The Leopold Museum in Vienna, Austria has settled a decade-long legal dispute over the restitution of a painting looted from a Jewish woman during the Nazi era. In order to keep the painting, the museum agreed to pay US$ 19 million to the estate of the late Lea Bondi Jaray and gave permission for it to be displayed for three weeks at the Museum of Jewish Heritage in New York. The Austrian expressionist Egon Schiele’s ‘Portrait of Wally’ was taken away from Bondi Jaray, a Jewish art dealer in Vienna, by the Nazis in 1939. It has been the subject of court proceedings in New York since it was lent twelve years ago to the Museum of Modern Art (MoMa) by the Leopold Museum.
‘Portrait of Wally’ was painted by Schiele in 1912. It was purchased by Austrian collector Rudolf Leopold in 1954 and became part of the collection of the Leopold Museum when it was established by the Austrian government, which purchased more than 5,000 pieces Leopold had owned.
The deal comes less than a year after a US judge rejected the Leopold Museum's argument that the painting was not stolen property and days before a trial was set to commence to decide whether the museum knew the painting was looted 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 Bondi Jaray was forced to sell it on the cheap to a Nazi art collector. The court case filed by Bondi's heirs focused on the question of whether Leopold knew of the painting's problematic history.
The painting was among more than 100 paintings lent to MoMa by Leopold for a three-month exhibit in 1997/98. At the time, it was estimated that ‘Portrait of Wally’ was worth about US$ 2 million.
The case had a wider effect in Austria, becoming the starting point for an investigation into the provenance of state-owned art and the drafting of a new restitution law. In the wake of these developments, the state returned Gustav Klimt's portrait of Adele Bloch-Bauer to Bloch's heir, who in turn sold it at auction for a reported price of US$ 135 million in 2006, achieving the highest-ever price for a painting at that time.
The Vienna Jewish Community, which supported the heirs in the 'Wally' case, said the late Rudolf Leopold's foundation had only agreed to the settlement under pressure of the upcoming US court session. "The right thing to do would have been to physically give back the painting," Erika Jakubovits, the community's executive director, said.
