The 1887 gouache, La cueillette des pois (Pea harvest), is currently on show at the Musée Marmottan as part of an exhibition dedicated to Pissaro, The First of the Impressionists.
It is on loan from a US couple named Toll, who bought it at Christie's New York in 1995.
It was among 93 artworks belonging to French collector Simon Bauer confiscated in 1943 and sold by a dealer designated by the Jewish affairs commissariat.
Bauer, who was interned at the Drancy camp near Paris in 1944, escaped deportation to a German concentration camp because of a railworkers' strike.
After the war he tried to reconstitute his collection but only managed to track down a small part of it.
US owners fight sequestration
On Friday his grandson, Jean-Jacques Bauer, aaked a court to place the picture under sequestration and then establish who is the rightful owner.
"This picture must stay in France," his lawyer Cédric Fischer said, so that the judge can decide "calmy, without haste".
The Tolls have opposed sequestration.
They are patrons of the Washington and Tel Aviv holocaust museums and say they did not know about the paintings history.
This is not the first time the picture has resurfaced since World War II.
In 1964 the Bauer family learnt that it was being sold under the counter and it was seized.
But a judge lifted the order and an American buyer took it away.
It was then sold at Sotheby's in London in 1966.