Vineberg v. Bissonnette

• Decision Date: 19 November 2008
• Docket Number: No. 08-1136.,08-1136.
• Citation: 548 F.3d 50
• Parties: Robert S. VINEBERG, Michael D. Vineberg, and Sydney Feldhammer, As Trustees of the Dr. and Mrs. Stern Foundation, Plaintiffs, Appellees, v. Maria-Louise BISSONNETTE, Defendant, Appellant.
• Court: U.S. Court of Appeals — First Circuit

548 F.3d 50

Robert S. VINEBERG, Michael D. Vineberg, and Sydney Feldhammer, As Trustees of the Dr. and Mrs. Stern Foundation, Plaintiffs, Appellees, v. Maria-Louise BISSONNETTE, Defendant, Appellant.

No. 08-1136.

United States Court of Appeals, First Circuit.

Heard October 8, 2008.

Decided November 19, 2008.

David A. Levy, for appellant.

Thomas R. Kline, with whom Andrews Kurth LLP was on brief, for appellees.

Before LYNCH, Chief Judge, SELYA and LIPEZ, Circuit Judges.

SELYA, Circuit Judge.

This case has its roots in one of history's bleakest periods: the Holocaust. It began with the de facto confiscation of a valuable work of art by the Third Reich, which eventually led to the litigation that confronts us today.

In its present form, the case presents a narrow legal question concerning the viability of a laches defense asserted by the current possessor of the work of art in an effort to fend off an action for replevin. After the close of discovery, the district court granted summary judgment in favor of the original owner's successors in interest. See Vineberg v. Bissonnette, 529 F.Supp.2d 300 (D.R.I.2007). We affirm.

I. BACKGROUND

The abecedarian facts are not seriously disputed. In 1934, Dr. Max Stern inherited an art gallery located in Düsseldorf, Germany. Dr. Stern, who was of Jewish ancestry, quickly became an object of Nazi persecution. The Reich Chamber for the Fine Arts, an organ of the Nazi government, determined that Dr. Stern lacked the requisite personal qualities to be a suitable exponent of German culture. For that reason, it directed Dr. Stern to liquidate the gallery and its inventory.

After unsuccessfully appealing this edict, Dr. Stern surrendered to the inevitable. He consigned most of the affected works of art to the Lempertz Auction House (LAH), a government-approved purveyor. The consignment included a painting by Franz Xaver Winterhalter known as "Mädchen aus den Sabiner Bergen" (the Painting). In November of 1937, LAH auctioned the consigned pieces (including the Painting) at prices well below their fair market value.

Fearing for his life, Dr. Stern fled Germany shortly after the forced sale. He eventually settled in Canada. The Nazi government prevented him from retrieving the auction proceeds.

During World War II, many of LAH's records were destroyed by bombing. That circumstance hampered post-war searches to identify and locate the purchasers of Dr. Stern's collection. Nevertheless, Dr. Stern made various efforts to find the works of art that had been wrested from him.

In the immediate aftermath of World War II, Dr. Stern recovered some of his paintings through the Canadian Military Mission. He also filed a restitutionary claim with the military government in the British zone of occupied Germany.

Having achieved only limited success, Dr. Stern placed advertisements in Canadian Art and Die Weltkunst in 1948 and 1952, respectively. In addition, he visited Europe in 1949 to hunt for his missing artworks.

In 1958, Dr. Stern initiated judicial proceedings in Germany regarding paintings seized by the Nazi government. Among other things, he later pursued claims for monetary compensation in the German restitution courts. In 1964, a German court awarded Dr. Stern damages for profits lost due to the forced sale of his art collection.¹

When Dr. Stern died in 1987, he bequeathed the residue of his estate, including any interest in the Painting, to what the parties have called the Stern Estate. In April of 2004, the Stern Estate contracted the Art Loss Register (the Register), an art recovery company and databank, to assist in the search for the missing works of art. For good measure, the estate also listed the Painting on Germany's Lost Art Internet Database.

As matters turned out — none of this was known to Dr. Stern or his successors in interest until the end of 2004 — the Painting had been purchased from LAH in 1937 by Dr. Karl Wilharm. For more than six decades, it remained sequestered in the private collection of Dr. Wilharm and his descendants, with the exception of a single brief exhibition in Kassel, Germany in the early 1950s. Defendant-appellant Baroness Maria-Louise Bissonnette, Dr. Wilharm's step-daughter, took possession of the Painting in 1959 and formally inherited it as part of her mother's estate in 1991.

The defendant has resided in the United States since 1956. She brought the Painting with her when she moved to Rhode Island in 1991. In April of 2003, she consigned the Painting to Estates Unlimited, a Rhode Island auction house. After verifying the Painting's authenticity, Estates Unlimited scheduled an auction for January 6, 2005. Promotional activities began.

Shortly before the appointed auction date, the Register informed the Stern Estate about what was transpiring. It simultaneously notified Estates Unlimited of the Stern Estate's claimed interest in the Painting. As a prudential measure, Estates Unlimited withdrew the Painting from the scheduled auction.

In January of 2005, the Stern Estate filed a claim for the Painting with the New York Holocaust Claims Processing Office (HCPO). HCPO demanded that the defendant return the Painting. Although the defendant refused to honor that demand, negotiations ensued. When the talks failed, the defendant shipped the Painting to Germany and instituted an action in a German court to determine ownership. That led to the institution of the instant action in Rhode Island's federal district court. The named plaintiffs are Robert S. Vineberg, Michael D. Vineberg, and Sydney Feldhammer, in their capacities as trustees of the Dr. and Mrs. Stern Foundation.² They sought to replevy the Painting or, in the alternative, to recover damages.

Following a period of discovery, the trustees moved for summary judgment. In a comprehensive rescript, the district court granted the motion and ordered replevin. See Vineberg, 529 F.Supp.2d at 311. In so holding, the court rejected a proffered laches defense, concluding (i) that Dr. Stern and the Stern Estate had exercised reasonable diligence in searching for the Painting and (ii) that in all events, the defendant had not been prejudiced by any delay in the filing of suit. Id. at 310-11. This timely appeal followed.

II. DISCUSSION

On appeal, the defendant raises two claims of error. First, she argues that the court below abused its discretion in refusing to reopen discovery after she retained new counsel. Second, she argues that the court erred in summarily rejecting her laches defense. We address these claims of error separately.

A. The Discovery Ruling.

Federal trial courts enjoy broad discretion in managing the pace of pretrial proceedings, including the timing of discovery. Dynamic Image Techs., Inc. v. United States, 221 F.3d 34, 38 (1st Cir. 2000); see Mack v. Great Atl. & Pac. Tea Co., 871 F.2d 179, 186 (1st Cir.1989) (indicating that court of appeals will intervene in discovery management only "where the lower court's discovery order was plainly wrong and resulted in substantial prejudice to the aggrieved party"). Accordingly, we review a district court's refusal to reopen discovery for abuse of discretion. United States v. Sayer, 450 F.3d 82, 90 (1st Cir.2006). We turn, then, to whether the district court had sufficient reason to reject the defendant's request to reopen discovery.

To begin, the record reveals with conspicuous clarity that the court gave the parties an ample opportunity to conduct discovery. In its initial scheduling order, the court allowed approximately seven months for this purpose. On three subsequent occasions — twice on joint motions and once on the defendant's unilateral motion — the court granted one-month extensions.

In the absence of extenuating circumstances — and none are evident here — a period of ten months for pretrial discovery in a one-on-one case involving relatively straightforward issues seems adequate. Trial courts have a responsibility to manage their dockets efficiently, and a necessary corollary of that proposition is that litigants are entitled to a reasonable period of time within which to conduct discovery, not a limitless period. See, e.g., Rivera-Torres v. Rey-Hernández, 502 F.3d 7, 11-12 (1st Cir.2007); Coyante v. P.R. Ports Auth., 105 F.3d 17, 23 (1st Cir.1997).

Here, moreover, the defendant failed to offer any persuasive explanation for her failure to complete discovery within the previously established time frame. The only reason cited by the defendant in her motion papers was her retention of successor counsel. The engagement of a new attorney, without more, does not compel— or even necessarily favor — the reopening of a previously closed period of discovery. See, e.g., Hussain v. Nicholson, 435 F.3d 359, 363-64 (D.C.Cir.2006).

In the same vein, the defendant has failed to point to any relevant leads that she might have obtained had the district court reopened discovery. This may be an important factor in deciding whether to reopen discovery. See Sayer, 450 F.3d at 90; Panatronic USA v. AT&T Corp., 287 F.3d 840, 846 (9th Cir.2002). By like token, it may be an important factor in gauging the district court's exercise of its discretion.

To cinch matters, the defendant's proposed discovery extension threatened to delay the proceedings. At the time the defendant moved to reopen, discovery had been closed for over five weeks, the plaintiffs' motion for summary judgment had been pending for nearly three weeks, and the defendant's response thereto was overdue. Taken in the ensemble, these circumstances counsel in favor of upholding the district court's ruling. See, e.g., Hussain, 435 F.3d at 363-64 (affirming district court's denial of request to reopen discovery filed three weeks after opponent's motion for summary judgment).

To say more on this point would be supererogatory. Under these circumstances, we hold without serious question that the lower court did not abuse its discretion in refusing to reopen discovery....