By: Fern Sidman

In a landmark ruling last Wednesday, a New York judge ordered the Art Institute of Chicago to surrender an Egon Schiele drawing looted by the Nazis during the Holocaust, paving the way for its return to the heirs of a Jewish cabaret performer murdered at a Nazi concentration camp. According to extensive reporting by The New York Times, the decision marks a major victory for Holocaust restitution efforts and highlights the increasingly aggressive stance of Manhattan prosecutors in reclaiming art stolen during World War II.

The drawing in question, Russian War Prisoner (1916), had been purchased by the Art Institute in 1966. However, investigators from the Manhattan district attorney’s office asserted that the piece, along with numerous other works by the famed Austrian Expressionist Egon Schiele, had been unlawfully seized from Fritz Grünbaum — a prominent Jewish entertainer and art collector — during the Nazi regime.

As The New York Times report explained, Grünbaum’s heirs have been engaged in a protracted legal battle to recover the dozens of artworks that were part of his esteemed collection. Many of these pieces, including Schiele’s vivid and haunting portraits, ended up dispersed across museums and private collections worldwide.

Delivering her decision from the bench, New York Supreme Court Judge Althea Drysdale left little room for ambiguity. According to the information provided in The New York Times report, Judge Drysdale declared that Russian War Prisoner had been “stolen property for the last 86 years,” firmly siding with the Manhattan district attorney’s office on every point in a 25-minute oral ruling and a comprehensive 79-page written decision.

Rather than undertaking serious due diligence, the museum instead “relied upon the assurances of a discredited art dealer with an obvious self-serving agenda,” Judge Drysdale wrote.

The court found that the museum failed to investigate the questionable history surrounding the artwork’s ownership and did not sufficiently scrutinize the supposed chain of custody offered by Eberhard Kornfeld, a Swiss art dealer who brought numerous Schiele works to the New York market in the 1950s.

In a sharply worded statement, Judge Drysdale concluded that it was “highly improbable that Mathilde Lukacs,” the sister-in-law of Fritz Grünbaum, “ever obtained proper title to Russian War Prisoner,” a key argument made by the Art Institute in its defense, according to the report in The New York Times.

Judge Drysdale found that the drawing remained stolen under New York law despite the passage of time, that criminal laws indeed applied to the matter, and that New York prosecutors maintained proper jurisdiction. The report in The New York Times noted that Manhattan prosecutors established jurisdiction based on the fact that the Schiele works in question had, at one point, passed through a New York gallery before finding their way into other hands.

The Art Institute of Chicago’s refusal to return the work set up a highly public and combative legal showdown. Unlike several other museums and private collectors who, according to The New York Times report, voluntarily returned Schiele works once presented with evidence of their Nazi-era provenance, the Art Institute fought vigorously to retain Russian War Prisoner.

As was reported by The New York Times, the Art Institute argued that the storage company where Grünbaum’s works were kept in Vienna — despite its affiliation with the Nazi regime — provided lawful storage services to Jewish families, including Lukacs. They maintained that Lukacs sold the Schiele drawings, including Russian War Prisoner, to Kornfeld, who in turn sold them on the legitimate art market.

However, Manhattan investigators compiled a damning dossier showing that several of Kornfeld’s alleged invoices were riddled with errors, including misspellings of Lukacs’ name, suggesting forgery. Judge Drysdale accepted the investigators’ findings, dismissing Kornfeld’s documentation as unreliable, as the report in The New York Times highlighted.

This evidence severely undercut the museum’s argument and led the court to conclude that the Art Institute’s claim to lawful ownership was without merit.

In the wake of the ruling, the Art Institute expressed disappointment. Megan Michienzi, a museum spokeswoman, stated, “We are disappointed with the ruling,” according to The New York Times. She added that the institution is reviewing the decision and exploring all available options for appeal, including possibly seeking a stay to delay the handover of the drawing to Manhattan investigators.

Despite this, legal experts cited by The New York Times suggest that the strength of Judge Drysdale’s ruling leaves the museum with limited options. The decision not only affirms the Manhattan district attorney’s authority to pursue restitution claims through criminal proceedings but also puts museums and private collectors worldwide on notice about the risks of handling artwork with dubious provenance.

The museum disputed the investigators’ evidence, challenged the Manhattan district attorney’s authority to bring a criminal proceeding, and maintained that the artwork had not been looted. Instead, according to the information contained in The New York Times report, the museum argued that the drawing had legitimately passed to Grünbaum’s sister-in-law, who allegedly sold it to a Swiss dealer after the war — a chain of ownership that, in the Art Institute’s view, cleansed the title.

The Art Institute also contended that because the drawing had been located outside of New York for more than six decades, New York’s criminal statutes should not apply. They argued that the matter should have been handled as a civil dispute rather than through criminal forfeiture proceedings.

However, The New York Times reported that the Manhattan district attorney’s art trafficking unit, which specializes in recovering looted cultural property, accused the museum of ignoring compelling evidence of an elaborate postwar fraud meant to obscure the drawing’s true history.

Ultimately, Judge Drysdale agreed with the prosecutors, finding that the Art Institute’s arguments did not stand up to legal scrutiny.

According to The New York Times, the ruling carries profound implications beyond the immediate fate of Russian War Prisoner. It strengthens the authority of Manhattan’s art trafficking unit and sets a critical precedent affirming that Nazi-looted art can and should be pursued under criminal law, even many decades after the original theft.

The decision is likely to bolster other efforts by heirs of Holocaust victims to reclaim lost artworks from institutions and collectors who have resisted restitution. As The New York Times report highlighted, the Art Institute’s high-profile resistance had threatened to undermine the momentum of the Manhattan district attorney’s broader campaign to secure justice for families dispossessed during one of history’s darkest periods.

By confirming the validity of the prosecutors’ approach, Judge Drysdale’s decision signals that museums cannot assume immunity simply because stolen art changed hands multiple times or crossed state or national borders.

Fritz Grünbaum, a celebrated Viennese cabaret star, was arrested by the Nazis in 1938 and ultimately perished at Dachau concentration camp in 1941. According to The New York Times, Grünbaum was known not only for his theatrical talents but also for his refined art collection, particularly his trove of Egon Schiele works.

Since the late 1990s, Grünbaum’s heirs have fought to recover his lost collection, contending that the Nazis forced Grünbaum to sign over his assets under duress. Numerous Schiele pieces once in Grünbaum’s possession have surfaced in museums and private hands, leading to a series of legal battles in the United States and Europe.

Raymond Dowd, the attorney for Grünbaum’s heirs, welcomed the decision, calling it a significant warning. “This judge wrote a clear warning call to any people in the world who are hiding Nazi-looted art that you had better not bring it anywhere near New York. Ever,” Dowd said, as reported by The New York Times.

As reported by The New York Times, the successful claim to Russian War Prisoner represents another important step in the long journey to restore Grünbaum’s legacy and deliver a measure of posthumous justice.