The department believes German prosecutors violated Washington Conference Principles on Nazi-Confiscated Art, international norms worked out Dec. 3, 1998, that govern the handling of claims to art seized or looted by the Nazis, the official told The Wall Street Journal.
In particular, Germany violated a provision about speedy publication of information about the discovery of stolen works, the person told the Journal.
The provision says, "Every effort should be made to publicize art that is found to have been confiscated by the Nazis" so the works' prewar owners or heirs can be located.
The 1,406 works -- including ones by Henri Matisse, Marc Chagall, Pierre-Auguste Renoir, Henri de Toulouse-Lautrec, Pablo Picasso and other masters -- were kept secret by Berlin since they were discovered in a Munich apartment during a tax-evasion investigation Feb. 28, 2012.
German prosecutors went public with the discovery only this week after German news magazine Focus reported the find Sunday.
The 121 framed and 1,285 unframed works were found in the apartment of Cornelius Gurlitt, 79, who father, Hildebrand Gurlitt, was one of the few art dealers selected by Joseph Goebbels, the Third Reich minister of public enlightenment and propaganda, to sell to buyers abroad the Modernist works banned by the Nazis as "degenerate."
Reinhard Nemetz, head of the state prosecutor's office in the Bavarian city of Augsburg, told reporters Tuesday officials didn't go public with the discovery because it would have been "counterproductive" to the tax-evasion probe as well as a security risk because of the artworks' value, which Focus said was more than $1.3 billion.
U.S. officials plan to call for Germany to publish all information discovered in the past 20 months by a German research team led by art historian Meike Hoffmann, the Journal said.
Hoffmann, of Berlin's Free University, is in charge of tracing the artworks' original owners and identifying if they have surviving relatives.
The State Department also intends to call for Hoffman's team to be expanded to include specialists in an array of areas of art, such as 19th century Impressionism, to speed up restitution of works to U.S. citizens and people elsewhere, the Journal said.