NEW YORK—In Vienna, where Hitler aspired to be an artist, tourists are served up Hapsburg nostalgia, and, as the saying goes, you can set your watch back 50 years — or 70 years, if you follow the art restitution debates. As Austria marks the 70th anniversary of the Anschluss that merged it with the Third Reich, the country is once again a battleground in the fight over art looted from Jews during the Nazi period.

Pressure for historical accountability is mounting, not just from Jewish groups but from the opposition Green Party. This campaign could energize the art restitution process, which has turned out to be less of a waltz than was expected two years ago, after Austria returned five Gustav Klimt paintings to the heirs of Ferdinand Bloch-Bauer, the original owner before World War II. The works had been in Vienna’s state-owned Belvedere Museum of the Austrian Gallery since the late 1940s. Their return—followed by Ronald Lauder’s purchase of "Adele Bloch-Bauer I," once the Belvedere’s most famous icon, for $135 million on behalf of the Neue Galerie in New York—signaled a turning point in relations between Holocaust-era claimants and Austria, or so it seemed. The media swooned when the Bloch-Bauer heirs sold the four other Klimts at Christie’s New York in November 2006 for more than $190 million.

On April 1, the heirs suffered a setback when the Austrian Supreme Court turned down their petition to reverse a decision by an arbitration board denying the family’s request for the return of a sixth Klimt painting residing in a national institution. Painted at the end of Klimt’s life, it is the unfinished portrait of a dark-haired woman, Amalie Zuckerkandl, who eventually died in Auschwitz. The picture was in the inventory of Ferdinand Bloch-Bauer’s house when the Nazis seized it in 1939 after Bloch-Bauer fled to Switzerland. But Zuckerkandl’s non-Jewish son-in-law, who never owned the work, sold it around that same time to an Austrian dealer, Vita Kuenstler, who donated it to the Austrian Gallery decades after the war.

"Amalie Zuckerkandl" is "no less stolen" than the Klimts that were returned in 2006, says E. Randol Schoenberg, the Los Angeles–based lawyer who represented the family in both cases. Schoenberg attributes the latest decision to Austria’s unwillingness to award another famous work in a national museum to the heirs of Holocaust theft victims. "We lose because the arbitrators were angry that we were taking the other Klimt paintings out of the country," he says. "It enabled the arbitrator to say that it was politically impossible to give up another painting." He notes that other unrestituted paintings in the Belvedere are still not being claimed, as families wait and weigh the prospects of return.

Restitution of Nazi-era loot is a slow, expensive process, and it isn’t getting easier, despite a few high-profile exceptions. Under Austrian law, private institutions and collectors can hold Nazi loot with near impunity. One case that challenges the status quo targets the Rudolf Leopold Foundation, an institution created in 1994 when the Austrian government bought the collection of Leopold, an ophthalmologist, for $250 million. The foundation’s museum, built at government expense, opened to the public in 2001. Last spring, the Green Party and the Israelitische Kultusgemeinde Wien, the official representative group of Vienna’s Jewish community, demanded that the Leopold conduct pro-venance research on its 5,500 artworks, many of them by Klimt and Egon Schiele. The demands came after the Greens alleged that 14 looted paintings were on view at the museum, in a special exhibition devoted to the Austrian genre painter Albin Egger-Lienz (1868–1926), a favorite of the Nazis.

The Leopold Foundation argues that it is a private entity, and its lawyers stress that no Austrian law requires any institution to conduct provenance research. IKG executive director Erika Jakubovits says the government-funded foundation’s private status has prevented researchers from determining where Leopold got his paintings—which he began collecting soon after the war—and prevented claimants from recovering them: "You could say that the government is hiding public property in a private foundation."

Leopold’s lawyer, Andreas Noedl, dismisses the criticism as "political" and notes that the Leopold Foundation is hiring a researcher to look into the provenance of its paintings. In interviews with the Viennese press, the 83-year-old Leopold has said that his detractors are "out for money," which Jakubovits sees as a not-so-veiled reference to Jews.