Iwanowa v. Ford Motor Co.

Decision Date28 October 1999
Docket NumberNo. Civ.A. 98-959 JAG.,Civ.A. 98-959 JAG.
Citation67 F.Supp.2d 424
PartiesElsa IWANOWA, on her own behalf, and on behalf of all others similarly situated; namely Persons Compelled To Perform Forced Labor for Ford Werke A.G., between 1941 and 1945, Plaintiffs, v. FORD MOTOR COMPANY and Ford Werke A.G., Defendants.
CourtU.S. District Court — District of New Jersey

Allyn Z. Lite, Joseph J. DePalma, Lite, DePalma, Greenberg & Rivas, LLC, Newark, New Jersey, Melvin I. Weiss, Deborah Sturman, Milberg, Weiss, Bershad, Hynes & Lerach, LLP, New York City, Michael D. Hausfeld, Cohen, Milstein, Hausfeld & Toll, P.L.L.C., Washington, D.C., Burt Neuborne, New York City, for plaintiffs.

James S. Dobis, Dobis & Reilly, P.A., Livingston, New Jersey, Warren Christopher, Walter Dellinger, John H. Beisner, Thomas E. Donilon, John F. Niblock, O'Melveny & Myers LLP, Washington, D.C., for defendant Ford Motor Company.

Robert Biskup, Ford Motor Company, Dearborn, MI, for defendant Ford Motor Company.

Clyde A. Szuch, Elizabeth J. Scher, Pitney, Hardin, Kipp & Szuch, Morristown, New Jersey, for defendant Ford Werke, A.G.

AMENDED OPINION

GREENAWAY, District Judge.

INTRODUCTION

This matter comes before the Court on the motion of defendants Ford Motor Company ("Ford") and its German subsidiary, Ford Werke A.G. ("Ford Werke") (collectively "Defendants"), seeking to dismiss plaintiff Elsa Iwanowa's ("Iwanowa" or "Plaintiff") Complaint, pursuant to Federal Rule of Civil Procedure 12(b)(1) and 12(b)(6). Before this Court ruled on the above-mentioned motion, Defendants filed a second motion to dismiss on the grounds of nonjusticiability and international comity. This Court shall consider each of Defendants' motions.

This action arises out of Iwanowa's allegations that Ford Werke coerced her, and thousands of other persons, to perform forced labor under inhuman conditions during World War II without compensation.1 The Complaint asserts causes of action against Defendants (1) for restitution/unjust enrichment and quantum meruit/quasi-contract under Michigan and Delaware law2; (2) for restitution/unjust enrichment under German law; and (3) for violations of the law of nations. Iwanowa seeks disgorgement of all economic benefits which have accrued to Defendants as a result of her forced labor, compensation for the reasonable value of her services and damages for the inhuman conditions Ford Werke inflicted upon her.

For the reasons set forth below, Defendants' motion to dismiss the claims under international law for lack of subject matter jurisdiction, pursuant to Rule 12(b)(1), is denied. Defendants' motion to dismiss all of the claims, pursuant to Rule 12(b)(6), is granted. Defendants' motion to dismiss on the grounds of nonjusticiability and international comity is also granted. Accordingly, the Complaint is dismissed in its entirety, with prejudice.3

BACKGROUND4
NAZI GERMANY

Ford established its German subsidiary, Ford Werke, in 1925. (Compl. ¶ 6.) In 1931, Ford Werke moved its headquarters and manufacturing plant to Cologne, Germany. (Id.) Ford Werke's Cologne plant produced passenger vehicles until 1938, when it began manufacturing tracked vehicles for the German government to be used to transport troops and military equipment during World War II. (Compl. ¶ 11.) By 1941, Ford Werke had ceased production of passenger vehicles and had begun to devote its entire production capacity to the manufacture of military trucks. (Id.) The Complaint alleges that Ford Werke produced approximately sixty percent (60%) of the three-ton tracked vehicles the German army used during World War II. (Id.)

By December, 1941, the German National Socialist Party (the "Nazis")5 had achieved domination over territories, in Europe and elsewhere, with an aggregate population of 350,000,000 people. (Compl. ¶ 8.) The Nazi juggernaut required more labor than the voluntary labor the German people could provide. (Id.) In order to support its war effort, the Nazi regime turned to unpaid, forced labor. (Id.) Specifically, the Nazis used forced labor from the captive population, inmates of concentration camps and prisoners of war. (Id.)

On March 21, 1942, the Nazi Party appointed Fritz Sauckel ("Sauckel") as Nazi Plenipotentiary General for the Allocation of Labor, with explicit authority over all available manpower, including workers recruited from abroad and prisoners of war. (Compl. ¶ 9.) After Sauckel's appointment, the Nazi regime obtained forced laborers by conducting manhunts in the streets, movie houses and churches. (Id.) The Nazi regime forcibly deported over 7,500,000 persons from occupied territories to Germany to support its war effort. (Id.)

Sauckel encouraged German industries to bid for forced laborers in order to meet production quotas and to increase their profits. (Id. ¶ 10.) The Complaint alleges that Ford Werke began utilizing French prisoners of war as forced laborers in 1941 and continued utilizing thousands of forced laborers throughout World War II. (Id.) The Complaint further alleges that by 1942, unpaid, forced laborers comprised twenty-five percent (25%) of Ford Werke's work force. (Id.) By 1943, that percentage had risen to fifty percent (50%), where it remained until the end of the war. (Id.) The forced laborers at Ford Werke's Cologne plant included French prisoners of war; Russian, Ukrainian, Italian and Belgian civilians; and concentration camp inmates from Buchenwald. (Id.)

The Complaint alleges that Ford Werke profited from the use of forced laborers because, although it paid the Nazi government for its use of the prisoners, it did not compensate the laborers for their work. (Compl. ¶ 12.) Consequently, Ford Werke's annual profits doubled between 1939 and 1943. (Id.) The Complaint further alleges that Ford Werke placed its wartime profits in a growing reserve account or reinvested them in the company through the building of additional production capacity. (Id.) In the years succeeding the war, as a result of its economic reserves and increased production capacity, Ford Werke continued producing trucks at a substantial profit, even though most of Europe, and specifically the German economy, was devastated. (Id. ¶ 14.) Iwanowa alleges that Ford Werke's internal reserves and large production capacity resulted from the work of unpaid, forced laborers. (Id.)

In addition to bringing suit against Ford Werke, Iwanowa has also named Ford, Ford Werke's parent company, as a defendant. Ford is a party based on its ownership of between fifty-two percent (52%) to seventy-five percent (75%) of Ford Werke's outstanding shares during World War II. (Id. ¶ 15.) Although the Nazi party nationalized or confiscated many American companies in Germany, the Nazis did not confiscate Ford Werke as enemy property; instead, the Nazis allowed Ford to continue its controlling ownership of Ford Werke. (Id. ¶¶ 16-17.) Indeed, the Nazis named Robert H. Schmidt ("Schmidt"), Ford Werke's CEO, Wehrwirtschaftsfuehrer, meaning Military Economic Leader. (Id. ¶ 17.) In addition to his duties as Military Economic Leader, Schmidt continued to manage Ford Werke on Ford's behalf until the end of the War. (Id.)6

IWANOWA

Plaintiff Iwanowa was born in 1925, in Rostov, Russia. Starting in November, 1941, the Nazi army occupied Rostov. (Compl. ¶ 24.) In June, 1942, the Nazi army began abducting adolescents as young as fourteen (14) years of age for transportation to Germany as forced laborers. (Id.) On October 6, 1942, Nazi troops abducted Iwanowa and transported her to Germany with approximately 2,000 other adolescents. (Id. ¶ 25.) When Iwanowa arrived in Wuppertal, Germany, a representative of Ford Werke purchased her, along with thirty-eight (38) other adolescents from Rostov. (Id.) Ford Werke's representative had Iwanowa, and the other adolescents, transported to Ford Werke's plant in Cologne. (Id.) Once in Cologne, Ford Werke placed Iwanowa with approximately sixty-five Ukrainian deportees in a wooden hut, without heat, running water or sewage facilities. (Id.) They slept in three-tiered bunks without bedding and were locked in at night. (Id.)

From 1942-1945, Ford Werke required Iwanowa to perform heavy labor at its Cologne plant. (Id. ¶ 26.) Iwanowa's assignment consisted of drilling holes into the motor blocks of engines for military trucks. (Id.) Ford Werke security officials supervised the forced laborers, at times using rubber truncheons to beat those who failed to meet production quotas. (Id.)

Iwanowa continued to perform forced labor for Ford Werke until 1945, when the victorious Allied Powers7 liberated her, and thousands of other slave laborers, in 1945. After the War, she became a citizen of Belgium, where she presently resides. Ford Werke's forced laborers, including Iwanowa, have never received compensation for their years of forced labor. (Id. ¶ 27.)

On March 8, 1998, Iwanowa filed the instant suit on her own behalf and on behalf of a class of thousands of persons who were compelled to perform forced labor for Ford Werke between 1941-1945. Iwanowa seeks compensation for the reasonable value of her services, restitution of unjust enrichment flowing to Defendants, as a consequence of her labor, and damages for the pain and suffering that Defendants' imposition of inhuman working conditions caused her.

Defendants moved to dismiss on the grounds that (1) this Court lacks subject matter jurisdiction over the claims under the law of nations; (2) all of the claims are barred by the applicable statute of limitations; (3) the Complaint fails to state a cognizable cause of action; (4) the claims are nonjusticiable; and (5) consideration of the instant claims would violate principles of international comity. This Court heard oral argument on Defendants' motions on March 8, 1999 and August 5, 1999.

DISCUSSION
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