## Facts

- Heirs of Paul von Mendelssohn-Bartholdy claimed two Picasso paintings were sold in the 1930s under Nazi duress and sought recovery from the museums holding them.
- The Museum of Modern Art and the Solomon R. Guggenheim Foundation asserted valid title and rejected the heirs’ demand after investigating the provenance.
- The museums initiated a declaratory-judgment action; the litigation was later reconfigured to reflect the heirs’ affirmative recovery claims.
- The court denied the museums’ summary-judgment motion, finding triable disputes, including whether the sale was coerced; it indicated German law governed duress and New York law governed laches and certain later-transfer issues.
- On the eve of trial, the parties settled: the paintings would remain with the museums, and the agreement included a confidentiality clause covering the payment amount.
- Because of the matter’s public profile and the museums’ public-serving role, the court asked the parties to submit the settlement agreement under seal so it could decide whether filing and public access were required.
- After submission, the museums indicated willingness to make the settlement public, but the heirs continued to insist on confidentiality.

## Issues

1. Whether the submitted settlement agreement was a “judicial document” triggering a presumption of public access.
2. If so, how strong the presumption of access was for a settlement agreement not incorporated into an adjudicative ruling.
3. Whether public interest in transparency concerning major museums and alleged Nazi-era coerced sales justified overriding the parties’ confidentiality provision.

## Decision

- The court treated the settlement agreement as, at most, only weakly a judicial document because it was not used to adjudicate the merits and was only tangentially related to the court’s performance of its judicial function.
- Any common-law presumption of public access was correspondingly weak for this type of settlement submission.
- Applying controlling Second Circuit standards, the court declined to order public disclosure and honored the confidentiality clause despite expressing reservations given the public interest.
- The action was dismissed with prejudice pursuant to the settlement, leaving the payment terms undisclosed and the paintings with the museums.

## Legal Principles

- A filed document is not automatically subject to strong public-access rights; it must be relevant to the exercise of judicial power and useful to the judicial process to qualify as a judicial document.
- Settlement agreements that are not incorporated into, or necessary for, a judicial decision on the merits generally carry only a weak presumption of public access.
- A weak access presumption will ordinarily yield to countervailing confidentiality interests reflected in an express settlement confidentiality term, absent a sufficiently weighty legal basis for disclosure.
- Significant public interest in the subject matter, without more, may be insufficient to overcome the limited judicial-document status of a purely private settlement.

## Conclusion

The court kept the settlement agreement confidential because it was only marginally connected to judicial decisionmaking and therefore carried, at most, a weak presumption of public access; under controlling precedent, that limited presumption did not justify overriding the parties’ confidentiality term, even in a high-profile dispute involving alleged Nazi-era coerced sales and public-serving museums.


Schoeps v. Museum of Modern Art, 603 F. Supp. 2d 673 (S.D.N.Y. 2009)