The record-setting $32 million sale of Gustav Klimt's "Portrait of Fräulein Lieser" (1917) has fallen through after a restitution settlement failed to resolve gaps in its provenance. The painting, discovered in early 2024 and sold at Im Kinsky auction house in Vienna to an anonymous Hong Kong buyer in April, was mired in controversy over its history during the Nazi era. The work's whereabouts between 1925 and 1961 were unknown, a period including Austria's annexation by Nazi Germany. The auction house proposed the work was commissioned by Henriette Lieser, who was deported and murdered at Auschwitz, but conflicting theories about the sitter's identity and the painting's path through a Nazi party member's family complicated restitution efforts. A new potential legal heir emerged after the sale, and the buyer ultimately pulled out.
This failed sale matters because it highlights the ongoing challenges of Nazi-era art restitution, even when works achieve record prices. The case underscores how incomplete provenance research can undermine high-profile auctions and create legal and financial risks for auction houses, buyers, and heirs. The controversy also reflects broader debates about how Austria and the art world handle works with questionable histories from the Holocaust period, potentially setting a precedent for future claims and sales of looted or displaced art.