Hungarian Holocaust Suits Don’t Belong in U.S.

CHICAGO (CN) - Claims over the role of Hungary's national bank and railroad in the Holocaust must first go through that country's courts, the 7th Circuit ruled.

The federal appeals court handed down the ruling on Jan. 23, looking at a consolidated appeal of cases dismissed by a federal judge.

Paul Fischer and Michael Albert led the Holocaust survivors and their heirs in the complaints against two Hungarian rail companies, Magyar Allamvasutak Zrt (MAV) and Rail Cargo Hungaria's predecessor, which transported Jews in the spring of 1944 to the Nazi concentration camp at Auschwitz.

Fischer and Albert said those rail companies, along with the Hungarian National Bank and other financial institutions, stripped their human cargo of their possessions and property, which they then sold or liquidated, generating cash for the government treasury that the Hungarian government commingled with other revenues.

In total, the survivors seek to recover $75 billion from the banks, and $1.25 billion from the national railway.

The case was dismissed, however, for failing to exhaust legal remedies in Hungary, and the 7th Circuit affirmed Friday.

"The comity at the heart of international law required plaintiffs either to exhaust domestic remedies in Hungary or to show a powerful reason to excuse the requirement," Judge David Hamilton wrote for a three-person panel. "So long as plaintiffs might get a fair shake in a domestic forum, international law expects plaintiffs at least to attempt to seek a remedy there first."

With three different Hungarian Compensation Acts under which the survivors could make claims in Hungarian courts, the plaintiffs cannot assert that adequate relief is not available there, the court found.

While World War II-era Hungary would not have been a viable forum for pursuing claims of genocide, "we should not presume that the modern regimes replacing them many decades later are unwilling or unable to remedy the wrongs asserted by plaintiffs, absent specific evidence to that effect," Hamilton wrote.

Evidence that anti-Semitism has been on the rise in Hungary for the past three years failed to sway the court that the plaintiffs would be denied a fair judgment.

"Anti-Semitism unfortunately has been on the rise throughout Europe and is also present in the United States," Hamilton said. "But absent governmental policies or other evidence that such discrimination is barring access to or punishing resort to domestic remedies, United States courts should not take the step of hearing these claims without first giving the Hungarian courts a chance to rule on them."

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