January 29, 2009 / 2:42 AM / 11 years ago

N.Y. museums head to trial in rights over Picassos

NEW YORK (Reuters) - Two major New York museums have lost a bid to throw out claims by a Jewish scholar that he is the owner of two Picasso paintings and the case will head to trial next week.

People walk past the entrance to the Museum of Modern Art in New York, June 12, 2008. REUTERS/Chip East

The Museum of Modern Art and Solomon R. Guggenheim Foundation will battle the scholar, Julius Schoeps, in court for the ownership rights to the paintings, “Boy Leading A Horse” and “Le Moulin de la Galette.” The trial is due to begin on Monday in Manhattan federal court.

In December 2007, the two museums sued Schoeps, who says he is the heir of wealthy German Jewish art collector and banker Paul Robert Ernst von Mendelssohn-Bartholdy. Schoeps contends the banker, his great uncle, was forced to pass on the paintings under duress in Nazi Germany.

Schoeps wants the paintings that have belonged to the museums for four decades handed over, while the museums have demanded they be declared the rightful owners.

U.S. District Judge Jed Rakoff said in a ruling released on Tuesday there was enough competent evidence for a trial.

“Le Moulin de la Galette” was painted in 1900 while “Boy Leading A Horse” was painted six years later. They have been attractions at both museums.

In dispute is over how Justin Thannhauser, a leading German Jewish art dealer and von Mendelssohn-Bartholdy business associate, came to acquire both paintings sometime near the death of von Mendelssohn-Bartholdy in 1935.

Thannhauser then sold “Boy Leading a Horse” in 1936 to former MoMA Chairman William Paley, who gave it to the museum in 1964. “Le Moulin de la Galette” was transferred to the Guggenheim by Thannhauser in 1963.

The museums have argued Schoeps has no claim to the paintings because they were left to von Mendelssohn-Bartholdy’s second wife, Elsa Lucy Emmy Lolo von Lavergne-Peguilhen, who was not Jewish, prior to their sale.

But in his ruling, Rakoff noted the heirs had provided “competent evidence that Paul never intended to transfer any of his paintings and that he was forced to transfer them only because of threats and economic pressures by the Nazi government.”

Two other plaintiffs, Edelgard von Lavergne-Peguilhen and Florence Kesselstatt, who are heirs of Elsa, joined Schoeps in the case late last year.

Schoeps, who is European-Jewish studies director at the University of Potsdam in Germany, lost an earlier claim contesting the ownership of “Portrait of Angel Fernandez de Soto,” a $60 million Picasso painting that belonged to the British composer Andrew Lloyd Webber’s Art Foundation.

Editing by Todd Eastham

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