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Holocaust survivors may continue to press their claims against French banks for looting assets, after a New York federal judge denied motions to dismiss two class actions. Eastern District Judge Sterling Johnson Jr. said in a 44-page opinion that federal courts in the United States have jurisdiction to address claims arising under customary international law. He also said that the class actions will not deter the French government’s investigation of the banks’ role in stealing the assets of Jews in France during the Nazi occupation and Vichy regime. In two class actions, consolidated as Bodner v. Banque Paribas, 97 CV 7433 (SJ), plaintiffs seek damages, an accounting and recovery of cash, records, art, jewelry, securities and other property allegedly wrongfully taken from them and their family members. They are also seeking punitive damages for the unlawful seizure of assets and for the unjust enrichment of the banks in retaining the assets over the past 50 years. The plaintiffs in one case are U.S. citizens, and the plaintiffs in the other are foreign nationals pressing their claims under the federal Alien Tort Claims Act. The defendants are 10 financial institutions implicated in carrying out the alleged seizure of assets. The claims in both class actions arise from identical facts, the court said. The French banks aided and abetted wholesale violations of international law during the period of World War II, the plaintiffs allege. And after the war, the defendants refused to return ill-gotten assets, enriched themselves with profits and concealed information about the looted property, the plaintiffs say. The defendants, French banks and successor institutions, sought dismissal of the class actions, arguing that the plaintiffs lacked standing to sue, and that there was no federal subject matter jurisdiction since all of the alleged wrongdoing occurred outside of the United States. The defendants also argued that the court should dismiss the lawsuits to preserve comity with actions of the French government, and that the New York forum was not convenient for the litigation. Judge Johnson rejected all of the reasons proffered for dismissal. Three commissions were set up by the French government to investigate the role of French banks in unlawfully taking the assets of French Jews during the occupation and Vichy regime, and defendants said that the U.S. case should be abandoned in the interest of comity with these investigations. But Judge Johnson declined to dismiss the case on those grounds, holding that there is no conflict between the French investigations, and that the commissions are not primarily designed to address individual claims against the banks. “There is no pending litigation in France, nor is the Court aware of any current law or policy of the French government which could either supplant or fully redress plaintiffs’ claims,” Judge Johnson said. The French government has not acted on any recommendations of the commissions, and the investigating bodies “were never charged with providing comprehensive remedies to an aggrieved class,” the judge said. Discovery in the Eastern District class action, Judge Johnson added, can be a complement to the information-gathering of the French government. The court also brushed aside defense arguments that the wrongdoing alleged by the plaintiffs was an “Act of State,” which cannot be judged by a U.S. court. The acts of the Vichy regime, which authorized the looting of assets held by French Jews, were rejected and repudiated by the legitimate French government after the liberation of France. Moreover, Judge Johnson reasoned, the wrongdoing alleged by the plaintiffs outlasted the Vichy regime, and it was in violation of postwar French law requiring that looted assets be returned to their proper owners. Defendants also said there was no federal subject matter jurisdiction in the case, since unlawful takings of assets constitute claims under state law. But Judge Johnson concluded that the federal courts had subject matter jurisdiction in the case because the complaint raised allegations of violations of longstanding principles of international law. Such principles, the court said, are part of federal common law. The court also turned aside defendants’ objection to standing. Plaintiffs have made competent allegations of a vast conspiracy in the French banking industry to deprive Jews of their assets, the judge said. They have also properly alleged that they are survivors of the period in question who owned personal property that was stolen, or whose parents owned such property, the judge said. While further discovery may be required to determine standing, the only objections to standing lodged by the defendants are “anecdotal.” The objections “have not vitiated plaintiffs’ standing and, in fact, only further establish the importance of thorough discovery in the case,” Judge Johnson wrote. “The court concludes that a conspiracy by the defendants has been pleaded properly and that the individual named plaintiffs have standing to sue even those banks with which named plaintiffs did not allege specific transactions.” New York lawyers representing the plaintiffs in the twin cases are: Kenneth F. McCallion, Thomas A. Dubbs and H. Rajan Sharma, of Goodkind Labaton Rudoff & Sucharow; Roy H. Carlin; Harriet Tamen; Elizabeth Cabraser and Michael Ratner, of Lieff, Cabraser, Heimann & Bernstein; Melvyn Weiss and Joseph Opper, of Milberg Weiss Bershad Hynes & Lerach; the Law Offices of Curtis Trinko; and Thomas A. Holman, of Starr & Holman. Washington, D.C., lawyers Michael D. Hausfeld and Paul T. Gallagher, of Cohen, Milstein, Hausfeld & Toll and Indianapolis-based Irwin Lewin and Richard Shevitz, of Cohen & Malad, are also plaintiffs’ counsel in the cases. Defense counsel in the cases are Frederick T. Davis, of Shearman & Sterling, for six French banks, Banque Paribas, Credit Lyonnais, Societe Generale, Credit Agricole, Banque Indosuez and Natexis; Owen C. Pell, of White & Case, for Credit Commercial de France and Chase Manhattan Bank; Floyd Abrams, of Cahill Gordon & Reindel, for Barclay’s Bank and J.P. Morgan; and Robert Stephenson, of the Chase Manhattan Legal Department for Chase Manhattan.

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