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The U.S. Supreme Court’s decision last week on the retroactivity of the Foreign Sovereign Immunities Act appears to have doomed a suit by Holocaust victims and their heirs for damages against a French railroad company whose trains transported tens of thousands of people to the Nazi death and slave labor camps. Monday, the Court accepted certiorari in Abrams v. Societe Nationale Des Chermins De Fer Francais, then remanded the case to the 2nd U.S. Circuit Court of Appeals in light of last week’s Republic of Austria v. Altmann. In Altmann, the Court gave hope to Maria Altmann, the heir of an Austrian art collector who had six Gustav Klimt paintings seized during the Nazi era. The Court found that plaintiffs may bring claims for actions that predated the passage of the Foreign Sovereign Immunities Act in 1976, in part, because the expropriation of the paintings is considered a continuing violation under the act. But the retroactivity of the act cut the other way for the plaintiffs in the French railroad case, which is an action in tort and does not involve expropriation. Eastern District of New York Judge David Trager had initially dismissed the suit, saying the railroad was an “agency or instrumentality of a foreign state” under the act, 28 U.S.C. �1603(b), and that the plaintiffs’ claims did not fall within any of the act’s exceptions. The 2nd Circuit reversed, with Judge Richard J. Cardamone saying the circuit needed “to resolve the question of whether that Act’s application to plaintiff’s causes of action would be impermissibly retroactive.” Cardamone noted that the Supreme Court had employed a “general presumption against retroactivity” in statutes, but that Congress has not “clearly expressed its aim” that the Foreign Sovereign Immunities Act applies to events before its enactment. Remanding the case to Trager for further discovery on what the U.S. State Department’s position on sovereign immunity may have been at the time of the injury, Cardamone noted that a finding that the law applied retroactively would “effectively extinguish plaintiffs’ causes of action.” That result now appears almost certain in light of the Altmann decision, a lawyer for the railroad said Monday. Professor Andreas F. Lowenfeld of the New York University School of Law said that, following the 2nd Circuit ruling, he filed a petition for certiorari arguing that further discovery before Trager into the State Department’s position on immunity in the 1940s “is an improper inquiry.” “Congress wanted the State Department to get out” of the business of offering opinions on immunity, he said, “and in any event, you can’t run the film backwards.” “In Altmann, which arguably opened the door to an expropriation claim that couldn’t be brought before, that was good for the plaintiffs, so Ms. Altmann may get her paintings back,” he said. “But for my case, it’s the other way around.” Unlike the case of the French railroad, the U.S. Supreme Court’s ruling in Maria Altmann’s case may bode well for the two other Holocaust-era cases remanded to the 2nd Circuit Monday, Austria v. Whiteman, 02-9361, and Garb v. Republic of Poland, 02-7844. Both cases also involve Holocaust-era expropriations. They also were remanded by the 2nd Circuit to determine the Department of State’s policy before the enactment of the law with respect to sovereign immunity for Poland and Austria. The plaintiffs in Abrams say they hope to distinguish Altmann from the facts of their case. Unlike the Whiteman and Garb cases, in which the government is being sued, they say they are suing a part of a government that engages in commercial activity — one that therefore falls within the “separate entity” exception to sovereign immunity that was recognized prior to the passage of the law. “We are the only lawsuit that has been brought against a private entity,” said attorney Harriet Tamen. “The other Holocaust cases have been against governments. Congress was intending to limit and narrow immunity, not grant more,” when it passed the Foreign Sovereign Immunities Act. Tamen’s co-counsel, Malvina Halberstam of the Benjamin N. Cardozo School of Law, said it makes no sense to interpret the act as destroying the separate entity exception. Halberstam said she believed that Congress “inadvertently omitted” the separate entity exception when it passed the act. Lowenfeld said he did not know whether the circuit will send the case back to Trager or ask for additional briefs and arguments. “They might simply say that we were wrong to reverse and Judge Trager was right all along,” he said.

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