A painting by Egon Schiele was formally handed over to an Austrian museum during a ceremony in New York on Tuesday after a settlement had been reached in the 12-year old dispute.

By Walter Pfaeffle 

The Leopold Museum-Foundation has agreed to settle the dispute by paying 19 million dollars to the estate of a Jewish woman who claimed that the  Nazis had extorted it  from her during World War II.

Photo above (from left) David Marvell, Director of the Museum of Jewish Heritage, Elisabeth Leopold, Carl Aigner, Board member of the Leopold-Stiftung, and Peter Weinhäupl, commercial manager of the Leopold Museum.

The painting in dispute, Portrait of Wally, was seized by the United States in 1999 while it was on loan to the Museum of Modern Art in New York. Another Schiele painting was seized along with Wally, but was allowed to be returned to Austria several months later.

The controversy around Wally triggered a legal battle in which the Leopold Museum claimed to have acquired the work legally in 1954. The original Jewish owner, Bondi Jaray, insisted until her death in 1969 that the work still belonged to her and her heirs maintained the claim. 

The settlement means the case will not go to a trial scheduled to start this month.

The Leopold collection was assembled by art collector Rudolf Leopold who died recently. His widow, Elisabeth, was in Long Island City to take possession of the painting during the ceremony at Fortress New York, an art storage facility were auction houses, museums and private collectors keep their most valuable pieces.  After that, it will go back to Austria.

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