[CPProt.net] Repost, without attachment: U.S. to pay $25.5 million to settle WWII 'Gold Train' lawsuit
MSN and CPProt list (Ton Cremers)
museum-security at museum-security.org
Sat Mar 12 09:46:08 CET 2005
U.S. to pay $25.5 million to settle WWII 'Gold Train' lawsuit
BY NOAH BIERMAN
nbierman at herald.com
The U.S. government formally agreed on Friday to pay $25.5 million to
redress a controversial historical incident -- the American military's
seizure of Nazi loot stolen from Hungarian Jews.
The government later auctioned off much of the property to fund refugee
relief efforts, rather than trying to return the possessions to their
owners, who were either dead or scattered around Europe.
The so-called ''Gold Train'' incident gained widespread notice more than a
half century after it happened, the result of a presidential commission and
a lawsuit filed by Hungarian Jews in Miami federal court in 2001. Many of
the Holocaust survivors who filed the suit had long since emigrated to the
United States and elsewhere. Some settled in South Florida.
Friday's settlement proposal will allot $25 million to cover basic
humanitarian services -- including health care -- for Hungarian Jewish
Holocaust survivors throughout the world. Individual plaintiffs will not
receive payments.
The settlement also includes $500,000 to build and maintain an archive
documenting the destruction of the Hungarian Jewish community as well as the
Gold Train incident. A panel of three experts will choose a major Holocaust
museum, still undetermined, to house it.
The United States government has not made a formal apology.
''It's going to be addressed in the future, but it's the government's own
discretion,'' said Sam Dubbin, the lawyer representing the plaintiffs.
The Department of Justice issued a statement saying the government was
''very pleased'' about the settlement.
''Once the settlement is approved by the U.S. district court judge, the U.S.
government will issue an appropriate statement of acknowledgement,''
department spokesman Charles Miller told The Herald, declining further
comment.
The settlement, which still requires approval of U.S. District Judge
Patricia Seitz, will not erase the memories of elderly Holocaust survivors
who filed it. But it will ensure the U.S. government acknowledges its role
in the incident.
''For a lot of people, the settlement was about documenting the history and
making it available,'' said Dubbin. ``At the same time, the monetary relief
is very significant and will help a large number of elderly Hungarian
Holocaust survivors who are in great need.''
The road to completing the settlement continues next week, when Seitz will
likely hold a hearing to consider preliminary approval. Then notices will go
out to members of the class of people represented in the suit, before Seitz
holds another hearing to consider possible objections.
The settlement calls for relief money to go to existing agencies that serve
Holocaust survivors. Using a survey, lawyers and survivors will distribute
the money in geographic proportion to the survivor population.
The story of the Gold Train begins before World War II, a period of
comfortable assimilation for many Hungarian Jews. Those of status owned the
finer things -- paintings, Oriental rugs, jewelry, gold.
During the war, Nazis plundered the Jewish homes and loaded goods onto 40
train cars bound for Germany. But the Gold Train was turned over to American
liberators in Austria in 1945, soon after the May 8 victory. Rather than
return the goods to their owners, as U.S. policy required, they were
diverted. Some wound up in generals' hands, according to the Presidential
Advisory Commission on Holocaust Assets. Others were sold for refugee
relief.
The U.S. government's acts came to light only decades later, as the advisory
commission did extensive research into Holocaust survivors' claims around
the world.
When survivors learned the U.S. government's role, many greeted the news
with mixed emotions. They were grateful to the American liberators, but
disappointed to be victims yet again. Many were further disappointed that
the military chose not to disclose the information.
As the civil case preceded, government lawyers have denied the Holocaust
Commission report. It has also been difficult for plaintiffs -- who may
number in the tens of thousands -- to prove exactly what was missing and
where it wound up.
Dubbin said the cap on legal fees that the attorneys agreed to seek is
``substantially below what the law will allow and substantially less than
the time we spent to prosecute the case.''
http://www.miami.com/
Text of settlement:
STATEMENT OF ATTORNEYS FOR HOLOCAUST SURVIVORS AND HEIRS
IN THE HUNGARIAN GOLD TRAIN LITIGATION
CONCERNING PROPOSED SETTLEMENT OF THE CASE
March 11, 2005
The landmark Hungarian Gold Train case reached a milestone with today’s
filing of a proposed settlement agreement between the United States
Government and Hungarian Holocaust survivors and heirs. With today’s
filing, the proposed settlement is now before the U.S. District Court in
Florida for consideration.
The proposed settlement in the case of Rosner et al v. United States creates
a $25.5 million Settlement Fund, and provides for a statement by the United
States government acknowledging the events surrounding the Gold Train
property. Because of the passage of time, lost documentation, and lack of
an inventory, there is limited information about the specific items that
were on the Gold Train and taken into U.S. custody in 1945. Thus it is very
hard to fairly assess and compensate individual class members based on their
personal losses. Therefore, the U.S. government and representatives for the
class have agreed that a minimum of $21 million in the Settlement Fund be
used to augment existing social welfare programs for Hungarian victims of
Nazi persecution. The settlement agreement also allocates $500,000 to fund
and create an archival collection of information and artifacts for the
benefit of the class and other educational purposes.
The settlement class includes all persons whose personal property was seized
or stolen by the Hungarian government, and all heirs, estates, assigns and
survivors of such persons.
The court has scheduled a hearing on March 17 to determine whether
to preliminarily approve the settlement. If approved by the Court, notice
of the settlement will go to class members by mail, through newspaper ads,
and through Jewish and survivor organizational networks.
Fred F. Fielding served as court-appointed mediator in this case.
The plaintiffs and the U.S. government first announced an agreement in
principle to settle the case on December 20, 2004. This settlement is the
result of nearly three months of confidential negotiations in which the
details of the agreement and distribution of the relief, among many other
issues, were addressed. In recent months, Jewish organizations extensively
participated in the negotiations that led to the settlement.
Counsel for the survivors and heirs are pleased with the proposed
settlement, and will recommend it to the Court. We feel that it fairly
resolves the claims that the Holocaust survivors and their heirs have
against the United States Government, though nothing can ever truly
compensate them for what they endured. We will continue to update the
Website with additional information as it occurs, including the final
approval of the settlement.
The counsel for the plaintiffs are Hagens Berman Sobol Shapiro LLP (Steve W.
Berman, R. Brent Walton) (206-623-7292); Cuneo Waldman & Gilbert, LLP
(Jonathan W. Cuneo, Michael Waldman and David Stanley) (202-789-3970); and
Dubbin & Kravetz (Samuel J. Dubbin, Jeffrey Kravetz) (305-357-9004).
Documents in support of the settlement may be found at
http://www.hbsslaw.com.
SUMMARY OF PROPOSED SETTLEMENT
• The United States has agreed to pay $25.5 million into a Settlement
Fund.
• The Settlement does not provide for direct payments to Class Members
as compensation for property lost on the Gold Train. Instead, the money will
fund social welfare programs benefiting eligible Class Members according to
the Plan of Distribution. After years of litigation, the parties concluded
that attempting to provide compensation payments directly to Class Members
would be impractical because of the difficulties of determining which
individuals had property on the Gold Train (or were heirs of such
individuals), and because the administrative costs of determining which
Class Members would be eligible for such compensation payments could very
well equal or exceed the total size of the Settlement Fund. The difficulties
of proof are compounded by the lack of records documenting whose property
was on the train and where it eventually wound up.
• A minimum of $21 million will fund social welfare programs
benefiting Class Members, born before May 8, 1945 who lived in the 1944
borders of Hungary some time between 1939 and 1945, who are in need. Only
such Class Members will be eligible for social welfare benefits. The funds
will be allocated according to the proportion of Hungarian Nazi Victims
living in each country today, and be disbursed over a period that could
extend up to five years. Over 90% of the eligible recipients live in
Israel, Hungary, the United States, and Canada.
• The programs will be carried out by existing and established social
welfare agencies with demonstrated capability and experience in operating
programs and providing assistance to Nazi victims. All funds will be
supplemental to programs offered to Nazi victims in general. The programs
will be determined and implemented in consultation with Class members. The
Plan of Distribution will be available for review and comment by June 10,
2005 at www.HungarianGoldTrain.org, and will be submitted to the Court for
its review and approval. The Claims Conference will administer the fund.
Both the agencies and program administration will be subject to court
jurisdiction and audit.
• At the end of the case, the United States Government will issue a
statement of acknowledgment about the events regarding the Hungarian Gold
Train. The United States Government will determine the contents of the
statement in its sole discretion.
• $500,000 of the Settlement will fund an archival project to collect
documents and artifacts relating to the history of the Hungarian Gold Train
and looting of the Hungarian Jewish community during World War II. The
archives will be available for scholarly research and educational purposes,
Class Members’ use, and for future generations.
• Counsel will petition the Court for reduced attorneys’ fees and
costs and expenses to be paid from the Settlement Fund, not to exceed $3.85
million (slightly more than 15%, less than half the normal rate for class
action settlements). This amount includes approximately $700-800,000 in
out-of-pocket expenses.
EXCERPTS FROM CLASS COUNSEL MEMORANDUM
TO JUDGE SEITZ IN SUPPORT OF PROPOSED SETTLEMENT
OF “HUNGARIAN GOLD TRAIN CASE”
>From Memorandum in Support of Motion for Preliminary Approval, Pages 8-12:
Is $25.5 million an acceptable compromise figure?
For three reasons, Class Counsel believe that $25.5 million is an
acceptable compromise figure. The United States has interposed formidable
factual and legal challenges to a classwide recovery. The United States’
defenses include the 60 year age of the claims, the sovereign status of the
United States, the lack of precise information on the contents of the train
when the United States accepted custody of it in May 1945 and certain
diplomatic agreements with Hungary and other nations. Successful resolution
of these issues would likely take years and could extend beyond the expected
lifetime of many eligible Hungarian victims of Nazi persecution. And, it is
possible that the United States would defeat class certification or even
prevail on one of its defenses. There are real litigation risks presented.
Second, there is no certainty as to the value of the goods on the
Gold Train when it came into the hands of the U.S. Army. There have been
many widely-varying estimates of the value of the property on the Gold
Train, both from the postwar era and more recently. No inventory was ever
made of the property, much less a detailed appraisal, and therefore any
estimate is somewhat speculative.1 However, reputable experts who have
intensively studied the Gold Train agree that post war rumors of extreme
value are exaggerated. Much valuable cargo was taken off the train before
it came into the possession of the United. States. Plaintiffs’ historical
expert, Gábor Kádár, in his book Self-Financing Genocide, estimated the
value at $6.5 to $13 million in 1945 dollars, or approximately $65 to $130
million today, before the removal of certain valuable items, leaving a value
of $45 million to $90 million in today’s dollars. The total recovery in
this case is thus approximately 28% to 56% of the total value of the train’s
worth according to those estimates. Professor Ronald Zweig, who also spent
years studying the Gold Train and serves as defendant’s expert, has
repeatedly written and stated that postwar estimates were highly
exaggerated. Given the substantial factual and legal hurdles that would
have had to been overcome before any recovery through further litigation,
and the very real risk of no recovery at all, Class Counsel believe that the
compromise figure of $25.5 million represents a fair and reasonable, indeed
outstanding, result.
Third, the settlement provides important non-monetary relief. The
acknowledgment that the United States will issue, and the archive the
settlement will finance are vital non-monetary terms that augment the
monetary recovery, especially since this case is more about history than
about money to most Class members.
Why has the Settlement not provided for individual payment to individual
Class members as compensation?
The Settlement does not provide for direct payments to Class members
as compensation for property lost on the Gold Train. Instead the money will
be used to fund social welfare programs benefiting eligible Class members
according to the Plan of Distribution. After years of litigation, the
parties concluded that attempting to provide compensation payments directly
to Class members would be impractical because of the difficulties of
determining which individuals had property on the Gold Train (or were heirs
of such individuals) and the value of such property, and because the
administrative costs of determining which Class members would be eligible
for such compensation payments could very well equal or exceed the total
size of the settlement fund. In addition, given the size of the Class,
individual payments may not have amounted to more than a token amount. By
contrast, agglomerating the funds in this fashion will provide maximum,
tangible benefit where it will make the most difference to Class members.
A proof of claims procedure would be futile. It is now nearly
impossible for the vast majority of Class members to show that (or even know
whether) they or their family members had property on the Gold Train at the
time it came into the possession of the U.S. Army in 1945, and if so, what
property it was. Also claimants might have to establish that he/she is the
correct person to assert that claim nearly 60 years later. Any claims
procedure based on individual proof would thus face enormous practical
difficulties, entail long delays, consume a huge amount of the available
resources and might well yield disappointing results.
Any distribution on a “per claim” basis would face similar practical
difficulties that could render such a procedure futile as well. There would
be significant questions of eligibility (e.g., How many claimants per
family? Who can assert a claim?) Any “per claim” basis that included
heirs would result in an extremely modest payment often with lengthy and
expensive claims procedures to determine who is a proper claimant.
After extensive and repeated consultation with Class members, Class
Counsel determined to accept a Plan of Distribution designed to assist
victims of the Holocaust from Hungary who are in need. Several factors
supported that decision. An important element of the Settlement is that the
Special Fund is being allocated geographically according to the relative
proportion of Hungarian Nazi victims, and will be distributed over a five
year period. Therefore, all Class members who are Nazi victims are
potentially eligible to receive monetary benefits, because even those who
are self-sufficient today may find themselves in need of assistance in the
future.
The designations will be developed through a transparent process
with input from many sources, will be available in advance of the opt-out
date, and will be subject to the approval of the Court. And class members
have full opt-out rights.
Class Counsel believes that limiting distribution of the Special
Fund to Hungarian Holocaust survivors in need, rather than making individual
payments of small sums to all Class members, and providing for the archiving
and dissemination of the history of the looting of the Hungarian Jewish
community, is the most justifiable and practicable settlement of this case
to benefit the Class as a whole.
What Benefits Do Heirs Receive?
Jewish Hungarian Nazi victims are eligible to receive welfare
benefits through the Settlement. Heirs cannot receive direct monetary
benefits. As monetary consideration, heirs receive a $500,000 cy pres award
to a recipient institution for the compilation of an historical archive
about the Gold Train and the looting of the Hungarian Jewish community
during World War II. This archive will be available for years to come and
will be a permanent memorial of the tragic events that gave rise to this
case. In addition, heirs benefit by the issuance by the United States of a
statement of acknowledgment about the events regarding the Gold Train. The
contents of the statement are in the sole discretion of the United States
and are not intended to be reviewable in this or any court. Counsel believe
that it is important that the statement not a negotiated statement. Rather,
the United States is responsible to history for its contents and it should
be in the United States’ own voice. Nevertheless, this acknowledgment is
important for intangible but real reasons. Numerous survivors and heirs
have repeatedly stressed the importance of this statement.
Finally, many heirs will benefit indirectly from the social welfare
programs offered to victims of Nazi atrocities to the extent that it will
lighten their burden in caring for elderly relatives in need. Counsel
represent to the Court that in discussing possible settlement terms with
class members, heirs cited the need for funds to care for elderly Hungarian
Nazi victims who are in need today.
PROPOSED SCHEDULE FOR NEXT STEP
IN SETTLEMENT OF HUNGARIAN GOLD TRAIN CASE
In their motion for preliminary approval, the parties have proposed
a schedule to the Court for next steps in the case. Once the Court has
ruled on the motion for preliminary approval, the deadlines for providing
notice, opting out of the Settlement Class and submitting objections or
comments to the proposed settlement will begin to run. The proposed
schedule, which is subject to the timing of actions to be taken by the
parties and the Court in this case, provides an approximate time-line of the
various steps in the settlement approval process under the Settlement
Agreement.
Event Timing
1 Motion for Preliminary Approval March 10, 2005
2 Hearing on Motion for Preliminary Approval March 17,
2005
3 Notice Date May 1, 2005
4 Submission of Proposed Final Plan of Distribution for Court’s
Approval June 10, 2005
5 Class Counsel submits fee petition June 17, 2005
6 Class Counsel submits petition for incentive payments for named
Plaintiffs June 17, 2005
7 Requests for Exclusion Due August 1, 2005 (postmarked)
8 Objections Due August 1, 2005 (postmarked)
9 Date by with the United States must decide whether to proceed with
the Settlement if opt-outs exceed specified number September 12, 2005
10 Deadline for filing Motion for Final Approval October 3, 2005
11 Fairness Hearing , 2005
US Response
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