overruled

SCOTUS unanimously tosses Holocaust restitution cases

The justices rejected the arguments of Holocaust survivors seeking restitution through the U.S. court system against Germany and Hungary

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The Supreme Court of the United States

The Supreme Court sided unanimously with the German and Hungarian governments in a pair of cases related to Holocaust-era property claims.

The first case, Germany v. Philipp, centered on the Guelph Treasure, or Welfenschatz, a collection of medieval art purchased from Jews by the Nazi regime in 1935. The heirs of the Jewish art dealers were seeking restitution from the German government for the artwork, which they claimed was sold under duress for below-market value. 

In the second case, Hungary v. Simon, 14 Holocaust survivors sought restitution from the government of Hungary and its state-owned railway company for property the government confiscated during World War II.

The court sided with both the German and Hungarian governments, vacating lower court decisions in favor of the two groups of Jewish survivors and descendants.

U.S. law generally holds that foreign nations are not subject to lawsuits in U.S. courts for actions within their borders targeting their own citizens. The heirs had argued that the cases fell within an exception to U.S. law that bans “property taken in violation of international law.”

In Germany v. Philipp, the heirs claimed that, although the art seizure did not target foreign citizens, it was a part of the Nazi genocide against the Jews and violated international law. The Supreme Court held that the exception only applied specifically to government confiscation of property belonging to foreign nationals.

“A statutory phrase concerning property rights most sensibly references the international law governing property rights, rather than the law of genocide,” Chief Justice John Roberts wrote in his opinion, joined by all eight associate justices. “The heirs’ position would arguably force courts themselves to violate international law not only by ignoring the domestic takings rule, but also by derogating international law’s preservation of sovereign immunity for violations of human rights law.”

“We hold that the phrase ‘rights in property taken in violation of international law,’ as used in the FSIA’s expropriation exception, refers to violations of the international law of expropriation and thereby incorporates the domestic takings rule,” he continued.

Nicholas O’Donnell, a lawyer representing the heirs in Germany v. Phillip, told Jewish Insider that his clients “are obviously disappointed in the Court’s ruling. We are considering our next steps for when the case returns to the District Court.”

Jonathan Freiman, who represented the German government, told JI: “We’re pleased with the Supreme Court’s clear and unanimous ruling reversing the decisions below. Any claim over the Welfenschatz does not belong in a U.S. court.”

The Supreme Court declined to address the heirs’ argument that the Jewish art dealers were not citizens of Germany at the time nor the German government’s argument that the case should be dismissed out of respect for international comity.

In a one-paragraph per curiam opinion in Hungary v. Simon, the court cited its ruling in Germany v. Philipp.

Paul Gaston, a lawyer for the Holocaust victims in Hungary v. Simon said, “Our legal team is still studying the decision in the Philipp case, but believe that decision leaves plenty of room for plaintiffs in Hungary v. Simon to prevail on remand.”

Lawyers for the Hungarian government could not immediately be reached for comment.

Germany v. Philipp had attracted significant attention from members of Congress, several of whom filed an amicus brief in the case siding with the heirs.

Rep. Jim Banks (R-IN), who led the amicus brief, criticized the Court’s decision.

“Congress has made it clear that Holocaust survivors can seek restitution in American courts,” Banks said. “The Supreme Court’s decision is a missed opportunity to give Jewish victims back a small part of what the Nazi regime stole from them.”

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