Simply IATA convention accepting a common sense reading of the Montreal Convention which points to LH because LH did not deliver the bag.
On the 21st day, the OP would have a claim for as much as approximately EUR 1,410 (SDR will vary slightly by day) which would be total of the fair market value of the bag itself, its contents and any interim reimbursements (which essentially replace items in the bag).
If you have an old beat up suitcase and worn clothes, the fair market value can amount to not much, sometimes a good reason to consider whether your travel insurance is for replacement cost).