Holocaust Victims of Bank Theft v. Magyar Nemzeti Bank, 10 C 1884.
Citation | 807 F.Supp.2d 689 |
Decision Date | 18 May 2011 |
Docket Number | No. 10 C 1884.,10 C 1884. |
Parties | HOLOCAUST VICTIMS OF BANK THEFT, Plaintiffs, v. MAGYAR NEMZETI BANK, et al., Defendants. |
Court | United States District Courts. 7th Circuit. United States District Court (Northern District of Illinois) |
OPINION TEXT STARTS HERE
Anthony Alfred D'Amato, Northwestern, Robert James Pavich, John J. Pavich, Monico, Pavich & Spevack, George K. Lang, Jeffrey A. Leon, Freed & Weiss LLC, Chicago, IL, Richard H. Weisberg, Cardoza Law School, New York City, NY, for Plaintiffs.
Anthony L. Paccione, Jonathan J. Faust, Katten, Muchin, Rosenman, LLP, Alan M. Kanzer, Amber C. Wessels, Alston & Bird, LLP, New York, NY, Brian J. Poronsky, Christian T. Kemnitz, Katten, Muchin, Rosenman, LLP, Sharon Renae Albrecht, Steven L. Baron, Mandell, Menkes, LLC, Justin Adam McCarty, Tyrone C. Fahner, Mayer, Brown, LLP, Gregory L. Stelzer, James R. Figliulo, Figliulo & Silverman, Chicago, IL, Thomas G. Corcoran, Berliner Corcoran & Rowe, LLP, Washington, DC, for Defendants.
Laina Catherine Wilk Lopez, Berliner, Corcoran & Rowe, LLP, Pro Hac, Vice.
This matter is before the court on Defendants' motions to dismiss. For the reasons stated below, the motions are denied in their entirety.
Plaintiffs brought the instant action against Defendants, which are international banking institutions that allegedly played a role in a wealth expropriation scheme involving the theft and withholding of assets and funds from Hungarian Jews who were victims of the Holocaust and their next of kin. Plaintiffs include in their amended complaint claims based on genocide, aiding and abetting genocide, bailment, conversion, and claims seeking a constructive trust and accounting. Defendants now move to dismiss the instant action.
Defendants argue that this court lacks subject matter jurisdiction in the instant action. Pursuant to 28 U.S.C. § 1331 (Section 1331), “[t]he district courts shall have original jurisdiction of all civil actions arising under the Constitution, laws, or treaties of the United States.” Id. The Seventh Circuit in Jogi v. Voges, 480 F.3d 822 (7th Cir.2007), made clear that “the assertion of a claim arising under any one of those sources of federal law [listed in Section 1331] is enough to support subject matter jurisdiction unless the claim is so plainly insubstantial that it does not engage the court's power.” Id. at 825. Plaintiffs contend that Defendants have violated certain non-U.S. treaties (Non–U.S. Treaties), U.S. treaties (U.S. Treaties), and customary international law.
Defendants argue that this court lacks subject matter jurisdiction over the Non–U.S. Treaties, arguing that Section 1331 references only “treaties of the United States.” 28 U.S.C. § 1331; see also Abagninin v. AMVAC Chemical Corp., 545 F.3d 733, 737 (9th Cir.2008) ( ). Defendants also argue that this court lacks subject matter jurisdiction over any of the Non–U.S. Treaties or U.S. Treaties because they are not deemed to be self-executing treaties. Regardless of whether the Non–U.S. Treaties or U.S. Treaties are self-executing, Plaintiffs have based their claims upon a violation of the historical norms established by the treaties, customary international law, and the limited area of law governing areas such as genocide. See, e.g., Sosa v. Alvarez–Machain, 542 U.S. 692, 725, 762, 124 S.Ct. 2739, 159 L.Ed.2d 718 (2004); Kadic v. Karadzic, 70 F.3d 232, 238–41 (2nd Cir.1995) ( ). In addition, contrary to Defendants' reading of footnote 19 in Sosa, the Supreme Court did not expressly foreclose bringing an action based on customary international law under the circumstances of the instant action.
In regard to the Alien Plaintiffs in the instant action, the Alien Tort Claims Act (ATS) provides that “[t]he district courts shall have original jurisdiction of any civil action by an alien for a tort only, committed in violation of the law of nations or a treaty of the United States.” 28 U.S.C. § 1350. Although the ATS did not authorize the creation of new causes of action, an action can be based on a violation of the norms of treaties, such as the Non–U.S. Treaties and U.S. Treaties. See, e.g., Sosa, 542 U.S. at 724–25, 124 S.Ct. 2739. As Defendants concede, the United States Supreme Court in Sosa indicated a claim can be “based on the present-day law of nations” as long as it “rest[s] on a norm of international character accepted by the civilized world and defined with a specificity comparable to the features of the 18th-century paradigms [the Court has] recognized.” Id. at 725, 124 S.Ct. 2739; see also Abagninin, 545 F.3d at 738 ( ).
Defendants contend that in the instant action Plaintiffs are presenting claims that are novel and not supported by law. However, Defendants have not shown that novel claims cannot be made, nor have Defendants pointed to any precedent explicitly foreclosing the instant action. See Bowoto v. Chevron Corp., 557 F.Supp.2d 1080, 1090 (N.D.Cal.2008) ( ). Defendants contend that “genocide by looting and aiding and abetting genocide by looting are not, per Sosa, universally accepted and specifically defined [contemporary international law] violations.” (OTP Mem. Dis. 14). Defendants cite no controlling precedent that has expressly agreed with Defendants' position. (OTP Mem. Dis. 14–15).
Genocide by looting and aiding and abetting genocide by looting falls within the limited scope of jurisdiction recognized in Sosa. Genocide has been recognized as a violation of the norms of international character accepted by the civilized world and of contemporary international law. See Sosa, 542 U.S. at 762, 124 S.Ct. 2739 (Breyer, J., concurring in part and concurring in judgment) ( ); see also Kadic, 70 F.3d at 238–39 ( )(internal quotations omitted). In addition, Plaintiffs have pointed to support indicating that genocide was considered an established violation of international law long before World War II.
Defendants contend that the ATS was not intended to have an extraterritorial effect. However, the Seventh Circuit has indicated that “[g]enerally speaking, Congress has the authority to apply its laws, ... beyond the territorial boundaries of the United States, to the extent that extraterritorial application is consistent with the principles of international law.” United States v. Dawn, 129 F.3d 878, 882 (7th Cir.1997).
Defendants also contend that the ATS cannot subject a corporation to liability. Defendants cite Sosa in support of their position. (OTP Mem. Dis. 13). Although the court in Sosa referenced the issue of whether a corporation could be held liable under international law, the Court did not decide the issue. Sosa, 542 U.S. at 733 n. 20, 124 S.Ct. 2739. Defendants argue that the only decision that properly addressed this issue and applied Sosa is the Second Circuit in Kiobel v. Royal Dutch Petroleum Co., 621 F.3d 111 (2nd Cir.2010). (OTP Reply 10). However, Kiobel is non-controlling precedent, and there is persuasive precedent indicating that corporations can be held liable under the ATS. See, e.g., Romero v. Drummond Co., Inc., 552 F.3d 1303, 1315 (11th Cir.2008) ( ). The express language of the ATS does not include any express exemption for corporations or language from which such a conclusion can be inferred. See id. ( ). This court agrees with the concurring opinion in Kiobel that there is a sufficient legal basis to hold corporations liable under the ATS for genocide. As the concurring opinion in Kiobel pointed out, if a corporation cannot be held liable under the ATS, then a corporation that “committed a genocide to increase its profits” would be able to obtain a dismissal of any action brought against it simply “on the ground that the defendant is a corporation.” Kiobel, 621 F.3d at 157 (Leval, J., concurring). The concurring opinion in Kiobel also aptly noted that “[r]ecognition of the humanitarian objectives of the law of nations makes it unlikely that this body of law intends to exempt corporations from its prohibitions or to provide a substantial financial incentive to violate the most fundamental of human rights.” Id. at 159. Therefore, based on the record before the court at this juncture, this court has subject matter jurisdiction. In addition, Defendants...
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