Brooklyn Journal of International Law Volume 28 | Issue 3 Article 2 2002 Trading With The neE my: Holocaust Restitution, the United States Government, and American Industry Michael J. Bazyler Amber L. Fitzgerald Follow this and additional works at: https://brooklynworks.brooklaw.edu/bjil Recommended Citation Michael J. Bazyler & Amber L. Fitzgerald, Trading With The Enemy: Holocaust Restitution, the United States Government, and American Industry, 28 Brook. J. Int'l L. (2003). Available at: https://brooklynworks.brooklaw.edu/bjil/vol28/iss3/2 This Article is brought to you for free and open access by the Law Journals at BrooklynWorks. It has been accepted for inclusion in Brooklyn Journal of International Law by an authorized editor of BrooklynWorks. File: BAZYLER Base Macro Final_2.doc Created on: 6/24/2003 12:17 PM Last Printed: 1/13/2004 2:22 PM TRADING WITH THE ENEMY: HOLOCAUST RESTITUTION, THE UNITED STATES GOVERNMENT, AND AMERICAN INDUSTRY Michael J. Bazyler∗ & Amber L. Fitzgerald∗∗ I. INTRODUCTION……………………………………………………685 II. THE ROLE OF THE UNITED STATES IN RESTITUTION EFFORTS ABROAD…………………………………………………………...686 A. Switzerland………...……………………………………….689 B. Germany..…………………………………………………...690 C. France......…………………………………………………...697 D. Austria………………..……………………………………..699 E. Israel……………………………...………………………….700 F. Insurance Claims…………………………………………..702 G. Art……………………………………………………………709 H. Role of Historical Commissions..………………………..712 1. Switzerland…………………………………………….712 a. Volcker Report……………………………………713 b. Bergier Final Report…………………………….715 2. Germany………………………………………………..719 3. Austria………………………………………………….720 4. France…………………………………………………..721 5. Other Countries……………………………………….723 ∗ Professor of Law, Whittier Law School, Costa Mesa, California; Fellow, Center for Advanced Holocaust Studies, U.S. Holocaust Memorial Museum (“USHMM”), Washington, D.C.; Research Fellow, Holocaust Educational Trust, London, England; J.D., University of Southern California, 1978; A.B., University of California, Los Angeles, 1974. I would like to acknowledge the support of the Center for Advanced Holocaust Studies at the USHMM, which made the publication of this Article possible. ** Staff Attorney, Jones Day, Washington, D.C.; Masters, International Public Policy, Elliot School of International Affairs, George Washington Uni- versity, 2002; LL.M. (with honors), International and Comparative Law, Georgetown University Law Center, 2000; J.D. (magna cum laude), Whittier Law School, 1998; B.A., University of California, Santa Barbara, 1993. File: BAZYLER Base Macro Final_2.doc Created on: 6/24/2003 12:17 PM Last Printed: 1/13/2004 2:22 PM 684 BROOK. J. INT’L L. [Vol. 28:3 III. HOLOCAUST RESTITUTION IN THE UNITED STATES………..724 A. Post-World War II Payments by the U.S. Government……….…………………………………………724 B. Nazi-Looted Books…………………………………………729 C. Royalties from Mein Kampf………………………………733 D. Nazi Persecutee Relief Fund……………………………...734 E. The Eizenstat Reports……………………………………..739 F. American Industry Fund………………………………….742 G. Presidential Advisory Commission on Holocaust Assets in the United States………………………………..748 IV. RESTITUTION LITIGATION AGAINST U.S. GOVERNMENT AND CORPORATIONS……………………………………………...….759 A. Holocaust Litigation against the U.S. Government…..759 1. Background on the Gold Train……………………...760 2. Gold Train Litigation: Rosner v. United States…..767 B. Holocaust Litigation Against U.S. Corporations……...772 1. Ford Motor Company.………………………………...773 2. J.P. Morgan and Chase Manhattan………………..776 3. IBM……………………………………………………...777 4. Other American Corporations ………………………786 V. CONCLUSION……………………………………………………...789 A. The Federal Government………………………………….790 B. American Industry…………………………………………793 APPENDIX…………...………………………………………………..797 File: BAZYLER Base Macro Final_2.doc Created on: 6/24/2003 12:17 PM Last Printed: 1/13/2004 2:22 PM 2003] U.S. HOLOCAUST RESTITUTION 685 Nearly two years after [the conclusion of] the last of the major Holocaust-era negotiations in the waning hours of the Clinton administration, justice is still beyond reach for too many aging victims. The unfinished business from World War II includes . a final accounting still owed by the American government itself. [T]he American government has properly called upon other countries to face their past. It is time now, more than 55 years after the end of World War II . to finish at last the unfinished business of World War II and to bring jus- tice to elderly Holocaust survivors. They must wait no longer.1 I. INTRODUCTION hile the United States has been the leading force behind W European governments and corporations examining their roles in the Holocaust, little has been done by American industry and, to an extent, by the U.S. government to help Holocaust survivors.2 Following the accusations of wartime wrongdoing raised against various European concerns, greater scrutiny has now also been applied to the conduct of the U.S. government and American corporations during World War II. Although Europe was the site of the Holocaust and the perpe- trators of the “Final Solution,” including the attendant financial machinations, were also primarily from Europe, the conduct of American industry and government during the war is not en- tirely blame-free. 1. Stuart Eizenstat, Justice Remains Beyond Grasp of Too Many Holo- caust Victims, FORWARD, Oct. 18, 2002, available at http://www.forward.com/ issues/2002/02.10.18/oped1.html (statement by Stuart Eizenstat, President Clinton’s Special Representative on Holocaust Issues). 2. For a collection of documents pertaining to the U.S. government's ac- tivities involving Holocaust issues, see the official website of the U.S. Depart- ment of State, at http://state.gov/p/eur/rt/hlcst/ (last visited June 21, 2003). See also Law-Related Resources on Nazi Gold and Other Holocaust Assets, Swiss Banks During World War II, and Dormant Accounts, available at http://www.lib.uchicago.edu/~llou/nazigold.html (last visited June 21, 2003). To date, three books have been published on the Holocaust restitution movement. See JOHN AUTHERS & RICHARD WOLFFE, THE VICTIMS FORTUNE: INSIDE THE EPIC BATTLE OVER THE DEBTS OF THE HOLOCAUST (2002); MICHAEL J. BAZYLER, HOLOCAUST JUSTICE: THE BATTLE FOR RESTITUTION IN AMERICA’S COURTS (2003) [hereinafter BAZYLER, HOLOCAUST JUSTICE]; STUART E. EIZENSTAT, IMPERFECT JUSTICE: LOOTED ASSETS, SLAVE LABOR, AND THE UNFINISHED BUSINESS OF WORLD WAR II (2003). File: BAZYLER Base Macro Final_2.doc Created on: 6/24/2003 12:17 PM Last Printed: 1/13/2004 2:22 PM 686 BROOK. J. INT’L L. [Vol. 28:3 The litigation against European companies has forced Ameri- can companies to confront their own shady wartime past. The Holocaust restitution movement — born in the United States with the specific aim of uncovering financial misfeasance in wartime Europe — has now enmeshed both the U.S. govern- ment and corporate America. The finger of blame that was first pointed from the United States to Europe is now being pointed back to the United States. Unfortunately, there seems to be a double standard at play. The demands made by the United States towards European governments and corporations to hon- estly confront and document their wartime financial dealings and other activities are not being registered in the United States itself. This Article will examine the effects of the Holocaust restitu- tion movement on the U.S. government and industry. Part II sets out the critical role played by the United States in prompt- ing European governments and corporations to recognize their long overdue wartime financial obligations to survivors of the Holocaust and other victims of World War II. Part III focuses on steps taken by the U.S. government to recognize its own ob- ligations. Part IV analyzes the lawsuits filed against the U.S. government and American corporations for their wartime and postwar financial dealings. Finally, in Part V, the Article con- cludes with two sets of recommendations — one directed to- wards the U.S. government and the other towards American industry — regarding what each needs to do to confront their unfinished business of World War II. II. THE ROLE OF THE UNITED STATES IN RESTITUTION EFFORTS ABROAD The unresolved controversies involving unscrupulous finan- cial dealings during the Holocaust and its aftermath finally be- gan to be settled at the end of the 20th century not in Europe, where the Holocaust took place, but in the United States. The United States has been the prime mover behind the numerous agreements concluded between 1998 and 2001 that led to com- pensation for individuals whose families’ bank accounts had been looted either during or after the war. The United States also forced Germany to pay former slaves of German companies seeking payment for their wartime labor, and European insur- ance companies to recognize survivors’ claims to benefits of in- File: BAZYLER Base Macro Final_2.doc Created on: 6/24/2003 12:17 PM Last Printed: 1/13/2004 2:22 PM 2003] U.S. HOLOCAUST RESTITUTION 687 surance policies issued to their family members who perished during the war. These settlements brought about by the U.S. government and in U.S. courts since August 1998, when the first settlement was made between the Swiss banks and Holo- caust-era claimants for $1.25 billion, have now reached a figure somewhere between $8 to $11 billion, depending on the method of calculation.3 All levels of government in the United States — local, state, and federal — were involved in the efforts. At the federal level, the seriousness of commitment (at least during the