Simon v. Republic of Hung.
| Docket Number | 22-7010,22-7013,22-7112 |
| Decision Date | 08 August 2023 |
| Parties | Rosalie Simon, et al., Appellees v. Republic of Hungary and Magyar Allamvasutak Zrt., (MAV ZRT.), Appellants |
| Court | U.S. Court of Appeals — District of Columbia Circuit |
Argued April 18, 2023
Appeals from the United States District Court for the District of Columbia (No. 1:10-cv-01770) (No. 1:21-cv-01739)
Gregory Silbert argued the cause for defendants-appellants/cross-appellees Republic of Hungary, et al. With him on the briefs was Konrad L. Cailteux.
L Marc Zell and David H. Weinstein argued the causes for plaintiffs-appellees/cross-appellants Rosalie Simon, et al and Steven Heller, et al. With them on the briefs were Noam Schreiber, Charles S. Fax, Liesel J. Schopler, and Paul G. Gaston.
Andrew D. Freeman and Anthony J. May were on the brief for amicus curiae Professor Vivian Grosswald Curran in support of plaintiffs-appellees/cross-appellants.
Before: PILLARD and CHILDS, Circuit Judges, and RANDOLPH, Senior Circuit Judge.
Opinion for the Court filed by Circuit Judge PILLARD and Circuit Judge CHILDS.
These two consolidated cases arise out of the Hungarian government's confiscation of property owned by Jews during the Holocaust. "Nowhere was the Holocaust executed with such speed and ferocity as it was in Hungary." Simon v. Republic of Hungary, 812 F.3d 127, 133 (D.C. Cir. 2016) ). In 1944, as World War II neared its end, the Hungarian government implemented an accelerated campaign to exterminate its remaining Jewish population. Within a matter of months, the government systematically executed over half a million Jews-roughly two-thirds of the Jewish population in Hungary at the war's outset. This state-perpetrated genocidal campaign ranks among the greatest crimes in human history.
The questions raised by these appeals bear on whether survivors of the Hungarian Holocaust may hale the Hungarian government and its instrumentalities into United States courts to answer for a subset of the wrongs they committed-namely, their confiscation of property from victims of the Holocaust. The plaintiffs invoke the Foreign Sovereign Immunities Act's expropriation exception as a means to pierce the Hungarian state's sovereign immunity and assert jurisdiction in federal district court. Defendants object that the exception is inapplicable.
In the first of the two cases consolidated before us, Simon v. Republic of Hungary, fourteen survivors of the Hungarian Holocaust sue the Republic of Hungary and one of its agencies, Magyar Allamvasutak Zrt., seeking compensation for the seizure of their property during the Holocaust. The litigation in Simon is long running, and we have reviewed appeals in the case twice before. In the second case, Heller v. Republic of Hungary, two Holocaust survivors more recently sued for compensation from Hungary for property confiscated from their late parents and grandparents during the war.
Cognizant of the Supreme Court's recent holding that "a country's alleged taking of property from its own nationals" generally falls outside the scope of the Foreign Sovereign Immunities Act's expropriation exception, Fed. Republic of Germany v. Philipp, 141 S.Ct. 703, 708 (2021); see id. at 715, the plaintiffs in these suits assert they were not Hungarian nationals at the time of the takings at issue. They instead claim that they were either stateless or Czechoslovakian nationals. The district court dismissed the claims of the plaintiffs asserting statelessness but concluded that most of the plaintiffs asserting Czechoslovakian nationality could proceed.
We largely affirm. Like the district court, we conclude that the plaintiffs claiming statelessness-Zehava Friedman, Vera Deutsch Danos, Steven Heller, and Charles Heller-have not made out a recognized claim within a Foreign Sovereign Immunities Act exception. Assuming without deciding that those plaintiffs were de facto stateless at the time of the alleged takings, as they claim, the plaintiffs have nevertheless failed to identify adequate affirmative support in sources of international law for their contention that a state's taking of a stateless person's property amounts to a taking "in violation of international law" within the meaning of the Foreign Sovereign Immunities Act. 28 U.S.C. § 1605(a)(3). We do not foreclose the possibility that such a takings claim might prevail if grounded in sources of international law not before us or based on arguments not raised here. But on this record, we affirm the district court's dismissal of those four plaintiffs' claims.
We likewise affirm the district court's denial of the defendants' motions to dismiss the claims of some of the plaintiffs asserting Czechoslovakian nationality, with a few exceptions. The district court correctly determined that four of those plaintiffs-Magda Kopolovich Bar-Or, Yitzhak Pressburger, Alexander Speiser, and Moshe Perel-had plausibly alleged they were Czechoslovakian nationals at the time of the takings. As for the five Lebovics sisters, the district court should have dismissed their claims, along with those of Tzvi Zelikovitch and Ella Feuerstein Schlanger, for failure to plausibly allege Czechoslovakian nationality. We direct that those dismissals, however, be without prejudice to the opportunity of any of those plaintiffs to amend in the event they can cure the identified defects in their nationality allegations.
In reaching this conclusion, we reject the Hungarian defendants' arguments that the plaintiffs are judicially estopped from asserting Czechoslovakian nationality and that, even assuming they were Czechoslovakian at the time of the takings, the Foreign Sovereign Immunities Act's treaty exception bars their claims. We also reject the plaintiffs' theory that Hungary's alleged treaty violations enable the plaintiffs to bypass the domestic takings rule.
Hungary and its instrumentality also assert that the plaintiffs' claims of expropriation in violation of international law lack the nexus to commercial activity in the United States that the Foreign Sovereign Immunities Act requires. We remand for the district court to make certain factual determinations regarding that nexus element of the remaining plaintiffs' claims.
All told, the claims of four Simon plaintiffs may proceed, and an additional eight Simon plaintiffs will have the opportunity to amend their pleadings. The district court, however, appropriately dismissed the Heller plaintiffs' claims.
The historical events giving rise to these suits are recounted at length in our first two opinions in the Simon litigation, see Simon v. Republic of Hungary (Simon I), 812 F.3d 127, 132-34 (D.C. Cir. 2016), abrogated in part by Fed. Republic of Germany v. Philipp, 141 S.Ct. 703 (2021); Simon v. Republic of Hungary (Simon II), 911 F.3d 1172, 1176-78 (D.C. Cir. 2018), vacated, 141 S.Ct. 691 (2021) (per curiam), as well as the district court's Simon and Heller opinions, see Simon v. Republic of Hungary (Simon-2021), 579 F.Supp.3d 91, 97-99 (D.D.C. 2021); Heller v. Republic of Hungary, No. 21-cv-1739-BAH, 2022 WL 2802351, at *1-2 (D.D.C. July 18, 2022). Further background is provided here as relevant to the disputes at issue.
We begin with a brief account of Hungary's evolving borders during the early twentieth century and their implications for the nationalities of persons living in affected territory. Prior to World War I, the Austro-Hungarian Empire controlled a significant share of European territory, including parts of modern-day Hungary, Slovakia, and the Czech Republic. At the war's end, however, the Austro-Hungarian Empire was dismembered into several smaller states organized primarily along ethno-linguistic lines. The Kingdom of Hungary, which had been part of the Austro-Hungarian Empire, ceded approximately two-thirds of its territory to newly created states. The territory Hungary retained is often referred to as "Trianon Hungary," in recognition of the treaty that largely defined its borders: the 1920 Treaty of Trianon. Treaty of Peace Between the Allied and Associated Powers and Hungary arts. 27-35, June 4, 1920, S. Treaty Doc. No. 67-348 (1923) (Treaty of Trianon). In that treaty, Hungary also agreed to recognize the independence of a new nation state, Czechoslovakia, in an area that had comprised the northern region of the Austro-Hungarian Empire. See id. art. 48.
As relevant here, two post-war treaties governed the assignment of nationalities to persons in the territories ceded by Hungary to Czechoslovakia. First, the 1919 Treaty of St. Germain required the newly created state of Czechoslovakia to extend its citizenship to most Hungarian nationals who were habitually residing in the territory that became part of Czechoslovakia. Treaty Between the Principal Allied and Associated Powers and Czechoslovakia art. 3, Sept. 10, 1919, S. Treaty Doc. No. 67-348 (1923) (St. Germain Treaty). The St. Germain Treaty also established that "[a]ll persons born in Czecho-Slovak territory who are not born nationals of another State shall" acquire Czechoslovakian nationality. Id. art. 6. Second, the 1920 Treaty of Trianon included parallel provisions granting Czechoslovakian nationality to, and stripping Hungarian nationality from, those who had "rights of citizenship" in the territory that became part of Czechoslovakia, Treaty of Trianon art. 61, subject to certain conditions and exceptions, id. arts. 62-66.
The borders of this newly conceived Czechoslovakian state however, did not last. In 1938 and 1939, on the eve of World War II in Europe, Nazi Germany and Hungary illegally annexed parts of Czechoslovakia. Hungary thereafter sought to re-nationalize persons living...
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