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Behind the Headlines: Principals Struggle to Interpret Judge’s Ruling in Nazi Labor Case

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Hopes persist that Nazi-era slave and forced laborers will receive German compensation funds starting in July, despite conflicting views about the latest decision by a U.S. judge whose previous rulings delayed payments from the fund.

In a dramatic reversal of her earlier rulings, Judge Shirley Wohl Kram last week dismissed class-action lawsuits that had been preventing payments from a $5.2 billion fund Germany created to compensate the former laborers.

German officials have been unwilling to release the cash until their lawyers can ensure “legal closure” – that is, a promise that no more lawsuits relating to the Nazi era will be filed.

When Kram, who had been hearing such lawsuits, dropped the cases May 10, German officials initially believed she had granted legal closure, enabling the German Parliament to approve payouts from the compensation fund before going on summer break July 7.

But by the weekend – after they had read the judge’s order – German officials were complaining about wording they said could force them to use the fund to pay out claims in Austrian cases as well.

According to advocates for the laborers, however, German officials are raising new hurdles in order to postpone the payments.

But the officials contend that if Germany does not extend the slave labor fund to cover Austrian cases, the lawsuits before Kram could be reinstated.

These concerns prompted the officials to predict further delays before payments from the fund can begin.

“Whoever says they don’t see assumptions or conditions” in the judge’s decision “is not able to read, or not willing to read,” said Wolfgang Gibowski, spokesman for the German firms that contributed to the fund.

The timing of the first payouts may now hinge on a U.S. appeals court hearing slated for this week. That court could force Kram to alter her decision in order to satisfy German concerns.

At a news conference in Berlin on Monday, Otto Graf Lambsdorff, the German government’s chief negotiator for the fund, said payments could begin this summer – if the appeals court removes all conditions from Kram’s decision.

Meanwhile, lawyers and others advocating on behalf of the former laborers claim there is nothing in Kram’s May 10 ruling that imposes new conditions on the German government or on German businesses, which jointly created the slave labor fund in February 1999.

All legal claims against Germany “have been dismissed,” Konrad Matschke, the spokesperson in Germany for the Claims Conference, said Monday after reading the Kram decision. The conference was among the groups that negotiated on behalf of the laborers.

“Our point of view is that the German Parliament can confirm legal closure now,” he said.

Matschke said the Claims Conference soon would present its point of view to German legislators, who are due to decide later this week whether requirements for legal closure have been met.

German legislators have received a letter from Lothar Evars, director of the Dusseldorf-based Federation for Information and Support for the Survivors of Nazi Persecution, similarly confirming legal closure.

Evars said he is only “50 percent sure” that the July 7 deadline will be met for releasing funds.

“Industry would like to get more time, and the best way is to pretend the cases are not closed,” Evars said.

The German government and a group of German businesses agreed in February 1999 to create the $5.2 billion fund to compensate slave and forced laborers.

Under the terms of an agreement reached in March 2000, some 240,000 slave laborers – about 140,000 of whom are Jewish – would receive up to $7,500 each. More than 1 million forced laborers would get up to $2,500 each.

People whose property was looted by the Nazis, who were victims of Nazi medical experiments or who hold unpaid Holocaust-era insurance policies also may claim payments.

As German officials debate whether to go ahead with payments, advocates for the laborers say the elderly potential recipients from the fund are dying every day.

Petra Rosenberg, director of the Berlin branch of a group representing Gypsies – who are among those eligible for payments – said 10 percent of those who filed applications through her office since last February have died.

In one case, she said, children were told they could apply for payments owed to their deceased mother.

Because of the frequent delays, however, “they said they did not want to have anything to do with” the fund, Rosenberg said.

German industry “profits still today” as the former laborers fall ill and die, she said.

According to the president of the lower house of Parliament, Wolfgang Thierse, the compensation fund is earning “six-figure interest daily,” while more survivors are dying.

He urged legislators to keep this in mind when they debate whether to go ahead with payments.

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