Steven D. Feldman (212) 592-1420 sfeldman@Herrick

1. International Conference onPROTECTING CULTURAL HERITAGE AS A COMMON GOOD OF HUMANITY: A CHALLENGE FOR CRIMINAL JUSTICE Joint Efforts in the United States by Private Counsel and Federal Prosecutors to Recover Cultural Property Steven D. Feldman (212) 592-1420 sfeldman@Herrick.com

2. Introduction • Former federal prosecutor at U.S. Attorney’s Office in New York • Currently head of White Collar Criminal Litigation at Herrick, Feinstein LLP

3. KEY CRIMINAL STATUTE -- National Stolen Property Act (“NSPA”) • 18 U.S.C. §§ 2314 & 2315 constitute the NSPA. • Section 2314 states in relevant part: • Whoever transports, transmits, or transfers in interstate or foreign commerce any goods, wares, merchandise, securities or money, of the value of $5,000 or more, knowing the same to have been stolen, converted or taken by fraud ... [s ] hall be fined under this title or imprisoned not more than ten years, or both. • Section 2315 states in relevant part: • Whoever receives, possesses, conceals, stores, barters, sells, or disposes of any goods, wares, or merchandise, securities, or money of the value of $5,000 or more, which have crossed a State or United States boundary after being stolen, unlawfully converted, or taken, knowing the same to have been stolen, unlawfully converted, or taken ... [s ] hall be fined under this title or imprisoned not more than ten years, or both.

4. KEY CRIMINAL STATUTE -- National Stolen Property Act (“NSPA”) (CONT’D) • Thus, a NSPA violation consists of three elements: • the transportation in interstate or foreign commerce of property, • valued at $5,000 or more, • with knowledge that the property was stolen, converted, or taken by fraud. • Other Relevant Criminal Statutes • 18 U.S.C. § 545 ~ Smuggling Goods Into the United States.

5. Legal Bases for Recovery • Federal civil forfeiture actions in the United States are governed by the Civil Asset Forfeiture Reform Act of 2000 (“CAFRA”) • Generally, property is subject to forfeiture if it falls under one of the following three categories: • contraband; • instrumentalities of a criminal offense; or • property constituting, derived from, or traceable to any proceeds obtained from criminal activity. • See 18 USC § 981(a)(1).

6. Legal Bases for Recovery (cont’d) • CAFRA applies to almost all civil forfeitures initiated under any provision of federal law -- including the National Stolen Property Act, 18 U.S.C. §§2314 & 2315 • Jurisdiction in civil forfeiture actions is based on in rem jurisdiction over the property, as opposed to personal jurisdiction over the parties. • For property located within the United States, seizure brings the property within the control of the court, and forms the basis of the court’s jurisdiction. • Where property that is subject to forfeiture under U.S. law is located in a foreign country, or where the property has been “detained or seized pursuant to [a] legal process or competent authority of a foreign government,” a district court may exercise original jurisdiction over that property. 28 U.S.C. §1355(b)(2).

7. CAFRA Legal Requirements • The Government bears the initial burden of proof to show, by a preponderance of the evidence, that the seized property is subject to forfeiture. 18 U.S.C. § 983(c). • Pursuant to 18 U.S.C. § 983(d), an “innocent owner” defense may defeat a civil forfeiture action under CAFRA. • Burden of proof on the claimant to prove he is an innocent owner by a preponderance of the evidence. • Where the property interest is acquired after the conduct giving rise to the forfeiture has taken place, an “innocent owner” is one who, “at the time that [the] person acquired the interest in the property,” was “a bona fide purchaser or seller for value” who either did not know, or had no reason to believe, that the property being acquired was subject to forfeiture. 18 U.S.C. § 983(d)(3)(A).

8. Non-CAFRA Forfeiture • Cases that are initiated for the forfeiture of stolen art objects are often brought pursuant to 19 U.S.C. § 1595a • Section 1595a is a customs statute that authorizes the forfeiture of any merchandise that is • introduced into the United States “contrary to law,” and • stolen, smuggled, or clandestinely imported or introduced.

9. Non-CAFRA Forfeiture (CONT’D) • CAFRA does not apply to civil forfeiture actions brought under Title 19 of the United States Code, so different procedural provisions apply. • Under § 1595a, the Government bears the burden to show that there is probable cause to believe that the object at issue is subject to forfeiture. • Once the Government meets this initial burden, the burden shifts to the possessor of the property to establish by a preponderance of the evidence that the object was not stolen merchandise introduced into the United States contrary to law. • The innocent owner defense, which is only available in CAFRA forfeiture actions, does not apply in forfeiture claims brought pursuant to section 1595a.

10. Representation of National Library of Sweden (“NLS”) • Background to NLS matter • Strategy: • Joint effort with the U.S. Attorney’s Office for the Southern District of New York and the FBI • Benefits for Client • Resources & expertise • Significant Leverage • Possible Negative Consequences • Loss of Control

11. UNITED STATES v. ONE TYRANNOSAURUS BATAAR SKELETON, 12 Civ. 4760 (PKC) • U.S. Attorney’s Office brought in rem action seeking civil forfeiture of Tyrannosaurus Bataar Skeleton, listed in Heritage Auctions May 20,2012 Natural History Auction Catalog • The Government alleged that the Defendant Property was subject to forfeiture under three different federal statutes. • Alleged that under Mongolian law, fossils such as the Defendant Property are the property of the state. • Further alleged that the Defendant Property was brought into the United States by way of false statements concerning its value and country of origin. • Government sought forfeiture on the grounds that the dinosaur fossil was • property obtained in violation of the National Stolen Property Act (18 U.S.C. §§ 2314 & 2315), and • property imported into the U.S. in violation of the Customs laws.

12. UNITED STATES v. ONE TYRANNOSAURUS BATAAR SKELETON, 12 Civ. 4760 (PKC) (CONT’D) • Case was resolved when Government brought criminal charges against the commercial paleontologist. • Ultimately, he pleaded guilty to engaging in a scheme to illegally import the fossilized remains of numerous dinosaurs that had been taken out of their native countries illegally and smuggled into the U.S. • Pled guilty to a three-count criminal information: • Count One charged conspiracy to smuggle illegal goods and make false statements with respect to a Chinese Microraptor flying dinosaur; • Count Two charged entry of goods by means of false statements with respect to two Mongolian dinosaur fossils; and • Count Three charged interstate and foreign transportation of goods converted and taken by fraud • Not yet sentenced.

13. CRIMINAL PROSECUTIONS • Mr. Prokopi’s case illustrates a conundrum periodically faced by defense attorneys in civil forfeiture cases. • Because the U.S. Attorney’s Office has the ability to bring a criminal case in appropriate circumstances, the Office often has far more leverage in a negotiation than does the importer or purported owner of the piece at issue. • While the client may wish to contest whether civil forfeiture is appropriate, the U.S. Attorney’s Office can threaten to bring criminal charges against the client if he or she does not consent to forfeiture. • Where a piece is forfeited, the client is only out the value of the object. But if a criminal case is instituted, the client is faced with a felony record and imprisonment. • With such great leverage, the U.S. Attorney’s Office often obtains the object it seeks to have forfeited and returned.

14. International Conference onPROTECTING CULTURAL HERITAGE AS A COMMON GOOD OF HUMANITY: A CHALLENGE FOR CRIMINAL JUSTICE Joint Efforts in the United States by Private Counsel and Federal Prosecutors to Recover Cultural Property Steven D. Feldman (212) 592-1420 sfeldman@Herrick.com