OF PROPERTY CRIMES DURING WWII.' THE DEAL COMES LESS THAN A YEAR AFTER US DISTRICT JUDGE LORETTA A PRESKA REJECTED THE LEOPOLD MUSEUM'S ARGUMENT THAT THE PAINTING WAS NOT STOLEN PROPERTY AND DAYS BEFORE SHE WAS TO PRESIDE OVER A TRIAL TO DECIDE WHETHER THE MUSEUM KNEW IT WAS STOLEN PROPERTY WHEN IT WAS BROUGHT INTO THE UNITED STATES IN SEPTEMBER 1997. IN JANUARY 1998, THE MANHATTAN DISTRICT ATTORNEY'S OFFICE BEGAN INVESTIGATING CLAIMS THAT THE PAINTING WAS STOLEN MORE THAN A HALF CENTURY EARLIER WHEN JARAY WAS FORCED TO SELL IT ON THE CHEAP TO A NAZI ART COLLECTOR. THE LEOPOLD MUSEUM HAS ALWAYS INSISTED THAT IT ACQUIRED THE PAINTING IN GOOD FAITH FROM LEGITIMATE POSTWAR OWNERS. IN A STATEMENT, REPRESENTATIVES OF THE BONDI ESTATE SAID THE SETTLEMENT REFLECTS THE TRUE VALUE OF THE PAINTING. THEY ALSO SAID THE PUBLIC DISPLAY OF THE PAINTING AT THE MUSEUM OF JEWISH HERITAGE WILL LET VISITORS VIEW IT IN A SETTING THAT MEMORIALIZES THE SUFFERING OF HOLOCAUST VICTIMS AND THE RESILIENCE OF THOSE WHO ESCAPED AND SURVIVED.