Nazi-Era Laborers Litigate For Interest on Reparations

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The New York Sun

More than six years after a consortium of German companies agreed to pay more than $2 billion to Nazi-era slave laborers, one lingering issue is being litigated: how much interest the companies owe for the time it took to raise the funds.

The 2000 settlement, in which the German government and several German corporations pledged to put more than $5 billion in a reparations fund, ended a series of lawsuits against German companies that profited from slave and forced labor during World War II.

The fund has been paid out, but the dispute over a relatively minor amount of interest appears intractable. Litigation over the dispute is entering its fifth year. After going up to the U.S. 3rd Circuit Court of Appeals, the case is now back before a federal district court judge in Newark, Dickinson Debevoise.

“In some very deep sense, it’s a shame that it has ended on this note,” a law professor at New York University, Burt Neuborne, who filed the suit against the German companies, told The New York Sun. “I’ve begged so many times for them to be reasonable.”

The 17 German companies that Mr. Neuborne says owe interest on the reparations fund include Allianz and DaimlerChrysler. The companies are organized under a consortium, the German Foundation Industrial Initiative.

At issue is a year and a half lag between when the settlement was agreed upon and when the German companies raised the necessary 5.1 billion deutschmarks. For that time, the companies have already paid about $50 million in interest. Mr. Neuborne says this only covers six months of interest. Mr. Neuborne is seeking hundreds of millions of dollars more, he says, citing a German law allowing for punitive interest on money that is withheld in violation of a contract. Several lawyers for the German companies could not be reached for comment yesterday afternoon. In court papers submitted last month, company lawyers argue that the settlement signed by Germany and America does not require further interest.


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