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Litigating the Nazi past

Imperfect Justice: Looted Assets, Slave Labor, and the Unfinished Business of World War II, Stuart E. Eizenstat, PublicAffairs: 402 pp., $30 Holocaust Justice: The Battle for Restitution in America's Courts, Michael J. Bazyler, New York University Press: 412 pp., $34.95

March 30, 2003|Benjamin B. Ferencz | Benjamin B. Ferencz is the author of "Less Than Slaves: Jewish Forced Labor and the Quest for Compensation." He is a former prosecutor in the Nuremberg war crimes trials and the director of several postwar restitution programs on behalf of leading Jewish organizations.

Justice and the Holocaust are incompatible -- not every wrongdoer can be held to account and no victim can ever be made whole. Two fascinating new books describe human suffering, desperation, determination and accomplishment revolving around "unfinished business" in the Holocaust's wake. Their story begins in the 1990s when Swiss banks were widely accused of hiding dormant accounts and enriching themselves during the Nazi period with looted gold, including gold from the teeth of concentration camp inmates.

Over the next few years, the public uproar inspired some American Jewish organizations and lawyers to demand that Swiss banks alleged to have collaborated with the Nazis make restitution to survivors. Politicians joined the fray and threatened economic sanctions against Switzerland. The accused banks were outraged at what they considered blackmail and extortion. Whether the actors are heroes or villains, or both, depends on the eye of the beholder.

The Swiss bank controversy was a media bombshell. Billionaire industrialist Edgar Bronfman, president of the World Jewish Congress, found a willing ear in President Clinton. Bronfman and his aide, Rabbi Israel Singer of Brooklyn, soon enlisted Sen. Alphonse M. D'Amato (R-N.Y.), powerful chairman of the Senate Banking Committee. For the next 2 1/2 years, beginning in 1996, writes Stuart E. Eizenstat in "Imperfect Justice: Looted Assets, Slave Labor, and the Unfinished Business of World War II," D'Amato "milked the Swiss controversy for all it was worth." In Switzerland, the senator was denounced as a venal politician chasing the Jewish vote.

"Imperfect Justice" is Eizenstat's exciting account of his six-year effort to obtain compensation for Nazi victims from Swiss banks while he served as a high-ranking State Department official. The Harvard-trained lawyer was glad to be tapped to mediate the sensitive issue threatening U.S.-Swiss relations. Then, according to Eizenstat, "lawyers hijacked the Swiss bank dispute."

The race to the courthouse was won by New York lawyer Edward Fagan, who "shamelessly [used] elderly Holocaust survivors as props." Fagan filed a complaint in U.S. District Court in Brooklyn in October 1996 demanding $20 billion for his unknown clients. Similar class actions by other lawyers followed. As a humanitarian gesture, $500 checks were sent on behalf of the banks to a number of needy concentration camp survivors.

In time, Chief U.S. District Court Judge Edward R. Korman persuaded the lawyers not to push their luck. The banks became convinced that it would be cheaper to settle than be excluded from American financial markets. They paid $1.25 billion to forever dispose of all Holocaust-related claims against any Swiss nationals or companies. It was, according to insider Eizenstat, "far beyond anyone's expectations." But implementing the settlement would present problems that were also beyond expectations.

The surprising capitulation by the Swiss banks sparked new assaults against Germany and its companies by what Eizenstat terms "lions on the prowl." The sharp eyes of class-action lawyers turned toward the deep pockets of well-known firms they accused of being Nazi accomplices in looting and abusing inmates as slaves.

Michael J. Bazyler, the son of Polish Holocaust survivors and a professor at Whittier Law School, gives details of nationwide litigation in which courts rejected the legal basis for such claims. His book "Holocaust Justice: The Battle for Restitution in America's Courts," like Eizenstat's, is enlightening and provocative.

Starting in 1948, U.S. military occupation decrees had mandated that properties confiscated under Nazi rule be returned to their former owners. In 1952, a treaty was signed by the West German government, Israel and a consortium of leading Jewish organizations worldwide calling for expanded eligibility and compensation for survivors of persecution.

With postwar Germany's limited capacity to pay, obvious gaps were unavoidable. Many of those hardest hit were not covered. Slave labor claims were left unsettled. In the 1960s, after failed litigation in German courts, the consortium squeezed a pittance from five major German firms for those few camp survivors who could prove they toiled for any of the companies. The corporate directors paid as little as they could get away with: 15,000 survivors had to divide about $26 million. Other slave laborers received nothing. And although Hitler's armies had totally ravaged countries occupied in the East, those former slave laborers who still resided in territories under Soviet domination were excluded. The reason given was that there were no diplomatic relations between Germany and communist nations. This spurious excuse vanished with the fall of communist regimes beginning around 1990.

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