SAVING THE SPOILS OF WAR

By Adam Zagorin

Daniel Searle, heir to a $1.5 billion fortune, has largely devoted himself to charity since stepping down 20 years ago as head of his family's pharmaceutical company. And no institution has received more of his attention than the Art Institute of Chicago. In 1987, at the museum's behest and with the assistance of two of its curators, Searle purchased a Degas pastel known as Landscape with Smokestacks for $850,000. Now, 10 years later, the 71-year-old philanthropist faces a major lawsuit filed by the heirs of Holocaust victims who claim that the painting was stolen from their relatives by the Nazis. "My family was murdered, their possessions destroyed or stolen," says Simon Goodman, a Los Angeles businessman who, together with his brother and aunt, is suing Searle. "These works are all that is left of our heritage, so we want the painting back." The two sides are holding talks that, if not successful, will set the stage for what is likely to be an acrimonious trial early next year.

Unlike the millions of victims who perished in the Holocaust, the possessions they were forced to leave behind often survived the war. The search for lost gold and cash has recently focused on Swiss banks, but the quest for their art is broader, spreading throughout Europe and into the U.S. Experts estimate that there are scores, perhaps hundreds, of paintings, prints and lithographs stolen by the Nazis that are now in America's private collections and top museums. New York City's Metropolitan Museum of Art owns two allegedly looted paintings, one claimed by the Belgian government, the other by an anonymous German owner. Last month the Boston Globe published a lengthy investigation that raised questions about paintings by Degas, Picasso, Cezanne and other masters that now hang in Boston's Museum of Fine Arts and in the Fogg Museum of Harvard University. The Philadelphia Museum of Art, the Seattle Art Museum as well as Sotheby's and Christie's all possess or, in the case of the auction houses, have recently sold works that may have been confiscated. Even the National Gallery in Washington has just been criticized by B'nai B'rith for a 1990 Impressionist show that contained four allegedly looted paintings, although the museum's catalog never identified the works as such.

These elite institutions minimize their role, saying they are shocked by the controversy and only want to discover the truth. "Buyers, especially major museums, have a moral responsibility to return anything taken by the Nazis," argues Thomas Hoving, the former director of the Metropolitan. "Art dealing is a multibillion-dollar, unregulated global business where some people are more concerned with selecting the right frame than with where a picture comes from."

The Nazis' plunder of art was carried out on the express instructions of Adolf Hitler, a failed art student and amateur watercolorist before he turned to mass murder. Fond of Old Masters, Hitler dreamed of building a huge stock of cultural masterpieces in the Reich. Hermann Goring, head of the Luftwaffe and later Hitler's right-hand man, eventually assembled one of the largest private art collections in Europe. Many of those works were confiscated from Jews.

The plunder was so great, the U.S. government later estimated, that by 1945, German forces had seized or coerced the sale of one-fifth of all the world's Western art. Some of the thousands of looted works were brought back to the Reich. But others were shipped abroad, principally to New York, where the art market continued to function even as fighting raged in Europe. One painting cited by the U.S. Treasury, Van Gogh's The Man Is at Sea, was apparently slipped out of France by a New York dealer who then sold it to Hollywood idol Errol Flynn for $48,000. "The paintings came to America because for more than 10 years during and after the war there was no place else to sell them," notes Willi Korte, a consultant on Holocaust losses to the Senate Banking Committee.

The odyssey of the Goodman family's Degas may have much in common with hundreds of lost works. Landscape with Smokestacks first came into the family on June 9, 1932, when it was acquired at a Paris auction for 10,000 francs (U.S. dollar equivalent at that time, $740) by Simon's grandfather, Friedrich Gutmann, a German-Jewish banker living in Holland. With the onset of World War II, part of the family collection, which included 10 Old Masters and several other Impressionist canvases, was sent to France for safekeeping, only to be seized there by the Nazis. When Germany invaded the Low Countries, Gutmann and his wife Louise were taken away. She later died at Auschwitz. He was beaten to death in the Theresienstadt concentration camp after refusing to transfer assets to his captors.

After the war the Gutmanns' surviving children, Lili and Bernard, began to hunt for the paintings they had grown up with. Bernard, who became virtually obsessed with the search, eventually concluded that most of the artwork, including the Degas, had been carried off by Soviet troops at the war's end. When Bernard died in 1994, his sister Lili and his sons Simon and Nick took up the quest. By chance, they stumbled onto one of the family's Renoirs, an orchard scene entitled Le Poirier, in an old auction catalog of Parke-Bernet, the corporate predecessor of Sotheby's. That painting is now in London, where the family is trying to get it back. As for the Degas, it turned up in the catalog for a 1993 exhibition at the Metropolitan Museum that listed the owner as Daniel Searle, a trustee of the Art Institute of Chicago. The Goodmans contacted Searle and presented him with a detailed record of their claim to the painting. When he refused to give it up, they sued.

Searle's lawyers maintain that the Degas was legitimately sold by Friedrich Gutmann, not stolen by the Nazis. They also point out that the canvas has been exhibited over the years at major museums around the country, as well as featured in numerous art books, and that their client was unaware of the painting's disputed provenance when he bought it. Asks his lawyer, Howard Trienans: "At what point is it safe for an honest man to buy a painting from a reputable dealer?"

Critics contend, however, that with a little basic research, buyers like Searle and his Art Institute advisers can readily ascertain a work of art's true origins. In many cases, dealers known to have bought or sold art for the Nazis turn up in a work's chain of custody, a red flag signaling a potentially looted object. In the case of Searle's Degas, German dealer Hans Wendland, who operated all but openly as a fence disposing of the Nazi trove, apparently transferred the painting during the war. "It's just obvious that people buying art need to do their homework, just as they would when they purchase real estate, used cars or even livestock," says Thomas Kline, who represents the Goodmans and has emerged as this country's most prominent lawyer in the field of art recovery.

The Goodmans tracked another painting, Portrait of a Young Man in a Red Cap, a canvas attributed to Botticelli, to New York, where it was sold by Sotheby's for $690,000 on Jan. 30, even though Kline says he had earlier informed Sotheby's, in writing, of the family's claim to the painting. Sotheby's later helped arrange a six-figure confidential settlement between the Italian seller of the work and the Goodmans, but got to keep its commission of more than $100,000 on the original sale. "We sell thousands of works of art every year and check every one of them with an electronic data bank," explains a spokesman for the auction house. "In this case, the disputed ownership did not turn up."

Efforts to improve the recovery of looted art are under way. G.O.P. House Banking Committee chairman James Leach and Democrats Charles Schumer and Nita Lowey of New York are considering legislation that would require more careful research into the provenance of a work at the time of its sale. In August the National Jewish Museum in Washington launched the Holocaust Art Restitution Project, or HARP, a database and research institute dedicated to cataloging lost collections both in Europe and the U.S. The World Jewish Congress has established a similar project, headed by Ronald Lauder, the chairman of the board for New York's Museum of Modern Art and chairman of the Estee Lauder cosmetics empire.

HARP has already received some two dozen inquiries from survivors or their heirs wanting to pursue claims. But most are not wealthy, and could have trouble bearing the cost of the protracted litigation that may be required to recover their property. As the Goodmans have discovered, locating lost art is one thing. Getting it back is another.