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To Holocaust survivors in South Florida, Miami lawyer Sam Dubbin is a hero who spent six years fighting for fair settlements from Swiss banks that allegedly funneled millions in assets looted by the Nazis. But to a New York federal judge, Dubbin’s years on the case had little or nothing to do with obtaining settlement money for his clients. Indeed, Chief Judge Edward R. Korman of the U.S. District Court in Brooklyn alleged in a ruling last month that Dubbin tried to “extort” the court to obtain a $3.6 million fee. In his March 9 ruling, Korman nixed Dubbin’s request for legal fees, refusing to give him a penny. The ruling has set off fierce recriminations in the longstanding class action suit filed against two Swiss banks in 1997 and consolidated in Brooklyn. The initial $1.25 billion settlement with the banks was announced in 1998. But a dispute over the “looted assets” portion of the settlement — and whether money should be distributed on the basis of the financial need of the survivors — has pitted Jewish and survivor groups from around the world against each other and held up much of the settlement’s distribution. In his ruling on legal fees, Korman took the financial need approach, which was recommended in 2000 by a general master he appointed, New York lawyer Judah Gribetz, as well as the lead plaintiff counsel he appointed, Burt Neuborne, a law professor New York University. Korman approved a settlement formula that grants Holocaust survivors in the former Soviet Union 75 percent of the $205 million in “looted asset” funds. Under the ruling, survivors in Israel were to receive 13 percent and the rest would be divided among survivors in other countries. Survivors in the United States were to get about 4 percent. In justifying the formula, Korman cited the extreme poverty of survivors in the former Soviet Union. In addition, he said, survivors in the United States have a variety of social and financial safety nets that survivors in the former Soviet Union lack. But Dubbin, the only lawyer who has steadfastly opposed what he has called Korman’s “welfare plan,” had asked Korman for an additional $50 million for U.S. survivors to be distributed immediately. Dubbin represents the Holocaust Survivors Foundation, an umbrella group of more than 50 survivor groups around the country. “There is over $670 million under the court’s control right now, sitting in the bank, helping no one other than the bankers,” Dubbin, of Dubbin & Kravetz in Miami, wrote in a motion. “This money is legally and morally the survivors’ money.” Korman rejected the request last month, along with Dubbin’s fee request. In finalizing the needs-based allocation, Korman rejected survey data collected by the United Jewish Communities showing that 25 percent of survivors in the United States — about 3,200 people — live at or below the federal poverty level. He wrote that the Holocaust Survivors Foundation USA and Dubbin lacked standing to bring the objections. Survivor groups and various U.S. Jewish federation organizations note that while the majority of U.S. Holocaust survivors are doing fine, a small group of Holocaust survivors in the country are poor, sick and in need of assistance. Yet only $1.4 million of the $205 million so far has gone to survivors in this country. South Florida has the second-largest group of Holocaust survivors in the country. Dubbin has filed an appeal to the 2nd U.S. Circuit Court of Appeals, challenging both his fee rejection and Korman’s allocation formula. Dubbin declined to comment on the record for this article. But clients and supporters of Dubbin — particularly in Miami — expressed anger about the actions of the judge, a 60-year-old Jew who on one occasion negotiated with the plaintiffs in Yiddish. “This is beyond everything that is decent,” complained David Schaecter, 75, a survivor from Slovakia who serves as president of Holocaust Survivors Foundation USA and now lives in Miami. “Sam has done everything we asked him to do. The judge simply does not believe we have a worthy cause. He feels Jewish people in America are affluent and has dug his heels in. His hatred against Sam Dubbin is fueling this whole thing.” Korman did not return calls for comment. SLAVE LABOR The Swiss banks case is one of a handful of reparation class action cases brought against German and Swiss interests by Holocaust survivors. In one of the biggest cases, the German government agreed in 2001 to a $4.5 billion settlement to be paid to 1 million slave laborers. In the German slave labor case, flat settlements of $5,000 to $7,500 were paid out, and a handful of class action plaintiff lawyers received fees of several million dollars each. The lawyers said the fees were far below their normal class action fees. In 1998, the Swiss banks agreed to pay $1.25 billion to settle claims brought in Brooklyn by Holocaust survivors accusing the banks of holding and failing to pay them for looted assets, bank accounts and for slave labor profits — all deposited by Nazis. The survivors included Jews, homosexuals and gypsies. Korman was charged with the enormous task of allocating the funds; in 1998 he appointed a special master and lead plaintiff counsel to assist. Jewish organizations assisted in locating the victims. But the looted assets portion of the case — which eventually represented about $205 million — was much trickier, since it was assumed that virtually every victim owned assets that had been looted. Gribetz, recognizing that the victim class would be so large in an evenly split allocation that each individual victim would get pennies, recommended that Korman allocate the funds based on the financial needs of survivors in different countries. Korman agreed, and first approved this needs-based allocation in 2000. In his ruling last month justifying the needs-based formula, Korman quoted Dovid Katz, a professor of Yiddish language, literature and culture at the University of Vilnius in Lithuania. “The last elderly Jews of Eastern Europe, whose lives were ruined by the Holocaust, and who choose to live out their days in the towns of their ancestors, are suffering acutely from malnutrition, poverty and lack of medicine, while the millions (or billions) from Germany, Switzerland and the great American Jewish organizations pass them by,” Katz said. Korman also described the survivors in the former Soviet Union as double victims, having survived both the Holocaust and communism. “While the economic plight of survivors in the United States is less well documented, it is also clearly less pressing,” Korman stated. The World Jewish Congress did not oppose either the settlement or Korman’s allocation plan. But American Jewish groups immediately attacked it. Some disputed the contention that U.S. survivors are protected by a social safety net, while others questioned whether Nazi victims living in Russia and other Eastern bloc countries should even be classified as “Holocaust survivors” and whether this distinction should be reserved for those who survived concentration camps. RENO AIDE Dubbin first became involved with the litigation after the initial settlement with the Swiss banks was announced in 1998. Dubbin was deputy attorney general for policy development in the U.S. Department of Justice under Attorney General Janet Reno and served as chief counsel for the National Highway Traffic Safety Administration. Dr. Thomas Weiss, a founding member of the Holocaust Survivors Foundation, initially hired him. Weiss, whose father was wealthy before the Nazis sent him to Auschwitz, was the driving force behind the lawsuit. The Holocaust Survivors Foundation is a 10-person executive committee representing 50 survivor groups. Those groups, in turn, represent an estimated 20,000 survivors around the country. Dubbin was hired by the Holocaust Survivors Foundation USA in 2000 to file an appeal of the settlement and later the allocation plan. But the group dropped its appeal, according to Dubbin and several members, after Korman, in a phone conference in May 2001 with 19 survivor leaders, pleaded with them in Yiddish to do so. “He said we would be doing the biggest mitzvah [good deed], and that if we did this he would take care of us later. He promised,” David Schaecter said. The foundation, represented by Dubbin, also criticized a provision in the original settlement that would have released Swiss businesses from liability other than the three named insurance companies in the suit. That provision was later abandoned. But Korman said in his ruling last month that the deletion of the provision was in no way caused by the efforts of Dubbin or Weiss. The problems with that provision began to be revealed when the Washington state insurance commissioner submitted a timely objection to the court in October 1999, the judge said. Dubbin and his client had submitted untimely papers concerning the provision, the judge said, and contributed little of value at a subsequent fairness hearing. “All told, Dubbin had a hand in submitting two things relevant to the insurance releases in this case: Five minutes of redundant and irrelevant testimony at a fairness hearing, and a three-month-late objection to the settlement agreement,” Korman wrote. “Neither of these actions required new research, shed new light on the issues in this lawsuit, or added anything to the work of Dr. Weiss, who no longer seeks a fee. In short, they were worthless.” “This was beyond the pale,” Korman wrote. “I was not going to be blackmailed, particularly with funds that belong to Holocaust survivors.” By withdrawing his fee request, Korman said, Weiss had come to recognize that his research into the Swiss banking industry’s ties to the Holocaust had no impact on the Swiss settlement. “Mr. Dubbin,” Korman wrote in In Re: Holocaust Victim Assets Litigation, “has not.” Neuborne, who reviewed fee requests by the attorneys in the case, had offered a more positive assessment of Dubbin’s work, according to Korman’s ruling. Neuborne said it had been helpful in reassessing the insurance releases and exploring the possibility of health care for survivors. He added, however, that neither initiative appeared “likely to confer a benefit” on the plaintiffs. Korman said he respected Neuborne’s judgment but felt his view of Dubbin was “overly generous.” Dubbins called the judge’s accusations “incorrect and unjustified.” “The so-called blackmail was Dr. Weiss’ belief that it would serve the interests of the survivor class for settlement funds to be used to create an institute [to] examine the theft of assets by the Swiss in proper detail, which had not up to that time occurred,” Dubbin wrote. “They had an honest disagreement about the situation, and the appeal went forward.” Neuborne, the plaintiffs’ lead counsel, said in an interview that although he has waived his legal fees in the case, he “didn’t have a problem” with Dubbin’s fee request. Neuborne himself has come under criticism for his fees in the slave labor case against the German government. In 2001, he took a $4.4 million fee in that settlement. He said he only took that fee because it did not come out of the plaintiffs’ recovery and was separate. Dubbin disputes this notion and says it came from the same pot. Observers noted that while Neuborne and the 10 other lawyers each received several million dollars, the plaintiffs were to receive no more than $7,500 each. In comparison, attorney fees in the Swiss banks settlement that have been approved since 2000 have been relatively low. About $5.3 million in total fees have been approved, amounting to 0.4 percent of the settlement. Four of the 10 attorneys on the case’s executive committee worked pro bono or have donated their fees to charity. ‘MISGUIDED AND UNFAIR’ In South Florida, Jewish philanthropic leaders and Holocaust survivors are sharply critical of both Korman’s refusal to grant Dubbin fees and his needs-based allocation formula. They say Dubbin insists on paying his own way on trips to hearings in New York. “I think he’s [Sam] entitled to his fee,” said Ezra Katz, president of the Greater Miami Jewish Federation. “Sam has worked very, very hard for more than five years.” “Korman was totally misguided and unfair in his personal remarks at Sam,” said Norman Braman, former president of the Jewish Federation of Miami and chair of the Holocaust Memorial Committee. “Sam has given years of his life for an equitable settlement. His fee was reasonable. Sam’s become a hero to the survivors in South Florida.” Schaecter accuses Korman of authorizing the use of some of the funds to build Holocaust memorials in Latvia and Lithuania “where there are no Jews left,” he said. “Let [Korman] be a philanthropist with his own money,” he said. Critics of the ruling also argue that while the majority of U.S. survivors are not in financial need, there are needy survivors in this country, particularly in Florida, which ranks 49th among the states in social services. “In some ways it’s a regional issue,” said David Saltman, chief executive of Jewish Community Services of South Florida, the main social service agency for Jews in Miami. “In Florida, the safety net is much smaller than in other states.” JCS estimates that there are between 9,000 and 11,000 Holocaust survivors in South Florida. JCS has a policy that it will provide basic social services — housing, food and a minimum amount of home health care — to Holocaust survivors if they need it. “We scrape and scrounge for money to be able to do this,” Saltman said. “Still, I know we’re not providing survivors with adequate support here.” David Paikin, senior vice president of the United Jewish Community of Broward County, who wrote a letter of support for Dubbin to Korman, estimates that 5,000 to 10,000 survivors live in Broward and that up to 230 need extra home health care. Medicare and Medicaid provide only limited coverage for home health care. The Greater Miami Jewish Federation has raised private funds to take care of needy Holocaust survivors in the last years of their lives. The federation, which has declined to take an official position on Korman’s ruling or Dubbin’s appeal, is encouraging other Jews to take care of survivors in need, Katz said. “We were all hopeful that the Swiss bank settlements would help the survivors,” Katz said. “Some are living in terrible, terrible conditions. People are dying. We can’t sit around and wait until all the appeals are made.”

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