An Italian insurance giant will pay tens of millions of additional dollars to the heirs of Holocaust victims who once held policies with the company, according to settlement papers filed in three class actions against Assicurazioni Generali in U.S. District Court in Manhattan.
The settlement has come under criticism from some who say Generali has been able to avoid paying all but a fraction of what it owes.
The settlement calls on the company to pay the claims currently pending before a London-based commission set up to deal with Holocaust-era insurance claims. The $100 million Generali gave to the commission, called ICHEIC, in 2000 has already been exhausted and additional claims remain, according to the settlement agreement.
The settlement will also allow victims and their heirs to submit new claims directly to the company through February 2007.
Although the settlement agreement does not say how much money Generali will have to pay to settle the new and existing claims, two sources close to the case said more than $25 million will likely be needed to cover them. The agreement also allows for the lawyers involved to inspect Generali's old records, a source said.
Generali's policies for life and dowry insurance and annuities were sold to Jewish communities across Eastern Europe before the Holocaust. The plaintiffs claim the company seized the assets belonging to Jews and others who were murdered. The company has intentionally thwarted their efforts to be compensated over the last 60 years, they claim.
The company, based in Trieste, has argued, among other things, that it is no longer responsible for the accounts in question and that the assets backing those policies were largely seized by communist regimes.
Generali maintains that it is settling for "humanitarian reasons and to honor the memory of its insureds who were the victims of Nazi persecution," according to the settlement agreement.
"Generali is pleased to reaffirm its commitment to ICHEIC and to have resolved these class actions so that more of its former insureds and their heirs can quickly receive payments," an attorney representing Generali, Peter Simshauser, said in a statement yesterday.
The lawsuits date back to 1997. The lawsuits suffered a serious setback in 2004, when a federal judge in Manhattan dismissed them, ruling that the claims should proceed through the commission process. The cases have been pending before the 2nd U.S. Circuit Court of Appeals, which had yet to rule on an appeal of the dismissal.
The settlement, filed in August in federal court in Manhattan, had gone unreported. No judge has yet approved the settlement.
Generali still faces more than 20 Holocaust-related lawsuits brought by individual plaintiffs and one class-action lawsuit that has not yet been certified, a source close to the case said. The 25-page settlement agreement stipulates that if more than 300 claimants decide to opt out of the settlement, Generali can back out as well.
One legal observer expressed dismay at the settlement, saying it will prevent a public accounting of what Generali did with the accounts of those who died in the Holocaust.
"The world needs to know what happened,"a law professor at Fordham University, Thane Rosenbaum, who has written extensively about restitution, said. "This is an entity that cheated and lied to its policy holders, took advantage of the extraordinary circumstances of a mass murder and genocide for its own institutional profit and gain and then wasn't honorable enough to do what is morally right and necessary."
Mr. Rosenbaum said that court proceedings in this case were especially relevant to survivors and their heirs because life insurance and annuities, often called the "poor man's Swiss bank account" had been so commonly held across Eastern Europe.
One man who is suing Generali, Thomas Weiss, called the settlement "a beautiful arrangement for the insurance company" and said he would press forward with his single lawsuit. Mr. Weiss, of Miami Beach, Fla., said his father, an Auschwitz survivor, had claimed to put an unusually large amount, $50,000, in a Generali policy in 1937.
According to the agreement, Generali will also pay up to$3.25 million in attorney fees and extra fees to several of plaintiffs.