No Deal Near in Holocaust Survivors' Suit
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Los Angeles Times December 15, 2004 Wednesday
Hungarian Jews, in a case against the U.S., are seeking compensation for property seized by the Nazis and recovered by the U.S. Army.
By: Henry Weinstein, Times Staff Writer
Facing a critical court hearing Monday, Justice Department attorneys and lawyers representing Hungarian survivors who have filed the only Holocaust reparations suit against the U.S. government are far from reaching a settlement, parties close to the negotiations said.
The survivors sued in U.S. district court in Miami in May 2001. They are seeking compensation for property seized by the Nazis in 1944 and recovered by the U.S. Army a year later but never returned to the original owners.
Justice Department lawyers have maintained that the suit should be thrown out for two primary reasons: The statute of limitations had run out years before the suit was filed, and the government was entitled to immunity.
In August 2002, however, U.S. District Judge Patricia A. Seitz said that the plaintiffs were entitled to have the statute of limitations waived, and that the government's immunity argument was only partially valid.
Seitz has been urging the two sides to settle the case. She ordered mediation this year, and Fred F. Fielding, a prominent Washington lawyer, was selected as mediator.
Fielding, who worked in the White House during the Nixon and Reagan administrations and served on the Sept. 11 commission, said recently: "The only thing I can tell you is that we're still at the table. There is a potentially defining moment coming up." He was referring to Monday's hearing on the government's motion to dismiss the case.
A lawyer who has been involved in the negotiations said: "Based on where we are today, it is unlikely that there will be a settlement by next week, because the sides are too far apart." The lawyer, who spoke on condition of anonymity, said the sides were divided on two key issues -- the amount of a settlement and what the government would say about its responsibility for events that occurred in 1945.
Rabbi Israel Singer, chairman of the World Jewish Congress, said he had participated in a mediation session on Dec. 6 in Washington. He said the session had "begun to bring the parties to an understanding of the other side's position." However, he added, the two sides were nowhere near agreement on a settlement "sufficient to even address the symbolic nature" of a payment he expected the government eventually to make.
The Justice Department attorneys, Singer said, "have to understand that there are Holocaust survivors in this group who have thrice been harmed -- once by the Nazis, once by the Communists and once by the U.S."
Members of Congress who have been urging the Bush administration to settle the case have expressed anger and frustration about a lack of progress.
"The response of the Bush administration thus far has been disgraceful," said Rep. Robert Wexler (D-Fla.). "It is incomprehensible why the Bush administration has not followed the same rules and guidelines that we have correctly demanded of other countries and companies" in Holocaust-related litigation, he said. "It's a stain on America."
Sen. Hillary Rodham Clinton (D-N.Y.) said that if the case was not resolved promptly, members of the Senate ought to question White House Counsel Alberto R. Gonzales about it next month in hearings on his nomination for attorney general -- "a post that can and should play a direct role in resolving an issue affecting thousands of aging survivors who are sadly dying as their case continues to languish."
On Friday, a dozen members of Congress sent a letter to Gonzales urging him to get the case resolved "quickly and fairly." The group took particular umbrage at the Justice Department.
Led by Rep. Anthony D. Weiner (D-N.Y.), the lawmakers emphasized that the department, in its attempts to get the case dismissed, had "attacked the survivors themselves for lacking 'due diligence' in failing to bring the case before 2001, though the facts of the mishandling [of stolen goods] were only publicly revealed by a commission in 1999."
The Justice Department declined to comment.
White House spokeswoman Erin Healy said that Gonzales would reserve any comments on the issue until his confirmation hearing.
Although most of the lawmakers pressing the issue are Democrats, some Republicans have joined in. Rep. Ileana Ros-Lehtinen of Florida has urged several key members of the administration -- including Karl Rove, the president's chief political advisor -- to settle the case.
"We've asked the world to provide restitution to survivors," she said recently. "Now it is our turn."
The case stems from the Nazis' seizure of more than $200 million in gold, jewelry, Oriental rugs, fabrics and artwork -- among them paintings by Durer and Rembrandt.
The spoils were loaded on dozens of rail cars -- which came to be known as the Gold Train -- bound for Germany. However, the train was abandoned by the Nazis in Austria and recovered by the U.S. Army. Most of the treasures vanished, according to a report issued by the Presidential Advisory Commission on Holocaust Assets in the U.S. in 1999.
The plaintiffs assert that the U.S. knew or could have discovered the provenance of much of the booty and had acted illegally by failing to return the goods to the rightful owners, particularly since the Army had inventories prepared by the Nazis.
The plaintiffs are seeking a full accounting from the government and as much as $10,000 in damages each. It has been estimated that there could be 30,000 beneficiaries.
Reports released by the commission in 1999 and 2000 stated that the chief U.S. military official in western Austria at the end of World War II had requisitioned a hoard of the goods from a U.S. military warehouse in Salzburg, Austria -- including enough china and silverware for 45 people, a dozen silver candlesticks, 30 sets of table linens, carpets and furs.
The special U.S. commission report called the Gold Train affair "an example of an egregious failure of the United States to follow its own policy regarding restitution of Holocaust victims' property."
The Justice Department has countered that because some Hungarian Jews knew as early as 1947 that the U.S. Army had taken possession of the Gold Train, the six-year statute of limitations for filing such a case expired no later than 1953.
In court papers filed in June, the government said the U.S. "bears neither the legal nor the moral responsibility" for the plundered valuables of the Hungarian Jews.
Singer said he was saddened by the government's position. The U.S. "fought against the Nazis and liberated people in concentration camps," Singer said. But some members of the government "fell short" in returning the seized possessions that are the subject of the survivors' lawsuit. He said the government should settle the case and make a formal apology.
"We are a nation strong enough to say 'I'm sorry,' " Singer said.
