There is a solution to get us beyond the seemingly endless stalemates and complications that continue to characterize the ongoing debate over Holocaust-era insurance claims. And I do not believe it can be found in the well-intentioned bill before the US Congress. This different approach will put money more quickly into the community of the survivors and their families, minimize huge financial rewards for certain lawyers, and help bring closure to this extremely painful process.
I propose that the relevant insurance companies agree to the appointment -- at their expense -- of an independent monitor who could determine whether all potentially valid but as yet unresolved Holocaust-era claims are being honestly processed under the relaxed standards of the International Commission on Holocaust Era Insurance Claims, or ICHEIC.
Some history of how we arrived at this point is in order.
For more than 50 years after the end of World War II, many German and other European insurance companies refused to honor life insurance policies that they or their predecessors had sold to Jews who eventually perished in the Holocaust. In 1998, the National Association of Insurance Commissioners joined with a number of such insurance companies and representatives of Jewish and survivors organizations to create ICHEIC. Its mandate was “to identify, settle, and pay individual Holocaust era insurance claims at no cost to claimants.”
ICHEIC applied relaxed standards that allowed individuals to file claims without documentation such as a policy number or even the name of the company they believed to have issued a policy. The insurance companies were given assurances backed by both the Clinton and Bush administrations that their participation in ICHEIC would insulate them from civil suits in U.S. courts.
According to its website, ICHEIC distributed US$ 306 million “to more than 48,000 Holocaust survivors, their heirs, and the families of those who did not survive."
The process was not without problems. There are survivors who argue, with some justification, that their claims were not properly considered, although the number of such remaining open claims is in sharp dispute. As a result, Congress is now considering a bill that would enable these survivors to resolve their grievances in US federal court. But the proposed legislation is unlikely to accomplish its intended laudable purpose. The aggrieved survivors generally do not know which insurance company may have issued a policy to a family member and/or do not have other specific information regarding such a policy. If lawyers are telling them they can prevail without any proof of their claims in a litigation that must satisfy the exacting standards of the Federal Rules of Evidence, such advice, to put it mildly, is unduly optimistic.
Also, the principal beneficiaries of past Holocaust-era litigations have indisputably been the plaintiffs’ lawyers. For example, in 2001 lawyers pocketed more than US$ 59 million in legal fees from the multibillion-dollar slave and forced labor settlement with German corporations. The surviving slave laborers themselves – mostly Jews and Sinti-Roma – received about US$ 7,500 each; forced laborers – primarily Eastern Europeans forced to work in Nazi war factories – received approximately US$ 2,500 apiece. One especially egregious lawyer profiteered from the slave labor and Swiss banks settlements to the tune of more than US$ 7.4 million.
In 2005, a federal judge in Florida awarded three law firms an aggregate US$ 3.85 million in fees and expenses out of the US$ 25.5 million “Gold Train” settlement of a litigation for the looting by US Army personnel of property belonging to Hungarian Jews. Thirty-four named plaintiffs received “incentive” payments of US$ 2,000 or 5,000 apiece, with the bulk of the settlement going for social services for needy Hungarian Holocaust survivors.
You see the pattern. While survivors receive, at most, a few thousand dollars each, their lawyers walk away with millions.
Lawyers promoting the new Holocaust insurance bill in Congress most probably have already collected names of potential plaintiffs and plan to bring suit on their collective behalf in the hope of being awarded hundreds of thousands, if not millions of dollars, in yet another settlement.
The proposed bill also risks raising unrealistic expectations. After ICHEIC was formally dissolved in March 2007, the German insurance companies agreed to continue processing Holocaust-era claims under ICHEIC’s relaxed standards. Yet the German Insurance Association reports only 219 inquiries regarding such claims in the past five years. That’s led to the identification of only 102 policies, 60 of which had previously been disposed of.
It seems doubtful that thousands or even hundreds of additional policies will now be suddenly discovered. Hence my suggestion that the relevant insurance companies be asked to agree to an independent monitor, a person who would determine whether all potentially valid but as yet unresolved Holocaust-era claims are being honestly processed under the relaxed ICHEIC standards.
The monitor, who should have the confidence of Congress and the survivor community, should be authorized to examine claims that ICHEIC supposedly disposed of in violation of its own rules. The monitor should report to Congress periodically on the status of all open or disputed claims. If the insurance companies reject such a compromise, or if the monitor were to find one or more of these companies to be recalcitrant, congressional action could then loom as a final remedy.
There is precedent for such oversight. Ambassador J.D. Bindenagel, the US State Department’s special envoy for Holocaust issues in the Clinton and Bush administrations, recently pointed out to the Senate Judiciary Committee that the New York Holocaust Claims Processing Office is mandated to report on the insurance companies’ processing of survivor claims and has done so. To date, it appears that all such claims have been handled appropriately.
We need a new path. Our collective challenge must be to at least try to provide, in the words of New York Senator Charles Schumer, an actual and viable “approximation of justice” for Holocaust survivors and their families. This proposal may be able to accomplish just that.
This opinion piece by the World Jewish Congress General Counsel Menachem Z. Rosensaft was first published by the 'Jewish Telegraphic Agency' (JTA) on 28 June 2012.
