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A quest by Miami federal Judge Ursula Ungaro-Benages to recover $1 billion from German banks as compensation for a corporate empire her family lost to the Nazis is meeting stiff opposition from the U.S. government. Justice Department lawyers recently asked U.S. District Judge William Terrell Hodges of the Middle District of Florida to dismiss Ungaro-Benages’ federal lawsuit against Dresdner Bank AG and Deutsche Bank AG. They said her suit undermines American foreign policy interests. Assistant Attorney General Robert D. McCallum Jr. explains the government’s position in court papers filed in the Miami case. He argues the United States supports a sweeping international initiative as the “exclusive remedy for all claims against German companies” arising out of the Nazi era. That initiative is being implemented by Germany’s Remembrance, Responsibility and the Future foundation with about $4.5 billion supplied by Germany and German corporations. “The alternative to the foundation would be years of litigation whose outcome would be uncertain at best, and which would undoubtedly last beyond the expected life span of the large majority of survivors,” the government’s court filings say. “Because of the United States’ strong interests in the success of the foundation, however, and because such success is predicated on the dismissal of this litigation, the United States recommends dismissal on any valid legal ground.” But Ungaro-Benages’ attorney, Lewis N. Brown, a partner at Gilbride, Heller & Brown in Miami, says the government should be ordered to back off because its position is based on an unconstitutional executive order signed by then-President Bill Clinton. On March 8, Ungaro-Benages filed a second Holocaust lawsuit, on behalf of herself and her brother, Peter Ungaro, against a U.S. and a Dutch construction equipment manufacturer that purchased much of Orenstein & Koppel, her family’s former business, in 1998. The suit demands tens of millions of dollars in damages. The original suit against the German banks, filed by Ungaro-Benages alone in Miami last year, alleges that the banks conspired with the Nazis before World War II to loot assets from German Jews, including the judge’s family. The banks have countered with a motion to dismiss, asserting a variety of jurisdictional defenses including a lack of standing on the part of Ungaro-Benages. Judge Hodges, who sits in Ocala, Fla., is presiding over the case in Miami because Ungaro-Benages’ colleagues on the federal bench in South Florida are conflicted. Ungaro-Benages and her brother, Peter, a physician who lives in North Carolina, were raised as Protestants. In 1993, they learned by chance that their maternal grandmother, Lili, was the daughter of a Jewish couple, Benno and Rosa Orenstein, court papers say. It wasn’t until last May, however, that they learned that Benno Orenstein had co-founded the successful equipment manufacturing business Orenstein & Koppel in Germany in 1876. Ungaro-Benages, 51, didn’t return a phone call seeking comment. Why she and her brother knew nothing of her Jewish heritage until so late in life is a mystery, Brown says. Ungaro-Benages’ grandmother, Lili Orenstein Berliner, who with her husband, Max Berliner, left Germany in 1936, never revealed the family’s Jewish heritage before her death in New York in 1972. Despite the Justice Department’s effort to end Ungaro-Benages’ Holocaust lawsuit against the banks, lawyers for the judge haven’t backed down. They’ve filed papers asking Judge Hodges to reject the government’s intervention on the grounds that it’s based on unconstitutional acts signed by Clinton. According to Ungaro-Benages’ second lawsuit, the two companies that purchased her family’s former company knew or should have known that the O&K business they bought “had been stolen from its rightful owners during the Nazi era,” the complaint says. Terex Corp. of Westport, Conn., paid $168 million for O&K Mining. Nine months later, Dutch giant CNH Global N.V. purchased 75.1 percent of the rest of O&K from Fried.Krupp AG Hoesch-Krupp AG. The complaint says that CNH, whose American headquarters is in Lake Forest, Ill., particularly should have known that the business was stolen. New Holland N.V., which merged with Case Corp. to become CNH in 1999, bought its share of O&K from Fried.Krupp, the direct descendent of another family-run company that was Adolf Hitler’s principal armament and munitions supplier. “Our theory of the case is really quite simple — possession of stolen property,” says Brown. “Krupp’s collaboration with the Hitler regime is widely known and well documented,” says the complaint. “New Holland was on constructive notice that any property it purchased from Fried.Krupp after World War II was potentially stolen, Aryanized during the Nazi era.” In separate interviews, CNH spokesman Jeffrey T. Walsh and Terex senior vice president and general counsel Eric Cohen said Ungaro-Benages’ claims are “without merit.” Cohen adds, “Terex has no knowledge, nor did it ever have any knowledge, that the company was Aryanized.” ‘EXCLUSIVE REMEDY’ For Ungaro-Benages, the Terex/CNH lawsuit has one possible advantage over the lawsuit she filed against the German banks. It sidesteps Justice Department foreign policy objections because it doesn’t target German corporations. In 1998, Germany asked for U.S. help to achieve “legal peace” by resolving a string of class action lawsuits regarding slave and forced labor during World War II. The United States, Israel and various European countries then participated in an effort to speed up compensation to aging Holocaust survivors. The foundation resulted from the collaboration. The German government and German companies agreed to capitalize the foundation with about $4.5 billion. Plaintiffs dropped their lawsuits. The United States supported the foundation by recognizing it as the “exclusive remedy” for World War II claims against Germany, and pledged to discourage lawsuits against companies covered by the foundation agreement. Claims are being processed and paid. “The United States has not extinguished the claims of its nationals or anyone else,” says the government’s statement filed in January in the Ungaro-Benages case. “A key point regarding the foundation is that all victims who suffered injury at the hands of German companies, including German banks … are eligible to apply for its benefits. This includes, by definition, the plaintiff in this litigation.” But Brown disputes that. He says Ungaro-Benages isn’t eligible for compensation from the foundation. Her sole recourse, he claims, is the courts because of a rule that disqualifies claimants whose ancestors had the opportunity to bring restitution claims but did not. To buttress its case for dismissal of the judge’s lawsuit, the Justice Department cites other overriding foreign policy considerations. It says the foundation strengthens ties with its “important European ally and economic partner, Germany,” and maintains good relations with both Israel and European nations “from which many of those who suffered” come. Brown counters that U.S. support for the foundation amounts to an unconstitutional giveaway of broader financial responsibilities imposed on Germany by treaties approved earlier by the U.S. Senate. He says Clinton violated the Constitution in signing the executive order that affirmed the foundation agreement. The idea of “full and complete” restitution for Nazi victims has been lost, Brown argues. “Why,” he asks, “was the president shielding German companies from potential liability?”

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