Special Referee’s Report Vacated In Part In Dispute Over Nazi-Looted Art

On December 4, 2024, Justice Joel M. Cohen granted in part plaintiff’s motion to vacate a Special Referee’s report. The case is Greason v. Helly Nahmad Gallery, Inc., Index No. 650646/2014.

The case concerned a ten-year-old dispute in which the heirs to the owner of a painting by Amedeo Modigliani, which had been stolen by the Nazi regime, sought to recover it from an art dealer who had later acquired it at auction.

The late Justice Eileen Bransten had appointed Michael P. Tempesta, Esq. as referee to oversee discovery in 2016. On September 24, 2024, Tempesta issued a report that set a briefing schedule for, and stayed further discovery pending his resolution of, defendants’ motion to quash plaintiff’s subpoena upon Wildenstein & Co., Inc., a non-party art gallery, and each side’s motion to preclude expert testimony. Justice Cohen granted in part and denied in part plaintiff’s motion to vacate the report.

Plaintiff had waived any objection to Tempesta’s appointment by failing to raise it for some eight years, until “almost all discovery has been completed.” Slip op. p. 4, citing Morton v Brookhaven Mem. Hosp., 308 A.D.2d 566,5 67 (2d Dep’t 2003).

The Special Referee was “within the scope of his authority” to schedule briefing on defendants’ motion to quash the Wildenstein subpoena, to hear that motion, and to stay discovery pending his decision, but any “motion involving the preclusion of testimony at trial should be made to the Court” rather than the Special Referee. Id., pp. 3-4.

While the discovery stay was thus sustained, Justice Cohen reiterated that “that it is imperative that this already 10-year-old case proceed to completion as promptly as possible.” Id., p. 3.

Contact the Commercial Division Blog Committee at commercialdivisionblog@schlamstone.com if you or a client have questions about claims involving fine art, title disputes over stolen property, or challenges to referee reports.