In the United States District Court for the District of Columbia

Case 1:10-cv-01770-BAH Document 24 Filed 05/06/11 Page 1 of 60

IN THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF COLUMBIA

ROSALIE SIMON, et al., * Individually, for themselves and for all * others similarly situated, * * Plaintiffs, * * v. * Case No. 1:10-cv-01770-BAH * THE REPUBLIC OF HUNGARY, et al., * * Defendants. * * * * * * * * * * * * * * * * * * * * * * * * * * * *

PLAINTIFFS’ MEMORANDUM OF LAW IN OPPOSITION TO MOTION OF DEFENDANTS THE REPUBLIC OF HUNGARY AND MAGYAR ÁLLAMVASUTAK ZRT. TO DISMISS THE FIRST AMENDED COMPLAINT

Charles S. Fax, D.C. Bar No. 198002 L. Marc Zell, admitted pro hac vice Liesel J. Schopler, D.C. Bar No. 984298 Zell & Co. Rifkin, Livingston, Levitan & Silver, LLC 21 Herzog Street 7979 Old Georgetown Road, Suite 400 Jerusalem 92387 Israel Bethesda, Maryland 20814 Telephone: 011-972-2-633-6300 Telephone: (301) 951-0150 Telecopier: 011-972-2-672-1767 Telecopier: (301) 951-0172 [email protected] [email protected]; [email protected]

David H. Weinstein, admitted pro hac vice Paul G. Gaston Weinstein Kitchenoff & Asher LLC Law Offices of Paul G. Gaston 1845 Walnut Street, Suite 1100 1776 Massachusetts Avenue, N.W, Suite 806 Philadelphia, Pennsylvania 19103 Washington, D.C. 20036 Telephone: (215) 545-7200 Telephone: (202) 296-5856 Telecopier: (215) 545-6535 Telecopier: (202) 296-4154 [email protected] [email protected]

Dated: May 6, 2011 Attorneys for Plaintiffs

Case 1:10-cv-01770-BAH Document 24 Filed 05/06/11 Page 2 of 60

TABLE OF CONTENTS

Page

TABLE OF AUTHORITIES ...... iii

I. INTRODUCTION: THE TRUE NATURE OF THE HUNGARIAN HOLOCAUST 2

II. STATEMENT OF FACTS ...... 3

III THIS COURT HAS SUBJECT MATTER JURISDICTION OVER THIS CASE UNDER THE EXPROPRIATION EXCEPTION OF THE FOREIGN SOVEREIGN IMMUNITIES ACT, 28 U.S.C. § 1605 (a)(3) ...... 7

A. At The Pleadings Stage, Plaintiffs Need Make Only A “Substantial And Non-Frivolous Claim” To Support An Exception To Sovereign Immunity ...... 9

B. The Taking Of Personal And Other Property By MÁV And Hungary From Hungarian Jews Violated International Law ...... 11

1. Courts Have Held That Discriminatory Takings Are Violations Of International Law ...... 12

2. Hungary’s Express Undertaking In The 1947 Treaty To Compensate Its Own Citizens For The Discriminatory Takings Acknowledges Those Takings To Have Been In Violation Of International Law ...... 14

C. Plaintiffs Have Expressly, Specifically And Plausibly Alleged That Some Of The Property Exchanged For The Property Taken Is In The Control And Possession Of MÁV And That Some Is Used In Connection With Hungary’s Commercial Activities Within The United States ...... 17

IV. PLAINTIFFS’ CLAIMS ARE JUSTICIABLE ...... 19

A. Neither The 1947 Peace Treaty Nor The 1973 Executive Agreement Preempts Federal Judicial Power Over Plaintiffs’ Claims ...... 21

B. Plaintiffs’ Claims Do Not Require Evaluation Of Hungary’s Compliance With Article 27 Of The Peace Treaty, Its Compensation Schemes, Or The Rulings Of The Hungarian Constitutional Court ...... 28

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V. THIS COURT IS THE PROPER FORUM FOR ADJUDICATION OF THIS CASE, AND IT SHOULD NOT BE DISMISSED ON THE GROUND OF FORUM NON CONVENIENS ...... 32

A. Standard For Forum Non Conveniens ...... 32

B. Hungary Affords An Inadequate Alternative Forum In Which To Adjudicate This Claim ...... 34

C. Alternatively, Defendants Have Not Met Their Heavy Burden Of Making A Clear Showing That The Balance Of Public And Private Interests Weighs So Heavily In Favor Of The Hungarian Forum That The Strong Presumption In Favor Of Plaintiffs’ Choice Of Forum Is Overcome ...... 41

1. Contrary To Defendants’ Assertion, The Court Must Afford Substantial Deference To The Plaintiffs’ Choice Of Forum ...... 41

2. The Private Interest Factors Weigh In Favor Of The Plaintiffs, And At A Minimum, Do Not Clearly Weigh In Favor Of The Defendants ...... 43

3. The Public Interest Factors Weigh In Favor Of The Plaintiffs, And At A Minimum, Do Not Clearly Weigh In Favor Of the Defendants ...... 46

VI. CONCLUSION ...... 49

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TABLE OF AUTHORITIES

Page(s)

CASES

Alberti v. Empresa Nicaraguense de la Carne, 705 F. 2d 250 (7th Cir. 1983) ...... 11

Altmann v. Republic of Austria, 317 F.3d 954 (9th Cir. 2002) ...... 46

Alperin v. Vatican Bank, 410 F.3d 532 (9th Cir. 2005), cert. denied, 546 U.S. 1137 (2006) ...... 20, 31

Am. Dredging Co. v. Miller, 510 U.S. 443 (1994) ...... 43

Aquamar S.A. v. Del Monte Fresh Produce N.A,. 179 F.3d 1279 (11th Cir. 1999) ...... 11

Arias v. Dyncorp, 517 F. Supp. 2d 221 (D.D.C. 2007) ...... 22

*Baker v. Carr, 369 U.S. 186 (1962) ...... 19-21, 23, 31-32

Bell v. Hood, 327 U.S. 678 (1946) ...... 10

Belk v. United States, 858 F.2d 706, 707 (Fed. Cir. 1988) ...... 28

Bhatnagar v. Surrendra Overseas Ltd., 52 F.3d 1220 (3d Cir. 1995) ...... 33-35, 42

*Bodner v. Banque Paribas, 114 F. Supp. 2d 117 (E.D.N.Y. 2000) ...... 12, 41, 44, 46-48

Boumediene v. Bush, 553 U.S. 723 (2008) ...... 23

Burger-Fischer v. Degussa AG, 65 F. Supp. 2d 248 (D.N.J. 1999) ...... 32

Butcher v. Gerber Prods. Co., 1998 WL 437150, 1998 U.S. Dist. LEXIS 11869 (S.D.N.Y. Aug. 3, 1988) ...... 43

Canadian Overseas Ores Ltd. v. Compania De Acero del Pacifico, S.A., 528 F. Supp. 1337 (S.D.N.Y. 1982) ...... 36

Cargill Int’l S.A. v. M/T Pavel Dybenko, 991 F.2d 1012 (2d Cir. 1993) ...... 11

Carijano v. Occidental Petroleum Corp., 626 F.3d 1137 (9th Cir. 2010) ...... 33-34, 40, 42, 44

Cassirer v. Kingdom of Spain, 616 F.3d 1019 (9th Cir. 2010) ...... 13-14

* Denotes cases or authorities on which counsel chiefly relies.

iii

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Chabad v. Russian Fed’n, 466 F. Supp. 2d 6 (D.D.C. 2006), aff’d in part and rev’d in part, 528 F.3d 934 (D.C. Cir. 2008) ...... 44, 48

*Chabad v. Russian Fed’n, 528 F.3d 934 (D.C. Cir. 2008) ...... 9-11, 18, 32, 40

Cheng v. Boeing Co., 708 F. 2d 1406 (9th Cir. 1983) ...... 41

Coalition for Underground Expansion v. Mineta, 333 F.3d 193 (D.C.Cir. 2003) ...... 16

Crist v. Republic of Turkey, 995 F. Supp 5 (D.D.C. 1998) ...... 10

Cruz v. Maritime Co. of Philippines, 549 F. Supp. 285 (S.D.N.Y. 1982), aff’d, 702 F.2d 47 (2d Cir. 1983) ...... 47

Dames & Moore v. Regan, 453 U.S. 654 (1981) ...... 28

*Deirmenjian v. Deutsche Bank, A.G., 2006 U.S. Dist. LEXIS 96772 (C.D. Cal. Sept. 25, 2006) ...... 43, 45, 47-48

Derensis v. Coopers & Lybrand Chartered Accountants, 930 F. Supp. 1003 (D.N.J. 1996) ...... 43, 45

DiRienzo v. Philip Servs. Corp., 249 F.3d 21 (2d Cir. 2002) ...... 44

Dorfman v. Marriott Int'l Hotels, Inc., 2001 U.S. Dist. LEXIS 642 (S.D.N.Y. Jan. 29, 2001) ...... 35, 46

Duha v. Agrium, Inc., 448 F.3d 867 (6th Cir. 2006) ...... 45

EEOC v. St. Francis Xavier Parochial Sch., 117 F.3d 621 (D.C. Cir. 1997) ...... 16

El-Shifa Pharm. Indus. Co. v. United States, 607 F.3d 836 (D.C. Cir. 2010) cert. denied, 131 S. Ct. 997 (2011) ...... 20

Eurofins Pharma US Holdings v. BioAlliance Pharma, S.A., 623 F.3d 147 (3d Cir. 2010) ...... 34, 38, 40

European Cmty. V. RJR Nabisco, Inc., 2011 U.S. Dist. LEXIS 41219 (E.D.N.Y. Apr. 14, 2011) ...... 46

Filartiga v. Pena-Irala, 630 F. 2d 876 (2d Cir. 1980) ...... 13

Freund v. Republic of France, 592 F. Supp. 2d 540 (S.D.N.Y. 2008), aff’d on other grounds, Freund v. Societe Nationale des Chemins de Fer Francais, 391 Fed. Appx. 939 (2d Cir. N.Y. 2010) ...... 13

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Frumkin v. JA Jones, Inc., 129 F. Supp. 2d 370 (D.N.J. 2001) ...... 32

Ganem v. Heckler, 746 F.2d 844 (D.C. Cir 1984) ...... 29-30

Garb v. Poland, 440 F.3d 579 (2d Cir. 2006) ...... 13

Gould v. Nat’l Life Ins. Co., 990 F. Supp. 1354 (M.D. Ala. 1998) ...... 43

Guidi v. Intercontinental Hotels Corp., 224 F.3d 142 (2d Cir. 2000) ...... 35

Gulf Oil Corp. v. Gilbert, 330 U.S. 501 (1947) ...... 33, 43

Haas v. Humphrey, 246 F.2d 682 (D.C. Cir. 1957) ...... 27

HTC Corp. v. IPCom GMBH & Co., KG, 2009 U.S. Dist. LEXIS 125791 (D.D.C. Dec. 18, 2009) ...... 24

*In Re: Assicurazioni Generali S.p.A. Holocaust Ins. Litig., 228 F. Supp. 2d 348 (S.D.N.Y. 2002) ...... 41, 44-48

In re Banco Santander Sec.-Optimal Litig., 732 F. Supp. 2d 1305 (S.D. Fla. July 30, 2010) ...... 41

In re Bridgestone/Firestone, Inc., 190 F. Supp. 2d 1125 (S.D. Ind. 2002) ...... 23-24, 35

In re Nematron Corp. Sec. Litig., 30 F. Supp. 2d 397 (S.D.N.Y. 1998) ...... 43, 45-46

Interpane Coatings, Inc. v. Australia & New Zealand Banking Group Ltd., 732 F. Supp. 909 (N.D. Ill. 1990) ...... 42

Iwanowa v. Ford Motor Co., 67 F. Supp. 2d 424 (D.N.J. 1999) ...... 32

Japan Whaling Asso. v. American Cetacean Soc., 478 U.S. 221 (1986) ...... 19

Jerome Stevens Pharm., Inc. v. Food & Drug Admin., 402 F.3d 1249 (D.C. Cir. 2005) . . 16

Joo v. Japan, 413 F.3d 45 (D.C. Cir. 2005), cert. denied, 546 U.S. 1208 (2006) ...... 30

Kadic v. Karadzic, 70 F.3d 232 (2d Cir. 1995) ...... 21

Kelberine v. Societe Internationale, 363 F.2d 989 (D.C. Cir. 1966), cert. denied, 385 U.S. 989 (1966) ...... 31

Koster v. Lumbermens Mutual Casualty Co., 330 U.S. 518 (1947) ...... 43

Lacy v. Cessna Aircraft Co., 932 F.2d 170 (3d Cir. 1991) ...... 38

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Lehman v. Humphrey, Ltd., 713 F.2d 339 (8th Cir. 1983) ...... 45

*Licea v. Curacao Drydock Co., Inc., 537 F. Supp. 2d 1270 (S.D. Fla. 2008) ...... 34-35, 37, 41, 44, 46, 48

Malewicz v. City of Amsterdam, 362 F. Supp. 2d 298 (D.D.C. 2005) ...... 10

Martin v. Vogler, 1993 U.S. Dist. LEXIS 15878 (N.D. Ill. 1993) ...... 42

Martinez v. Dow Chemical Co., 219 F. Supp. 2d 719, 637-38 (D. La. 2002) ...... 35, 37

McDonald’s Corp. v. Bukele, 960 F. Supp. 1311 (N.D. Ill. 1997) ...... 48

MBI Group, Inc. v. Credit Foncier du Cameroun, 616 F.3d 568 (D.C. Cir. 2010) ...... 34, 37

Menedez Rodriguez v. Pan Am Life Ins. Co., 311 F.2d 429 (5th Cir. 1962) , vacated on other grounds, Pan American Life Ins. Co. v. Menendez Rodriguez, 376 U.S. 779 (1964) ...... 34

Motor Distributors, Ltd. v. Olaf Pedersen’s Rederi A/S, 239 F.2d 463 (5th Cir. 1956) . . . . 33

Mujica v. Occidental Petroleum Corp., 381 F. Supp. 2d 1134 (C.D. Cal. 2005) ...... 42

Moscovits v. Magyar Cukor Rt., 2001 U.S. Dist. LEXIS 9252 (S.D.N.Y. July 9, 2001) . . 35, 48

Norex Petroleum Ltd. v. Access Industries, Inc., 416 F.3d 146 (2d Cir. 2005), cert. denied, Tyumen Oil Co. v. Norex Petroleum Ltd., 547 U.S. 1175 (2006) ...... 33-35

Norwood v. Kirkpatrick, 349 U.S. 29 (1955) ...... 42-43

Pain v. United Technologies Corp., 637 F.2d 775 (D.C. Cir. 1980), cert. denied, 454 U.S. 1128 (1981) ...... 33, 35

Peregrine Myanmar Ltd. v. Segal, 89 F.3d 41 (2d Cir. 1996) ...... 44

*Piper Aircraft Co. v. Reyno, 454 U.S. 235 (1981), reh. denied, 455 U.S. 928 (1982) ...... 33-34, 40, 42-43, 47-48

*Presbyterian Church of Sudan v. Talisman Energy, Inc., 244 F. Supp. 2d 289 (S.D.N.Y. 2003) ...... 44, 46-47

Princz v. Federal Republic of Germany, 26 F.3d 1166 (D.C. Cir. 1994) ...... 31

Rosner v. United States, Cas. No. 01-1859-CIV-SEITZ, Final Order and Judgment, ECF 246 (S.D. Fl., Sept. 30, 2005) at Pacer.gov: https://ecf.flsd.uscourts.gov/doc1/0511542114 ...... 19

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Sangeorzan v. Yangming Marine Transp. Corp., 951 F. supp. 650 (S.D. Tex. 1997) ...... 36

Siderman de Blake v. Republic of Argentina, 965 F.2d 699 (9th Cir. 1992), cert. denied, 507 U.S. 1017 (1993) ...... 10

SME Racks, Inc. v. Sistemas Mecanicos Para Electronica, S.A., 382 F.3d 1097 (11th Cir. 2004) ...... 41

State of Netherlands v. Fed. Reserve Bank of New York, 201 F.2d 455 (2d Cir.1953) . . . . . 12

Tuazon v. R.J. Reynolds Tobacco Co., 433 F.3d 1163 (9th Cir. 2006) ...... 34, 37

*Ungaro Benages v. Dresdner Bank AG, 379 F.3d 1227 (11th Cir. 2004) ...... 20-21, 25

United States v. Curtiss-Wright Export Corp., 299 U.S. 304 (1936) ...... 22

United States v. Pink, 315 U.S. 203 (1942) ...... 28

USH Ventures v. Global Telesystems Group, Inc., 1999 Del. Super. LEXIS 123 (Del. Super. June 9, 1999) ...... 35

Van Cauwenberghe v. Biard, 486 U.S. 517 (1988) ...... 43, 45

Vaz Borralho v. Keydril Co., 696 F.2d 379 (5th Cir. 1983), reh. denied, 710 F.2d 207 (5th Cir. 1983) ...... 34, 37

Vieth v. Jubelirer, 541 U.S. 267 (2004) ...... 20

Watts, Watts & Co. v. Unione Austriaca di Navigazione, 248 U.S. 9 (1918) ...... 30

Weltover, Inc. v. Republic of Argentina, 753 F. Supp. 1201 (S.D.N.Y. 1991) ...... 44-45

West v. Multibanco Comermex, S.A., 807 F.2d 820 (9th Cir. 1987) ...... 10

Whiteman v. Dorotheum GmbH & Co KG, 431 F.3d 57 (2d Cir. 2005) ...... 24-25, 32

Wiwa v. Dutch Petroleum, 226 F.3d 88 (2nd Cir. 2000) ...... 46

Zappia Middle East Construction Co. v. Emirate of Abud Dhabi, 215 F.3d 247 (2d Cir. 1999) ...... 14

Zinsler v. Marriott Corp., 605 F. Supp. 1499 (D. Md. 1985) ...... 47

Zivotofsky v. Sec'y of State, 571 F.3d 1227 (D.C. Cir. 2009) (Edwards, J., concurring), reh’g denied, 610 F.3d 84 (D.C. Cir. 2010) (en banc) (Edwards, J., dissenting), cert. granted sub nom., M.B.Z. v. Clinton, No. 10-699, 2011 U.S. LEXIS

vii

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3528 (May 2, 2011) ...... 19

STATUTES

U.S. CONST. art. III, § 2 ...... 22

22 U.S.C. § 1641a(a) ...... 26

22 U.S.C. § 1641a(c) ...... 26

22 U.S.C. § 1641b ...... 26

22 USC § 1645b ...... 27

28 U.S.C. § 1350 ...... 22

28 U.S.C. § 1391(f)(4) ...... 34

28 U.S.C. § 1404(a) ...... 42-43

*28 U.S.C. § 1605(a)(3) ...... 7-11, 13-14, 18

28 U.S.C. § 1610 ...... 40

TREATIES

*1947 Treaty of Peace, T.I.A.S. No. 1651, 61 Stat. 2065 ...... 8-9, 12, 14-16, 21, 23-24, 26, 29-30, 32

Vienna Convention on the Law of Treaties (1969), 1155 U.N.T.S. 331, TS No. 58 (1980), 8 I.L.M. 679 (1969), Available at http://untreaty.un.org/ilc/texts/instruments/english/conventions/1_1_1969.pdf ...... 15

Treaty of Peace Between the Allies and Associated Powers and Hungary and Protocol and Declaration, Signed at Trianon, June 4, 1920, 1921 U.S.T. LEXIS 12; 6 L.N.T.S. 188 (In force Dec. 17, 1921) ...... 3, 8,12, 16

1973 Executive Agreement...... 21, 23, 26, 41

OTHER AUTHORITIES

46 Fed. Reg. 19893 (1981) ...... 28

47 Fed. Reg. 8092 (1982) ...... 28

58 Fed. Reg. 40461, 40462 (1993) ...... 28

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Fed.R.Civ.P. 23 ...... 31, 38

2006 New York Code § 112(b)(4), Available at http://law.justia.com/codes/new-york/2006/not-for-profit-corporation/npc0112_112.html . . 40

Amoco International Finance Corporation v. Islamic Republic Of Iran, 27 I.L.M. 1320, 1350 (1988) ...... 13

Article 38(1)(a) of the Statute of the International Court of Justice, Available at http://www.icj-cij.org/documents/index.php?p1=4&p2=2&p3=0 ...... 15

In the Matter of Claim of [Personally Identifiable Information Redacted] against The Great Socialist People’s Libyan Jamahiriya, Claim No. LIB-I-052, Decision No. LIB-I-023 (F.C.S.C. Oct. 16, 2009) ...... 27

Restatement (Third) of Foreign Relations Law of the United States § 102 (2004) ...... 15

Case 1:10-cv-01770-BAH Document 24 Filed 05/06/11 Page 11 of 60

IN THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF COLUMBIA

PLAINTIFFS’ MEMORANDUM OF LAW IN OPPOSITION TO MOTION OF DEFENDANTS THE REPUBLIC OF HUNGARY AND MAGYAR ÁLLAMVASUTAK ZRT. TO DISMISS THE FIRST AMENDED COMPLAINT

Named Plaintiffs, Hungarian Holocaust survivors Rosalie Simon et al., on behalf of

themselves and all others similarly situated (“Plaintiffs”), submit this Memorandum of Law in

opposition to the Motion to Dismiss the First Amended Complaint (ECF 22, hereinafter

“Motion”) filed by Defendants The Republic of Hungary (“Hungary”) and its national railway,

Magyar Államvasutak Zrt. (“MÁV”) (collectively, “Defendants”).1 Defendants make three

arguments: (a) The Court lacks subject matter jurisdiction due to Defendants’ claimed sovereign immunity under the Foreign Sovereign Immunities Act; (b) the claims are non-justiciable under the political question doctrine; and (c) the doctrine of forum non conveniens compels dismissal.

As demonstrated below, none of these arguments has merit, and the motion should be

denied.

1 Plaintiffs note that a default has been entered against Defendant Rail Cargo Hungaria Zrt. ECF 19. Case 1:10-cv-01770-BAH Document 24 Filed 05/06/11 Page 12 of 60

I. INTRODUCTION: THE TRUE NATURE OF THE HUNGARIAN HOLOCAUST

As the mass deportation of Hungarian Jewry to the gas chambers of Auschwitz reached its apex in July 1944, Prime Minister Winston Churchill decried the slaughter as “probably the greatest and most horrible crime ever committed in the whole history of the world.”2 This lawsuit seeks, for the first time in history, to bring Hungary to account for its actions.3

In their Motion, Defendants suggest that the Hungarian Holocaust was a German affair, and that Hungary was merely “integrated into the German war machine by the Nazi Regime that conceived and organized these crimes.” Defendants’ Memorandum in Support of Motion to

Dismiss First Amended Complaint, ECF 22-1 (“Def. Mem.”) at 1. That is not true. To be sure, the destruction of Hungarian Jewry was masterminded by Adolph Eichmann and his staff, but they comprised only some 130 persons.4 The Germans could not have effectuated the isolation,

concentration, impoverishment, expropriation, deportation and destruction of Hungarian Jewry

without the wholehearted, wholesale cooperation of the Hungarian government, which marshaled

and deployed the full complement of state authority, including Defendant MÁV, to destroy nearly half a million human beings within a few months in the spring and summer of 1944.5

2 Note from Prime Minister W. Churchill to Foreign Secretary A. Eden (July 14, 1944) in Winston S. Churchill, THE SECOND WORLD WAR: TRIUMPH & TRAGEDY, Appendix at 693 (Houghton Mifflin 1953).

3 In a parallel suit pending in the Northern District of Illinois, MÁV is the sole defendant. Victims of the Hungarian Holocaust v. Hungarian State Railways (MÁV), No. 1:10-cv-00868 (N.D. Ill.). The United States Judicial Panel on Multidistrict Litigation declined to consolidate the two cases in the District of Columbia pursuant to 28 U.S.C. §1407. ECF 10.

4 Gerald Fleming, HITLER AND THE FINAL SOLUTION at 160 (Univ. of Calif. Press 1984).

5 Randolph L. Braham, The Holocaust in Hungary: A Retrospective Analysis, in THE HOLOCAUST AND HISTORY: THE KNOWN, THE UNKNOWN, THE DISPUTED AND THE RE-EXAMINED at 434-435 (Michael Berenbaum & Abraham J. Peck eds., U.S. Holocaust Memorial Museum and Indiana Univ. Press 1998). 2 Randolph L. Braham, THE POLITICS OF GENOCIDE: THE HOLOCAUST IN HUNGARY, table 32.1, at 1298 (Rev. ed., Columbia Univ. Press 1994) (“2 Politics of Genocide”). These numbers do not take into account the murder of nearly 20,000 Hungarian Jews deported from the Transcarpathia and other territories annexed to Hungary after 1938 (Compl., ¶¶ 92-95); the death 2

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II. STATEMENT OF FACTS

The facts in the First Amended Complaint, ECF 21 (“Complaint” or “Compl.”) are largely undisputed.6 The 14 Named Plaintiffs are Holocaust survivors who lived in the

Hungarian State at the threshold of World War II. Contrary to Defendants’ assertion, Def. Mem. at 8, not all of the Plaintiffs were considered Hungarian citizens when they were deported by

Defendants. Some, like Plaintiff Tzvi Zelikovich (who, alone in his family, survived the 1941 massacre), believed themselves to be Hungarian citizens, but were forcibly expelled from their homes and delivered to the Nazi extermination squads based on Hungary’s assertion that they were not Hungarian nationals.

Named Plaintiffs lived in disparate locales. Several lived in what is called Trianon

Hungary, within the borders of Hungary today.7 Others lived in territory annexed by Hungary in

1938 after Czechoslovakia’s dismemberment.8 Certain members of the class alleged in this case

(“Class”) reside in areas seized and then annexed by Hungary from Romania and former

Yugoslavia (today Croatia).

Beginning in 1941, Hungary systematically excluded the Jews from public life. Compl.,

¶ 96. Far worse, by 1944, Hungary and MÁV had already sent some 60,000 Jews to their of 42,000 slave laborers in Hungarian and MÁV labor brigades; and 1,000 victims of Bacska massacres in 1942. With the exception of the Bacska murders, these deaths were the direct responsibility of Hungary and MÁV.

6 Defendants question only the sufficiency of Plaintiffs’ allegations concerning certain jurisdictional facts relevant to the exemptions under FSIA. These are discussed below at 17-19.

7 Zehava (Olga) Friedman, Satoraljaujhely (Compl. ¶ 27); Yitzhak Pressburger, Budapest (id., ¶ 38); Vera Deutsch Danos, Miskolc (id., ¶ 64). The term “Trianon” refers to the treaty between the Allied Powers and the Kingdom of Hungary that concluded World War I. In the Trianon Treaty, Hungary was shorn of approximately two-thirds of its territory, ceding it to Romania and the newly formed states of Czechoslovakia, Yugoslavia and Austria. Treaty of Peace Between the Allies and Associated Powers and Hungary and Protocol and Declaration, Signed at Trianon, June 4, 1920, 1921 U.S.T. LEXIS 12; 6 L.N.T.S. 188 (In force Dec. 17, 1921).

8 Rosalie Simon, Helen Herman, Lenka Weksberg, Rose Miller and Charlotte Weiss, Tarackoz, Ruthenia (Compl. ¶ 10); Tzvi Zelikovitch, Uglya, Ruthenia (id., ¶ 14); Magda Kopolovich Bar-Or, Korosmezo, Ruthenia (id., ¶ 21); Alexander Speiser, Ersekujvar, Slovakia (id., ¶ 40); Ze-ev Tibi Ram, Munkacs, Ruthenia (id., ¶ 48); Ella Feuerstein Schlanger, Benedeke, Ruthenia (id., ¶ 72); Moshe Perel, Ersekujvar, Slovakia (id., ¶ 80). 3

Case 1:10-cv-01770-BAH Document 24 Filed 05/06/11 Page 14 of 60

intended deaths, id., ¶ 95, including Plaintiff Tzvi Zelikovitch (then age 13), his parents and six

siblings. Id., ¶¶ 14-20; Declaration of Tzvi Zelikovitch (“Zelikovitch Decl.”), ¶ 17.

Soon after the Germans arrived in March 1944, Hungary passed a law requiring every

Jew over six years old to wear a yellow Star of David on the left chest of the outer garment.

Compl., ¶97. Hungary then undertook a well-coordinated program to drive the Jews from their

homes in the provinces and large towns outside of Budapest into ghettoes, abandoned factories

and railroad sidings, where they were incarcerated for weeks. These actions were executed

almost exclusively by Defendant Hungary with the assistance of MÁV and agencies of the

Hungarian government. The Jews were stripped of their valuables and other personal property, much of which was confiscated by the Hungarian state with no compensation to the owners. The property was converted to cash through sales or other means, and the proceeds were transferred to the Hungarian treasury where they were commingled with other Hungarian revenues. Id., ¶¶

98-99. Hungarian officials prepared inventories of this property, which records still exist, but have never been shown to the public. Id., ¶¶ 99, 218.

In many cases the Jews were transported from the villages to the regional ghettoes by

Defendant MÁV. Compl., ¶¶ 11, 23. Defendants did not provide housing for the Jewish

deportees – they were simply dumped like trash in abandoned factories and railroad sidings,

many of which were controlled and serviced by MÁV without food or basic sanitary facilities.

Id., ¶¶ 42, 67. Plaintiffs and Class members were incarcerated in these horrific conditions for

weeks until the deportations by MÁV to Auschwitz. Id., ¶¶ 67, 92, 98, 101, 106, 107. As a practical matter, by the spring of 1944 the Jews of Hungary had ceased to have the rights of

Hungarian citizens, nationals, alien residents or even human beings.

Case 1:10-cv-01770-BAH Document 24 Filed 05/06/11 Page 15 of 60

The deportations to Auschwitz and other death camps began in earnest at the end of April

1944. Compl., ¶ 102. Virtually all of the Named Plaintiffs were among those deported,

including Plaintiff Tzvi Zelikovitch, (then age 16) who, having miraculously survived the 1941

massacres near Kamenetz-Podolsk, was deported from Hungary for the second time. Id., ¶ 19,

Zelikovitch Decl., ¶ 20. As they boarded the MÁV trains, Plaintiffs and their families were stripped of most of their remaining possessions by employees and agents of Defendants MÁV and Hungary. Compl., ¶¶ 19, 43, 86, 100; Declaration of Yaffa Dascal (“Dascal Decl.”), ¶ 12.

Not only did MÁV confiscate Plaintiffs’ personal property and convert it to cash or its equivalent, MÁV charged the Jewish communities for the cost of transporting Plaintiffs and

Class members to the death camps. Compl., ¶ 105. MÁV pocketed substantial revenues from carrying the Jews to the death camps, which funds today amount to hundreds of millions of dollars or more, and were commingled with MÁV general revenues and used to fund MÁV’s capital and operating budget. Id., ¶¶ 98-100. MÁV has never compensated Plaintiffs or the

Class for the despoliation of their personal property and for the pain and suffering caused them during their deportation to the death camps of Poland and Austria. Id., ¶¶ 16, 32, 54, 68.

MÁV created and maintained detailed records of its deportation of Plaintiffs and other

Hungarian Jews to the death camps, including cargo manifests, bills of lading, invoices and inter- agency memoranda, which cumulatively specified the details of each “shipment,” and were cryptically demarcated by the letter “D.” Compl., ¶104. Despite repeated requests by victims and historians, Defendants Hungary and MÁV have concealed these documents in an effort to obscure their involvement in the destruction of Hungarian Jewry during the Holocaust. Id.

The Complaint describes the unspeakable conditions under which the Hungarian Jews were transported to the death camps. Compl., ¶¶ 105–108. Cruelly, MÁV charged the victims

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for what little water they were given to last the two or three-day journey to Auschwitz,

commingling those extorted funds with the company’s other revenues. Id.; Dascal Decl., ¶ 13.

In 1941, before Hungary commenced its genocide, there were approximately 825,000

Jews in Greater Hungary, including approximately 100,000 converts. Compl., ¶ 120. Excluding

those who managed to flee abroad, the loss of Hungarian Jewry in the Holocaust for which

Defendants are directly responsible was 564,507. Id. Of these, 440,000 were deported to

Auschwitz over a single rail line between May 15, 1944 and July 8, 1944. Id., ¶ 121.9

As a result of Defendants’ concerted actions, enormous quantities of Jewish-owned

property of all types, totaling hundreds of millions of dollars (at World War II-era values) were

seized by Hungary and MÁV. Much of this was converted into cash and cash equivalents and

commingled with general revenues which financed the operations of the Hungarian government

and MÁV through the end of World War II and beyond. Compl., ¶¶ 98, 100, 105. Thus, these

comingled and fungible funds have been used to procure assets, good and services by Defendants

Hungary and MÁV, including assets, goods and services in the United States. Id., ¶ 83.

While the post-armistice Hungarian government and post-Communist regime have

expressed sympathy for the plight of the Jewish victims of the Hungarian Holocaust through the

enactment of laws and decrees purporting to address their injuries, the Jews have enjoyed no

tangible results with respect to compensation or restitution.10 Hungary’s most recent legislative

attempts to deal with its participation in the genocide against Hungarian Jewry have been

described by the world’s leading authority on the Hungarian Holocaust as “too little too late.” 2

9 This does not include the tens of thousands of remaining Jews slaughtered by the Arrow Cross/Nyilas government from October 1944 until the Soviet occupation in January 1945. Compl., ¶¶ 117-119; Declaration of Menachem Beck (“Beck. Decl.”), ¶¶ 18-19.

10 2 The Politics of Genocide at 1308.

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The Politics of Genocide at 1310.11 This assessment has been updated and buttressed by

Hungarian law expert András Hanák, who, unlike Defendants’ chosen expert (who is a partner in the law firm that represents Defendants), is not affiliated with any party in this case. Hanák

Decl., passim. Such compensation as was actually paid by Hungary to certain Holocaust victims was capped at an arbitrarily low sum of $5,000 per person, hardly approaching “fair compensation” as that term is understood in international law and general human experience.

Id., ¶ 30; Beck Decl., ¶¶ 21-22. Moreover, the compensatory scheme adopted some fifty years after the fact by Hungary is illusory, as shown by the declarations of Class members Yaffa

Dascal and Menachem Beck, who diligently sought indemnification from Hungary through administrative and judicial channels, to no avail. Dascal Decl., ¶¶ 20 – 23; Beck Decl., ¶¶ 21-25.

III. THE COURT HAS SUBJECT MATTER JURISDICTION OVER THIS CASE UNDER THE EXPROPRIATION EXCEPTION OF THE FOREIGN SOVEREIGN IMMUNITIES ACT, 28 U.S.C. § 1605 (a)(3).

As Defendants agree, Section 1605(a)(3) of the Foreign Sovereign Immunities Act

(“FSIA”), 28 U.S.C. § 1605(a)(3), expressly provides that a foreign state and its instrumentalities are not immune where:

rights in property taken in violation of international law are in issue and that property or any property exchanged for such property is present in the United States in connection with commercial activity carried on in the United States by the foreign state; or that property or any property exchanged for such property is owned or operated by an agency or instrumentality of the foreign state and that agency or instrumentality is engaged in a commercial activity in the United States.

11 “[I]t is fair to assume that the compensation and reparation that Hungary will eventually provide will not approximate a fraction of the staggering losses that were incurred by Hungarian Jewry.” Id., at 1311. Although Professor Braham made his comment in 1994, there has been no material change in the situation in the last 17 years. Indeed, with the election of the ultra-rightist Fidesz government in 2010, matters have deteriorated significantly. Declaration of András Hanák (“Hanák Decl.”), ¶¶ 17, 19, 21-25. 7

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Further, Defendants do not deny that MÁV and the Republic of Hungary are “engaged in . . .

commercial activity . . . in the United States,” as alleged by Plaintiffs. Compl. ¶¶ 83, 85. Nor do

they deny the taking of property from Plaintiffs in connection with Defendants’ collaboration in

Hitler’s “Final solution,” the extermination of Europe’s Jewish population. Compl., passim. Nor do they disagree, as the plain language of § 1605(a)(3) provides, that Plaintiffs need not allege that any property taken or property exchanged for the property taken is present within the United

States in order for the Court to have jurisdiction, at least over MÁV.12 Instead, Defendants argue that (1) takings of property from Plaintiffs did not violate international law, because a taking of property from a state’s own citizens is generally not considered a violation of international law; and (2) Plaintiffs either have not alleged at all that property exchanged for the property taken is

(i) in the possession or control of MÁV, or (ii) within the United States, or have not alleged those facts with sufficient specificity. Def. Mem. at 7-9. Both propositions are demonstrably wrong, as demonstrated below.

First, the takings at issue violate international law because they were discriminatory; based solely on the religious and ethnic identity of the victims; not for any legitimate public purpose; and uncompensated. Indeed, the takings from Hungarian Jewish citizens were recognized as a legitimate matter of international concern in the 1947 Treaty of Peace entered into among Hungary, the United States and other countries.13 As Defendants concede, Article 27

of that Treaty expressly required Hungary to recognize and compensate the claims of its own

citizens and former citizens. See 1947 Treaty of Peace, T.I.A.S. No. 1651, 61 Stat. 2065, 1947

12 In order to qualify for the § 1605(a)(3) exception with respect to MÁV, an instrumentality of Hungary, Plaintiffs need allege only that the property taken or property exchanged for the property taken “is owned or operated . . . [by MÁV] and that . . . [MÁV] is engaged in commercial activity within the United States,” not that the property itself is in the United States.

13 As observed below at 14-16, Hungary’s discriminatory treatment of its Jewish minority is also a flagrant violation of Hungary’s obligations under international law as expressed in the Treaty of Trianon.

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WL 26320, Def. Mem., Exh. 1 (ECF 22-4).14 Second, Plaintiffs have properly and specifically

alleged that property exchanged for the property taken, in the form of cash and credits derived

from the illegal takings, is within the possession and control of MÁV, and is also present in the

United States and used by Hungary in its United States commercial activities. Compl., ¶¶ 83, 85.

Before addressing that issue, however, Plaintiffs underscore – contrary to Defendants’

assertion – that the burden of persuasion as to jurisdictional facts relating to immunity rests

solely on sovereign defendants who assert that immunity.

A. At The Pleadings Stage, Plaintiffs Need Make Only A “Substantial And Non- Frivolous Claim” To Support An Exception To Sovereign Immunity.

In the leading case in this circuit, Chabad of United States v. Russian Federation, 528 F.

3d 934 (D.C. Cir. 2008), the Court of Appeals determined the applicable standards when, as

here, a plaintiff invokes the property-expropriation exception to sovereign immunity under FSIA,

§ 1605(a)(3).15 The Court held that the exception has two parts, each with a different standard of review.

One part of the exception considers “the character of a plaintiff’s claim,” asking whether it properly is a claim for the taking of property in violation of international law. Chabad, 528 F.

3d at 940. On this issue, a plaintiff adequately invokes jurisdiction by alleging a claim that is substantial and non-frivolous. The Chabad court explained:

[T]o the extent that jurisdiction depends on the plaintiff’s asserting a particular type of claim, and it has made such a claim, there

14 In Article 27 of the 1947 Treaty, Hungary recognized its obligation under international law to restore or pay fair compensation for property in Hungary of “persons under Hungarian jurisdiction” where that property was confiscated “on account of the racial origin or religion of such persons.” Def. Mem. at 3-4.

15 In Chabad, a non-profit Jewish organization in the United States alleged that the predecessor government of Russia and certain Russian instrumentalities had taken without compensation religious texts and library collections in 1917 and 1925. Chabad asserted a claim within § 1605(a)(3) of FSIA, the same provision at issue here, and alleged that those takings were in violation of international law and otherwise met the requirements for that exception to sovereign immunity. The D.C. Circuit held those allegations sufficient to withstand Russia's jurisdictional challenge. 9

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typically is jurisdiction unless the claim is “immaterial and made solely for the purpose of obtaining jurisdiction or . . . wholly insubstantial and frivolous,” i.e. the general test for federal question jurisdiction under Bell v. Hood, 327 U.S. 678, 682-83 (1946) . . .

Id., citing West v. Multibanco Comermex, S.A., 807 F.2d 820, 826 (9th Cir. 1987) (jurisdiction proper under § 1605(a)(3) when plaintiff’s claim of conversion was “substantial and non- frivolous”) and Siderman de Blake v. Republic of Argentina, 965 F.2d 699, 712 (9th Cir. 1992), cert. denied, 507 U.S. 1017 (1993) (“At the jurisdictional stage, we need not decide whether the taking actually violated international law; as long as a ‘claim is substantial and non-frivolous,’ it provides a sufficient basis for the exercise of our jurisdiction . . .”). In examining whether the

plaintiff claims that property was taken in violation of international law, the court reiterated that

“non-frivolous contentions suffice under Bell.” Id. at 941.

In fact, this Court so held even before the D.C. Circuit handed down its decision in

Chabad, e.g., Crist v. Republic of Turkey, 995 F. Supp. 5, 10-11 (D.D.C. 1998) (“an expropriation is a violation of international law if the taking does . . . not provide for just compensation . . . At the jurisdictional stage, a court is not required to determine whether a taking or expropriation actually violated international law. The claim must merely be substantial and non-frivolous to provide a sufficient basis for jurisdiction.”) (citations omitted); accord,

Malewicz v. City of Amsterdam, 362 F. Supp. 2d 298, 306-07 (D.D.C. 2005).

The other part of the § 1605(a)(3) exception considers whether “one or the other of two possible ‘commercial activity’ nexi between the United States and the defendants” exists.

Chabad, 528 F.3d at 940. These alternative nexi are either that the subject property (or any property exchanged for the property) is present in the United States in connection with commercial activity carried on in the U.S. by the foreign state, or that the property (or any property exchanged for the property) is owned by an agency of the foreign state which is 10

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engaged in commercial activity in the U.S. As to these “purely factual matters under the FSIA,” at least those independent of the merits, the Chabad Court held that plaintiffs have no more than

“a burden of production” under the FSIA if their facts are challenged, but “the burden of persuasion rests with the foreign sovereign claiming immunity, which must establish the absence of the factual basis . . .” Id., citing Aquamar S.A. v. Del Monte Fresh Produce N.A., 179 F.3d

1279, 1290 (11th Cir. 1999); Cargill Int’l S.A. v. M/T Pavel Dybenko, 991 F.2d 1012, 1016 (2d

Cir. 1993); Alberti v. Empresa Nicaraguense de la Carne, 705 F. 2d 250, 255-56 (7th Cir. 1983).

Defendants have not challenged the basic factual underpinnings advanced by Plaintiffs – that property of Hungarian Jews was stolen, confiscated or otherwise taken by MÁV and the

Hungarian government and that such property (or property exchanged for it) is present in the

United States in connection with commercial activity carried on here by Hungary, or the property

(or any property exchanged for it) is owned by MÁV, a Hungarian agency or instrumentality engaged in commercial activity in the United States.

Accordingly, under the governing precedent in this Circuit and Court, the sole question presented by Defendants’ jurisdictional challenge – whether the taking violated international law for purposes of § 1605(a)(3) of FSIA – is subject only to the requirement that plaintiffs have made a “substantial and non-frivolous claim.” Plaintiffs undoubtedly have done so here.

B. The Taking Of Personal And Other Property By MÁV And Hungary From Hungarian Jews Violated International Law.

Defendants argue that a taking by a state or its instrumentality of property from its own citizens, without more, does not rise to the level of a violation of international law. This ignores the unique and special circumstances here: (1) The takings were part of an international program of genocide, which is itself a violation of international law; (2) the takings were concomitant with and part of the international transportation of Hungarian Jews from their homeland to

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destinations in Poland, Germany, and Austria on the death trains committed to this purpose by

MÁV; (3) the takings were based solely on the religious and ethnic identity of the victims, in violation of international law; and (4) the takings were recognized as a fit subject of international agreement, and therefore of international law, in the 1947 Treaty of Peace entered into by

Hungary and the United States as well as the 1920 Treaty of Trianon.

1. Courts Have Held That Discriminatory Takings Are Violations Of International Law.

Courts that have been presented with Holocaust-era claims have concluded that the taking of property in a discriminatory fashion from targeted ethnic and religious groups (such as the

Hungarian Jews) violated international law. Bodner v. Banque Paribas, 114 F. Supp. 2d 117,

134 (E.D.N.Y. 2000) (noting that “the confiscation of private property during the Holocaust was a violation of customary international law . . .”), citing State of Netherlands v. Fed. Reserve Bank of New York, 201 F.2d 455, 459 n.4 (2d Cir.1953). As Bodner stated, “[T]his Court finds that plaintiffs have stated a cognizable claim under international law for the confiscation and plunder of private property, for aiding and abetting genocide, and for conspiracy to plunder and transact in plundered property, all violations of international law.” Id.

As in Bodner, the takings alleged here were part of a larger murderous international program in which Hungary and MÁV were willing and eager participants, designed to divest all

European Jewry of their property, their freedom and their lives. The Hungarian Jews whose property was taken as they boarded the cattle cars that were used to transport them to their deaths or to slavery were already “in transit” to foreign destinations in Poland, Austria and Germany.

In a Second Circuit case involving the taking of property from Polish Jews by the Polish government after World War II, the Second Circuit quoted the opinion from the lower court on appeal to the effect that “no consensus existed on the issue whether the right to be free from

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discriminatory and uncompensated taking of property was one of the ‘fundamental rights’ conferred by international law upon all people vis-a-vis their own governments . . .” Garb v.

Poland, 440 F.3d 579, 589 (2d Cir. 2006). Noting that the lower court rested its decision to

dismiss at least in part on what it perceived as a “substantial legal hurdle” that plaintiffs would

have to overcome on that point, the Second Circuit refused to endorse the lower court’s view,

expressly reserving judgment on that issue. Id., at 589-90.

In a case with similarities to this one, Freund v. Republic of France, 592 F. Supp. 2d 540,

554-55 (S.D.N.Y. 2008), aff’d on other grounds, Freund v. SNCF, 391 Fed Appx. 939 (2d Cir.

2010), the district court assumed (without expressly deciding) that the taking of property from

French Jews by the French National Railways in connection with their deportation during the

Holocaust was a violation of international law. Significantly, the court relied on both the Garb

and Chabad precedents as recognizing that the “violation of international law” allegation was

one of the three under § 1605(a)(3) that were “jurisdictional” and sufficient so long as the

allegations were not “wholly insubstantial and frivolous.” Id., at 555.16 Another leading case

has found “that the dictum in [a prior decision] to the effect that ‘violations of international law

do not occur when the aggrieved parties are nationals of the acting state,’ is clearly out of tune

with the current usage and practice of international law.” Filartiga v. Pena-Irala, 630 F. 2d 876,

884-85 (2d Cir. 1980) (holding that “international law confers fundamental rights upon all people

vis-a-vis their own governments” and that torture “admits of no distinction between treatment of

aliens and citizens”). See also, Cassirer v. Kingdom of Spain, 616 F.3d 1019, 1036 (9th Cir.

16 See also a decision of the Iran-United States Claims Tribunal, which stated that “[d]iscrimination is widely held as prohibited by international law in the field of expropriation.” Amoco Int’l Fin. Corp. v. Iran, 27 I.L.M. 1320, 1350 (1988).

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2010) (sustaining jurisdiction over defendant Spain where complaint alleged taking by Germany

of property of a German Jewish national prior to World War II).

The legislative history of § 1605(a)(3) identifies a “tak[ing] in violation of international

law” as one where the “prompt, adequate and effective compensation required by international

law” is not forthcoming, and specifically includes “takings which are arbitrary or discriminatory

in nature,” without other limitation. See Zappia Construction v. Emirate of Abu Dhabi, 215 F.3d

247, 251 (2d Cir. 1999) (citing to H.R. Rep. No. 94-1487 at 19-20 (1976), reprinted in 1976

U.S.C.C.A.N. 6604, 6618).

None of the precedents cited by Defendants holds to the contrary. Most involve a state’s

run-of-the-mill expropriation of its own citizen’s property, sometimes accompanied by some

form of compensation, and usually for a public purpose. Plaintiffs have found no case where a court has held that an uncompensated taking of property, not for any public purpose, from a targeted religious or ethnic group singled out for persecution, where that taking was done in the context of an overall plan of genocide that traversed international borders, was not a violation of international law.

Accordingly, there is no question that the takings at issue here were in violation of international law as understood by the drafters of the FSIA and as interpreted by those courts which have addressed the issue in this and similar contexts.

2. Hungary’s Express Undertaking In The 1947 Treaty To Compensate Its Own Citizens For The Discriminatory Takings Acknowledges Those Takings To Have Been In Violation Of International Law.

Article 27(1) of the Treaty of Peace that Hungary entered into with the United States and

other sovereign powers in 1947 provided that:

Hungary undertakes that in all cases where the property, legal rights or interests in Hungary of persons under Hungarian

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jurisdiction have, since September 1, 1939, been the subject of measures of sequestration, confiscation or control on account of the racial origin or religion of such persons, the said property, legal rights and interests shall be restored together with their accessories or, if restoration is impossible, that fair compensation shall be made therefor.

Def. Mem., Exh. 1. Hungary undertook to fulfill this obligation “within twelve months from the

coming into force of the Treaty.” Id., Art. 27(2).

In general, treaty obligations entered into between two or more sovereign states are

subject to international law. Historically referred to as “the law of nations,” international law

incorporates both treaty law and customary international law. Restatement (Third) of Foreign

Relations Law of the United States § 102 (2004); see also, e.g., Article 38(1)(a) of the Statute of

the International Court of Justice,17 which recognizes “international conventions, whether

general or particular, establishing rules recognized by the contesting states,” as one of its sources

of international law.

Indeed, it is a bedrock principle of international law that that the agreements and

obligations that sovereign states undertake to each other are fundamental elements of

international law. Thus, the Vienna Convention on the Law of Treaties (1969), in its preamble,

expressly recognizes “the ever-increasing importance of treaties as a source of international law .

. .” 1155 U.N.T.S. 331, TS No. 58 (1980), 8 I.L.M. 679 (1969). Here, the Treaty obligation that

Hungary undertook in 1947 expressed Hungary’s understanding that its obligation to compensate

even its own citizens for discriminatory and uncompensated takings was a matter of international

concern, international recognition and international law. This recognition reinforced Hungary’s

17 Available at http://www.icj-cij.org/documents/index.php?p1=4&p2=2&p3=0 (last visited May 6, 2011).

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earlier international law undertakings to nearly the same effect first made in the Treaty of

Trianon after World War I, supra at 3 n.7.18

As Defendants admit, “in 1993, the Hungarian Constitutional Court determined that

Hungary had not fully complied with its obligations under the 1947 Peace treaty . . .” even after

46 years. Def. Mem. at 5. Although Defendants claim to have made some amends on that score since the Constitutional Court finding in 1993, id., it is clear that any such efforts were wholly inadequate and insubstantial. Dascal Decl., ¶¶ 20–23; Zelikovitch Decl., ¶¶ 23-24; Beck Decl.,

¶¶ 21-25; Hanák Decl., ¶¶ 26-30.19 However, issue need not be joined on that score with respect

to the separate point being made here, that in the 1947 Treaty Hungary and the other signatory

nations recognized that Hungary’s obligations under international law to pay compensation for

discriminatory takings directed at its own citizens was a fit subject for an international treaty, and

therefore, a fit subject of international law.

Finally, although many of the Plaintiffs were citizens of Hungary at the time of the

takings in question, not all were. For example, Named Plaintiff Tzvi Zelikovitch was one of the

18,000 Jews expelled from Hungary in 1941 on the premise that they were not Hungarian

nationals. Zelikovitch Decl., ¶¶ 5, 10. Further, many of the Jews deported in 1944 were not

18 In Article 55 of the 1921 Trianon Treaty, Hungary undertook to “assure complete protection of life and liberty to all inhabitants of Hungary without distinction of birth, nationality, language, race or religion.” Art. 58 provides that “[a]ll Hungarian nationals shall be equal before the law and shall enjoy the same civil and political rights without distinction as to race, language or religion. Difference of religion, creed or confession shall not prejudice any Hungarian national in matters relating to enjoyment of civil or political rights, as for instance admission to public employments, functions and honours, or the exercise of professions and industries.”

19 A court may consider material beyond the complaint in determining whether it has jurisdiction to hear the case, so long as the court accepts the factual allegations in the complaint as true. EEOC v. St. Francis Xavier Parochial Sch., 117 F.3d 621, 624-625 n.3 (D.C. Cir. 1997). In this regard, “the court may consider the complaint supplemented by undisputed facts evidenced in the record, or the complaint supplemented by undisputed facts plus the court’s resolution of disputed facts.” Coalition for Underground Expansion v. Mineta, 333 F.3d 193, 198 (D.C. Cir. 2003); see Jerome Stevens Pharm., Inc. v. Food & Drug Admin., 402 F.3d 1249, 1253 (D.C. Cir. 2005).

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Hungarian nationals, but rather, citizens of Rumania, Poland and numerous other neighboring

areas. With respect to these groups, Defendants’ jurisdictional arguments simply do not apply.

Defendants ignore or mischaracterize Plaintiffs’ allegations on this issue. The Complaint specifically alleges that: (1) “Hungary engages in an ongoing course of commercial activity throughout, and maintains property in the United States, that has been exchanged for the property it stole from plaintiffs herein,” Compl. ¶ 83; (2) “That property is owned and operated by MAV and/or other agencies and instrumentalities of Hungary that are engaged in commercial activity in the United States,” id.; (3) “Alternatively, that property is present in the United States in connection with commercial activity carried on by Hungary within the United States,” id.; and

(4) “MAV owns and/or operates property and property exchanged for property that it stole from

Jewish deportees,” id., ¶ 85.

Throughout the Complaint, Plaintiffs allege with specificity exactly what happened to the monies and possessions taken from them:

All expenses associated with ghettoization were taxed on the Jews, including the Plaintiffs herein. The monies thus confiscated were remitted to defendant Hungary’s national treasury and commingled with general government revenues.

Compl. ¶ 98.

Hungarian officials . . . went from one Jewish home to the next making detailed inventories of property in the homes . . . . The property was then expropriated by defendant Hungary and converted to cash through sales and other means. The proceeds were transferred to the Hungarian government treasury and commingled with other Hungarian government revenues.

Id., ¶ 99.

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The defendant railways sold, liquidated or otherwise converted some or all of the property they stole from Plaintiff deportees to cash and commingled those funds with other revenues. Defendant railways’ funds and operations are in part derived from the funds they realized from liquidating the possessions they stole from Plaintiffs.

Id., ¶ 100.

MÁV charged the victims exorbitantly for the cost of the meager supply of water . . . . These extortionate charges were also commingled with MÁV’s legitimate revenues.

Id., ¶ 105.

The Complaint thus describes the kinds of property taken, such as illegal “taxes” for ghettoization, personal property left in their homes by ghettoized and deported Jews and seized by Hungary, and personal property taken from them when they arrived at the ghettoes from which they were later deported. It describes what happened to that property – it was generally liquidated and converted to cash, and commingled with other funds in the Hungarian Treasury or in MÁV’s operating accounts. And it specifically and plausibly alleges that those funds, or funds derived from those funds, are (1) still in the possession and control of MÁV, which conducts commercial operations in the United States, Compl. ¶ 85; and (2) used by Defendant

Hungary in its commercial operations in the United States, id., ¶ 83. These are much more than just “barebone allegations” or “bald assertions,” as claimed by Defendants, Def. Mem. at 9.

They are specific, historically based and plausible. Indeed, Defendants do not deny that they took the property as alleged, that in fact they liquidated and converted that property to cash as alleged and that they commingled those funds with their general operating funds as alleged.

Defendants have thus failed to sustain their burden of persuasion by a preponderance of the evidence on these factual underpinnings of the § 1605(a)(3) exception to sovereign immunity.

See Chabad, 528 F.3d at 940.

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Plaintiffs have stated all the necessary factual elements with specificity and plausibility:

funds derived from the original takings are still in the possession and control of MÁV, which has

commercial operations in the United States, and other such funds are in the possession and

control of Hungary and used in its commercial operations in the United States.

Defendants also argue that Plaintiffs alleged in ¶ 136 of the Complaint that all of this

property was initially “transferred” to the Nazi government in World War II. Def. Mem. at 9.

Defendants fail to quote the rest of the paragraph, which states that such property was

subsequently received back by the Hungarian government. In any event, Plaintiffs intended to

refer in ¶ 136 only to those possessions that were looted and put on the infamous “Hungarian

Gold Train.”20 The specific allegations of ¶¶ 98-100 quoted above make clear that transfer to

Germany of Jewish property was not the norm. The historical norm was the direct liquidation of

the property of Hungarian Jews by Defendants here, and the commingling of those realized funds

with Defendants’ ordinary operating funds.

IV. PLAINTIFFS’ CLAIMS ARE JUSTICIABLE.

Defendants paint Plaintiffs’ claims with a broad brush in arguing that the political

question doctrine precludes the Court from considering these claims. In fact, “it is error to

suppose that every case or controversy which touches foreign relations lies beyond judicial

cognizance.” Japan Whaling Assoc. v. American Cetacean Soc’y, 478 U.S. 221, 229-30 (1986)

(quoting Baker v. Carr, 369 U.S. 186, 211 (1962)); Zivotofsky v. Sec'y of State, 571 F.3d 1227,

1236 (D.C. Cir. 2009) (Edwards, J., concurring), reh’d denied, 610 F.3d 84 (D.C. Cir. 2010) (en

banc) (Edwards, J., dissenting), cert. granted sub nom., M.B.Z. v. Clinton, No. 10-699, 2011 U.S.

20 See generally Presidential Advisory Commission on Holocaust Assets in the United States, “Progress Report On: The Mystery of the Hungarian ‘Gold Train’”, http://govinfo.library.unt.edu/pcha/goldtrainfinaltoconvert.html (last visited May 5, 2011); Rosner v. United States, Cas. No. 01-1859-CIV-SEITZ, Final Order and Judgment (S.D. Fl., Sept. 30, 2005) at Pacer.gov: https://ecf.flsd.uscourts.gov/doc1/0511542114 (last visited, May 5, 2011).

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LEXIS 3528 (May 2, 2011). Instead, as the Court instructed in Baker, the political question

analysis requires a “discriminating inquiry into the precise facts and the posture of the particular

case.” 369 U.S. at 217. See El-Shifa Pharm. Indus. Co. v. United States, 607 F.3d 836, 841-42

(D.C. Cir. 2010), cert. denied, 131 S. Ct. 997 (2011). Furthermore, in the area of foreign relations, this inquiry must be couched “in terms of the history of its management by the political branches, of its susceptibility to judicial handling in the light of its nature and posture in the specific case, and of the possible consequences of judicial action.” Baker, 369 U.S. at 211-12.

The precise facts of this case and its unique historical posture compel a finding that the political question doctrine is inapplicable.

The Baker Court identified the parameters of the requisite political question analysis in the following six “formulations”:

a textually demonstrable constitutional commitment of the issue to a coordinate political department; or a lack of judicially discoverable and manageable standards for resolving it; or the impossibility of deciding without an initial policy determination of a kind clearly for nonjudicial discretion; or the impossibility of a court’s undertaking independent resolution without expressing lack of the respect due coordinate branches of government; or an unusual need for unquestioning adherence to a political decision already made; or the potentiality of embarrassment from multifarious pronouncements by various departments on one question.

369 U.S. at 217. These formulations are “probably listed in descending order of both importance and certainty.” Vieth v. Jubelirer, 541 U.S. 267, 278 (2004).

Defendants suggest that the resolution of Plaintiffs’ claims has been constitutionally committed to the executive branch. However, “[r]eparation for stealing, even during wartime, is not a claim that finds textual commitment in the Constitution.” Alperin v. Vatican Bank, 410

F.3d 532, 551 (9th Cir. 2005), cert. denied, 546 U.S. 1137 (2006). See Ungaro Benages v.

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Dresdner Bank AG, 379 F.3d 1227, 1236 (11th Cir. 2004) (similar claims “not constitutionally committed to a coordinate political branch”); Kadic v. Karadzic, 70 F.3d 232, 249 (2d Cir. 1995)

(with regard to international claims sounding in tort, “the department to whom this issue has

been ‘constitutionally committed’ is none other than our own – the Judiciary.”) (citation

omitted). As detailed herein, Plainitffs’ claims implicate no issue that is constitutionally

committed to a coordinate branch of government.

Defendants also argue that the Court’s adjudication would demonstrate a lack of respect

due the executive and legislative branches of government, and that there is an unusual need for

unquestioning adherence to political decisions already made. The last of the Baker factors

“appear to be relevant only if judicial resolution of a question would contradict prior decisions taken by a political branch in those limited contexts where such contradiction would seriously interfere with important governmental interests.” Kadic v. Karadzic, 70 F.3d at 249-50. See

Ungaro-Benages, 379 F.3d at 1237. As detailed below, however, Defendants have identified no such potential contradiction. Plaintiffs’ claims lie squarely within judicial cognizance.

A. Neither The 1947 Peace Treaty Nor The 1973 Executive Agreement Preempts Federal Judicial Power Over Plaintiffs’ Claims.

To prevent justiciability of Plaintiffs’ claims under the political question doctrine, one or both political branches of government must have occupied the subject matter field to such an extent that, applying the Baker standards, judicial power has been supplanted. Whether that has occurred is a narrow question. Since all branches of government may operate simultaneously in the sphere of foreign affairs, the question is whether the executive branch’s exercise of power in concluding the 1947 Peace Treaty (ECF 22-4) and the 1973 Executive Agreement (ECF 22-5) is such as to preclude judicial power in the circumstances. The constitutional, statutory, diplomatic

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and administrative record shows that these two instruments are not intended to be an exclusively

executive exercise of power precluding judicial determination of Plaintiffs’ claims.

A treaty or executive agreement with a foreign country, by itself, does not reserve the subject matter exclusively in the executive branch. On the contrary, the Constitution contemplates that all branches of government may operate in the field of foreign affairs, expressly providing that “[t]he judicial Power shall extend to all Cases, in Law and Equity, arising under . . . Treaties made, or which shall be made . . .” U.S. CONST. art. III, § 2 (italics

supplied). Thus, the federal courts may constitutionally exercise judicial power even where the

executive branch has concluded a treaty with a foreign state and the legislative branch, through

the Senate, has advised and consented thereto. That judicial power extends as well to actions,

like the present one, “between a State, or the Citizens thereof, and foreign States . . .” Id.

Recognizing this broad reach of the federal judicial power, Congress in 1789 authorized

suits under the Alien Tort Claims Act, 28 U.S.C. § 1350. See Arias v. Dyncorp, 517 F. Supp. 2d

221, 227 (D.D.C. 2007) (“The ATCA confers upon the district court subject matter jurisdiction when an alien sues for a tort committed in violation of the law of nations or treaty of the United

States.”). This statute is an example of legislative acknowledgement of the intermingling of legislative, executive and judicial powers in foreign relations.

Case law also demonstrates the overlap of the powers of the three departments of government in foreign affairs. In United States v. Curtiss-Wright Export Corp., 299 U.S. 304,

311, 333 (1936), the Court authorized criminal proceedings – an exercise of judicial power – against a corporation that had been indicted for allegedly violating a joint resolution of Congress that imposed penalties for shipping arms to those countries where the President had determined, in accordance with authority granted in the joint resolution, there was domestic violence. More

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recently, in Boumediene v. Bush, 553 U.S. 723, 798 (2008), the Court held that the writ of habeas corpus extends to aliens detained by the military as enemy combatants. The political question doctrine did not arise before the Court in either of these cases, because the exercise of foreign affairs and war-making powers was not, by itself, a sufficient basis to invoke the doctrine.

As Baker v. Carr counsels, the doctrine requires a discriminating case-by-case analysis of

the precise facts. That analysis in this case demonstrates that neither the 1947 Peace Treaty nor

the 1973 Executive Agreement is inconsistent with and hence preemptive of the judicial power

of the Court over Plaintiffs’ claims. Taken together these documents and related statutes

demonstrate that the present claims are indeed justiciable.

Article 27 of the 1947 Peace Treaty cited by Defendants does not supplant Holocaust

victims’ rights to pursue individual claims for compensation in court. To the contrary, the

Article declares a standard of international law, appropriate for such a multi-lateral treaty, that countries such as Hungary must compensate the victims of conduct now understood as crimes against humanity.21 Section 2 of Article 27 reflected Hungary’s obligation to effectuate its terms

“within twelve months from the coming into force of the Treaty.”

Defendants admit that Hungary utterly failed to comply with Article 27. Indeed, their expert states that for 45 years Hungary enacted no relevant legislation, Declaration of László

Nagy, ECF 22-2 (“Nagy Decl.” ¶ 27) (no legislation at all until 1992), and that additional required legislation was not enacted for five more years. Id. ¶ 28 (legislation only in 1997).22

21 While the Holocaust occurred at the same time as World War II, the Holocaust is distinct from the war. Extermination of the Jews did not further the war effort of the Axis but clearly detracted from it. Thus, crimes against humanity are distinct from war crimes, and war reparations are different from compensation for the human rights violations during the Holocaust.

22 While the many admissions in Mr. Nagy’s Declaration are telling, the Court should reject any self-serving statements proffered because he is not independent – he is a partner in Defendants’ law firm in this case. Nagy Decl., ¶ 3. The opinion of someone who regularly represents one of the parties and is not an “independent, objective expert” on the question of the adequacy of a foreign forum is perforce “unreliable” and “virtually useless.” In re 23

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Defendants have pointed to no efforts by the U.S. executive branch during those five decades (or

thereafter) to pursue Hungary’s obligations to Holocaust victims under Article 27 or otherwise.

Thus, in the 64 years since the Treaty was concluded, the U.S. executive and legislative branches have been absent from this field.23

This history of inactivity contrasts dramatically with the events in Whiteman v.

Dorotheum GmbH & Co. KG, 431 F.3d 57 (2d Cir. 2005), cited by Defendants. There the

Second Circuit dismissed Holocaust claims of Austrian Jews under FSIA. The United States

Government had submitted a formal Statement of Interest to the court urging dismissal of the

claims because

(1) the Executive Branch has exercised its authority to enter into executive agreements respecting the resolution of those claims; (2) the United States Government (a) has established through an executive agreement an alternative international forum for considering the claims in question, and (b) has indicated that, as a matter of foreign policy, the alternative forum is superior to litigation; and (3) the United States foreign policy advanced by the executive agreement is substantially undermined by the continuing pendency of the claims.

Id. at 59-60.

Unlike in Whiteman, here there is no statement of foreign policy interest by the United

States. Moreover, none of the specific actions identified in Whiteman is present here.

Significantly, the agreement in that case extended “to Austrian victims of Nazi-era persecutions,”

id. at 62, not just to U.S. nationals. As discussed below, there is no comparable executive

agreement with Hungary respecting the resolution of the claims in this case, since the Executive

Bridgestone/Firestone Inc., 190 F. Supp. 2d 1125, 1131 n.5 (S.D. Ind. 2002). See also, HTC Corp. v. IPCom GMBH & Co., KG, 2009 U.S. Dist. LEXIS 125791 (D.D.C. Dec. 18, 2009) (district court allowed the affidavit of a foreign lawyer who was patent counsel to the party on whose behalf his affidavit was being introduced, but expressed skepticism about accepting anything case-specific that he might say).

23 Article 40 of the 1947 Treaty is not relevant to Plaintiffs’ claims. Plaintiffs are not bringing a claim pursuant to the Treaty, and Article 40 is not intended to afford a remedy for Plaintiffs or other individuals. It is merely a provision to address diplomatic disputes among the various signatory nations. 24

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Agreement here concerns only the claims of persons who were U.S. nationals when the claims

arose. Thus, there is also no alternative forum, international or otherwise, established by

agreement for adjudication of these claims. And consequently, there is no identified foreign

policy that would be substantially undermined by judicial resolution of the present claims.

Indeed, the Eleventh Circuit has held that claims like those brought by Plaintiffs are justiciable even where there exist, as in Whiteman, indicia of substantial executive branch foreign relations engagement. See Ungaro-Benages, 379 F.3d at 1235-36. Ungaro-Benages

involved a claim by a German against German corporate interests to recover property that had

been nationalized in the Holocaust. In evaluating the justiciability of the plaintiff’s claim, the

court reviewed pertinent United States-German agreements, focusing on the Foundation

Agreement, which “aimed at achieving a ‘legal peace’ with Germany through the creation of a foundation to hear claims brought by German Nazi victims and to provide compensation therefor.” Id. at 1231 (quoting Agreement concerning the Foundation “Remembrance,

Responsibility and the Future,” July 17, 2000, U.S.-F.R.G., 39 I.L.M. 1298).

Nevertheless, the court concluded that “federal court consideration of the present case

does not reflect a lack of respect for the executive nor does it interfere with American foreign

relations.” Id. at 1236. In support of its conclusion, the court emphasized the fact that the U.S.

executive had elected not to settle claims or transfer them to the Foundation, “although it had the

power to do so.” Ungaro-Benages, 379 F.3d at 1235. Moreover, although the U.S. executive

had delivered a statement of national interest regarding the Ungaro-Benages litigation, the court

held that “a statement of national interest alone . . . does not take the present litigation outside of

the competence of the judiciary.” Id.

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Here, Defendants offer nothing remotely comparable to the Foundation Agreement in

support of their political question argument. The 1947 Treaty falls far short of demonstrating the

U.S. executive branch’s engagement evidenced by the Foundation Agreement, and similarly does not represent a settlement of Plaintiffs’ claims. Furthermore, the Ungaro-Benages court’s determination that a Statement of Interest was insufficient to establish a political question only further underscores the weakness of Defendants’ position here, because the U.S. government has been silent, both as to the litigation and the historical resolution of Plaintiffs’ claims. Thus,

Ungaro-Benages counsels strongly in favor of a ruling that Plaintiffs’ claims are justiciable.

The Executive Agreement also does not resolve and hence preclude justiciability of

Plaintiffs’ claims, because the agreement does not even address those claims. Rather, like

numerous similar executive agreements involving other countries, the agreement resolves only the claims of persons who were United States nationals at the time the claims arose. Plaintiffs

and the members of the Class (or their decedents), however, were not United States nationals when their claims arose.

That the Executive Agreement is so limited is clear from the Peace Treaty, related federal statutes and the decisions of the Foreign Claims Settlement Commission (“FCSC” or

“Commission”), charged by Congress to adjudicate claims out of funds like those received from

Hungary under the Executive Agreement. Congress has provided that funds received pursuant to the Executive Agreement are to be used to pay certain claims of United States nationals including those arising under the Peace Treaty. See 22 U.S.C. § 1641a(a) (creating Hungarian

Claims Fund), § 1641a(c) (directing deposit of Hungarian payments under the Executive

Agreement into Hungarian Claims Fund), and § 1641b(1), (2), and (5) (directing payments on claims of United States nationals, including under Articles 25 and 26 of the Peace Treaty).

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Demonstrating this approach, the FCSC has previously ruled:

In the Claim of [Redacted], Claim No. LIB-I-001, Decision No. LIB-I-001 (2009), the Commission held, consistent with its past jurisprudence and generally accepted principles of international law, that in order for a claim to be compensable, the claimant must have been a national of the United States, as that term is defined in the Commission’s authorizing statute, from the date the claim arose until the date of the Claims Settlement Agreement.

In the Matter of Claim of [Personally Identifiable Information Redacted] against the Great

Socialist People’s Libyan Jamahiriya, Claim No. LIB-I-052, Decision No. LIB-I-023 (F.C.S.C.

Oct. 16, 2009) slip opinion at 4 (italics supplied), attached hereto as Exhibit 1. In that case

under a claims settlement agreement with Libya, the FCSC discussed when one generally must

be a national of the United States to be encompassed in such an agreement. The Commission explained:

The Claims Settlement Agreement is silent, however, as to when a claimant must be a United States national in order to be eligible for compensation under the Claims Settlement Agreement. Therefore, the Commission must look to United States practice and the applicable principles of international law, justice and equity, including its own jurisprudence, to make this determination. It is a well-established principle of the law of international claims, which has been applied without exception by both this Commission and its predecessors, the War Claims Commission and the International Claims Commission, that a claim may be found compensable only if it was owned by a United States national at the time the claim arose.

Id. at 5-6 (“when” in italics in original; other italics supplied). See, also, Haas v. Humphrey, 246

F.2d 682, 683 (D.C. Cir. 1957) (affirming denial of compensation because “the plaintiff was not

a national of the United States at the time the property in question was taken”); 22 USC § 1645b

(allowing compensation for “losses incurred as a result of the nationalization, expropriation, or other taking of (or special measures directed against) property [by Viet Nam] which, at the time of such nationalization, expropriation, or other taking, was owned wholly or partially, directly or

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indirectly, by nationals of the United States”); Official Notice by FCSC of claims program for

claims against the government of Czechoslovakia, 47 Fed. Reg. 8092 (February 24, 1982)

(stating that compensable claims relate to “rights or interests in property owned . . . at the time of

loss by nationals of the United States, where the claim arising therefrom, or an interest therein,

was owned continuously by a United States national until the date of filing a claim with the

Commission”); Department of State, Public Notice 749, “Registration of Claims Against Iran

With the Department of State and Submission of Claims to the Iran-United States Claims

Tribunal Department of State” ¶ 7, 46 Fed. Reg. 19893 (April 1, 1981) (specifying that “[f]or

purposes of defining the jurisdiction of the Tribunal, the term ‘claims of national of the United

States’ means claims owned continuously by U.S. nationals, from the date on which the claim

arose to the date on which the claims agreement entered into force . . .”); Department of State,

Office of the Legal Advisor, Public Notice 1837, “Claims for Property Located in Albania,” 58

Fed. Reg. 40461, 40462 (July 28, 1993) (advising that “[a]ny [claims settlement] agreement [the

United States might conclude with Albania] would likely cover only claims for property which

was owned by United States nationals at the time of expropriation by Albania”).24

B. Plaintiffs’ Claims Do Not Require Evaluation Of Hungary’s Compliance With Article 27 Of The Peace Treaty, Its Compensation Schemes Or The Rulings Of The Hungarian Constitutional Court.

Defendants maintain that, notwithstanding the United States’ inactivity in pursuing

Hungary’s obligations to Holocaust victims, the adjudication of Plaintiffs’ claims will require an

24 The cases cited by Defendants, Def. Mem. at 17, n.18, likewise demonstrate that presidential settlement of foreign claims is focused upon claims of the United States and its nationals. See Dames & Moore v. Regan, 453 U.S. 654, 679 (1981) (“[T]he United States has repeatedly exercised its sovereign authority to settle the claims of its nationals against foreign countries. Though those settlements have sometimes been made by treaty, there has also been a longstanding practice of settling such claims by executive agreement without the advice and consent of the Senate.”) (citing at least 10 such agreements since 1952); United States v. Pink, 315 U.S. 203, 227 (1942) (“The United States is seeking to protect not only claims which it holds but also claims of its nationals.”); Belk v. United States, 858 F.2d 706, 707 (Fed. Cir. 1988) (“The relevant provision of the Algiers Accords prohibits United States nationals from prosecuting claims related to the seizure of the hostages, their detention, and injuries to them or their properties that arose out of events that occurred before the date of the Accords.”). 28

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assessment of Hungary’s compliance with its Article 27 obligations, a determination of the

sufficiency of Hungary’s “compensation schemes” for Holocaust victims, and a judgment as to

the sufficiency of the Hungarian Constitutional Court’s ruling regarding Hungarian compliance

with Article 27. See Def. Mem. at 15, 17, 23. These determinations, according to Defendants,

are constitutionally committed to the executive, and any claims that required their resolution

would therefore amount to a nonjusticiable political question.

But Defendants are mistaken in their analysis of what rulings the Court might need to

make in this case. Plaintiffs’ claims are not founded upon Article 27 of the 1947 Treaty,25 and thus there is no reason that the Court will need to assess Hungary’s compliance with that provision. Indeed, Defendants’ own expert has already established that Hungary failed to honor its responsibilities under Article 27. Further evaluation of Article 27 is therefore not relevant to the adjudication of Plaintiffs’ claims. Similarly, there is no need for this Court to assess the sufficiency of the Hungarian Constitutional Court’s ruling – and Defendants suggest no reason such need would arise. As discussed above, Defendants’ expert has explained that the Hungarian court simply acknowledged Hungary’s failures to comply with Article 27.

Further, although Defendants refer to subsequent Hungarian laws providing compensation for Holocaust victims, which Plaintiffs regard as an inadequate response to their claims in this action, either way the Court is clearly permitted to apply Hungarian law just as it would any other foreign law where necessary. American courts construe and apply foreign legal standards on a regular basis without implicating U.S. foreign affairs or the political question doctrine. See, e.g., Ganem v. Heckler, 746 F.2d 844, 853-54 (D.C. Cir 1984) (determination of foreign law “is one which courts make virtually every day as a matter of course. . . . [D]irect

25 As explained above in Part III, the 1947 Treaty is strong evidence of what international law was at the time of the Holocaust. 29

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governmental contact has not been deemed necessary to the task.”). See, also, Watts, Watts &

Co. v. Unione Austriaca di Navigazione, 248 U.S. 9 (1918) (federal court has jurisdiction to hear

claim by British corporation against Austro-Hungarian corporation under either French or

English law).

Moreover, this case is distinguishable from the cases cited by Defendants. For example,

in Joo v. Japan, 413 F.3d 45 (D.C. Cir. 2005), cert. denied, 546 U.S. 1208 (2006), women from

China, Taiwan, Korea and the Philippines asserted claims against Japan following World War II.

Japan, at the insistence of the United States, had negotiated peace treaties with each of the

plaintiffs’ nations following the war, and the court reasoned that an adjudication of their claims

would require interpretation of the treaties. The Executive Branch, in a detailed Statement of

Interest highlighting its history of management over the Japanese post-war recovery, explained

that such a ruling would “undo” U.S.-Japan policy and could “disrupt” Japan’s relations with

China and Korea, “thereby creating ‘serious implications for stability in the region.’” Id. at 52

(quoting Statement of Interest at 34-35). The court concluded, in light of the Executive’s judgment, that the plaintiffs’ claims were nonjusticiable because of the need to evaluate competing treaty interpretations.

Here, by contrast, the executive branch has offered no Statement of Interest, which is consistent with our nation’s history of asserting no management over the damages now sought by

Plaintiffs. Moreover, unlike the treaties identified in Joo, the 1947 Hungary-U.S. Treaty did not reflect a settlement of Plaintiffs’ claims, but rather an acknowledgment that Plaintiffs were to be compensated. The instant case therefore lacks the two elements relied upon by the Joo court: the underlying dispute implicating foreign affairs, and the insistence by the Executive that the resolution of that dispute impinged upon a textually committed exclusive power.

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Defendants also cite two cases from this Circuit to suggest there is a precedent for finding

Holocaust-era claims against foreign defendants to be nonjusticiable political questions. Both cases, however, are inapposite, as neither involves a political question analysis or application of the Supreme Court’s Baker v. Carr test.

The first case, Kelberine v. Societe Internationale, 363 F.2d 989 (D.C. Cir. 1966), cert. denied, 385 U.S. 989 (1966), was dismissed over concerns for its manageability. Defendants fail to recognize that Kelberine preceded the 1966 revamping of Rule 23, the resulting new class action jurisprudence and practice and the advent of the Manual for Complex Litigation. See

Alperin v. Vatican Bank, 410 F.3d at 554. In fact, the Ninth Circuit chided a district court for relying on Kelberine in a Holocaust case, describing Kelberine as “somewhat anachronistic.” Id.

The second case, Princz v. Federal Republic of Germany, 26 F.3d 1166 (D.C. Cir. 1994), also omits any political question analysis. Instead, the D.C. Circuit ruled that the reparations claim there was barred under FSIA. Id., at 1176. The footnote cited by Defendants, wherein the court considered the intended scope of FSIA, was written as a response to the dissent, and merely set forth the majority’s rationale for not reading the statute more broadly. See id., at 1174 n.1.

That statement did not pertain to the justiciability of the Princz claim or any similar claims.

The other cases cited by Defendants fare no better. Despite the limited connection between Plaintiffs’ claims and the foreign relations of the United States, Defendants over- generalize Plaintiffs’ claims as “claims arising out of World War II” that have “routinely” been rejected. See Def. Mem. at 20. But Defendants’ over-generalizations fly in the face of the

Supreme Court’s requirement of a “discriminating inquiry into the precise facts and the posture of the particular case.” Baker, 369 U.S. at 217. Indeed, Defendants ask the Court to rely on a series of cases concerning claims against Austrian and German interests where courts focused

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their political question analyses on the numerous, far-reaching post-war agreements between the

United States and those countries.26 The contrast between the single 1947 Peace Treaty, which

represents the only American involvement in Plaintiffs’ claims, and the German and Austrian

diplomatic histories, is striking. The political question analysis here is dramatically different

from that in the German and Austrian cases, and thus it is inappropriate to sweep this case

haphazardly into a “World War II reparations” category under the political question doctrine.

That approach simply does not meet the demands of Baker.

Given the 64-year long history of non-involvement by the U.S. government in Plaintiffs’ claims, there is no possibility that this Court’s adjudication here will violate the “respect due coordinate branches of government.” Baker, 369 U.S. at 217. And in light of the purely normative nature of Article 27, as well as the absence of any subsequent political activity by the

United States with regard to Plaintiffs’ claims against Hungary, there is no need, much less an

“unusual need[,] for unquestioning adherence to a political decision already made.” Id. Under the Baker standard, Plaintiffs’ claims are fully justiciable.

V. THIS COURT IS THE PROPER FORUM FOR ADJUDICATION OF THIS CASE, AND IT SHOULD NOT BE DISMISSED ON THE GROUND OF FORUM NON CONVENIENS.

A. Standard For Forum Non Conveniens

It is axiomatic that where, as here, there are U.S. plaintiffs – including four Named

Plaintiffs and untold others within the putative class – the federal courts will accord a

“substantial presumption in favor of [their] choice of forum.” Chabad, 528 F.3d at 950. “The doctrine of forum non conveniens is a drastic exercise of the court’s ‘inherent power’ because,

26 See, e.g., Whiteman, 431 F.3d at 74; Burger-Fischer v. Degussa AG, 65 F. Supp. 2d 248, 262-72 (D.N.J. 1999) (describing post-World War II treaties between U.S. and Germany, including establishment of reparations program and reparations court for dispute resolution); Iwanowa v. Ford Motor Co., 67 F. Supp. 2d 424, 448-60 (D.N.J. 1999) (same); Frumkin v. JA Jones, Inc., 129 F. Supp. 2d 370, 376078 (D.N.J. 2001) (same). 32

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unlike a mere transfer of venue, it results in the dismissal of a plaintiff’s case.” Carijano v.

Occidental Petroleum Corp., 626 F.3d 1137, 1144-45 (9th Cir. 2010) (citations omitted). It

follows that forum non conveniens is “‘an exceptional tool to be employed sparingly,’ [and] . . .

[t]he mere fact that a case involves conduct or plaintiffs from overseas is not enough for

dismissal.” Id. “Instead of the rule being . . . that jurisdiction should be denied unless such

denial would work an injustice, the rule is, rather, that jurisdiction should be taken unless to do

so would work an injustice.” Motor Distributors, Ltd. v. Olaf Pedersen’s Rederi A/S, 239 F.2d

463, 465 (5th Cir. 1956). The heavy burden lies with the defendant to demonstrate its

entitlement to this “exceptional” relief. See Pain v. United Technologies Corp., 637 F.2d 775,

784 (D.C. Cir. 1980), cert. denied, 454 U.S. 1128 (1981).

In examining the issue, the court should first ascertain whether there is an available and

adequate alternative forum for the litigation. If not, the court has no discretion to dismiss the

case, and the forum non conveniens motion must be denied. Norex Petroleum Ltd. v. Access

Industries, Inc., 416 F.3d 146, 157 (2d Cir. 2005), cert. denied, Tyumen Oil Co. v. Norex

Petroleum Ltd., 547 U.S. 1175 (2006); Bhatnagar v. Surrendra Overseas Ltd., 52 F.3d 1220,

1225-26 (3d Cir. 1995). Only where an available and adequate alternative forum exists should

the court then consider what degree of deference to give to the plaintiffs’ selection (“substantial”

if they are U.S. citizens, and less deference if they are not, Piper Aircraft Co. v. Reyno, 454 U.S.

235, 255 (1981), reh. denied, 455 U.S. 928 (1982)). Then the court must balance the public and

private factors enunciated in Gulf Oil Corp. v. Gilbert, 330 U.S. 501, 508-9 (1947), and make its

determination accordingly. Applying this three-step analysis, it is manifest that Plaintiffs are

properly before this Court, and that the case should not be dismissed for forum non conveniens.

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B. Hungary Affords An Inadequate Alternative Forum In Which To Adjudicate This Claim.

Plaintiffs’ choice of Washington, D.C. as the forum for this suit is not random. In addition to the factors discussed below at Section V(C)(2) and (3), Congress has expressly provided that Washington, D.C., is a proper forum in which to bring suit against a foreign state.27

Further, Hungary affords an inadequate alternative forum. An alternative forum is inadequate where, inter alia:

• “the proposed foreign forum. . . would deem Plaintiffs’ claims precluded,” Norex Petroleum, 416 F.3d at 162; or

• “the remedy provided by [it] is so clearly inadequate or unsatisfactory that it is no remedy at all,” Piper Aircraft, 454 U.S. at 254; or

• plaintiff demonstrates significant legal or political obstacles to conducting the litigation in the alternative forum, Menendez Rodriguez v. Pan Am Life Ins. Co., 311 F.2d 429, 432-33 (5th Cir. 1962), vacated on other grounds, Pan Am Life Ins. Co. v. Menendez Rodriguez, 376 U.S. 779 (1964); or

• conditions there “plainly demonstrate that the plaintiffs are highly unlikely to obtain basic justice therein,” Vaz Borralho v. Keydril Co., 696 F.2d 379, 393-94 (5th Cir. 1983), and will be “treated unfairly,” MBI Group, Inc. v. Credit Foncier du Cameroun, 616 F.3d 568, 574 (D.C. Cir. 2010); or

• there is a prevalence of bias, Tuazon v. R.J. Reynolds Tobacco Co., 433 F.3d 1163, 1179 (9th Cir. 2006); or

• only nominal damages, at most, are recoverable, Carijano, 626 F.3d at 1144-45; or

• unreasonable delays in adjudication effectively deny the plaintiffs justice, Bhatnagar, 52 F.3d at 1227-28; or

• plaintiffs cannot access evidence essential to prove their claims, Eurofins Pharma US Holdings v. BioAlliance Pharma, S.A., 623 F.3d 147, 161 n.14 (3d Cir. 2010); or

27 “A civil action against a foreign state . . . may be brought . . . in the United States District Court for the District of Columbia if the action is brought against a foreign state or political subdivision thereof.” 28 U.S.C. § 1391(f)(4).

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• the plaintiffs suffered trauma there, causing undue prejudice or inconvenience to force them to return to litigate their claims, Licea v. Curacao Drydock Co., 537 F. Supp. 2d 1270, 1275 (S.D. Fla. 2008) (citing Guidi v. Intercontinental Hotels Corp., 224 F.3d 142 (2d Cir. 2000)).

Each of these conditions is present here, and the Defendants have not met the “heavy burden” of overcoming any, let alone all, of them. Pain, 637 F.2d at 784.28

At the threshold, if the new Hungarian constitution, effective January 1, 2012 (called the

“Basic Law”), is construed literally by the courts, this suit will be substantially barred. See

Hanák Decl., ¶¶ 22-24. That is because the Preamble to the Basic Law states that on March 19,

1944 (the date the Germans occupied Hungary) Hungary lost its state sovereignty, which was restored only on May 2, 1990 (after the fall of the Communist regime). Thus, actions of

Hungary and MÁV during the bracketed period, which embraces most of the violations alleged herein, would not be viewed as the acts of the sovereign and would not be attributable to it. Id.

The likely inability to litigate this suit in Hungary per se disqualifies it as an available or adequate forum. Norex Petroleum, supra.

Apart from that, the manifest religious and ethnic prejudice to which these plaintiffs will undoubtedly be exposed if they subject themselves to the Hungarian judicial system to try to litigate these claims renders Hungary an inadequate forum. Defendants’ expert affiant, László

28 Significantly, whether an alternative forum is adequate requires that the court conduct a case- and fact-specific inquiry and not simply adopt prior determinations that any specific proposed forum was adequate or inadequate. See Martinez v. Dow Chem. Co., 219 F. Supp. 2d 719, 741 (E.D. La. 2002); In re Bridgestone/Firestone, Inc., 190 F. Supp. 2d at 1132 n.6. See also Bhatnagar, 52 F.3d at 1229 (stating that prior case law finding the foreign forum adequate is “irrelevant to the issue of whether [the defendant] met its burden of proof on the issue here.”). Thus, it is irrelevant that the courts in Moscovits v. Magyar Cukor Rt., 2001 U.S. Dist. LEXIS 9252 (S.D.N.Y. July 9, 2001) and Dorfman v. Marriott Int'l Hotels, Inc., 2001 U.S. Dist. LEXIS 642, at *22-23 (S.D.N.Y. Jan. 29, 2001) (neither one a Holocaust case) found Hungary to be an adequate forum – although in Dorfman, the Court, applying the balancing factors discussed below at Section V(C)(2) and (3), denied defendants’ motion for dismissal for forum non conveniens. Id. at *28. Likewise, the court in USH Ventures v. Global Telesystems Group, Inc., 1999 Del. Super. LEXIS 123, at *9-11 (Del. Super. June 9, 1999) rejected a forum non conveniens argument made by a Hungarian litigant. (Applying Delaware forum non conveniens law, comparable to federal law, the court in USH Ventures found that the defendant, a Hungarian telecommunications company, failed to demonstrate that continued litigation in the United States would be an overwhelming hardship, despite its arguments that it would be too difficult to take the depositions of witnesses in Hungary and that translation costs would be burdensome.)

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Nagy, suggests that the Hungarian civil justice system is free of bias – because the Hungarian

Constitution (the one still in effect) so mandates – and therefore the Plaintiffs could receive a fair trial there. Nagy Decl., ¶ 7. Of course, such aspirational language is not self-enforcing; what is more, it is belied by the facts. Mr. Hanák attests to his own experience in local litigation where

Hungary is a party and the opposing party is foreign, noting that there is noticeable bias in favor of the State. Hanák Decl., ¶ 20.29 Where the plaintiffs are Jewish Hungarian Holocaust victims, the prospect of overt anti-Semitism is palpable. Mr. Hanák cites articles in the media describing the ominous growth of virulent anti-Semitism in Hungary during the past several years. Id., ¶ 21 and attachments thereto.30 In these polluted conditions, the likelihood of a fair trial for these plaintiffs who are making horrific allegations against the Republic of Hungary that cut to the

29 See Sangeorzan v. Yangming Marine Transp. Corp., 951 F. supp. 650, 653-54 (S.D. Tex. 1997) (Where the defendant was 48% owned by the Taiwanese government, Taiwan was not an adequate alternative forum); Canadian Overseas Ores Ltd. v. Compania De Acero del Pacifico, S.A., 528 F. Supp. 1337, 1342 (S.D.N.Y. 1982) (Where one party was a state owned corporation, “serious questions about the independence of the Chilean judiciary vis a vis the military junta currently in power” rendered Chile an inadequate forum).

30 During a speech by the Budapest mayor last year, a mob chanted “Jewish pigs” and “To the concentration camps.” Hanák Decl., ¶ 21.

Election posters have been smeared with yellow Stars of David and anti-Semitic slogans.

Budapest rabbis describe racial epithets being shouted as they walk their children to school, slogans such as “Jews go to Israel” are daubed in the streets, accompanied by swastikas, while cars bear stickers with the slogan “Jew-free car.”

Id. (see excerpt from article in the Sunday Times of London, April 11, 2010, appended to Hanák Decl. as Attachment 1). An avowedly anti-Semitic political party has recently gained political prominence in Hungary “for the first time since the end of World War II.” Id. Perhaps most alarming, a news story dated March 11, 2011, reporting on a re- evaluation of a 2008 survey, found that “‘Hungarians and Poles are those most likely [Europeans] to hold extreme anti-Semitic views.’” Id.

Asked whether they agree with the statement that "Jews have too much influence in my country," 69.2 percent of Hungarians and 49.9 percent of Poles agreed. The lowest levels were in Holland, with 4.6 percent agreeing. Germany, with 19.6 percent, was in the middle, sociologist Beate Kuepper told JTA in a telephone interview.

Id. (quoting news report by the Jewish Telegraphic Agency on March 11, 2011).

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core of its national consciousness, pride, guilt and fisc, is fanciful in the extreme.31 Accordingly,

Hungary is inadequate as a forum. Vaz Borralho v. Keydril Co., supra; MBI Group, supra;

Tuazon v. R.J. Reynolds Tobacco Co., supra.

Delays in the judicial system are another reason why Hungary is an inadequate forum.

Mr. Hanák identifies two sources of delay. The first, a possible six-year time line for the

litigation under the current judicial regime, Hanák Decl., ¶ 19, may not be dispositive on its own,

but when coupled with the second source of delay, becomes prohibitive. Under the new Basic

Law, 30% of the judges of the Supreme Court of Hungary and 10% of the lower court judges

will be forced to retire in 2011-2012. Id., ¶ 25. Mr. Hanák concurs with the statement of the

Hungarian judiciary that this will drastically retard the performance and schedule of the

judiciary, and could result in many years’ delay for tens of thousands of litigants. Id., ¶ 25, n.19

and Attachment 5 thereto. The greatest vice of these expected delays is that Plaintiffs here are in

their eighties and nineties, and many are ill. See, e.g., Zelikovitch Decl., ¶ 25; Dascal Decl., ¶

23. Even assuming that this suit were otherwise permissible in Hungary, many, if not most,

Plaintiffs likely would not survive through judgment.

The trauma that Plaintiffs would endure is yet another reason why Hungary is an

inadequate forum. See Licea, supra. As expressed by one victim, “the mere thought of

appearing in a courtroom of the very people who murdered almost my entire family and refused

to compensate me for the horrible losses that my family and I incurred financially,

psychologically and physically, is beyond my capacity to bear . . .” Dascal Decl., ¶ 23. Plaintiff

31 That prospect is exacerbated by the new Constitution’s blatant efforts to restrict the independence of the Hungarian judiciary and make it toe the legislature’s line, as attested by Mr. Hanák, Hanák Decl., ¶ 25. This heavy- handed action flies in the face of Mr. Nagy’s blandishment that the Constitution guarantees the “independence” of the judiciary, Nagy Decl., ¶ 8. See Martinez, 219 F. Supp. 2d at 737-38, 740-41 (describing problems with the Honduran and Philippine judicial systems, including the fact that they were poorly staffed and not truly independent, despite such claims in their constitutions, and finding that they were accordingly inadequate forums). 37

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Zelikovitch writes: “[T]he emotional trauma of subjecting myself for a third time to the system

and the culture that murdered my family and hundreds of thousands of Jews is far more than I

could bear emotionally. I could not do it. My memories of that time and place are still with me, as are my memories of my family and friends who were killed there.” Zelikovitch Decl., ¶ 25.

In addition, substantial legal differences between the two systems, as applied to the facts

of this case, independently render Hungary inadequate as an alternative forum. Hungary does

not allow class actions. Hanák Decl., ¶ 9. While joinder of claims is possible on a discrete basis,

that is vastly different from a class action as allowed by Fed.R.Civ.P. 23. Id. Mr. Hanák notes that in 2010 there was a legislative effort to allow for a form of class action in Hungary, as

acknowledged by Mr. Nagy in his Declaration, but it failed. Id., ¶ 10.

Civil damages are highly restrictive in Hungary. “In any given case, recovery for non-

pecuniary damages, if available at all, is limited to a relatively modest amount in relation to the

cognizable pecuniary damages in that case.” Hanák Decl., ¶ 11. There is no right to punitive damages under Hungarian law. Id. “Further, in terms of available remedies under Hungarian

law, there is no right to a declaratory judgment to compel disclosure or inspection of documents,

much less a right to an injunction enjoining the Defendants from destroying documents.” Id.

Plaintiffs’ inability to obtain evidence essential to prove their claims as a result of being unable

to compel the production of documents or enjoin Defendants from destroying documents, is an

independent ground rendering Hungary inadequate as an alternative forum. See Eurofins

Pharma US Holdings, 623 F.3d at 161 n.14 (“Where a plaintiff cannot access evidence essential to prove a claim in an alternative forum, that forum is inadequate.” (citing Lacey v. Cessna

Aircraft Co., 932 F.2d 170, 191 (3d Cir. 1991)).

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Contrary to U.S. civil procedure, there is no right to inter-party pre-trial discovery under

Hungarian procedure. Hanák Decl., ¶ 12. And unlike in the United States, there are no statutory

protections afforded a party in Hungary as to documents controlled by the adverse party – no

right to a motion to compel, no right to sanctions for destruction of documents. Id.

In Hungary, unlike in the U.S., “the losing party ordinarily must pay the attorneys’ fees

and costs incurred by the other side pursuant to the prevailing party’s agreement with its counsel,

or as set by the Court.” Hanák Decl., at ¶ 13.32 None of the Named Plaintiffs would have brought this suit were they at risk of liability for Defendants’ doubtless substantial legal fees and expenses paid to their New York counsel, much less would there be any likelihood of class participation. Id. In addition, were this case brought in Hungary, “upon Defendants’ motion

U.S. Plaintiffs may be ordered to pay a prohibitively high amount of security deposit – the potential for an exemption from this requirement to which Mr. Nagy refers, Nagy Decl., ¶ 22, is very limited at best.” Hanák Decl., ¶ 13.

Further, while Mr. Nagy argues that Hungary would be bound to pay damages assessed against it by a Hungarian court whether or not budgeted funds were allocated for that purpose,

Nagy Decl., ¶ 15, his statement is incomplete in two material respects. “First, if the money has not been allocated, enforcement would be difficult if not impossible as a practical matter.”

32 Mr. Nagy asserts that translation and interpretation costs may be borne by the Court, but he admits that this is subject to international convention or reciprocity, and he fails to disclose that even at that, any such limited benefit would apply only when a party or witness is testifying in court. [footnote omitted] See Nagy Decl. at ¶ 9. As, in fact, there is no pre-trial discovery allowed under Hungarian civil procedure . . . it follows that translation expense for pre-trial depositions, document translation and so forth are not subject to any cost-shifting. Here, where many of the Class members will require translation services during pre-trial discovery proceedings, and where a multitude of documents may require translation, it is clear that the possible, limited, availability of translation services for the trial itself affords little if any practical benefit.

Hanák Decl., ¶ 14.

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Hanák Decl., ¶ 17. Second, the current law may well be revoked.33 Finally, while it may be true that a foreign judgment against Hungary cannot be enforced in Hungarian courts absent certain restrictive conditions, Nagy Decl., ¶ 14, inhibitions on execution against Hungarian assets in the

United States are much more limited under FSIA, see 28 U.S.C. § 1610; Chabad, 528 F.3d at

951, and there is no prohibition on execution of assets against Rail Cargo in Hungary (Hanák

Decl., ¶ 18) or in the United States.34

Some of these limitations alone render Hungary inadequate as an alternative forum (e.g, the severe restriction on damages, see Carijano, supra, 626 F.3d at 1144-45, and the inability to access evidence essential to prove plaintiffs’ claims, see Eurofins Pharma US Holdings, 623

F.3d at 161 n.14). Thus the effect of all of these limitations, taken together, is clear: Taking all of these restrictions into account, Plaintiffs could not obtain basic justice in Hungary.35 Hungary is neither available nor adequate as a forum in which to adjudicate this case.

33 . . . [T]he powers and jurisdiction of the Constitutional Court . . . have recently been limited by a new constitutional amendment, [footnote omitted] which has recently been re-codified in the new Hungarian Constitution called the Basic Law (“Alaptörvény”) [footnote omitted]. The effect of Act CXIX of 2010 and that of the new Basic Law is that the Constitutional Court will no longer have the power to review, much less invalidate, any legislation relating to taxes, public finance or budget. This would include legislative restrictions on payment of damages by the government. Stated differently, the current Civil Code provision could be quickly revoked by a legislative majority with no recourse to constitutional judicial review. This is a distinct possibility in part because, under Section (3) of Article N of the new Basic Law, both the Constitutional Court and ordinary courts need to adjudicate cases with a view to the balanced budget requirement set forth in Section (1) of Article N, which prescribes that Hungary must run a balanced, transparent and sustainable budget.

Hanák Decl., ¶ 17.

34 See, e.g., 2006 New York Code (“Actions or Special Proceedings by the Attorney General”), § 112(b)(4).

35 See Piper, 454 U.S. at 254 (“[I]f the remedy provided by the alternative forum is so clearly inadequate or unsatisfactory that it is no remedy at all, the unfavorable change in law may be given substantial weight; the district court may conclude that dismissal would not be in the interests of justice.”).

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1. Contrary To Defendants’ Assertion, The Court Must Afford Substantial Deference To Plaintiffs’ Choice Of Forum.

A U. S. plaintiff’s election to file suit in a United States court is entitled to great weight, and that deference is not diminished when the plaintiff sues in a representative capacity.36

This presumption in favor of the plaintiffs’ initial forum choice in balancing the private interests is at its strongest when the plaintiffs are citizens, residents, or corporations of this country. . . . [I]n this Circuit we have long mandated that district courts “require positive evidence of unusually extreme circumstances and should be thoroughly convinced that material injustice is manifest before exercising any such discretion as may exist to deny a United States citizen access to the courts of this country.

SME Racks, Inc. v. Sistemas Mecanicos Para Electronica, S.A., 382 F.3d 1097, 1101 (11th Cir.

2004) (internal citations omitted).37 The defendant must make a “clear showing of facts which . .

. establish such oppression and vexation of a defendant as to be out of proportion to plaintiff’s

36 Contrary to Defendants’ assertion, Def. Mem. at 24, the U. S. plaintiffs’ claims were not extinguished by the 1973 Agreement between the United States and Hungary. See supra, 26-28. Further, while the majority of Named Plaintiffs are non-U.S. citizens, this does not mean that the class will consist mainly of foreign citizens. See, e.g., In Re: Assicurazioni Generali S.p.A. Holocaust Ins. Litig., 228 F. Supp. 2d 348, 352 (S.D.N.Y. 2002) (stating that “‘outside of Israel, New York is home to the largest number of Holocaust survivors and their heirs in the world,’ N.Y. Holocaust Victims Insurance Act of 1998 (‘HVIA’) § 2, N.Y. Ins. Law § 2701 notes (McKinney 2000), which suggests that whomever the unnamed plaintiff class or classes ultimately include, a substantial portion will consist of New York residents.”).

37 See also, Bodner, 114 F. Supp. 2d at 131-32 (“This Court should not dismiss a complaint brought by American plaintiffs in favor of a foreign jurisdiction on forum non conveniens grounds unless trial in the United States is demonstrably “unjust, vexatious, or oppressive.” (citation omitted)); In re Banco Santander Sec.-Optimal Litig., 732 F. Supp. 2d 1305, 1335-36 (S.D. Fla. July 30, 2010) (“When plaintiffs are United States citizens suing in United States courts, their choice of forum is entitled to substantial deference.”); Licea, 537 F. Supp. 2d at 1273 (“plaintiffs’ choice of forum is entitled to a strong presumption of suitability, and ‘positive evidence of unusually extreme circumstances’ must be present and . . . the court must be ‘thoroughly convinced that material injustice is manifest’ before ousting a domestic plaintiff from this country’s courts.” (citations omitted)).

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convenience, which may be shown to be slight or nonexistent. . . .” Cheng v. Boeing Co., 708 F.

2d 1406, 1410 (9th Cir. 1983).

Defendants have made no showing, much less a clear showing, that pursuit of this case in

this district would be oppressive and materially unjust to them. Instead, Defendants shift the

attention away from that inquiry and focus instead on Plaintiffs. Defendants argue that the

District of Columbia is not the U.S. plaintiffs’ “home forum” and thus is not entitled to great

weight, Def. Mem. at 27. The argument is weightless. “When the alternative forum is abroad,

any domestic forum constitutes a ‘home’ forum for purposes of forum non conveniens analysis.”

Martin v. Vogler, 1993 U.S. Dist. LEXIS 15878, at *8 n.4 (N.D. Ill. 1993) (citing Interpane

Coatings, Inc. v. Australia & New Zealand Banking Group Ltd., 732 F. Supp. 909, 915 (N.D. Ill.

1990)). Defendants also argue that less deference is afforded a foreigner’s choice of a U.S.

forum, Def. Mem. at 27. But that is irrelevant, for as noted throughout this memorandum, four

Named Plaintiffs and an untold number of class members are U.S. citizens.38

Finally, Defendants improperly conflate the lower standard for consideration of transfer

under 28 U.S.C. § 1404(a) with the higher standard for dismissal under forum non conveniens.

The high bar for dismissal on the ground of forum non conveniens has been discussed above. A lesser standard for transfer to another district (i.e., less deference to plaintiff’s choice of forum) obtains under 28 U.S.C. § 1404(a), which provides that “[f]or the convenience of parties and witnesses, in the interest of justice, a district court may transfer any civil action to any other district or division where it might have been brought.” See Norwood v. Kirkpatrick, 349 U.S. 29,

38 See Carijano v. Occidental Petroluem Corp., 626 F.3d 1137, 1149-50 (9th Cir. 2010) (“Piper does not in any way stand for the proposition that when both domestic and foreign plaintiffs are present, the strong presumption in favor of the domestic plaintiff's choice of forum is somehow lessened.”). At that, even if there were only foreign plaintiffs present, the Defendants would still be required to establish a “strong preponderance” in favor of dismissal. See Mujica v. Occidental Petroleum Corp., 381 F. Supp. 2d 1134, 1141 (C.D. Cal. 2005) (citations omitted). See also Bhatnagar, 52 F.3d at 1226 n.4.

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32 (1955). Thus, the § 1404(a) cases upon which Defendants rely for the proposition that a plaintiff’s choice of forum is entitled to less deference when the action is brought on behalf of a class are irrelevant to this suit.39 Id. (noting that the district court has broader discretion to transfer a case under § 1404(a) than to dismiss under the doctrine of forum non conveniens);

Derensis, supra at 1003, 1007.40 Plaintiffs’ choice of forum is entitled to substantial deference.

2. The Private Interest Factors Weigh In Favor Of Plaintiffs, And At A Minimum, Do Not Clearly Weigh In Favor Of Defendants.

Defendants fail to meet their burden to show clearly that private or public interest factors strongly weigh in their favor. Deirmenjian v. Deutsche Bank, A.G., 2006 U.S. Dist. LEXIS

96772, at *68 (C.D. Cal. Sept. 25, 2006).41 The private interest factors include the relative ease of access to sources of proof; the availability of compulsory process for attendance of unwilling witnesses; the cost of attendance of witnesses; the enforceability of a judgment, if obtained; and other expenses or inefficiencies.42 Am. Dredging Co. v. Miller, 510 U.S. 443, 448 (1994)

(quoting Gulf Oil, 330 U.S. at 508). Contrary to Defendants’ assertion that the balance of private

39 See Def. Mem. at 27 (citing Gould v. Nat’l Life Ins. Co., 990 F. Supp. 1354, 1358 (M.D. Ala. 1998); In re Nematron Corp. Sec. Litig., 30 F. Supp. 2d 397, 405-06 (S.D.N.Y. 1998); Butcher v. Gerber Prods. Co., 1998 U.S. Dist. LEXIS 11869 (S.D.N.Y. Aug. 3, 1988). Koster v. Lumbermens Mutual Casualty Co., 330 U.S. 518 (1947), was technically a forum non conveniens case because 28 U.S.C. § 1404 was not yet enacted. However, the alternative forum at issue in Koster was a different U.S. forum, rather than a foreign forum. Accordingly, as explained in Derensis v. Coopers & Lybrand Chartered Accountants, 930 F. Supp. 1003, 1007 (D.N.J. 1996), that case is inapposite as well.

40 Likewise misplaced, for the same reason, is Defendants’ reliance on Gould, supra, for the proposition that a plaintiff’s choice of forum is afforded less deference where the operative facts occurred abroad. Def. Mem. at 27.

41 “Even when an adequate alternative forum exists, [the court] will not disturb the plaintiff's original choice of forum ‘unless the “private interest” and the “public interest” factors strongly favor’ dismissal.” Deirmenjian, supra (citations omitted)).

42 This list is not exhaustive. See Van Cauwenberghe v. Biard, 486 U.S. 517, 528 (1988) (“This list of considerations to be balanced is by no means exhaustive, and some factors may not be relevant in the context of a particular case.”). The factors provide for flexibility, with no one factor being dispositive. See Piper, 454 U.S. at 249-50 (the United States Supreme Court refused to “lay down a rigid rule to govern discretion” and “[e]ach case turns on its facts”).

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interest factors favors Hungary, they weigh decisively in favor of Plaintiffs. Certainly, and at a minimum, they do not strongly weigh in favor of the Defendants.

First, even if the majority of documents are in Hungary, given modern technology and the fact that any documents utilized by Defendants in the case will still have to be provided to U.S.

Plaintiffs and their counsel, the factor of “relative ease of access to sources of proof” does not

weigh strongly in favor of Defendants. See Chabad, 466 F. Supp. 2d 6, 28-29 (D.D.C. 2006),

aff’d in part and rev’d in part, 528 F.3d 934 (D.C. Cir. 2008); In re Assicurazioni Generali

S.p.A. Holocaust Ins. Litig., 228 F. Supp. 2d at 360-61; Presbyterian Church of Sudan v.

Talisman Energy, Inc., 244 F. Supp. 2d 289, 340 (S.D.N.Y. 2003).

Second, even assuming the majority of witnesses are not in the U. S., the proper inquiry is

not the number of witnesses in various locations, but the evaluation of “the materiality and

importance of the anticipated . . . witnesses’ testimony and then [the] determin[ation] [of] their

accessibility and convenience to the forum.’” Carijano, 626 F.3d at 1152.43 The cost of

attendance of witnesses weighs in favor of Plaintiffs because in the U. S., unlike in Hungary,

inter-party deposition testimony is allowed. See Hanák Decl., ¶¶ 9, 12; Bodner, 114 F. Supp. 2d

at 131-32 (observing that the use of deposition testimony for witnesses who cannot travel from

abroad is typical in international cases); Licea, 537 F. Supp. 2d at 1275-76 (stating that if foreign

witnesses are necessary, “depositions could be used at trial, reducing the expense and

inconvenience to witnesses”); DiRienzo v. Philip Servs. Corp., 249 F.3d 21, 30 (2d Cir. 2002)

43 In any event, the Defendants merely assert that “most of witnesses . . . are located outside the United States,” Def. Mem. at 28, and not that the majority of witnesses are located in Hungary, so it is not clear why Hungary would be the more convenient forum. In fact, as for the Named Plaintiffs, while not all are U.S. residents, not one resides in Hungary. Clearly, the United States would be a more convenient forum for the Plaintiffs.

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(“Despite the preference for live testimony, we have recognized the availability of letters rogatory as relevant in deciding whether plaintiffs’ chosen forum is inconvenient.”).44

Additional grounds tilting the balance of private interest factors in favor of Plaintiffs’ choice of forum, unmentioned in the Motion to Dismiss, include:

• The substantial legal differences between the American and Hungarian forums that show why Hungary is not an adequate alternative forum.

See Deirmenjian, 2006 U.S. Dist. LEXIS 96772, at *37-40; id. at *52-53 (finding that the lack of a class action devise, more stringent discovery, and the uncertainty of the availability of contingency fee-arrangements in Germany, “are practical problems that make Germany a less attractive forum than California” (citations omitted)); In re Assicurazioni Generali S.p.A.

Holocaust Ins. Litig., 228 F. Supp. 2d at 366 (stating that the unavailability of contingency fees and the absence of a class action procedure weigh against dismissal, and also noting that “[m]any of the skills of plaintiffs’ current lawyers would be wasted in European civil-law systems which do not provide for pretrial discovery”); Lehman v. Humphrey, Ltd., 713 F.2d 339, 346 (8th Cir.

1983) (prospective application of an extremely low cap on damages in the alternative forum served as a factor against forum non conveniens dismissal); Derensis, 930 F. Supp. at 1007-09

(finding alternative forum inadequate due to the undeveloped state of class action procedure);45

44 In addition, Defendants do not meet the heavy burden of showing that the cost of attendance of witnesses or the availability of hostile witnesses weighs heavily in their favor here since they failed to furnish any list of witnesses. While Defendants are “not required to identify potentially unavailable witnesses in exact detail,” see Carijano, 626 F.3d at 1152, they fail to allege any issues as to any specific witness. See id.; Presbyterian Church of Sudan, 244 F. Supp. 2d at 340-41; Peregrine Myanmar Ltd. v. Segal, 89 F.3d 41, 47 (2d Cir. 1996); Weltover, Inc. v. Republic of Argentina, 753 F. Supp. 1201, 1209 (S.D.N.Y. 1991) (“In the absence of such information, the Court cannot assess how defendant will be prejudiced by litigation in New York.”); Duha v. Agrium, Inc., 448 F.3d 867, 877 (6th Cir. 2006) (“When no witness’ unwillingness has been alleged or shown, a district court should not attach much weight to the compulsory process factor.”); Van Cauwenberghe, 486 U.S. at 528 (“To examine ‘the relative ease of access to sources of proof,’ and the availability of witnesses, the district court must scrutinize the substance of the dispute between the parties to evaluate what proof is required, and determine whether the pieces of evidence cited by the parties are critical, or even relevant, to the plaintiff's cause of action and to any potential defenses to the action.”).

45 Of great significance in this case is substantial prejudice due to the fact that Hungary requires in person testimony and makes no provision for depositions. Not only is a hindrance due to the age and health of many of the Plaintiffs, 45

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• The financial disparity in relative means between Plaintiffs and Defendants.

See In re Nematron Corp. Sec. Litig., 30 F. Supp. at 405 (“Where disparity exists between the parties, such as an individual plaintiff suing a large corporation, the relative means of the parties may be considered.”); Presbyterian Church of Sudan, 244 F. Supp. 2d at 341 (“A countervailing factor is the relative means of the parties. . . . In this case, defendants clearly have the upper

hand when it comes to resources.”); Wiwa v. Dutch Petroleum, 226 F.3d 88, 107 (2d Cir. 2000)

(“The additional cost and inconvenience to the defendants of litigating in New York is fully

counterbalanced by the costs and inconvenience to the plaintiffs of requiring them to reinstitute

the litigation in [the foreign forum]--especially given the plaintiffs’ minimal resources in

comparison to the vast resources of the defendants.”); and,

• The undue burden that would be placed on Plaintiffs if trial were held in Hungary due to the fact that they cannot, if at all, travel easily due to their age and health, and also due to the undue emotional burden that would be placed on them if forced to return to Hungary, where they suffered horrendous trauma, to litigate their claims.

See In Re: Assicurazioni Generali S.p.A. Holocaust Ins. Litig., 228 F. Supp. 2d at 366; Altmann

v. Republic of Austria, 317 F.3d 954, 973-74 (9th Cir. 2002); Dorfman, 2001 U.S. Dist. LEXIS

642, at *25-26; Bodner, 114 F. Supp. 2d at 132.46

Balancing the private interest factors, it is clear that this is not one of the rare forum non

conveniens cases wherein Plaintiffs’ choice of forum should be disturbed.47

but, as discussed, it would be an undue hardship to require many individuals to travel to Hungary in light of the horrific trauma they suffered there.

46 While providing no names, Defendants assert that their witnesses are elderly and/or ill and, therefore, this factor weighs in their favor. But Named Plaintiffs and the class members are also of advanced age and ill. Foreign parties and witnesses who are aged and ill can testify by deposition in the U.S. if necessary, but Hungarian procedure does not make that allowance. Hanák Decl., ¶ 12.

47 The Defendants’ argument that the United States is an inconvenient forum for them should also not carry much weight in light of the fact that Hungary is currently a plaintiff in a lawsuit that was filed in the United States. See 46

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3. The Public Interest Factors Weigh In Favor Of Plaintiffs, And At A Minimum, Do Not Clearly Weigh In Favor Of Defendants.

The balancing of public interest factors – which include the administrative difficulties flowing from court congestion; local interest; avoidance of unnecessary problems in conflict of laws or application of foreign law; and the unfairness of burdening citizens in an unrelated forum with jury duty, see Piper Aircraft, 454 U.S. at 241 n.6 – likewise fail to support Defendants’ forum non conveniens motion.

The administrative difficulties do not weigh in favor of Defendants. There is no evidence that Hungarian courts are less congested than this Court;48 there would be no undue burden placed on local jurors given the U.S.’s and the District of Columbia’s interest in the subject matter, discussed below; and the cases cited by Defendants that discourage U.S. courts from taking “upon themselves . . . to resolve the disputes of the world,” Def. Mem., at 34 (citing

Zinsler v. Marriott Corp., 605 F. Supp. 1499, 1506 (D. Md. 1985); Cruz v. Maritime Co. of

Philippines, 549 F. Supp. 285, 290 (S.D.N.Y. 1982), aff’d, 702 F.2d 47 (2d Cir. 1983) are inapposite because those cases concerned foreign plaintiffs only, whereas U.S. citizens are plaintiffs here.

Hungary’s interest is outweighed by the interest of the United States and the District of

Columbia in providing relief to their residents who were harmed in the Holocaust, and because public policy favors providing a forum in which United States citizens may seek to redress the alleged wrongs. See In Re: Assicurazioni Generali S.p.A. Holocaust Ins. Litig., 228 F. Supp. 2d at 367; Bodner, 114 F. Supp. 2d at 133. See also Presbyterian Church of Sudan, 244 F. Supp. 2d

European Cmty. V. RJR Nabisco, Inc., 2011 U.S. Dist. LEXIS 41219 (E.D.N.Y. Apr. 14, 2011). See Licea, 537 F. Supp. 2d at 1276 (noting that the defendant is a large corporation which has brought federal lawsuits in U.S. courts).

48 To the contrary, the evidence of delay tilts this factor decidedly in favor of Plaintiffs. See Hanák Decl., ¶¶ 19, 25; Deirmenjian, 2006 U.S. Dist. LEXIS 96772, at *55 (“The real issue, however, is ‘whether a trial may be speedier in another court because of its less crowded docket.’”) (emphasis in original) (citation omitted)).

Case 1:10-cv-01770-BAH Document 24 Filed 05/06/11 Page 58 of 60

at 339 (“A second factor militating against dismissal on forum non conveniens grounds is the

strong United States interest in vindicating international human rights violations. In this case,

plaintiffs seek redress for jus cogens violations of international law.”).

Further, the local general public interest in this case is evidenced by the demonstrated

interest and involvement of the United States in violations of international human rights norms

and in Holocaust reparation matters. See Chabad, 466 F. Supp. 2d at 29-30; Bodner, 114 F.

Supp. 2d at 133; Deirmenjian, 2006 U.S. Dist. LEXIS 96722, at *55; Licea, 537 F. Supp. 2d at

1276 (finding that “any interest that a forum in Curacao may have is countered by the public

interest factors this jurisdiction has in the matter. This case concerns alleged violations of

international human rights norms of concern to all nations and that the Alien Tort Statute

empowered this Court to address.” The court cautioned, “Courts should be careful not to dismiss

as inconvenient such cases.” Id., at 1274).

Additional factors that illuminate the District of Columbia’s interest in this case include

Congress’s designation of this Court as the proper forum for virtually all actions brought under

FSIA and its status as the seat of the United States government and the preferred location for

foreign embassies, including that of Hungary.49 See Chabad, 466 F. Supp. 2d at 29-30;

Deirmenjian, 2006 U.S. Dist. LEXIS 96722, at *58.

Finally, Defendants assert that the Court should dismiss this action on grounds of forum

non conveniens because Hungarian law will apply. Even assuming arguendo that were true, it

would not warrant dismissal for forum non conveniens. See Piper, 454 U.S. at 245; McDonald’s

Corp. v. Bukele, 960 F. Supp. 1311, 1320 (N.D. Ill. 1997); Moscovits, 2001 U.S. Dist. LEXIS

9252, at *21-22; In Re: Assicurazioni Generali S.p.A. Holocaust Ins. Litig., 228 F. Supp. 2d at

49 By contrast, Hungary’s interest, defending itself against the allegations of its massive wrongdoing, should not be seen as a local interest factor that militates towards Hungary. See Licea, 537 F. Supp. 2d at 1276.

Case 1:10-cv-01770-BAH Document 24 Filed 05/06/11 Page 59 of 60

368-69 (finding that the forum’s interest in the litigation of plaintiffs’ claim was “only somewhat

diminished by the probable need to apply foreign law,” and holding the application of foreign law was not a persuasive basis for dismissal.).

VI. CONCLUSION

Accordingly, for the reasons set forth hereinabove and in the accompanying Declarations,

the Motion to Dismiss should be denied.50

Respectfully submitted,

Charles S. Fax Charles S. Fax, D.C. Bar No. 198002 Liesel J. Schopler, D.C. Bar No. 984298 Rifkin, Livingston, Levitan & Silver, LLC 7979 Old Georgetown Road, Suite 400 Bethesda, Maryland 20814 Telephone: (301) 951-0150 Telecopier: (301) 951-0172 [email protected]; [email protected]

L. Marc Zell, admitted pro hac vice Zell & Co. 21 Herzog Street Jerusalem 92387 Israel Telephone: 011-972-2-633-6300 Telecopier: 011-972-2-672-1767 [email protected]

David H. Weinstein, admitted pro hac vice Weinstein Kitchenoff & Asher LLC 1845 Walnut Street, Suite 1100 Philadelphia, Pennsylvania 19103 Telephone: (215) 545-7200 Telecopier: (215) 545-6535 [email protected]

Paul G. Gaston Law Offices of Paul G. Gaston 1776 Massachusetts Avenue, N.W, Suite 806

50 Alternatively, the Court is respectfully requested to allow Plaintiffs to conduct limited discovery to elucidate further the jurisdictional facts giving rise to exemptions under FSIA.

Case 1:10-cv-01770-BAH Document 24 Filed 05/06/11 Page 60 of 60

Washington, D.C. 20036 Telephone: (202) 296-5856 Telecopier: (202) 296-4154 [email protected] Attorneys for Plaintiffs Dated: May 6, 2011

Case 1:10-cv-01770-BAH Document 24-1 Filed 05/06/11 Page 1 of 7 Case 1:10-cv-01770-BAH Document 24-1 Filed 05/06/11 Page 2 of 7 Case 1:10-cv-01770-BAH Document 24-1 Filed 05/06/11 Page 3 of 7 Case 1:10-cv-01770-BAH Document 24-1 Filed 05/06/11 Page 4 of 7 Case 1:10-cv-01770-BAH Document 24-1 Filed 05/06/11 Page 5 of 7 Case 1:10-cv-01770-BAH Document 24-1 Filed 05/06/11 Page 6 of 7 Case 1:10-cv-01770-BAH Document 24-1 Filed 05/06/11 Page 7 of 7 Case 1:10-cv-01770-BAH Document 24-2 Filed 05/06/11 Page 1 of 18

IN TIlE UNIT ED STATES m STRICT COURT FOR T HE DI STRICT OF COLUMBIA

ROSAL IE SIM ON, ~ Q/., • Indi"idually, lor t h tmse l n~s IlD d for " II • otbU5 similarly situated, • • Plaintiffs, • • ", • c.se No. 1:IQ..-cv..{l I770·UAH • TIlE REPUBLIC O F HU NGARY, el (l/., • • Defendunl5. • • * * ~ ~ ~ ~ * * • ~ ~ ~ ~ ~ • * • ~ ~ ~ * • ~ ~ * ~

DEC LARAT ION OF ANImAs I. HANA K

ANDRAs I. HANAK, under penalties of perjury and In kWrdance wilh 2g

U.S.C. § 1746, declares 3S fo ll ows:

I. I am over eighteen yean old and I am competenl to make this Dec laration.

2. J am a citize" or tile United States and Hunga ry, and a practici ng anomey living in Budapest, Hungary, with my law practice, rept'Ci!enting Hungarian and international clients. based there.

3. In 1975 1 received my Juris {)octOI' degree, Slm",w cum laude, from lOOMIs Lorand University School of Law in Budapest, Hungary. In 1982 I received my

LLM. from Ollumbia Un ivoef1ily WW School in New York, New York . In 1987 I rece ived a second J.D. degree, from the University of Pennsylvania Law School In

Ph iladel phia, Pennsylvania. I was admilled to Ihe Bar of the Commonwealth of

Pennsylvania in 1937 (not eum:ntly active) and to l ~ Hungarian Bar {Budapest Bar Case 1:10-cv-01770-BAH Document 24-2 Filed 05/06/11 Page 2 of 18 •

Association) in 1996. t am nuen! in Engl ish and Hungarian. I MI not a member of the putative Plaintiff Class.

4. Between 1987 and 1990 I practiced law as an associate altomey in the

Washington, D.C., office of the law firm Stroock &. Slroock &. Lavan (based in New

Yon, New York). Betweet1 1990 and 1991 I was an associate attorney in SlrOOCk &.

Siroock & Lavan's Budapest, Hungary, office. Between 199 1 and 1996 [ was the

Managing Lawyer and a local parlner in the Oudapes! office of Squire, Sand<.:rs &.

Dempsey, LLP (based in Cleveland, Ohio). Between 1996 and 2002 I was the Managing

Lawyer and a local panner in lhe Budapest office of Dewey Ballantine LLP.llOw Dewey

LeBctlf(bosed in New YOfk, New York). Since 2002 I have served as principal anomey in the Andras Hanak Law Office in Budapest. lind as Senior Advisor to Euro-Phocnix finaocial Advison, Ltd .. also in BudapeM. Further, bctw«!! 1991 and 2008 I SCfVed as

Adjunct Professor of Law III COlv/k Lomnd University School of L..aw and at Central

European University, both in Budapest. I hold the title ~HorlOrary Professor" at EO\V/k

Lonind University School of Law, a designation of distinction in lhe Hungarian academic community.

5. My main lln:ms of substantive concentration are corporate law and domestic and international commercial tranSllClions and disputes; mergers and acquisiti()fls; finance; and anti-lrust law. In the Hungarian legal system, complex • commercial Dnd corporate disputes can be subject to either litigation or arbitration, and in both cases the Hungarian general rules of civil procedure are used. I frequently act as counsel 10 ()fle or another party in such legal procecdin8$. In Hungary, anti-trust disputes are subject 10 regulatory proceedings culminaling in judicial appeals, in which I also

2 • Case 1:10-cv-01770-BAH Document 24-2 Filed 05/06/11 Page 3 of 18

frequently act as counsel 10 one or another party. My legal work. in Hungary, coupled

with my engagemef]! in international U.S.-relaled corporate \(lInsaetions and litigation,

necessitates my familiarity with both Hlmgarian lind US. substantive law and Hungarian

civil procedure. and it is based on that experience that I make this Dedaralion.

6. I have previously bc<.:rl recognized as an expert witness on Hungarian law

by lhe Swiss Court of Arbitration in Zurich, Switzerland.

7. llwlve reviewed the First Amended Complain! in this case, together wilh

Ihe Motion 10 Dismiss and related papers filed by Defendant!; Republic of Hungary

r'Hungary") and Magyar AlIlII11vasutak Zrt. ("MAv,,), with particular emphasis OIl til<::

Declaration of Uiszl6 Nagy. While his Dec laration makes many admissions that Ihe

Hungarian legal system is not !learl)' as accommodating \0 plaintiffs as the U.S. system.

and docs not afford litigants th e rights granted litigants in the U.S. system, I disagra: with

his implication that nonetheless the I'laintiffs in th is case would have at least the same

rights and remedies in a Hungarian proeeeding as they have in this lawsuit in the United

Statcs. As discussed below, Hungarian law docs IlOt provide ror (he scope ofli(igation 01"

relierthat American Jawaffonls in a ~ like this.

8. The H un~ari8n legal system is a codified civil law system whO$!: traditions

have been shaped by the German-Austrian fami ly of continenlDJ civil law. Thi$ is

panicularly true in the areas of propeny, contracts, torts and privacy mailers. The

consequences are thai (a) there is no generally-attepled system or body of jud icial

precedel1ts that has binding or uniform force on $ubsequcnt cases; and (b) Hungarian

courts do not, as a matter of course, apply doctrines and precedents developed by

customary intcmalionallaw.

3 " ' . I Case 1:10-cv-01770-BAH Document 24-2 Filed 05/06/11 Page 4 of 18

9. As Mr. Nagy admits in , I I of his ~Ianuion ("Nagy Dccl.ft), class

actions arc 1'10\ recognized ~nder the Hungarian legal system. To be sure, joinder of

claims is possible on a d iliCrete basis l - comparable to joinder of claims by multiple

named parties under America .. civil procedure. Thai is vastly different, however, frolt'! a

class aclion as allowed by Fed.R.Civ.P, 23. There is simply ItO mechanism in HungarillR

law for a body of private persons living in va rious cOITntr ies around the world to be given

actual or cooSi ruc t i~ nOl ice of a su it, and be em braced by the tribunal 's j udgment

through a class certifi cation process, without having entered their formal appearances as

named parties. Any person who wished to participate in a lawsuit and be bou nd by the

judgment of the Hungarian tri bunal would have to appear as a pany, hire a lawyer, come

10 HunGary and appear in person in Hungary if he or $he wislled to give testimooy, and

pay ~ I ] of the substantia] fees a nd costs associated with such participation. Therefore, thi s

class action could oot be brought in Hungary, aod un less ca.ch person amoog tile

mu ltitude of Hun garian Holocaust Sllrvivors embrtlc cd by the class participated

personally in IIle lawsuit, the IOUIlity of these claims could !lever be brouaht in Hunpry

(assuming tltey could be brought in Hun gary in tlte fi rst place).

10. Sigoificantiy, in 2010 there was a legislative effort to allow for a fonn of

class action in Hungary, as ack l,owledged by Mr. Nag)', Nagy De<:l. at 1 II , n.13, but that

effort was defeated. The draft legislation to which he refers has not been revised or

resubmilled to Parliament? That effort. and its failure, reflcct a clear recognition on the

I ACI Ill. of 1952 "" Rule. of Civil Procedure (SedioM 51 • Sl~

, The ...ft legislation n.:ed "'" 1)'1ICS of challeore': r. .... il "'*" I'I(lt _y III delajled 111 11>0 US. ruin and thu, fOilN 10 ~« , the poten,i.1 pllintifT 011$$. and «

part orthe Hungarian polity of the V8St differences between joinder of claims, on the one

hand, and clllSS ktioo emillement 00 lht other.

II. Civil damages are much more restrictive under Hungarian law than under

American jurisprudence. In any given case, ~very for non-pecuniary damagcs/ if

avail able 3t all, is limited 10 a relatively modest amount in relation \0 Ihe cognizabl e

pecuniary damages in llInt ease.' Moreover, as adm itted by Mr. Nagy, Nagy Decl. at 1

12, lheff: is no enlillernenllO punitive damages under Hungarian law.l Further, in terms

of nvailable remedies under Hungarian Jaw, there is no righl to a declaratory judgment to compel d isclosure or inspection of docume.llS, much less a right 10 an injWlction

enjoining the Defendants from destroying documents."

12. In that regard, in the United Stales pre-trial discovery is an essential part of virtually all civil lawsui ts seeking more than nominal damages. Requests for

production, interrogatories and depo.sitions are inteGJllI to such civil li tigation practice.

Further, the U.S. Federal Ru les of Civil Procedure haV() detailed requiremenl5 governing

the usage of consulting experts and testimonial experts, as well as discoverability and

non-disooverability of their work-product. In addition, the Rules afford and protect a

party's right of access 10 documents controlled by the other sid e, and provide $IInctions

for, infer olia, destruction of such documenl5. Under Hungarian law and procedure,

I Non_pecun iOl)l damage. may .. a""arrled "nder Secti"" 354 of Act IV. of 1959 (the Hunp";." Civil Code). The coneepl of ,.,.,-peCUnial1' domaps.. 110..., .... . is diff=m f""" lhe doom ... ..sed in U.S. 1Of1 IIw to """'~ rOf lou .,ftife, pain and ,"lI'tri"l-

• S=ion JH or.he Civil Co,x.

l Whi le in c.... i" circum.lan_ defend.n .. may be ord.red", pay 10 tIIo Stile a foxed .mounl. puniti ... dam"8os collectible by pJ.inciffi ... not ~ited .

• The injulK:l;a.Hyp< ren,edi .. uDder S«1ion 156 of'he Civil Pn><:edur. "eI-.e ~ ~IriCled in their n:och. ""'pc . n~ errOCl th"" the d.d.... t Of)' ",]iefond injunction ,emedi .. unde. the Fed ....1 Rules of Civil P"",.dure. 5 nO ". ;.,a, 4 Case 1:10-cv-01770-BAH Document 24-2 Filed 05/06/11 Page 6 of 18

however, tile panies have 00 entitlement 10 pre-trial discovery as unden,ood in U.S. procedure, including requests for production of documents, inlerrogatorie~ or depositions.' There are no stalUlOry prol:ectiolill given to a pany as respec:ts the document~ controll ed by the adverse paMy.

13. As admil1ed by Mr. Nagy, Nagy Dec!. at 'V 16, under Hungarian law, the losing pany onfilWlrily must pay the attorneys' fees Bfld costs incurred by the other side pursuant to the prevlliling part y's agreement with its counsel, Of as set by the Court. As applied 10 Ihis case, Ihis means, had the suit been filed in Hungary and the Plaintiffs were not the prevailing parties, they could be responsible for the considerable legal fees and expenses that fhe Defendants doubtless are paying 10 their attorneys. Counsel for the

Plaintiffs advise me that none o f the named Plaintiffs in this case would have brooghtlhis suit if they were at risk of having to pay the Defendants' legal fees and/or expenses _ and that there could be no expectation whatsoever that anyone else wou ld join the Plaintiff

Class unde!" those tondition.s. Mr. Nagy also points out that a foreign plaintiff may be ordered to post an advBflce security deposit for the litigation costs' unless a treaty provision or reciprocity provide for an exemption (Nagy Ded., \119 -20). While it is not entirel y clear whether Hungary's l!el'Ities in fact make available, practical exemption wi th respect to Canadian and Israeli citizens, it is without doubt that no reciprocity exists between Hungary and lhe United States. Accordingly, upon Defendants' motion U.S.

Plaintiffs may be ordered to pay a prohibitively high amount of security deposit. The

, A tl"npri... COU<1

• The ... 1.. penainina to the =uri!)' deposit (perliJIlstgl>iu",/lik) . ",.<1 <>tit in SeClioru S9 - 92 of til< Ci.i) rrocodure ACt, 6 Case 1:10-cv-01770-BAH Document 24-2 Filed 05/06/11 Page-- 7 of 18----

potential for an exemption from this requirement 10 which Mr. Nagy refers, Nagy Decl .• 1

22, is very limited al besL Mr. Nagy also "oil'lls Olll (Nagy Decl., 1 22) ma! certain plaillliffs may, panially or en tirely, be e ~cmpl from the payment of litigations C05\S and the fl'lyment of the security deposit on the basis of their individual finlll1cial silualion.9

The exemption based on jJldjvidual circumstances would h.ard ly woO; in II class action or when multiple plaintiffs make such an application. Also, foreii" nationals rna)' be exempt on the basis of bi latera l treaty provisions or re.:iprocily. Mr. Nagy admits, however. IhallO such exemption would apply in the case ora United Slates plaintiff, due to lack ofreciprocilY. Nagy Decl., 1 22.

14. Likewise, entitlement 10 costs is limited under Hungarian law. Mr. Nagy asserts that Il1lnslation and interpretation 00515 may be borne by the Coun, but he admits that this is subject to international conw:ntion or reciprocity, and he fails 10 disclose thaI even at thot, an y such limited benefit W()uld apply on ly when a pany or witness is testifying in coun.IO See Na gy rkd. at ,. 9. As, in fact, there is no inter-pony pro-trial discovery allowed under Hun garian civil procedure. as discussed supra at 1 12, it follows that translation expense for JHl'-lrial depositions. document translation and so forth arc not s(lbject to any cost-shifting 10 the Hungarian Slale. Here, where many of the Class members will require tnulslation services during pre-trial discovery proceedings, and

\\-"IIere 8 multitude of documents may require trnnslation, it is clear thaI the possible, lilnited, avai labi lity of translnt ion services for the triDI itself affords liule if any pracliCllI benefit.

• S«tion '4 of lbe Civil Procedure "CI.

I. S«';on ~ of I.. Ci.iI Proocdu", ACI . 7 _. ·· ______·0. ___". Case 1:10-cv-01770-BAH Document 24-2 Filed 05/06/11 Page 8 of 18

IS. There i5 no right to jury lrial in Ihe Hungarian civil legal system. While it is true Ihallhere is no right 10 ajury trial again$! a sovereign under the Foreign Sovereign

Immllllities Act, 28 U.S,c. § 1602, el seq., ("FSIA") the Plaintiffs in this case have also sued a private entity, Rail Cargo Hungaria ZI1. (which has defaulted). and. 115 I uOOerstand U.S. law, are entitled to a jury trial to prove damages against that entity.

Plaintiffs would oot IIave tllnt right in a suit in Hungary.

16. Further, while it is true that Hungary in concept "Te~pec15 the generally ac(epted principles of int

17. Mr. Nagy Slat~ that Ihe Republic of Hungary would be bound 10 pay d3!nages lI$5Cssed againsl il by I Hungarian court, whether or not the money were aJlOQI.ted in the budb>e! for that pu!'JlOS<'." Nagy Decl. at 1 15. Wh ile this is currently block-lencT law. the stalement is incomplete in two critical rcspccts. First, if the money has not been al located, enforcement would be dimcult if not impossible as a prottical maller. Second, the powers Dnd jurisdiction of the Constitutional Court (which in the past

20 ~ars has adjudicated the validity of legislation such as the law concerning payment of damages by the Republic of Hungary). have been limited by a new C()nstitulional amendment, '2 which has recently been re-codified in the new Hungarian Constitution

II Sec,iooI2'(2) of'he Ci.,,;t Code.

"AC1 ext>: "nO l O. • - • -- ,~, - -- '<' ",,"' Case 1:10-cv-01770-BAH Document 24-2 Filed 05/06/11 Page 9 of 18

called tile Basic Law (~Alllp"'rWny"),1l The elTeet of Act CXIX of2010 and the IH:W

Basic Law is thai the ConstihJtional Court will no longer have the powe!" to review, much

less invalidate, any l<,gi5latiol1 relating to taxes, public finance or budge!. This would

ioclude legislnlive ",strictions on payment of damages by Ihe government, Stated dilTerently, the CUm:flt Civil Code provision CQuid be quiek.ly Aevoked b)' a legislative majoril)' with no recourse to constitutional judici al ",view. This is a distinct possibilit),

in part because. under Seclion (3) of Article N of Ihe new Basic Law, both the

Constitutional Coun and ordinary courts need to IIdjudicate cases with a view to the balanced budget requirement set forth in Section (I) of Article N, which p=aibes that

Hungar)' mUSt run a balanced, trtlnSplI",nl and sustainable budget.

18. Moreover, wliil e it ma), be title that a judgment against tlie Republic of

HUll gar), Aell(lcred in lIllother country cannot be enforced in Hungarian COlIrts absent certain restrictive conditiollS, see Nagy Decl. 81 1 14, inliibitions on execution against

Hungariall assets in Ihe Uni ted States are mucli more limited under I'SIA, and there is no prohibition on execution, pursuant \0 ajudgmcnt entered in the United Stales, of assets of

Defendant Rai l Cargo Hungaria, bt., in the United Stales or Hungary. Of COlII"l;<', this docs not consider the polential enforcement in third coulllries of ajudgment ofa US cuurt against Hungarian asscts in such third countries.

19. Another issue of concern is that the Plaintiffs, WCf"C the)' to file suil in • Hungar)" could I ikel)' face significant court delays in the prosecution of tliei r claims. In my personal experience, the court that might have jurisdiction and venue in this case (if an)' local coon were 10 have jurisdiClion), the Budape5t City COlIn ("FiJvtirmi 8ir6sQg"),

IJ Th. lIosic Law odojlted on ~prif 18.2011 has no .pecificci,OIioco. It i. funetOon oUy ,he new conltillnion of U,,"~ary. whid,. on I.n""ry I, 20 12. wiil "'PI"". 'he CO""iMi"" of 1949 (~CI ;':X . of 19(9). 9 Case 1:10-cv-01770-BAH Document 24-2 Filed 05/06/11 --Page 10, -of 18 ,---'-

is quite congested. In general, in a Iypical, non-trivial civil lawsuit before Budapest City

Coon. ([) Ille lime between the filing of Ihe complaint and the first day of trial could be

6-12 months, (2) the lime betwecl1 the first date of mal and the first·illstanee decision could be another 8-24 months, and in complex cases thai CQU ld easily e~lend 10 36 months and (3) th e time fo r appeal and olher review eQu id lake another 12-2-4 momhs.

Furthermore, the forced retirement of a great num ber of senior judges, as discussed in 1

25 below, would exacerbate tile probkms caused by delays in all couns, including the

Budapest City Coun. I' In additioo, the Hl/I1garian courts are IlOl. IIIkpt &1 efficient management of comple" li(igalion. [\ is the rare exception, ralher than lhe general rule, that a civil trial is a co ntinuous, uninterrupted process. More Iypically, a trial is broken up by the coun into multiple hcarings with many interruptions of several weeks or mooths at a time. Thus, in my pel"SOflal experience, a QlSC llIat wou ld lake two weeks to try if do"" from day to day has taken from no less than eight to as many as tWi:nty-four months to complete at th e trial level. Obviously. such a schedule could wreak havoc in 3 case where many plaintiffs and witnesses must come from long distances if they wish to partici pate in the presentation of the suit.

20. Mr. Nagy suggests thatlhc Hungarian civil justice system is free of bias, and therefore the Plaintiffs could receive a fai r trial in Hungary. Nagy Decl. al 7. He purports to paraphrase language in the Hungarian Constitution (currently still in effect) to support that proposition.1.I Of course, it is elementary that the mere faclthat progressive

.. The SIal ...' .... of,... lIu"priOlljudiciOf)'. IUaohed hemo .. AII~d".... ~ ' s .... di"",soed oubsoan,j""ly ., , 25. infrrJ. ~mplla$l~ ....ici[>ll ed add~i"""l d

" Act xx. of 1949 111 .mended). w hich will be repe.IN .nd reploced by tile 11I,it: L.w on January 1. 20 11. 10 , Case 1:10-cv-01770-BAH Document 24-2 Filed 05/06/11 Page 11 of 18

language is written on paJ>er proves nothing, Bnd certainly is not self-executing.

Moreover. my personal experience in civil litigation in Hungary, where tile Republic of

Hungary or one of its instrumentalities is a party, and the opposing part)' is a oon-

Hungarian, is ihallheTt is noti ceable bias in f.vor of the State.

2 1. Even more to the point, however. the Named Plaintiffs Dnd Plaintiff Class

in this lawsuit, consiSiing of Hungarian Jews (and their heirs) who were victimized by the

Defendants as pan of the Hol0C3ust, have a legitimate concern that lhey ClI0rlOi receive a

fair and unbiased hearing in a Hungarian C(HJn. II is well-establi91e<1. as reponed during

[he past few years in the med ia throughout the world, thai anti-Semitism is on the

increase in Hungary. For example, as reported by an article in the Srutday Times of

London on April 11,2010, titled ""Anti-Semitism Stirs 35 Hungary goes to Poils,"

Ouring a recent speech by Gabor [kmszky, the mayor of Budapest, a mob ch.antcd "Jewis!! pigs" and "To the oollCCf1lrntioo camps". Election posters have been smeared with yellow Stars of David and anti-Semitic slogans.

Budapest rabbis describe racial epithets being shouted as they walk their children to school, slogans such as "Jews go to Israel" are daubed in the streets, accompanied by swastikas. while cars bear stickers with tile slogan "Jew free car."

See Allachmtnt I hereto,

hnp;l/www.limcsonline.oouk/tol/nCWslWQrldfeurope/Jtnicle70943:U.ru (last viewed on

4123111). A report of the Chl"islilln Broadcasting Network daled April 28, 2010, titled

"Hungary' s Anti-~mitic Party Gains FOOIhold," reports that "[a) group wi th fascist, anti-

mitie and anti-Gypsy views has gained political prominence in Hungary for the first

time since tile end of World War II. The group's political rise C()ITle5 35 Europe witnesses

rising anti-semitism." See Allaehmcnt 2llerelO. " I Case 1:10-cv-01770-BAH Document 24-2 Filed 05/06/11 Page 12 of 18 -_.-

hit [>: I /www .cbncom!cbol1cws/wodtlt;!Q l0/A!}[ iIIHunsarys_AIl!i_Scmilil:.AI1! i -G ypsv

l'arw-Gains-FoollIQldI (last \'iew ~d 0 11 4123/1 1). Ominously, the Jewish Telegraphi,

AgcIlCY, in a report dated M~h 11, 20 11 , captioned "European anti·Semitism and

Kenophobia are linked, report firnls." sUllesthat a new evaluation ofa 2008 su...w.y reveals

that "Hungarians and Poles are those most likely [Europeans] to hold extreme anti-

Semitic views:"

Asked whetller they agree with the statement Ilia! "Jews have \00 much influence in my country,· 69.2 pen:ent or Hungarians and 49.9 percent of Poles agreed. 1M IowesI levels wen: in Holland, wilh 4.6 pe«:ent agreeing. Germany, wilh 19.6 percent, was in the middle, socialOiis! Beate Kuepper told JTA in a telephone inlerview.

See AIfDClimcn\ J hereto,

Imp;/lw",,,,. jln,or!!lncwslanieleJ20 J J10)/) JQ0863171euroDean-an!j-semitisrn-

~cnophQbip.liDkcd.n;oon-finds (1M!. viewed on 4/23111). Under any cin:umstances, it

would be reasonable fo r the Plaintiffs in this case: 10 be concerned that thei r claims

against th e Hun gllri an government might not be well re<:eived, much less fairly

considered or adjudicated, in Hungary. In the emergent conditions for Jews in Hungary,

ho"'ever, as described in these illustrative news repons, that legitimate concern takes on

added urgency and force. I oote that I personally !\ave observed the trend, described in

thi s paragraph, and further, that the ci ted articles upon which I rely 10 C()nfinn my views

and opinions in this regard are generally nccepted sources of infonnation upon which

reasonable reliance is placed by informed persons formulating opinions and inferences on

the maller.

22 . On Apri l 18,2011, as menlion.ed SIlpra 8t '1111, the Hungarian Parl iament

passed II new constitution called the Basic Law 10 replace the Constitution. It will be

12 Case 1:10-cv-01770-BAH Document 24-2 Filed---"'--'"---- 05/06/11 Page 13 of 18

effective all January I. 2012. The Busic Law limits [he powers of the jl,diciary and also affects a nllm~r of issues penaining to constitutional intaprcUition. both of which could have bearing on Ihis case: were it brought in Hungary.

23. One of tile provisions ortke Pl't'omble afthe Basic Law may have a direct bearing 011 this class aetion.'6 The preamble !ipe(:i fically declan:s Ihat on March 19,

1944, Hungary lost its stntc sovereignly (allam; Onrtndelke:w..), which was restored only on May 2. 1990. The first dale is Ihe date of the German occupation during World War

11 , and Ihe second dmc is the dale of Ihe first free Parliamentary elections after the downfall orthe CommuniSllllgime.

24. The potentia l import of this statemen t is that stale actions (actions of the

SUlle IUld MAV) during lht Holocaust, and especially a ller March 19, 1944, were not the acts of the sovereign notion that exists today, that could be held responsible for the lIo~e mm ent' s actions then. 1lllls Hungary and ilS instrumentali!ies would be absol~ed from moral or legal responsibi lity for actions perpe!rated during tha! vas! time period, whi ch inc ludes the time period covc~d by many of the allegations of wrongdoing in the present lawsuit Whi~ this result would fly in the face of accepted interna!ional law, in my opinion it is a probab le outcome in lighl of the new Basic Law. and !he potemial for same has been recognized by noted historian commenta!0f$.11 In sum, this new

" The P ..... mbl. of I.... Bosle Law i, l1 in illelf.

" Krintl'" UnaYlty: I"NO" /PU In 1M Hdts: CONlilllliwr (Inda. April I~, 2011 (.ranUation~ I personally did 11>0 tr3n,I ..ion ff'Oll'l HunpOlJI i"1<> Ensli$lt, and boIb "'" orilittll Hu"",""" vemon. and my Endi'" trafl$llItion. ~ Inached ... -,nu h" •.." , hereto. I note that ,hi, -.tiel. i, the 'ype of mottriol 'har I would rea_.bly ..lyon 10 i"fOfm "nd funher cQnfirm my own opinion one! inference. in lhi' mo1l ...

13 . Case 1:10-cv-01770-BAH Document 24-2 Filed 05/06/11 Page 14 of 18

legislation, if Slnetly interpreted as wriuen, wou ld bar tile claims brought by Plaintiffs in this lawsuit

25. There is an equally IrO\Ibling facet to the new law Ihal is aimed at restricting the independenC(: of Ihe Hungarian judiciary, notwithstanding Mr. Nagy's asser1ion, Nagy De<;1. at 1 8. that the Hungarian Constitution recites thai ~ju d~ are indepcndent.~ Hungary's new Basic UtW reduces the mandatory retirement age for judges (other Ihan the Chier JUSCice orme Supreme Coon) from age 70 to ale 62. 11 As a result oflhis new rule approximately 30% ofllle judges of the Supreme Court of Hungary

(2 8 of the 88 judges), and 10% of the judges of the lower courts will be forced to retire between 2011 Dnd 2012.'9 This new law goes against the principle of non·removability of judges; il is widely understood that the purpose of the new law is to remind the beneh thnt il serves at the sufferance of the legislature, ond that effons to override judicially specific legislative pronouncements CO\lld lIave an adverse impact on tile judges' tenure.

The Chief Justice of Hungary, together Wilh other prominent high cotJn judges, have released a Statement on April 15,2011. in whicl1 they vehemently protest against tile forced retirement of members of the judiciary, calling such measures as "irresponsible" and "professionally unfoun

" *.jon (2) of Aniele 26 oftbe Buk Low.

I. SI(Jt~'''''nI uf file 1/1II1gari"" .mdiciory. Aprit IS, 20 t 1 (1,."I I,lion by llIe _ Ihe <>rigi",,1 i$ alsa allochcd~ Se. Au.rh ,nonl S hOfeto. FurthC<', I inCOrpOrale h... ,,;. b~ rer.renc. Ih. COnIm.,," 01 •. 17 .bclVe. cone"""nl my 1r2nll00ion of the d.ed Sialoonen •. • 1Id lbe impon .Ila! I ""i!;ll 11 in infonnina """ coofinninl my OW~ opinion ;" W man....

III 'd.

14 • Case 1:10-cv-01770-BAH Document 24-2 Filed 05/06/11 Page 15 of 18

runs counter 10 generally accepted principles of international law and the fundamcrual doctrine of the independence and non-removability of judges.ll

26. In ,12)-31 of his Declllf1ltion, Mr. Nagy aUempU to argue that Hungarian

Holocaust victims have been adequately compensated through treaty provisioos,

Hung..... ian stale legislation and certain payments, and that any further compensation is fore<::loSC

27, In 1 23, for e;(ample, he SIllies in II conclusory fashion thai "[slinee the end of World War 11 , Hungary has taken and continues 10 lake steps in order to resolve issues

related to Ihe compensation of damages suffered by Jewish people ...ft This suggests that II seamless process e;..:ists in which material progress has been made over a period of years in eompensluing Hungarian Jews for their losses during the Holocaust. In fact, tllal has not been the case, as di scussc:d below.

28. Article 27 of the Paris Peace Treaty of 1947 (after World War II), Ex. t to

Defendants ' Motion to Dismiss. had two distinct provisions. Section I of Art. 27

PfnCribed thai "the property. legal rights or interests in Hungary of pel3Ol1S under

Hungarian jurisdiction" whose property was taken on account of racial origin or religion

shall be restored, M or, if reslOflltion is impossible, that fair compenslilion shall be: made therefor." Section 2 of A11. 27 provided that subject property of persons and organiZOlions that remained heirless or unclaimo:d for six months follow ing the treaty shall be: transferred by the Hu ngarian Government to Jewish organizations or communities. ~ Ex. Ito Defendants' Motion to Dismiss. Until 199 1, however, neither provision of An. 27 was even implemented, much less enforced.

" Id. 15 -- I Case 1:10-cv-01770-BAH Document 24-2 Filed 05/06/11 Page 16 of 18

29. In 1991 and 1992, Hungary passed laws authorizing partial compensation

to Hungarian citizens for a variety afclaims for propeny expropriated by the government

dllring the Holocaust and Ihe Communi st era.:l See Nagy Deel. at 1 25. Compensation

under these Jaws was limited, however; claims first had \0 be discounted OIl a sliding

scale, and then the maximum 8mOUnt of compensation for any propeny claim was limited

to no more lhan S5,OOO U.s. per aggrieved party (approximate value in 1991 U.S.

dollars)Y Furthermore, compensation was paid in vouchers for securities and Olhcr

2 property, 1'101 in cash. ' In a 1993 decision, the Hungarian ConSlilul ional Court construed

Ihis extremely limited payment scheme as "fair compensation" within the meaning of

Article 27 (1) of lhe Pari s Peace Trcaty.~ The rationale for this decision was thallhcsc

token payments WCI'<' all thaI Hungary could afford at the time and that claims arising

under the Paris Peace Treaty IwId to be treated in a oon-di~riminatory manner with

claims arising from the nationaliVlt;on of the post· World War II era.16

30. The question, then, is whether the Hungarian Constitutional Court fairly

and properly interprrtcd and applied the tenn Mfai r compensation" as wri tten in the Paris

Treaty, such that subsequent payments in the amount of $5.000 to aggrieved pcl"$On$

satisfied the terms orthe Treaty and fu lly discharged Hungary's legsl obligations toward

persons aggrieved by Hungary's conduct during the Holocaust. In my opinion, the

::: Act XXV. of t 99t ond Act XXI V. of 1992. BoIh Act. odd,..,., • vo.riOly of ","k1nllJ" unMnhe ol&Sp1ea of law. adotl,td be,w= M~ I . 1939.nd June I, 1949.

" Seetion' 4(2) .nd 4(3) of Act XXV of 1991 .

,. Section S of A<' XXV of t99' .

'" Corut1,..,io ...1 COlIn Decls"" I'" 993 (UI.12.~

.. Pari IV of Ce''''i1U(i"". 1Coun Dec!I;"" 161 1993 {lII.ll.~

J6 Case 1:10-cv-01770-BAH Document 24-2 Filed 05/06/11 Page 17 of 18

Hungarian Constitutional Court's interpretation of ~ fair compensalion" comportS neither wilh common sense (because individual people 10$1 con,iderably more Ihan $5,000), nor does il comport with Ihe plain langua~ of the Treat), itself, which provides ror Mfair co mpensation~ as an altemative to restoration of propert)' in kind wIlere that is not possible. Thus. the teoo "fair" relates to the value of the property, which must be commensurate with Ihe restoration or replacement value in 1947, and flO( an arbitrary num ber established by the Hungarian legislature more than fort)' years after Ihe losses incurred.

31. The problem is thaI current Hungarian law apparel(1)' rejects my posilioo, and according 10 Mr. Nagy, would foreclose a de novo adjudicati on in Hungary of claims such lIS those brought by these Plaintiffs. ThaI, in fact, is D furtller argument in support of the Plaintiffs' position tha t this case should be tried under principles of customary intcmatiolla l law in the United States, where an im partial tribunal can fairly evaluate, inle~ olio, the adequacy of Hungary's tola:n payments in lieu of restoratioo and asserted compliance with the Treaty of Paris.

32 _ Finally. in n- 28·3 1 of hi s Declaration, Mr. Nagy sets fo rth a number of payments by Hungary to IIIe Hungarian Jewish Heritage Public Foundation

(Mugyororszagi Zsido ()n'Jheg Xr)zu/upirv

11 Case 1:10-cv-01770-BAH Document 24-2 Filed 05/06/11 Page 18 of 18

which they a~ entitled, under general principles of international law. which they seck in thi5 lawliuit,

33. The views and opinions that I have expressed hereinabove are stated to I reasonable degree of professional certainty in my field of Law,

I declare under penalty of perjury under the laws of the United Stales of America that the foregoing is lrue and cotTeCI.

Executed on May 3. 2011.

•

" Anti-Semitism stirs as Hungary goes to polls - Times Online Page 1 of 2 Case 1:10-cv-01770-BAH Document 24-3 Filed 05/06/11 Page 1 of 2

THE TIMES THE SUNDAY TIMES TIMES+

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From The Sunday Times April 11, 2010

Anti-Semitism stirs as Hungary goes to polls

Bojan Pancevski in Budapest

Rabbi Shmuel Raskin and his 50 guests were celebrating the Jewish festival of Passover last weekend when two stones smashed though the double-glazed windows of his home in the centre of Budapest.

Police said they had probably been fired from a sling. The group continued with its ceremonies, but in silence and behind closed shutters. The incident was one of a series of hate attacks in Hungary amid an atmosphere of heightened racial tension in the run-up to today’s general election.

During a recent speech by Gabor Demszky, the mayor of Budapest, a mob chanted “Jewish pigs” and “To the concentration camps”. Election posters have been smeared with yellow Stars of David and anti-Semitic slogans.

Critics connect the abuse to the RELATED LINKS rise of the extreme right-wing Jobbik party, which has been Jobbik: Meet the BNP's accused of anti-Semitism and fascist friends in Hungary xenophobia. Far-right parties in the European Parliament The increase in violent attacks on minorities — a dozen Roma (gypsies) have been gunned down in recent years — has coincided with the emergence of Jobbik, which won 15% support in the European elections held in 2009. Opinion polls suggest that it will attract between 13% and 20% today.

Although the centre-right Fidesz opposition party of Viktor Orban, the former prime minister, is expected to win a landslide victory, Jobbik, led by Gabor Vona, a 31-year-old former history teacher, could become the second-largest party following a populist campaign dominated by attacks on corruption and “Roma crime”.

The party denies accusations of neo-Nazism but Gordon Bajnai, the caretaker prime minister, warned that the “monster” was at the door and threatening to “crush” Hungarian democracy.

Jobbik is linked to a paramilitary blackshirt group, the Hungarian Guard, which was banned in 2008 but has resurfaced at election rallies.

Robert Fröhlich, chief rabbi at the Dohany Street synagogue, said to be the largest in Europe, complained about Nazi salutes. “Insulting Jews on the street is nothing new here, but now it’s done more brazenly,” he said.

The country has been hit hard by the recession and had to be bailed out by the European Union and the International Monetary Fund. Unemployment is above 11% and inflation is

http://www.timesonline.co.uk/tol/news/world/europe/article7094323.ece 5/5/2011 Anti-Semitism stirs as Hungary goes to polls - Times Online Page 2 of 2 Case 1:10-cv-01770-BAH Document 24-3 Filed 05/06/11 Page 2 of 2

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Observers have suggested that the increased confidence and visibility of the Jewish population has created a backlash among other Hungarians.

Adam Schonberger, a Jewish community leader, complained that successive governments had failed to tackle the issue of minorities in education and political debate. “The government must declare that Hungary is a country of mixed ethnic and cultural traditions and not a home to one single nation,” he said.

More than 500,000 Hungarian Jews died in the Holocaust and 100,000 still live in the country. Between 8% and 10% of Hungary’s 10m inhabitants are Roma.

Krisztian Szabados, head of the Political Capital Institute, a think thank, said racism had been “swept under the carpet” for decades. “Jobbik have simply delivered extremism to an electorate that demands it. No mainstream party has seriously tackled the antagonism towards minorities that has been here for decades.”

http://www.timesonline.co.uk/tol/news/world/europe/article7094323.ece 5/5/2011 Hungary’s Anti-Semitic Party Gains Foothold - World - CBN News - Christian News 24-... Page 1 of 3 Case 1:10-cv-01770-BAH Document 24-4 Filed 05/06/11 Page 1 of 3

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Hungary’s Anti-Semitic Party Gains Foothold

By George Thomas Wednesday, April 28, 2010 CBN News Sr. Reporter

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BUDAPEST, Hungary - A group with fascist, anti-semitic and anti-Gypsy views has gained political prominence in Hungary for the first time since the end of World War II.

The group's political rise comes as Europe BECOME A CBN PARTNER witnesses rising anti-semitism. and receive Pat and Gordon Robertson's The Law of Expectation on DVD. Swearing-In the Hungarian Guard

On October 21, 2007, hundreds of men dressed in black pants and vests with white shirts took their place in the main square in downtown Budapest.

It was a proud moment for 29-year-old Gabor Embed:

Some 600 people will join the group May 2, pledging to defend the nation. Ad Feedback "We've received more than 5,000 applications from people wanting to E-MAIL RSS FEEDBACK join, but we have yet to induct them officially in the group," Vona added. Sign up for the CBN News Dispatch and receive CBN Controversial Flag News Reports in your inbox each day. Subscribe Now >> Standing in military formation, each new member proudly wore a hat bearing the red and white striped Arpad flag. CBN NEWS TOP STORIES The emblem was the same symbol used by the Hungarian Arrow  Decision to Seal Bin Laden Pics Gets Mixed Reaction Cross, a Nazi political party that helped kill Hungarian Jews at the end  Lawmakers Question Pakistani Aid After Bin Laden

of World War II.  European Press Condemns Obama's 'License to Kill'

 Weapons Highway? Egypt-Gaza Border Opening Six hundred thousand Jews were killed in Hungary-- 20,000 of them Feared shot and dumped into the river, Danube. Today, a memorial of shoes lines an area along the river to remember the horrific act.  Joni Eareckson Tada Honors Vets on Day of Prayer  House OKs Limits on Tax Breaks for Abortions But more than 60 years after the Holocaust, the Jews in Hungary face an uncertain future. BLOGS Hungarian Jews Worry About Future The Brody File The Case For Releasing the UBL Photos Rabbi Alfred Schoner watched the 2007 ceremony fom his home in the White House Wrap suburbs of Budapest.

http://www.cbn.com/cbnnews/world/2010/April/Hungarys-Anti-Semitic-Anti-Gypsy-Party-... 5/5/2011 Hungary’s Anti-Semitic Party Gains Foothold - World - CBN News - Christian News 24-... Page 2 of 3 Case 1:10-cv-01770-BAH Document 24-4 Filed 05/06/11 Page 2 of 3

Ad Feedback "I am not afraid, but I know many older Hungarian Jews who survived the Holocaust or whose family members were taken and killed in Obama Says 'World Is Safer' Auschwitz," Schoner said. "They are afraid when they see this group." Beltway Buzz 'For God and Country Geronimo, Geronimo, Fast forward to April 11, 2010 -- national election day in Hungary -- Geromimo' when the country's ruling Socialist government was trounced by a Jerusalem Dateline center-right party. The Ultimate Ally

"There will be a big change," Victor Orban, president of Fidesz, Stakelbeck on Terror claimed. "The country needs this and is ready for it." Update on The Terrorist Next Door (Plus: New Episode of the Stakelbeck on Terror Show)

Far Right Wins Parliament Seats Boots on the Ground The Case for Proof But the more dramatic headline was what happened with Gabor Vona. Hurd on the Web Not only did he start the Hungarian Guard, he also started a far-right political party -- and thousands of Hungarians voted for that party, Lars Hedegaard Found Guilty of 'Racism' giving him a strong third-place finish. The Global Lane Vietnamese Government Thwarts Palau Hanoi Vona launched the Movement for a Better Hungary, or Jobbik, in 2003. Celebration CBN News spoke to him shortly after he founded the group. Healthy Living Osteoporosis: The Need for Strong Bones "Things are getting really bad. The country is crumbling," he said then.

The global recession hit Hungary hard. Unemployment is in double digits. And there's growing frustration that life hasn't gotten better since the collapse of Communism.

Blame The Jews, Gypsy

Vona's Jobbik party seized on the national anger by blaming the Jewish and Gypsy communities for the economic downturn.

"This is a known historical formula," Schoner said. "Every time there's an economic problem, they are looking for scapegoats, someone who is responsible for the country's problems."

And it worked, giving Jobbik 47 seats in parliament-- a first for a far- right extremist party.

A leading Hungarian Jewish group said the vote was the first time that a "movement pursuing openly anti-Semitic policies had taken a step to power since the Nazi era."

In the meantime, Jobbik maintains close ties with the Hungarian Guard. The Guard was recently banned by a court, but returned under a new name.

During the election campaign Vona said he'd use the Guard's influence to police Hungary's Gypsy minority.

He has also promised to revive the disbanded national police force that deported hundreds of thousands of Hungarian Jews to German concentration camps.

For now, he and Jobbik party members look forward to the opening of parliament. They've told supporters that they plan on wearing their black paramilitary fatigues to the event.

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 Print European anti-Semitism and xenophobia are linked, report finds

March 13, 2011

BERLIN (JTA) -- Anti-Semitism and other forms of xenophobia are closely linked among Europeans, and Hungarians and Poles are the most likely to hold extreme anti-Semitic views, according to a new report.

The report, "The State of Intolerance, Prejudices and Discrimination in Europe," was released March 11 in the framework of a conference by the Friedrich Ebert Foundation, a think tank associated with the Social Democratic Party in Germany. The foundation commissioned the new evaluation of a 2008 survey by researchers at the University of Bielefeld of about 1,000 people in eight European countries: Germany, Poland, Holland, Great Britain, Italy, Hungary and Portugal.

Kuepper, Andreas Zick and Andreas Hoevermann evaluated the data for the foundation.

Scientists found that those with anti-Semitic tendencies also were likely to be xenophobic against other minority groups, including Muslims, as well as resentful of homosexuals and women, Kuepper said.

Kuepper said she was most surprised by the fact that Germany's level of anti-Semitism was about average, given the strong public message against anti-Semitism, including the emphasis on Holocaust education. She also said that the results for Poland bore out those of previous studies, which show that religious-based anti-Semitism is extremely high there, at 70 percent.

Researchers find, she said, that "lots of Poles will agree" with the statement that Jews today can be blamed for the death of Jesus, "whereas in the Netherlands people would jump out of the phone if you ask them something like that."

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K rintiin Upgvirv

vur 1944 in the New f ides'l, Cons.itutinn

(Index, April 15, 2011)

I have recently signed a statement together with 41 other hi slOrians, in which we have expressed ou r COncCnJ5 regarding the draft Constitution of FIDESZ - KDNP. Other authors have also pointed OUt the problems of this process, which I do not repeat hen:. I wish to deal with only one Sllltement of the Preamble, wh ich, as a drop in the bucket, highlights the deficiencies of this entire endeavor.

The Preamble states that "our country has lost its state sovereignly on March 19.

2011, which has been restored on May 2, 1990, the day of fonnation of tlte new freely elected national assembly." This definition is incorrect, unacceptable and unjustifiable by scholars since it ignores II good part of Ollf national history. Let's start from lhe beginning. In this first pan of my arguments I will not express opinion since [ want to argue againsl lllc very method that a law should prescribe how we express opinion about the facts of history.

After the German occupation of Hungary Ion Man:h 19, 201 ljthe Hungarian

Parliament continued to opcrnte business as usual. 1lle measures of the S:a6jay

Government have been approved by Parliament without any duress, Members of

Pariiulllent elected in 1939 pursuant to fair general elections and SC(.ret baUot have not beefl under any external pressun::. 1lle Government consisted of ministers that held offiees in previous Governments, they have preformed their duties QUI of their Case 1:10-cv-01770-BAH Document 24-6 Filed 05/06/11 Page 2 of 8

C()nvictions and not under duress. Tlle actions of the Government did oot result in genei'll! discontent of the population. strikcs or armed resistance. On the comrary, the level of general welfare has increased somewhat IS a result of ille depoo1ation of Jews, a process Ihat had been prepared fo r quite some lime practically without meaningful

Gennall assistance (in contrast wit h Eichmann's 50 mem ber stafT the Hungarian administration of 200,000 was involved). Tlle priu of foreign cUlTeIlcies, precious mClOl s, real property and othcr assets have fallen as 8 resul t orthe actions carried out by tile SZI6jay Government. The assets of 437,000 persons have been taken, many ended up in the Ilands of people who never dreamt about such fortunes.

There were other measures of which we may pass opinion whether they were morally acceptable and served the intereslS of the country - il is 8 mailer of facl, hoWi:ver. th ai the majority of Parliament had agreed with such measures as a sovereign emily. Among$t such decisions wns the continued commitment that the Hungarian Royal

Army wage 10 war on Ihe side of the Third Reich.

It is true roevertheless Ihatthe scope of ~ions of Hungary's "Governor", Mikl6s

Horthy. have been severely restricted as a result of the Gennan occupation. The sovereignly of the Government and the Head of Sale, however, is not the samc thing_

The Head of State, 115 the President tooay, onl y reneclS the dynamics of po litic$ shaped by elections. Our present Hea d of State has told us tIlat his role is not a cheek or balance, but rather 311 engine lhat wants 10 catalyze national cooperation. Nonelheless, no one would argue that as 3 result of th e personal lack of independence of our President the sovereignty of Hungary would be at risk. The faC! tIlat foreign armies stayed on

Hungarian soil d id not necessarily mcan thaI Hungary 10$1 its sovereignty for this reason.

2 Case 1:10-cv-01770-BAH Document 24-6 Filed 05/06/11 Page 3 of 8

As II maner of foct, after 1990 we experienced lhe presence of NATO troops in Hungary,

001lhi5 has nOI provoked protestS such as that the.e had been no public protest against the presence of tile troops of tile German Reich, lin ally of Hungary lit the time.

As Stated above Ihe Preamble intends 10 rob us from a pan of our history. Had the sove.ei,nty of the country been lost 85 a resu lt of the Gennan occupation, lhose shameful acts thllt will be remembered for centuries wad, which had chang~-d the mix of the population and altered the real and personal properties of the populace, would not be viewed as a«ions for which the Hungary polily would be responsible. Presumably,lhis responsibility would fall upon 5OmCOlle else. Obviously Ihis is the objective here.

The Preamble liS proposed by Hungarian Government is inherently inconsistent.

The statement that our soldiers woo were fighting against Bolshevism were "the heroes of Europe ~ (cover page of DemokOlta, February 15, 20(4) is hardly consistent with the claim that we waged a war for II county, whiCh had l05t ils independence. Soldiers as puppets of other annies cannOI be regarded as I1l1tional heroes.

I must also add thallhe proposed Preamble nics in the face ofthe intentions of the

Hungarian decision mak.ers of 1944. Such decision makers acted out of deep convictions, and those onlhc right wing orthe political persuasion respect such persons and 8ft' proud of these persons and their decisions.. For eX8lnple, on June 26, 1944, Fcrene Schibema, the prefect of Veszprim COUnly, called a Te Dcum mass in the Veszprim Franciscan

Church 10 commemorate the historical deeds of Ihe Government. SAndor Balogh. the mayor of Debrecel1, adopted EI resolution (National Growth of A SStts) with respc<:t to lhc

IntTlSrer of properties to Hungarian natiolWll$. Hungarian public administntlioo jubi laled the enrichment of lhe nation by the ~ eliminalion of uselCS$ customers ~ (Jews).

3 Case 1:10-cv-01770-BAH Document 24-6 Filed 05/06/11 Page 4 of 8

Distri bution of Jewish as$ClS has been regulated by

Skould we exonerate Ihe SlIIXeSSOrs ofthc Hungarian right wing from facing reality?

All this does not simp ly go to the crimes committed during World War II. With the expulsion ofcthnic Germllns in 1945 the Hun garian Government not only approve

Szakasits nsked for unrelenting vigor. Imre Kovacs called for the deportation of remaining Germans in detention centers, Geza l eleki spoke about saving !he health of the

~Hu n gar i an race," FerellC Erdei thought it important that everyone be subject 10 forced relocation. All this transpired prior to the Potsdam Conference, which has not prescribed a duty of relocation, instead. it authoriICd . uch measures at the request of the then

Hunganan Government. Under the new constitution this would not be Hungary's responsibility. While it is true tlull under Soviet Qa;upation none of our Governments had been fully sovereign. the Preamble of the new constitution Hlso implies that in the absence of sovereignty our liability equals zero. This conclusion would be absurd si!lee every politician had some room 10 maneuver.

Judging history is everyone's own right. It depends on our opinion whether we regard the politicians of 1944 as mass murderers or national heroes. We all would be better off. however, if Ihis verdiet on history is not carried 01.11 at the level of our constitution or in other public laws. IF, however. the constitulion passe:;; judgment on

4 Case 1:10-cv-01770-BAH Document 24-6 Filed 05/06/11 Page 5 of 8

specific periods of our history. then it will be the constitution and not us that effe(tively assume$ responsibility for our opinions.

Criminal liability of tho:: culpable should not be avoided. and fo r thc most part this has been carried out in Hu ngary after 1945. in proceedings where due: process was not always grtInted. If not in a legal sense, posterity also carrie$ liability; it IS our responsibility to face our history in a fair manner. The proposed Preamble of the

Constitut ion is a major roadblock fo r this cxerci$C.

'" I. Andris I. Hanak. ccnify that I personally translated the allal:hed Hungarian document inlO th is English VCf'Sion ofthc same on May 3. 2011. and thaI il is a complete and accurate translalion to the best ofmy knowledge.

Andris I. HanG:

•

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Statement

10 Ihe vulll it ovinioo or Ih e c01! n! ry and that nr the Eg r9mn Union

(April IS, 20 11)

We the judges orthe Supreme COlIn of tile Republic of Hungary, the Chairman of the National Council of !he Judiciary (Or.u6gos IgauagszolgatulIDsl TanOa), chief j udges of the appellale circuit coons and thaI of the county district counsllereby wifoh 10 express our disappointment and disbelief over Ihe decision of the majority ruling panies which intend to place the mandatory retirement age of judges to a constitutional leve l in lhe new Basic Law, We arc oflhe view that lhis proposal is irresponsible, rcckless and professionally unfounded. Pl.lrsu.antto Ihis proposal ajudge will cease 10 be able 10 ~rve on the bench unli l the age of 70 if his or her health so permils.; Ihis is conlrary 10 the principles laid down already by Act IV. of 1869 on the Judiciary, and is in sharp conlrast with the provisions of other European juri$dielions.

The proposal has oo ly surfaced in the very last days of the conStilutiollal process; there has bcm hard ly any polilical debate 00 ils lawfulness and consequences. Nor has there been any professional discussion ovcr its merits. The proposal runs counter to

European and Hun gari an trends of inc rca sing the retirement age of judges. Such proposal is also discriminatory and constitu tes a violation of the basic standards of international law regarding the status, ilKkpe!ldeooe snd non_removability ofjudges.

As a result of the proposal, on January I, 2010, the retircment age would be 8

~ears shoner for all judges. Consequently, tile tenure or22S judges who will become of Case 1:10-cv-01770-BAH Document 24-7 Filed 05/06/11 Page 2 of 7

the age of 62 (121 of them are senior judges) will be temtinated without furt her notice on

January I. 2012. Prior to December 31, 2012, another 46 judges will be forced to retire.

As a result of thi ~ decision. the efficiency indicators will substantially suffer (new judges need to be assigned in almost 40.000 cases, which may result in many years' of delay for many ten thousands of litiganlS). Then: will be other shortcominp in Ihe operation of coutts since replacement of the retiree judges on th is scale would involve unprecedented difficulties.

Whi le the specifie consequences of the unjustified forced retirement of highly qualified and experienced judges, who occupy the top orthe judicial hicOirchy, are at this point of time unpredictable. this measure will fundamentally undermine the perfo rmance of the judiciary. These Kllons are unjust and humi liating with regard to those JudllCS who swore in to uphold j ustice and Ihe integrity of the j udiciary.

It is incomprehensible why the Constitution itself should prescribe the retirement age of judges. We only have one possible answer: the aim is that by so doing lhi s legislation, which wou ld constitute a clear violation of the principles of Ru le of Law in any democl'1lCY. could not be lawfully dtallenged before the Constitutional Coun.

We see political mot ivation behind this unjustifioo action. Our suspicion is strengthened by the removal from the curren! system of self-governance of the judiciary from the Constitution. The new Basic Law would noI give constitutional protection and standing to the National Council of Judiciary. in sharp contrast with the approval and potential improvement by the same Parliament in December 2010 of the system of Stlf governance. llte decision before the legislature creates lite polenti.1 for the political influence over the j ud ic iary and for elimi nati ng the independence orille judiciary.

2 Case 1:10-cv-01770-BAH Document 24-7 Filed 05/06/11 Page 3 of 7

For us, as leadell of the judiciary it would be professionally unatteptablc and morlIlly untenable to abSlDin from prote<:ting the: independence of the judiciary. We wish to refuse potenti.1 politiClIl influerlCC' and take advantage of the only legitimate m:ourse we ha"e by turning to the public opinion of this wunty and thaI of the Eutopo:"" Union.

We find it an e~traordinary (and absurd) situation !hat after 21 yeall of the ",birth of Hungarian democracy. and in a Member Stale of the Europe,," Union during ill; EU

Presidency. we need 10 defend the minimum st.andards of democracy. We would have never believtd that .... e need to stand up IOgemer and defend the fundamental values of democracy against those many of whom lIC1ively participattd [21 years ago] in dismantling authoritarian rule and building a dcmocmtic Stale. '" I, Andm l. Ham\k, «rlify that I penonally U'lInslattd the allXhed Hungarian document into this English vcnion of the same on May J. 2011. and that it is a complete and a(:curate translation to the best of my knowledge.

Andras I. HanAk

•

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IN THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF COLUMBIA

ROSALIE SIMON, et ai., * Individnally, for themselves and for all * others similarly sitnated, * * Plaintiffs, * * v. * Case No. 1:10-cv-01770-BAH * THE REPUBLIC OF HUNGARY, et ai., * * Defendants. * * * * * * * * * * * * * * * * * * * * * * * * * * * * DECLARATION OF MENACHEM (nVADAR) BECK

MENACHEM (TrV ADAR) BECK, under penalties of perjury and in accordance

with 28 U.S.C. § 1746, declares as follows:

I. I am over eighteen years old and I am competent to make this Declaration.

2. I am a citizen of the State ofIsrael as well as a citizen of the Republic of

Hungary and reside at 15 Kaddish Luz Street, Apartment I I, Ramat Sharett, Jerusalem

96920 in Israel.

3. I have notified the attorneys for the Plaintiffs in the above-captioned action that I am prepared to join this lawsuit either as a named plaintiff or as a member of the plaintiff class in the event the Court decides to certify this suit as a class action under

Rule 23 of the Federal Rules of Civil Procedure.

4. I am fluent in the Hebrew and Hungarian languages. I am not able to understand or read English. This Declaration was translated into Hebrew for me by

Advocate Marc Zell so that I could understand its contents. Case 1:10-cv-01770-BAH Document 24-9 Filed 05/06/11 Page 2 of 8

5. I was born in Kecel in the Rics-Kiskun District, Hungary on 21 August

1938. This area is within what is known as Trianon Hungary and remains within the

borders of the Republic of Hungary today.

6. I am the son of Marton Beck (b. Kiskunmajsa, Austria-Hungary, 5

October 1900) and Anna VetO (born Kecel, Austria-Hungary, 1906).

7. I am the brother of Laszlo (b. 1929, Kiskunhalas, Hungary).

8. Both my father and mother were Austro-Hungarian citizens and citizens of

Hungary after the dissolution ofthe Austro-Hungarian Empire after World War I.

9. My father was a wine merchant and also dealt with agricultural

commodities and made a good living. We were not wealthy by Hungarian standards, but

we had a very comfortable existence. Before the deportation and my father's arrest (see

Paragraph 10 below) we lived in a lovely rented home at II. Rakoczy Ferenc with

servants. Our home was filled with valuable tapestries, crystal ware, jewelry, silverware,

judaica items, fine furniture, sets of dishes and tableware for dairy and meat as well as for

Passover observance. I remember my father had an impressive and valuable gold pocket

watch. My mother had a fine collection of jewelry including pearl necklaces, gold

bracelets, diamond rings, and the like). My father and mother both owned valuable fur

and fur-lined coats. In my estimation our household possessions were worth more than

$5,000 United States Dollars in 1940s value.

10, In the fall of 194 I the Hungarian government arrested my father and incarcerated him in an internment camp quite some distance from KeceL I believe (but am not sure) that the camp was located in a place called Garany. There was no legal basis for my father's arrest other than the fact that he was a Jew. My father was

Page 2 0/7 Case 1:10-cv-01770-BAH Document 24-9 Filed 05/06/11 Page 3 of 8

imprisoned in the camp for several months and then released. Following his release, our

family left Kecel and took up residence in the nearby town of Kalocsa in 1942. In 1943

we moved to Budapest and after a sojourn there for just over a year, we returned to our

home in Kecel. Despite our absence, we continue renting the home on Rakoczy Ferenc

Street mentioned above.

11. Some time at the end of 1943 or in the beginning of 1944 but in any case

before the Germans came to Hungary in March 1944, the Hungarian government took my

father away to serve as a slave labor in one of the infamous Hungarian labor brigades.

The reason given by the Hungarians for "conscripting" my father was the utterly false

accusation that he had made a statement to the effect that when the Russians arrived, they

would pave the road leading to the train station in Kecel with the skulls of Christians. As

I said this was a lie, as my father told us repeatedly. Similar charges were made against

other Jewish men when they were taken away to the labor brigades.

12. On March 19, 1944 the Germans arrived in Hungary. I was in the third

grade and I remember being sent home from the Hungarian State Jewish school and never

allowed to return.

13. Within a few days the Hungarian authorities through the local gendarmerie forced us from our home into a "Jewish" home owned by my grandmother. For the time our valuables remained in our rental home, except that we were forced by agents of the

Hungarian government (gendarmes and customs agents). All my families jewelry (except my mother's wedding ring), gold cigarette case, his pocket watch and my mother's gold watch, my mother' earrings, and other items (like my bicycle and the family radio) were seized by the Hungarian authorities. They were never returned to us and we were never

Page 3 0/7 Case 1:10-cv-01770-BAH Document 24-9 Filed 05/06/11 Page 4 of 8

compensated for these items. These items alone were worth in 1940s dollars over $2,000

in my estimation.

14. We were then told to wear the yellow Star of David and move into the

Jewish Ghetto in Kecel where we remained for a relatively short time.

15. Thanks to efforts of my uncles who lived in the Budapest we were able to

flee to Budapest before the deportation to Auschwitz.

16. In Budapest we were forced to live in a Jewish house marked by a large

Star of David and thence to the Ghetto.

17. In September 1944 my father escaped from the labor brigade and brought

us some food and clothing. He was arrested shortly thereafter, taken back to the labor

brigade and we never saw him again.

18. On 10 December 1944 a group of Hungarian Arrow Cross officials and

arrested my mother along with other Jewish women her age. She was then deported to

the concentration camp in Bergen-Belsen where she was marched on foot in one of the

infamous death marches - a journey of more than 800 kilometers. I later learned that my

mother died in Bergen Belsen before the end of the war.

19. In late December 1944, the Hungarian Arrow Cross authorities then in control of the Hungarian government captured my brother, Laszlo, and murdered him along with other Jews in cold blood on the streets of Budapest. He had done absolutely nothing other than being a Jew. My brother was legally on the street at the time, having gone out to buy food for me.

Page 4 of7 Case 1:10-cv-01770-BAH Document 24-9 Filed 05/06/11 Page 5 of 8

20. I survived the war and lived with my mother's younger sister until 1956

when I emigrated to Israel after the collapse of the Hungarian revolt against the

communist regime of that year.

21. Some time in the 1980s I learned that the Hungarian government was

offering to pay compensation for survivors of the Holocaust in the amount of 30,000 Hfl.

(then about U.S.$ 300!) for a parent who had been killed during the Holocaust and 15,000

Hfl. (then about U.S.$150.00) for a murdered sibling. I was so outraged at the nominal

amounts offered, that I actually wrote a letter to the Prime Minister of Hungary in

protest. I received a response in which a Hungarian treasury official admitted that the

sums were paltry, but claimed that there was no alternative. When I received this letter, I

decided that it was an insult even to request compensation under such circumstances.

22. Several years later after the fall of the communist regime in the 1990s, the

compensation ceiling was increased to about U.S.$2,000 for murdered family members

and reopened the application period. Even though these sums were also ridiculously low,

I nevertheless filed a claim for my parents' and brother's death. The Hungarians paid the

minimal compensation for my mother and brother (a total of $3000 for the two of them together). However, they denied the claim for my father on the grounds that Jews who had been taken to the slave labor brigades were military conscripts and therefore not entitled to compensation. This claim was utterly outrageous and as a result I decided to engage Hungarian attorney and file a lawsuit.

23. I hired the services of a Hungarian attorney from Budapest and she filed a suit in my name against the Hungarian government in a court of special jurisdiction

Page 5 of7 Case 1:10-cv-01770-BAH Document 24-9 Filed 05/06/11 Page 6 of 8

known in Hungarian as K6zponti IgazsagUgyi Hivatal. The proceeding lasted a considerable time and my claim was denied. I then appealed to a court known as a

Fovarosi Itelotabla. The appellate court also denied my claim on the grounds that my father, a slave laborer, was in reality a military conscript not entitled to compensation.

For the life me, I never understood how they could make such a claim given the circumstances under which my father was taken away from us by the Hungarian authorities. They claimed further that because I could not prove how my father had died while in the Hungarian slave laborer and I could not prove that he had been killed by the slave labor or deportation, I was not entitled to any compensation. Thus, I could not support my claim that my father was killed by the Hungarian authorities for "political" or racial reasons.

24. Only a few weeks ago, I learned what really happened to my father from records released by the Red Cross taken from the German Nazi archives. In fact my father had been deported to the Dachau death camp by the Hungarian authorities some time in 1944 or 1945 and my was killed in Dachau on 18 February 1945. The Hungarian authorities knew very well the fate of my father at time I filed my claims on account of s his death. They deliberately concealed this information from me, forced me to file the lawsuit and allowed the court to deny my claims when the court knew or should have know full well that my father was deported by the Hungarians and murdered subsequently by the Germans.

25. My experience proves incontrovertibly that it is nearly impossible to expect justice for a Jewish Holocaust claim from the courts and judicial authorities of

Page 6 of7 Case 1:10-cv-01770-BAH Document 24-9 Filed 05/06/11 Page 7 of 8

Hungary, even after the fall of the communist regime and under current law. My own

attorney wrote after my appeal as denied in a letter dated 3 March 2010 that the legal

proceedings in Hungary were based on the theory that the Hungarian authorities were not

active participants in the Hungarian Jewish Holocaust and the murder of the 600,000

Jewish victims of the Hungarian Holocaust were the sale responsibility of the Germans ,- J I' \\ il If and not the Hungarians. .~ 'j.. 'I. C rf fl,

I declare under penalty of perjury under the laws of the United States of

America that the foregoing Declaration is true and correct.

Executed on May 4, 2011

Page 7 0/7 Case 1:10-cv-01770-BAH Document 24-9 Filed 05/06/11 Page 8 of 8 Urbanne dr. Csal6 JuliannE! ii8)rved

Telefon: +36 I 403-7746 !rolla: Budape~tXVl., Linda ter 8. H-1165 Mobil tel.: +36309548693 E-mail: [email protected] Fax: +36 I 4034979 hon/ap: www.csatu.uatanel.hu

Budapest, 2010. 03. 03. Dgyszam: 08060 T. Beck Menachem Jerusalem, P.O.B. 9437 Israel 91093

Tisztelt Uram!

SZ;-V'GD 'taj~ko:;=taLasdrci lilcU&kdt..;n DlcgkUIJc.ill it r.}ymvsl Itcl5t.iblu ;tCl~lCl, illll(.;ly - lilin!.. aL viirhat6 volt- a fellebbezest elutasltotta, es 1O.000.-Ft perkiiltseg megfizetesere kiitelezte bnt. Ez az iisszeg a mai arfolyamon kb 50,- USD-nak felel meg.

Az indokolas az volt, hogy bar felteheto, hogy edesapja a Holocaust aldozatava valt, de ez a feltetelezes nem ad alapot a szemelyi karp6tlas megallapltasara.

Sajnalom, hogy nem sikeriilt eredmenyt elerni az iigyben, larnia kell, hogy a mai magyarorszagi biraskodasi gyakorlat igyekszik azt az allaspontot kovetni, hogy a magyar hat6sagok tev61egesen nem vettek reszt a Holocaustban, a hatszazezer magyar zsid6 megoleseert kiziir61ag a nemetek a felelosok.

Munkadijam az iigyben 10.000,- Ft.

Kerem, hogy mindiisszesen 100 USD-t legyen szives ennek megfelel6en eljuttatni hozzmn.

Ezt elkiildheti magancsekken, vagy Western Unionnal, vagy USD penznemben atutalassal az alabbi szmnlmma:

Name of my bank: Orszagos Takarekpenztiir es Kereskedelmi Bank Rt. Address: H-1161 Budapest XVI., J6kai u. lib., Hungary Swift code: OTPVHUHB

Account nr.: 11775166-03901010 IBAN code in electronicaI form: HU21117751660390101000000000 IBAN code in printed form: HU211177 5166 03901010 0000 0000

Kerem, hogy a teljes banki kiiItseget vaIlalja. Ha Euroban utal, az alabbi szamlaszamra kerem az utalast:

Account nr.: 111775166 03901883 IBAN code in eIectronical form: HU21117751660390188300000000 IBAN code in printed form: HU21 1177 5166 0390 1883 0000 0000

Tisztelettel: Ogyv'd H-1165 Buclape . Li ten!. " Hun a Y

\~,p-sen"r\scrycrle\'\$7.en'e,\2(! IOs\SkarpCllas20 I O\b

IN THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF COLUMBIA

PROPOSED ORDER DENYING MOTION TO DISMISS

Defendants The Republic of Hungary (“Hungary”) and Magyar Államvasutak Zrt.

(“MÁV”) (collectively, “Defendants”) having filed a Motion to Dismiss the First Amended

Complaint;1 and Named Plaintiffs, Hungarian Holocaust survivors Rosalie Simon et al., on

behalf of themselves and all others similarly situated (“Plaintiffs”), having filed their Opposition

to the Motion to Dismiss; and Defendants having filed a Reply in further support of their Motion

to Dismiss; and the Court being fully apprised in the premises; it is by the Court this ___ day of

______, 2011,

ORDERED that Defendants’ Motion shall be, and the same hereby is, DENIED.

United States District Judge

1 A default has been entered against Defendant Rail Cargo Hungaria Zrt. ECF 19.