High Court to Hear Appeal Involving Art

Ruling May Affect Other Nazi-Era Cases

The Supreme Court announced yesterday that it will decide whether the federal courts should be open to suits against foreign governments for abuses suffered before the second half of the 20th century, in a case that could determine the fate of efforts to win redress for Holocaust-related human rights abuses through the U.S. courts.

In a brief order summarizing its actions on cases that have accumulated over the summer recess, the court said it will hear Austria's appeal of a ruling last year by the San Francisco-based U.S. Court of Appeals for the 9th Circuit, which said Austria and its national art museum can be sued in U.S. courts by Maria Altmann, an 87-year-old Jewish resident of California.

Altmann seeks to recover six Gustav Klimt paintings, worth $135 million, that she says were unlawfully expropriated from her family by Austria during the Nazi era and retained by the postwar Austrian authorities through legal subterfuge.

Austria argues that foreign governments are immune from suit in the United States for their actions before 1952, because it was not until that year that the U.S. government recognized exceptions to the immunity of foreign sovereign entities in U.S. courts.

Altmann says that the absolute immunity of foreign states had begun to erode before 1952, and was not even recognized by Austria.

The implications of the case, Austria v. Altmann, No. 03-13, are broad, because the same legal issue is at the heart of three other cases pending in New York federal courts: a case brought by Jews who say that the postwar government of Poland illegally seized their land as part of an effort to keep survivors of the Holocaust from remaining in the country; a case brought by former Jewish citizens and residents of Austria who lost property between 1938 and 1945, including works of art recently auctioned in the United States; and a case brought by Jews against the French state-owned railroad over its role in helping the German occupation authorities transport Jews to death camps.

Austria has been supported in the Altmann case by the Bush administration, which submitted a legal brief unsuccessfully urging the full 9th Circuit to reconsider the case, partly because of what it said were the adverse diplomatic ramifications of permitting the suit to go forward.

The administration advanced similar arguments, with success, in a different Holocaust-related case last term at the Supreme Court. In that case, the court ruled 5 to 4 that the executive branch's foreign policy authority trumped a California law that required insurance firms with links to European companies to divulge detailed information about their Holocaust-era policies so that survivors could more easily recover their assets.

Separately, the court also said yesterday that it will decide whether the Constitution permits states to be sued by debtors before federal bankruptcy judges, a case that appears to give the court's five-member conservative majority another opportunity to pursue its drive for states' rights.

At issue in the case, Tennessee Student Assistance Corp. v. Hood, No. 02-1606, is an effort by a former college student, Pamela L. Hood, to shed $4,139.31 worth of student loan obligations she owes Tennessee.

The state objected that it enjoys sovereign immunity from such a suit, but a federal bankruptcy judge said Congress has the authority to pass a law subjecting states to hardship suits.

The Cincinnati-based U.S. Court of Appeals for the 6th Circuit upheld the judge's ruling earlier this year, ruling that the Constitution, by making bankruptcy a matter of exclusive federal jurisdiction, has implicitly abrogated the states' sovereignty so as to create a uniform national system.

Tennessee appealed to the Supreme Court, arguing that the 6th Circuit decision clashes with a 1996 Supreme Court ruling in which the court, while staking out its broad, new doctrine of state sovereign immunity, implied that it should extend to bankruptcy, as well.