UNITED STATES DISTRICT COURT

SOUTHERN DISTRICT OF FLORIDA

CASE NO. 01-1859-CIV-SEITZ/BANDSTRA

PLAINTIFFS’ OPPOSITION TO GOVERNMENT’S MOTION TO DISMISS UNDER RULES 12(b)(1) AND 12(b)(6)





I. INTRODUCTION
After three years of litigation, the Defendant again moves to dismiss this lawsuit brought by Hungarian Holocaust survivors and their heirs. This motion should be denied, and the Plaintiffs should be allowed to proceed, for the simple reason that the facts and law plainly compel it.
Notwithstanding the Government’s legal machinations, on key factual questions little is in dispute. The Government, through its experts and pleadings, now agrees that the Gold Train contained stolen Jewish property,[1] that it was handed over to the U.S. with explicit assurance the property would be returned to Hungary or its rightful owners,[2] that looting and misappropriation occurred,[3] and that it decided to keep the stolen Jewish property to alleviate the burdens of the U.S. Treasury.[4] The Government has not challenged the testimony of Plaintiffs who show their property was on the train,[5] or the conclusions of Plaintiffs’ expert as to which Jewish communities in Hungary had their property on the train,[6] or Plaintiffs’ experts who have shown that it was U.S. law and policy to restitute the property to the country of origin, regardless of later border shifts, and that Government did so many times.[7] Indeed, before another court, the Government has made a judicial admission that it was the policy of the United States to return all property seized in Austria to the country from which it was taken.[8] The factual differences that do exist (such as the amount of looting that occurred, the precise dollar value of the property on the train) are irrelevant at this stage of the proceedings.
The Government’s motion to dismiss is a recitation of irrelevant facts combined with a series of technical and meritless legal arguments. Indeed, some of them (e.g., the treaty and other 12(b)(6) defenses) are barred in a second pre-answer motion under Rule 12(g).
The Plaintiffs’ standing to bring this case is clear. They have suffered an injury in fact, traceable to the Government’s conduct, and have shown conclusively that they and other Hungarian Jews had property on the Gold Train that the United States had in its hands and refused to return. (See infra at § IV.) The Court already has ruled against the Government twice on the statute of limitations defense; and Plaintiffs have presented unrefuted evidence that they did not know about the Gold Train until 1999, or later. (See infra at § VI.) As for the Government’s rather incredible contention that the survivors “should have known” the story of the Gold Train, suffice it to say that the Government’s own expert admits he had never heard of it until the 1980s, and that years of work in archives were required to learn what happened. (Id.)
The Plaintiffs’ claims for non-monetary relief should proceed. The “military authority exception” to the APA’s waiver of sovereign immunity does not apply because the actions complained of are decidedly non-military as alleged throughout the First Amended Complaint and confirmed through discovery. (See infra at § VII.) The Government’s 12(b)(6) motion claiming that two international agreements bar the plaintiffs’ claims (the 1946 Treaty of Peace, and a 1973 Executive Agreement) are untimely because the Government already has made a 12(b)(6) motion, and cannot make a second one pre-answer. Even still, the Government’s argument is specious; neither pact was ever intended to address victims’ claims. (See infra at §VIII.C.)
Finally, the U.S. Supreme Court’s recent landmark ruling in Rasul v. Bush, 124 S. Ct. 2686 (2004), significantly widens the Court’s authority to hear this case brought by Hungarian survivors who were friendly aliens during World War II for alleged violations of the Constitution and international law.[9]
In the end, although the Court may resolve factual disputes when deciding a Rule 12(b)(1) motion that attacks the facts (as the Government’s motion does), the law does not permit the court to resolve every fact. Instead, the Eleventh Circuit requires a court to deal with only the bare minimum, until the court is satisfied it is competent to exercise its jurisdiction.[10] All facts that touch on or overlap with the merits must be construed in Plaintiffs’ favor – to be resolved not merely on cross motion documents, but in a trial.
Since August 2002, when this Court last ruled on the Government’s prior Motion to Dismiss, the plaintiffs have had the opportunity to conduct limited discovery. Newly produced documents,[11] combined with court rulings and admissions by the government,[12] have significantly strengthened the legal basis for this case. In all, Plaintiffs have more than met the necessary showing to survive this Motion to Dismiss. They should be permitted to proceed to trial to test the merits of their case.
II. FACTS
The central fact is this: nearly six decades after the events described, the defendant through its retained expert, Ronald Zweig, has suddenly admitted many – in fact, most – of the key factual allegations supporting Plaintiffs’ complaint. The Government’s submission is largely a frontal admission that the allegations of the First Amended Complaint (“FAC”) are accurate. The Government has produced few, if any, contemporaneous documents to refute Plaintiffs’ allegations.
Plaintiffs’ FAC contains the factual allegations that support this case, which are incorporated herein. In addition, Plaintiffs have submitted expert reports from Gábor Kádár, Francis A. Gabor, and Jonathan Petropoulos as Exhibits 1, 2, 3, 4, and 5, attached to the Declaration of R. Brent Walton (“Walton Decl.”). Plaintiffs explicitly rely on and incorporate their statements. It is not necessary to rely on the Plaintiffs’ experts alone. The Government has submitted two declarations by Ronald Zweig; the second of which incorporates, for the first time, his 312-page book, The Gold Train, including its references (hereinafter “GT”). While Zweig puts a different gloss on the facts and seeks to justify the Government’s thefts and misappropriations of property, and its unilateral reinterpretation of the multilateral restitution agreement, his research confirms Plaintiffs’ case on most major issues. In addition, the Government put forward as the person most knowledgeable Clayton Laurie, who gave deposition testimony and [under seal]. While the Government’s entire motion does not mention the testimony of its “most knowledgeable” person, his testimony also confirms key aspects the Plaintiffs’ case.
A. The Confiscation of Jewish Property
Plaintiffs assert that a large volume of property stolen from Hungary’s Jews was loaded onto the Gold Train for plunder. For years, the Government claimed it did not know what was on the train, or that there was any proof that Jewish property was on the train. See, e.g., Phillips Dep., 59:6-12, Ex. 14 Walton Decl. Now, the Government admits the obvious. Zweig states that the Gold Train “carried a large part of the transportable wealth of the Jews who had lived within the enlarged borders of wartime Hungary. Gold, wedding rings, watches, jewelry, silverware, cash, stamp collections, cameras, binoculars, even Persian carpets and expensive furniture – enough to fill a freight train of almost fifty wagons.” (GT at 3.) Indeed, the subtitle of his book calls it “The Second World War’s Most Terrible Robbery.”[13]
Though the parties disagree about the value of the property that was on the Gold Train, there is no dispute that the Gold Train contained a sizeable portion of the movable wealth of the Hungarian Jews. Furthermore, there is no dispute that the cities and towns in Hungary from which the Jewish wealth was taken and placed on the Gold Train are those specified in Gábor Kádár’s expert report.[14] Consequently, there is no dispute that the Gold Train contained a large part of the transportable wealth of the Jews who in 1944 resided in:
Barcs, Bátaszék, Békéscsaba, Beregszász, Beszterce, Budapest, Csíkszereda, Csorna, Csurgó, Dabas, Debrecen, Dés, Devecser, Diosgyőr, Dombóvár, Eger, Esztergom, Felsővisó, Gyöngyös, Győr, some places of Heves County, Kaposvár, Kassa, Keszthely, Kolozsvár, Kunszentmiklós, Marcal, Miskolc, Mohács, Monor, Mosonmagyaróvár, Munkács, Nagykanizsa, Nagylózs, Nagyvárad, Nyíregyháza, Orosház, Ózd, Pápa, Pécs, Pécsi, Putnok, Sopron, Sopronkőhida, Sopronkövesd, Szatmárnémeti, Szécsény, Szentgotthárd, Szigetvár, Szombathely, some places of Southern Hungary, Tab, parts of the “Transdanubian” region, Tamási, Újpest, Ungvár, parts of Vas County, Veszprém, Zalaegerszeg, Zalaszentgrót, Zilah, and Zirc.[15]
B. The Handover of the Train and the Promises Made
The Plaintiffs contend that the train was handed over to the Americans for safekeeping, at which time a promise was made that the train and its contents would be returned. Zweig argues that the U.S. promised to return the train; the Hungarian guards later fretted that while they had indeed received a promise, it had not been put in writing. (GT at 124; Zweig Dep., 96:20-22.) The Government admits this fact. (Def. Br. at 9.)
C. Relevant U.S. Rules, Regulations and Policy
The Plaintiffs contend that the policies and laws of the United States required the Government to restitute the property to Hungary or to Plaintiffs, the real owners. In its Motion to Dismiss, the Government insists otherwise.
However, in the evidence it has presented, the Government confirms that Decree No. 3,[16] Provisional Handbook, and the Army Field Manual, are directly applicable to and governed the Army’s conduct in occupied Austria. First, Laurie testified at his deposition that the Army is subject to laws and regulations including the Articles of War, the requirements set forth in the Army Field Manual, which likewise impose duties and affirmative obligations upon the Army in occupied Austria. (Laurie Dep., 113:1-5.)[17]
Second, [UNDER SEAL]
Laurie also explained that [UNDER SEAL] Lastly, the Government has also confirmed and echoed Plaintiffs’ position in statements and arguments it made to one federal court. Thus, the Government admits that Decree No. 3 governed the conduct of the occupation forces in Austria, and noted that “[u]nder the military decrees and policies in effect in post-war Austria, property seized by the United States Forces in Austria was sorted and turned over to the country from which the object had been taken.”[18] This Decree required that all property – “whether stolen, aryanized, or legitimately acquired” – had to be returned to the country of origin. Id.; see also In re Portrait of Wally, 2002 U.S. Dist. Lexis 6445, *47 (S.D.N.Y. April 12, 2002) (same).
D. Identifiability
Plaintiffs contend that despite classifying the Gold Train as enemy property, the United States knew from the outset the Gold Train property was “persecutee property,” that originated from Hungary; and that some considerable number of individual items were personally identifiable. (See, e.g., FAC at ¶¶ 12, 13, 23, 25, 196, et seq.) The Government cannot prove otherwise.
According to Zweig, the United States knew from the beginning that the Gold Train contained “persecutee property,” (GT at 124), and confirmed this fact no later than July 10, 1945, when American Intelligence officials interrogated the Hungarian soldiers who accompanied the Gold Train. (GT at 123.)[19] Thus, the Army established that the Gold Train contained looted assets taken from the Jews of Hungary. Zweig also confirms that the United States never compiled an inventory (GT at 194; Zweig 1st Rep., at 32); the Government denied Hungarian requests to create an inventory (GT at 144-145); and refused requests to inspect the contents from both the Jewish community and the Hungarian Government (GT at 144, 153.)[20] Moreover, Zweig admits that the Executive Branch wanted to turn over identifiable items to their proper owners (GT at 154) and that “items of jewelry” were identifiable. Zweig further agrees that other items on the train included stamp collections and Judaica, (GT at 96), both distinctive and thus identifiable.[21] Moreover, the Parke-Bernet Galleries catalogs of items that the United States caused to be auctioned show many distinct items, many of which were identifiable.
E. Failure to Safeguard the Property
Zweig confirms that the Government failed to compile a detailed inventory of the contents on the Gold Train. (GT at 194; Zweig 1st Rep. at 32.) He also confirms that the United States refused requests from members of the Jewish community in Hungary and the Hungarian Government to inspect the contents of the train and assist in inventorying the looted property. (GT at 144-145, 153.) According to one of the documents relied on by the Government and Zweig, and produced to Plaintiffs, one reason no inventory had been completed was that the creation of the inventory itself would deprive high ranking members of the armed forces an opportunity to plunder:
The local American Military Authorities are doing everything to obstruct that work [inventorying the Gold Train], especially in view of the fact that with the beginning of this work they have lost a source for easily acquiring riches. It is known that top-ranking officers of the American Army have pocketed very valuable items.[22]
F. Hungarian Jews Seek their Property and Are Rebuffed
Zweig confirms that representatives of the Hungarian Jewish community met with and corresponded with Arthur Schoenfeld, who headed the diplomatic mission to Hungary, from December 1945 through March of 1946. During that time, they explained the history of the train and despoliation of the Jews, asked the Government to inventory the train, asked for the return of the Gold Train, and offered to help return the property to its owner, and when impossible, the items would be used for Jewish welfare, and that Hungary had created the legislative apparatus to accomplish such a purpose. Schoenfeld told them that they could not make a claim, they needed to speak to the Hungarian Government about this as the matter was one between the Governments, and that Hungarian Government was negotiating with the U.S. (GT at 144-145, 153, 158-159; Zweig Dep., 105-106, 109:26-28, 110:7-14.) Schoenfeld also told them that the Gold Train was a matter for inter-Allied determination. (Zweig Dep., 110:15-21.) After being told this, and following Schoenfeld’s instruction, the representatives approached the Hungarian Government and the Hungarian Government began to negotiate the return of the Gold Train on behalf the Jewish community. (Id. 116:5-11.)[23] The Hungarian government even passed a law that would funnel the looted property back to the original owners and created a special Jewish committee to help in this process. (Id. 116:12-17; GT 158-159.)
G. Ownership
Zweig concedes that the property continued to belong to the Hungarian Jewish owners (GT at 106) and that despite the magnitude of the Holocaust there were approximately 140,000 surviving Jews in Hungary in 1946. (Id. at 140.) His book weakly explains that the Government decision not to turn the train back was made because “it was felt” (Id. at 163) that most of the owners had “presumably” died in Auschwitz (Id.), despite the U.S. knowing about the presence of a large and vibrant Jewish community in Budapest that repeatedly sought the return of the items. (Id. at 139-140.)
H. United States’ Mishandling of the Property
Zweig also corroborates Plaintiffs’ allegations of looting and other mishandling of the Gold Train property while it was in the Government’s custody. (Zweig 1st Rep. at 32-33.) Although Zweig tries to minimize the extent to which the Army mishandled the property, he admits that in March of 1946 the United States “formalized” into policy the existing practice of “allowing officers to requisition materials” solely on memorandum receipt. He further admits that these items were “rarely returned.” (GT at 155.) In fact, “almost none” of the items requisitioned were ever returned to Property Control. (Id. at 198.)
And, though Zweig also tries to minimize the value of the Gold Train and the looting that occurred while in U.S. custody, he cites and otherwise relies upon notes of a conversation between Gideon Rafael, envoy for the Jewish Agency in Palestine, and Col. Arthur Marget, Chief U.S. Economic Officer in Austria, who not only valued the property between $50 and $120 million in 1945, (Id. at 147),[24] but also informed Rafael – on at least two occasions – that it was known to him that there was widespread looting.[25] Moreover, the looting was not confined to senior officers. According to Zweig, “enterprising young women” were seen wearing jewelry near the Salzburg warehouse. (Zweig 1st Rep. at 32.)
I. United States’ Determination
Zweig corroborates Plaintiffs’ contention that the United States’ decision not to return the Gold Train was based on its own budgetary concerns arising out of its agreement to fund the resettlement of Europeans, including European Jews. (Zweig 1st Rep. at 36-37; White Decl. at ¶ 22 n.2; FAC ¶¶ 16, 20, 261, 365-66; Plunder & Restitution, at 9, Ex. 16 Walton Decl.) According to Zweig, the United States unilaterally redefined Article 8 of the Paris Agreement in two significant ways. (GT at 163-164.) As ratified, Article 8 expressly applied only to “non-monetary” gold, and then only to the sub-set of non-monetary gold found in Germany.[26] However, in November of 1946, the Executive Branch changed the existing and on-going application of Article 8 “so that the original allocation to the IGCR of ‘non-monetary gold found in Germany’ would be extended to all victim assets (not only gold) found anywhere in the European theatre, including Austria.” (GT at 163.) Furthermore, Zweig confirms that the Government made this unilateral amendment to Article 8 of the Paris Agreement to benefit itself by alleviating the burden on the Treasury “in connection with the financing and resettlement problems” of displaced persons (Id. at 167), which was “a problem that would not go away.” (Id. at 163.)[27] Once these financial benefits to the United States’ fisc were explained, whatever differences of opinion may have once existed were gone, the Executive Branch altered Article 8 and “approval [to the decision not to return the Gold Train property to Hungary] was quickly given.”[28] This is admitted by the defendant. According to the final report of the Presidential Advisory Commission on Holocaust Assets, the decision to auction off the Jews’ property “had the effect of decreasing the financial burden on the United States of supporting the refugees.” Plunder & Restitution at 9 (emphasis added).
J. Statute of Limitations
Zweig, a noted scholar in the Holocaust and restitution issues stated, that until the 1980’s, he did not know about the Gold Train. His understanding of the Gold Train story required research in 25 public and private collections located in six different countries. Many of the documents are still classified and some have only recently been released. (GT at x-xi; Zweig 2nd Rep. at 2, Ex. 8 Walton Decl.)[29]
K. The Sum of the Government’s Admissions Confirms Each Element of Plaintiffs’ Claims
From these admitted facts, it is clear that the United States mishandled the Gold Train property by: (a) failing to inventory it or maintain property controls over the inventory; (b) failing to secure the property (which includes allowing senior officers to “requisition” the property on memorandum receipt); and (c) by failing to return the property to Hungary. The United States Government well understood that: (i) the property on the train came from the Jewish population of Hungary; (ii) numerous items were personally identifiable[30] and that means existed through the Jewish community by which even more materials were personally identifiable; (iii) the Government disposed of the property for reasons that carried out an American budgetary policy; (iv) and the Government violated its own international agreements and directly benefited itself. The United States shrouded many of the facts related to the Gold Train in secrecy for many years, hiding them from the public view, protecting them by classifications.
These are the major allegations of the Plaintiffs’ complaint. Recognizing its inability to refute the facts, the Government strains to construct a series of evasive, legalistic defenses, including a sudden and late “discovery” that not one, but two international agreements, it now tells the Court, preclude Plaintiffs’ claims. For the reasons discussed below, all of the Government’s arguments are incorrect and should be rejected.
legal argument
III. THE COURT MAY NOT DISMISS THE CASE UNDER 12(b)(1)
A. The Government’s Heavy Legal Burden
To obtain a dismissal pre-answer under Rule 12(b)(6)[31] or 12(b)(1), the Government, being the moving party, bears a heavy burden as “it is a rare case in which a motion on this ground should be granted.” St. Joseph’s Hosp., Inc. v. Hospital Corp. of Am., 795 F.2d 948, 953 (11th Cir. 1986). “[A] complaint should not be dismissed for failure to state a claim unless it appears beyond a doubt that the plaintiff can prove no set of facts in support of his claim which would entitle him to relief.” Conley v. Gibson, 355 U.S. 41, 45 (1957); Roe v. Aware Woman Ctr. for Choice, Inc., 253 F.3d 678, 682 (11th Cir. 2001) (complaint may not be dismissed unless “it is clear that no relief could be granted under any set of facts that could be proved consistent with the allegations”). The Court “must accept the allegations set forth in the complaint as true.” United States v. Pemco Aeroplex, Inc., 195 F.3d 1234, 1236 (11th Cir. 1999) (en banc).
B. Dismissal Under Rule 12(b)(1) Is Precluded Because Facts Are Intertwined With The Merits
Though citing to the governing cases in a footnote, (Def. Br. at 16 n.9), the Government fails to acknowledge that: “it is extremely difficult to dismiss a claim for lack of subject matter jurisdiction.” Garcia v. Copenhaver, Bell & Associates, 104 F.3d 1256, 1260 (11th Cir. 1997). [32] Here, the burden is insurmountable since there are disputed issues of fact intertwined with the merits; the case cannot be resolved in a motion brought under Rule 12(b)(1).
As the court held in Morrison v. Amway Corp., 323 F.3d 920, 929-30 (11th Cir. 2003), where the jurisdictional challenge requires decision of facts going to the merits of the case, “the district court should . . . treat[ ] the motion as a motion for summary judgment under Rule 56 and refrain[ ] from deciding disputed factual issues”[33] More specifically, the court explained:
If a jurisdictional challenge does implicate the merits of the underlying claim then ‘the proper course of action for the district court . . . is to find that jurisdiction exists and deal with the objection as a direct attack on the merits of the plaintiff’s case. . . . Judicial economy is best promoted when the existence of a federal right is directly reached and, where no claim is found to exist, the case is dismissed on the merits. . . . .’ Garcia, 104 F.3d at 1261, quoting Williamson v. Tucker, 645 F.2d 404, 415-16 (5th Cir. 1981). . . .  
Id.; see also Lawrence v. Dunbar, 919 F.2d 1525, 1529 (11th Cir. 1990) (same); 5A Wright & Miller, Federal Practice and Procedure § 1350, at 235 (2d ed. 1990).[34]
Thus, although jurisdiction is essential to the exercise of Article III powers, and even though the Court can resolve certain factual disputes, in Lawrence and Morrison, the Eleventh Circuit explained that courts should not decide everything to do with jurisdiction, even in a 12(b)(1) factual attack, the way the Government requests. Rather, the Eleventh Circuit, consistent with the requirements of jurisdiction, requires a court to deal with only the bare minimum, until the court is satisfied that it is competent to exercise its authority. All findings beyond that are attacks on the merits, not to be resolved merely on the cross-motion documents, but must await a full trial.
C. Article III Standing For One Party And One Claim Is Sufficient To Confer Jurisdiction
Article III defines the limits of the “judicial power” – or subject matter jurisdiction – of the federal courts. This includes the power to hear “all Cases, in Law and Equity, arising under this Constitution, the Laws of the United States, and Treaties made or which shall be made, under their Authority.” Pursuant to this Constitutional authority, Congress has granted the federal courts jurisdiction over “all civil actions arising under the Constitution, laws, or treaties of the United States.” 28 U.S.C. § 1331. Congress has also granted the federal courts jurisdiction over actionable claims asserted by aliens for “violations of the law of nations or a treaty of the United States.” 28 U.S.C. § 1350; Sosa v. Alvarez-Machain, infra.
Standing is another threshold issue that must be met before a court can exercise its Article III powers. However, if “one plaintiff has standing to bring all claims in an action, the court need not inquire into the standing of others.” American Iron & Steel Inst. v. OSHA, 182 F.3d 1261, 1274 n.10 (11th Cir. 1999) (citing Planned Parenthood of the Atlanta Area, Inc. v. Miller, 934 F.2d 1462, 1465 n. 2 (11th Cir.1991)); see also Prado-Steinman v. Bush, 221 F.3d 1266, 1280 (11th Cir. 2000) (one named plaintiff must have standing to assert the same claims on behalf of other sub-class members).
Similarly, once the Court has jurisdiction over the parties, to obtain jurisdiction over the case, all the Court needs is jurisdiction over a single claim. For once the court has jurisdiction over any claim, under the supplemental jurisdiction provisions of 28 U.S.C. § 1367 and principles enunciated by the Supreme Court in Supreme Tribe of Ben-Hur v. Cauble, 255 U.S. 356 (1921), the Court may adjudicate the other claims presented, if they “are so related to the claims in the action within such original jurisdiction that they form part of the same case or controversy under Article III.” 28 U.S.C. § 1367(a).
D. The Tucker Act Waives Sovereign Immunity
The Government’s dismissal motion all but ignores the issue of sovereign immunity. However, given a 12(b)(1) motion, Plaintiffs are compelled to address the issue briefly, as jurisdiction is lacking unless a waiver of sovereign immunity applies. The Little Tucker Act, 28 U.S.C. § 1346(a)(2), supplies such waiver and grants the Federal District Court concurrent jurisdiction with the Federal Court of Claims over “any claim against the United States founded either upon the Constitution, or any Act of Congress or any regulation of an executive department, or upon any express or implied contract with the United States,” as long as the claim does not exceed $10,000. This language provides a waiver of the Government’s sovereign immunity, and does so for all claims based on any act of Congress, executive regulations, implied contracts, and Constitutional claims that can “fairly be interpreted as mandating compensation” for the damage sustained. United States v. White Mountain Apache Tribe, 537 U.S. 465, 472 (2003).
This is a new standard, one more relaxed than before:[35]
This “fair interpretation” rule demands a showing demonstrably lower than the standard for the initial waiver of sovereign immunity. “Because the Tucker Act supplies a waiver of immunity for claims of this nature, the separate statutes and regulations need not provide a second waiver of sovereign immunity, nor need they be construed in the manner appropriate to waivers of sovereign immunity.” Mitchell II, supra, at 218-219. It is enough, then, that a statute creating a Tucker Act right be reasonably amenable to the reading that it mandates a right of recovery in damages. While the premise to a Tucker Act claim will not be “lightly inferred,” 463 U.S., at 218, a fair inference will do.
Id. at 472-73. Thus, if a plaintiff relies on an act of Congress, regulation, or constitutional provision that is “reasonably amenable” to a reading requiring compensation, then the Tucker Act has waived sovereign immunity and the suit may proceed. Id.
Furthermore, courts do not strictly construe statutes and substantive rights against finding a particular right is reasonably amenable to providing damages. To the contrary, the Supreme Court explained in Mitchell, “the exemption of the sovereign from suit involves hardship enough where consent has been withheld. We are not to add to its rigor by refinement of construction where consent has been announced.” 463 U.S. at 219; see also White Mountain, 537 U.S. at 477 (rejecting strict requirements in favor of “the less demanding requirements of fair inference that the law was meant to provide a damage remedy for breach of a duty”).
Money mandating rights include all statutes that require payment of damages for violations, breaches of contracts,[36] and breaches of fiduciary duties. Those rights to compensation can be found in the statute or regulations either expressly or by implication. Eastport S.S. Corp. v. United States, 372 F.2d 1002, 1007 (Ct. Cl. 1967).
IV. PLAINTIFFS HAVE STANDING
The Government argues that Plaintiffs lack standing because they have suffered no injury caused by or at least fairly traceable to the actions or omissions of the defendant that will be redressed by a favorable ruling. (Def. Br. at 17 (citing Lujan v. Defenders of Wildlife, 504 U.S. 555 (1992)). This contention is amply refuted by the allegations in the FAC, and affirmatively satisfied by the evidence presented below.
A. Plaintiffs’ Injuries Caused By The Government Can Be Redressed By This Court
In evaluating whether a party has satisfied Lujan, the Court must “accept as true all material allegations of the complaint, and must construe the complaint in favor of the complaining party.” Midrash Sephardi, Inc. v. Town of Surfside, 366 F.3d 1214, 1223 (11th Cir. 2004) (citing Warth v. Seldin, 422 U.S. 490, 501 (1975)). Moreover, unlike other threshold issues, “a district court cannot decide disputed factual questions or make findings of credibility essential to the question of standing on the paper record alone but must hold an evidentiary hearing,” Bischoff v. Osceola County, 222 F.3d 874, 878, 879 (11th Cir. 2000) (emphasis in original).
Applying these standards here, it is plain that, as alleged, Plaintiffs suffered a clear and demonstrable injury at the hands of the Government. This was implicit in the Court’s first ruling denying the Government’s motion to dismiss. The Government took possession of Plaintiffs’ property and failed to return it either to them or Hungary despite being required to do so under implied-in-fact contract theory the Court upheld against the Government’s Rule 12(b)(6) challenge. If the Government had returned the property either to Plaintiffs or Hungary, Plaintiffs (or Plaintiffs’ now deceased parents or other loved ones) would have received their property back more than 55 years ago and would not have had to rebuild their lives from scratch. In fact, Hungary had enacted a law that required it to return the property to its owners or pay compensation. (Kádár Dep., 253-254; 261:10-20.) Moreover, the Government wrongfully retained the Jewish property knowing it was stolen property to alleviate its own obligations. (Supra at § II.I.) These are sufficient allegations to establish standing under any circumstance: Plaintiffs allege an injury to themselves and have a viable claim that would entitle them to relief by a favorable decision. The threshold issue of standing is satisfied as a matter of law.
1. Plaintiffs have proved their property was in U.S. custody
The Government contends, without support, that no Plaintiff has demonstrated his or her property ever came into U.S. possession. (Def. Br. at 18.) By doing so, the Government ignores the unrefuted evidence offered by Plaintiffs who have demonstrated that their property came into U.S. possession; some have done so without the assistance of any expert testimony at all.
For example, Elizabeth Bleier testified that her family’s identifiable possessions were auctioned off in New York in the late 1940s. She produced Decree 1600 receipts listing specific property seized by the Hungarians in April 1944 – property that she was able to identify as having been sold by Parke-Bernet at auction in 1948,[37] including an elaborate and distinctive silver bowl;[38] a distinctive piece of jewelry;[39] a handmade handbag;[40] distinctive hand painted jewelry;[41] and several other specific family heirlooms seized by the Hungarian Nazis, and auctioned by the Americans. Mrs. Bleier also produced her own wedding photograph, in which her mother is wearing a distinctive, handmade brooch that was auctioned off at Parke-Bernet in 1948.[42] Mrs. Bleier also brought her Kiddush cup (the one depicted in the FAC at ¶ 468) to the deposition and observed that since the cup had followed a clear chain of custody—seized from her father, loaded on the Gold Train, auctioned in New York—it stood to reason that other property seized from her family at the same time had made the same journey.[43]
The Government does not dispute that property auctioned off at Parke-Bernet was on the Gold Train, and Zweig confirms that it was. (GT at 206-07.)[44] Moreover, he corroborates Plaintiffs’ evidence that most of the property sold at Parke-Bernet auctions held over four years came from the Gold Train. (Id.) Thus, any Plaintiff who can, as Mrs. Bleier has, identify property in the auction catalogs as being his or hers has established that his or her property came into the Government’s possession and was on the Gold Train.[45]
The Government also possesses an inventory of the some 1,200 pieces of art that came into its possession that the U.S. documents explain were on the Gold Train.[46] This inventory likewise provides proof that Plaintiffs’ property was in the Government’s hands. For example, Plaintiff Erwin Deutsch testified that he and his family were expelled from their apartment in Budapest, and then stripped of their valuable property (Deutsch Dep., 16:2-5, Ex. 22 Walton Decl.) He testified that, as documented by witnesses in a 1994 statement a painting by a well-known Hungarian artist, Fulup Laszlo, was hanging on his apartment wall. (Id. 21:22-25.) Mr. Deutsch testified that this same painting was listed in the inventory identifying paintings in the possession of the United States and stored at the Salzburg Warehouse. (Id. 25:17-21.) Similarly, Plaintiff Zoltan Weiss identified several paintings from a receipt filled out by his father, which he believed were likely to be the paintings listed on the inventory that the Government has determined were on the Gold Train.[47]
2. Expert testimony proves that class members’ property was in U.S. custody.
The Government asserts it is impossible to determine with any degree of likelihood whose property was on the train. (Def. Br. at 9.) Yet, even beyond the above examples, any one of which is sufficient to establish standing, the Government’s assertion is demonstrably wrong. Plaintiffs and their families turned over identifiable property to the Hungarian fascists, and in turn, that property was in fact loaded onto the train. (Kádár Aff. at ¶¶ 22-65, Ex. 1 Walton Decl.) If Plaintiffs show “a colorable interest in at least some of the property,” they are “asserting their own right” and satisfy the standing requirement. Rodriguez-Aguirre, 264 F.3d 1195, 1206 n.7 (10th Cir. 2001). As the foregoing examples and the facts below demonstrate, Plaintiffs meet this test.
Gábor Kádár, Plaintiffs’ expert and recognized worldwide as a leading authority on the Hungarian Gold Train,[48] has opined after having taken into consideration the looting that occurred in Hungary, the protocols of the “processing,” and the separation of Toldy loot from the train, that “when the United States accepted custody of the Gold Train cargo and acceded to Avar’s request to safeguard that property until it could be returned to Hungary or its true owners, the Gold Train contained the stolen Jewish property, from Jews who resided in the named cities and/or regions identified in Paragraph 65 of Kádár’s Affidavit.[49] Before the Holocaust, the named Plaintiffs (or their parents or relatives) resided in these places.
Additionally, the Government and Zweig overstate the impact that Toldy’s separate loot and the alleged “disorganization, massive looting, and the wartime chaos” had on the train’s cargo. (Def. Br. at 18.) All of these potential confounding variables were considered carefully by Gábor Kádár in his opinions. Indeed, both Gábor Kádár and Ronald Zweig have explained that whatever “disorganization” existed in Hungary, the looting of the valuable property—the property that was on the Gold Train—was a “carefully organized plunder.” (GT at 3.)
Second, there is little if any evidence that the wartime chaos had any impact on the size of the train’s cargo. Certainly, wartime chaos impacted which Financial Directorates followed the Hungarian protocols and actually delivered the Jewish property to Budapest or the sorting facilities at Óbánya or Brennbergbánya. However, there is no evidence of “massive looting” of the valuable Jewish property intended for the Gold Train. According to official U.S. documents, there is only one instance where Avar and his men failed to protect the cargo from looting and theft from the day it left Brennbergbánya to the day the Army accepted custody over it, and even then only 500 inexpensive chrome-cased watches were lost from the voluminous cargo.[50]
Furthermore, there is little if any documentary evidence of looting in Hungary either, not even in Zweig’s book—except of course the looting from Plaintiffs and other Hungarian Jews, and then what Toldy took.[51] Zweig’s evidence of looting that he describes in his reports are irrelevant to this case, as they largely address poultry, agricultural products, horses, automobiles, cattle, equipment, and other property that was never intended for the Gold Train. (Zweig 2nd Rep. at 10 (citing the looting of cattle, farm machinery, animals and poultry);[52] Zweig Dep., 185-186.) This evidence is unavailing to the Government’s position, as even Zweig admits its irrelevance to the case: “[o]nly the most valuable property [looted from the Jews] was selected for centralization and later transportation out of Hungary,” (Zweig 1st Rep. at 9) (emphasis added), and the Government has yet to present documentary evidence that these items were pilfered from the Hungarian authorities handling Jewish assets once they were under the department’s control, and Kádár has explained there was very little looting of the valuable movable property because that property was “safeguarded.” (Kádár Dep., 38-39, Ex. 59 Walton Decl.)[53]
Additionally, the Government is incorrect that the loot taken by Toldy prevents this case from satisfying Article III. (Def. Br. at 18-19.) It is relatively easy to remove Toldy from the equation based on the kind of property he took. For example, he did not take any of 18 cases of gold jewelry with precious and semi-precious stones (“Ar. eksz”) (GT Inventories at 103-104; Kádár Aff. at ¶ 64, Ex. 1 Walton Decl.; Identification of 18 cases marked “Eksz,” GT 12394, Ex. 48 Walton Decl.); nor did Toldy have Judaica, (Zweig Dep., 78:18-22), silver, (Id. 79:6-10),[54] rugs or carpets, (Id. 80:1-4), or china, (Id. 80:5-6), or other similar property. As Kádár explained in his affidavit and deposition, Toldy absconded with the small, valuable pieces; he did not take the silverware, the porcelain, rugs or other household items of value. (Kádár Aff. ¶ 36; Kádár Dep., 248:5-19.) Toldy’s total take: 44 cases of valuables identified by Kádár in his affidavit. (Zweig Dep., 77:22-24.) Thus, for Plaintiffs who are claiming anything other than the kinds of valuables that traveled in pine cases with the Toldy convoy, whatever “valuables” Toldy absconded with are irrelevant to the claim.
Plaintiffs lived in the cities and towns[55] from which the loot was taken. Furthermore, Plaintiffs all provided compelling and undisputed evidence that the Hungarian Nazis had confiscated their property, some even showing the Government the receipts given to their families by the Hungarian Nazis under Decree 1600. These receipts itemize property that was taken, and placed on the Gold Train.[56] Several Plaintiffs saw their family members take their family’s property to the local bank as was required. For instance, Plaintiff Veronika Baum, as a terrified young girl, saw German soldiers go from room to room in her family’s home and business, inspecting property and taking notes. (Baum Dep., 47:2-11, Ex. 24 Walton Decl.) Several Plaintiffs had jewelry, wedding rings and other personal items wrested from them by gendarmes and soldiers while their families were crowded into the ghetto.[57] The property seized from these Plaintiffs from the towns identified by Gábor Kádár was among the property on the Gold Train when the Government accepted custody of the train.[58]
The Government’s argument, stripped to its essence, is that although the Government did not own the property on the Gold Train, Plaintiffs have not proved that they did, thus the property must have been owned by other Hungarian Jews who lived in the cities and towns listed above but as yet are unnamed parties to this case and Plaintiffs cannot represent them. The argument is legally deficient. The Tenth Circuit in Rodriguez-Aguirre, 264 F.3d 1195 (10th Cir. 2001), responded to a similar argument made by the government and held that the standing requirements were met by those who made a colorable claim to some of the property. Here, Plaintiffs are asserting their own rights to the property, they have established that some of their property was (or at least probably was) on the Gold Train, and that they certainly have a colorable right to items on the train. (See Zweig Dep., 101:13-15 (Reasonable to assume that some of the survivors still in Hungary had property on the Gold Train)). Moreover, under Rule 23, and with the Court’s permission, Plaintiffs can and have sought to enforce the rights of all owners of property on the Gold Train. If the class is certified, the Court would thereby include all property owners that the Government admits exist but, as yet, are allegedly absent from the case.
3. Plaintiffs’ harm is traceable to the Government’s conduct
Plaintiffs were directly harmed by the Government’s decision not to restitute their property to Hungary, as U.S. laws and policies required. (Petropoulos Supp. Aff. ¶¶ 44-50; see Portrait of Wally, at 161-62 (“the United States Forces were required to transfer all seized property — whether stolen, aryanized, or legitimately acquired — back to the designated agency of the country from which the object had been taken”)). The Government contends that plaintiffs cannot be certain they would have received property or compensation, had restitution been duly made. (Def. Br. at 19-20.) This is not a legal defense, but an excuse for misconduct – and a wholly hypothetical one at that. It provides no basis for dismissal.
The available evidence indicates that the Jews of Hungary would have benefited from timely restitution. When the United States promised to restitute the property, Hungary was actively preparing to receive it and to return it to the Jews. Indeed, in anticipation of the arrival of the Gold Train assets, the Hungarian Government had formed a Jewish Rehabilitation Agency, in cooperation with Jewish organizations, and expressly agreed to turn over those assets to that agency. (See supra at § II.F.) Jewish leaders in Hungary personally “offered to supervise the return of the items on the train to their individual owners. Where this was not possible, the items would be used for general Jewish welfare purposes in Hungary.” (GT at 144.) Weeks later, the Hungarian Government convened a committee with leaders of the Jewish community to work together to retrieve the train’s contents. (Id. at 145.) Indeed, Hungary was willing to assign its claims (and perhaps did assign its claims) to the Hungarian Jews in an effort to assist them reclaim their property.[59] Later, when Hungary received its gold reserves, it made clear that it was not waiving any Jewish claims. (Id. at 156.)
The record is clear: Pre-Communist Hungary, seeking to win favor with the West, restituted to Jews. (Kádár Aff at ¶ 95, Ex. 1 Walton Decl.) Even the U.S. knew this: Hungary had adopted several measures “to restore to the Jews both the status and property of which they were deprived during Hungarian fascist regimes. In some cases these measures have gone even further than restoration to include some element of recompense. These measures are all in conformity with the public statements of Hungarian leaders and the announced principles of the Hungarian Republic.” (Id. at ¶ 90 (quoting U.S. memo)).
The Government also argues that it would be unfair to have restituted the property to Hungary, since that nation’s borders had shifted after the war. (Def. Br. at 20.) Hungary was not unique; the borders of dozens of European nations changed as a result of World War II. The U.S. was required to restitute property to the country of origin, without parsing border shifts. Anything else would have meant either that no property could ever have been restituted, or the U.S. would have faced an impossible administrative burden.
By April 1944, the U.S. had made clear its conviction that occupation officials should bear only the initial responsibility for effecting restitution for property looted from occupied countries, and that “The question of restoration to individual owners is a matter for these [foreign] Governments to handle in whatever way they see fit. The original owners may have received part payment for property taken from them under duress and the Governments in question may wish to make adjustments for this circumstance in returning the property. In some cases it may be impossible to locate the original owners or their heirs and the Governments involved will have to decide what should be done with the property or proceeds therefrom” (Plunder and Restitution, SR-140). Thus, once looted assets were returned to the country of origin, no additional U.S. involvement was deemed necessary or desirable.
(Petropoulos Supp. Aff. at ¶ 7, Ex. 4 Walton Decl.) (emphasis added); see also id. at ¶ 63 (“[the United States] restitutes any property irrespective of ownership [once the officials] are satisfied that removal was by general direction of ex-enemy puppet government or without compensation, or even removal by owner himself without compensation as in case of Hungarians”). So consistent with restitution laws and policy, the United States restituted property to the U.S.S.R., Poland, Czechoslovakia, Romania, and Hungary, and others – all countries that saw their borders shift. (Id. at ¶ 5; Petropoulos Dep., 88-90, Ex. 60 Walton Decl.) In fact, as early as 1945, the Government began to return parts of the Gold Train — the railcars — to Hungary despite that some cars bore markings of other countries. (Zweig Dep., 86:11-22.)[60] The train and its contents came from Hungary. The law required their return to Hungary. The United States immediately returned some railcars but kept the contents.
Furthermore, the Government’s recent “unfairness” argument is not supported by the facts. The wealth of the Hungarian Jews was focused in Hungary, as the country is known today, and the core of wealth on the Gold Train came from Budapest. (Kádár Dep., 29:16-17, Ex. 59 Walton Decl.; see also Zwieg Dep., 49:5-17 (acknowledging wealth focused in Budapest and a few other major urban areas, and Kruge in Greater Hungary)).
Lastly, to the extent that some Plaintiffs might not be able to prove conclusively which items of their specific property were on the train, that failure is itself ascribed to the Government’s unlawful acts. The passage of decades has made it far more difficult for Plaintiffs – individually or as a class – to identify specific personal property (though, of course, some are able to, see supra). For example, the Government was required to inventory and keep proper records of the property accepted into custody.[61] However, the Government never did this with the Gold Train. Certain categories of items were frequently marked with initials or engraved with family names.[62] Numerous Plaintiffs testified that they would have been able to identify their property had they been given access to it in a timely manner, viz., in the years immediately after World War II.[63] Additionally, the Government had in its possession numerous lists of property and property owners, as well as sealed envelopes that, according to U.S. documents, bore the names of original owners. (Kádár Aff. at ¶ 59; Petropoulos Supp. Aff. at ¶ 57.) Those lists, once in the possession of the Government, now have disappeared and were not used by the Government in making its decision, even though that was the reason they were retained. (Kádár Aff. ¶ 59.) Furthermore, the Government on numerous occasions rebuffed the efforts of representatives of the Hungarian Jewish community and/or the Hungarian Government to inspect the property, help inventory the property, or aid the Government in returning the property to its rightful owners.[64] (See supra at § II.F.)
The doctrine of “spoliation” holds that when a party has within its possession evidence that is damaged or eliminated, it is appropriate to presume the evidence was contrary to the interest of the party. In this case, the Government allowed property and lists of property to be lost, degraded, destroyed or sold, at a time when it knew full well that claims were being made by the Hungarian Jews. In 1945-47, representatives of the Hungarian Jewish community, as well as directly pleading with United States authorities for access to the property, were pursuing the only legal remedies that the Government told them were available, namely working through the Government of Hungary. The Government thus was on notice that claims were being made on the property, and in fact, knew that after February 1946, the Hungarian Government had waived its rights to the property in favor of the Jews and was now asserting the claim for the property on behalf of Hungarian Jews. (See supra.)
The Government was aware that it might face liability for the property in a court of law. As the transfer of the property to the International Refugee Organization was being readied, the United States sought indemnification from the American Jewish Joint Distribution Committee (“Joint”) for legal claims expected to be brought by Hungarian Holocaust survivors. The Joint demurred, as an internal memorandum concluded that such guarantees might get the group in “legal hot water.” Joel Fischer, the general counsel to the Joint, wrote:
The U.S. Army is presumably turning over to the IRO all of the non-monetary gold in Austria, (including the Hungarian Gold Train) which they have and which has not been stolen by individuals. . . . For us to come forward and give guarantees with respect to claims which might be lodged against these assets would be ill advised. We will receive the proceeds from the sale of these assets without any strings attached and why should we start attaching strings for ourselves; from your letter I'm sure you'll agree.
Letter from Joel Fischer to Moses Leavitt, Aug. 2, 1947, Ex. 43 Walton Decl.; see also Memo to Sec. of State from Paris, France sgd Caffery, 3 July 1946, GT 22808-22813 (noting Gen. Tate’s recommendation to set aside a reserve of 15% to satisfy future claims), Ex. 41 Walton Decl.
The Government cannot shirk its obligations to restitute the stolen Jewish property because of conjecture that Hungary might shirk its own laws and treaty obligations. Whether Hungary would have broken its promise to the Jews is unprovable speculation. That the United States broke its promise to the Hungarian Jews is proven historical fact.
Plaintiffs meet the threshold requirements required by Article III.
B. This Case May Not Be Dismissed Under the Doctrine of Prudential Standing
1. Prudential standing principles are not jurisdictional
The Government next claims that Plaintiffs’ claims must be dismissed for lack of subject matter jurisdiction under Rule 12(b)(1) because “prudential principles” preclude standing. (Def. Br. at 21.) This argument is misplaced. The “general prohibition on a litigant’s raising another person’s legal rights” is a judicially self-imposed limit[].” Allen v. Wright, 468 U.S. 737, 751 (1984). As such, it is “flexible and not jurisdictional in nature.” American Iron & Steel Institute v. Occupational Safety and Health Administration, 182 F.3d 1261, 1274 (11th Cir. 1999) (emphasis added). As a matter of law, the Government’s prudential standing argument provides no grounds for dismissal for lack of subject matter jurisdiction.
2. Plaintiffs assert their own claims, not Hungary’s
The Government’s argument posits a moral inversion.  The Government argues in effect that Plaintiffs – the true owners of the Gold Train property, from whom it was stolen by agents of the Hungarian Fascist Government – have no direct interest in their own property, but have only an indirect interest derivative of the direct interest of the successor Hungarian Government. Perhaps sensing how outrageous its argument is, the Government disavows belief in its factual basis, claiming only that it is based on “their [i.e., Plaintiffs’] theory.” (Def. Br. at 21.)
Plaintiffs have never said that the Hungarian Government had a superior interest to their property. This was stolen property. The Plaintiffs never lost title to it, and neither the Hungarian Fascist Government nor the successor Hungarian Government ever gained good title to the property. (FAC at ¶ 304.) And, neither did the Army.
Plaintiffs’ point is that the United States restituted looted property “to the Governments of the rightful owners,” i.e., the country of origin. (Petropoulos Supp. Aff. at ¶ 5.) This policy was followed not because the Governments of the countries of origin had superior claims than the “rightful owners,” but rather was based on administrative convenience. (Id. at ¶ 18.) Rather than processing the claims of thousands of individuals, it was the policy of the U.S. to, in effect, permit the countries of origin to act as the “agents” of the rightful owners and deal only[65] with them. This administrative choice does not confer a superior legal interest in the property.
3. Even if prudential standing principles apply, Plaintiffs satisfy the requirements
While Plaintiffs deny that they are asserting Hungary’s rights, rather than their own, it is nevertheless clear that, even if third-party prudential standing analysis applies, Plaintiffs satisfy these requirements. The “general prohibition against third-party standing” is intended to “ensure[] that the courts hear only concrete disputes between interested litigants who will frame the issues properly.” Harris v. Evans, 20 F.3d 1118, 1121 (11th Cir. 1994). In contrast to the amorphous claims common in standing jurisprudence, Plaintiffs present a concrete dispute: they seek compensation for personal property that they allege was misappropriated by the Government. It is hard to imagine litigants more interested than rightful property owners who, despite the hardships they have endured, are vigorously pursuing their claims for compensation in the twilight of their lives.
Plaintiffs in any event satisfy the three factors set forth in Powers v. Ohio, 499 U.S. 400 (1974), to allow third-party standing. The Government does not even contest the first requirement, injury in fact. The second factor requires a close relationship between the litigant and the third party; this test, too, is met.  As the Supreme Court has recognized, “the relationship between the litigant and the third party may be such that the former is fully, or very nearly, as effective a proponent of the right as the latter.” Singleton v. Wulff, 428 U.S. 106, 115 (1976). Such is the case here. Many Plaintiffs are citizens or former citizens of Hungary. It is Plaintiffs’ property that is at issue, not Hungary’s; Plaintiffs are the real parties in interest. Hungary is obligated by the 1947 Treaty of Peace to restore property seized from Jews or, if restoration is impossible, to compensate them. (Article 27.) Thus, Hungary’s only conceivable interest in the property is to ensure that its use is to compensate the owners. Hungary’s interests are not only “properly aligned” with the Plaintiffs’ (Harris, 20 F.3d at 1123), they are entirely congruent. The Government relies on the spurious argument that the 1947 Treaty of Peace and/or the 1973 Settlement Agreement set the Plaintiffs and Hungary at odds. (Def. Br. at 23-24.) As we show below, neither of these documents bars Plaintiffs’ right to recover. (See infra at § VIII.C.)
The third prudential standing factor is that there be “some hindrance” to the third party’s asserting its own interest. Curiously, the Government says not a word here about either the Treaty or the Settlement Agreement. Rather, it says merely that Hungary is a “sovereign state” and there is “no reason that it cannot protect any interest it thinks it may have regarding the Gold Train.” (Def. Br. at 24.)  The reason is obvious. The Government’s argument with respect to the second factor demolishes its argument on the third factor. Clearly, from the Government’s viewpoint, the Treaty and the Agreement are a hindrance to Hungary bringing suit. Not a bar, but a hindrance. The Government would clearly raise these issues if Hungary sued which would make the litigation more protracted and uncertain. And, it must be recalled, the object of such litigation would not be to compensate Hungary, but the rightful owners of the property. Thus the cost-benefit calculus would present a “practical barrier[]” to suit by Hungary sufficient to meet the hindrance factor. Cf. Powers, 499 U.S. at 415 (small financial stake and burdens of litigation present sufficient hindrance to support third party standing).
V. THE COURT HAS SUBJECT MATTER JURISDICTION OVER
PLAINTIFFS’ DAMAGE CLAIMS BECAUSE EACH
CLAIM IS MONEY MANDATING
As discussed above, the Court has subject matter jurisdiction over any claim for damages founded upon the “Constitution, or any Act of Congress or any regulation of an executive department, or upon any express or implied contract” that is fairly interpreted as money mandating. Without question, Plaintiffs’ claims are money mandating and founded upon these very sources.
A. Plaintiffs’ Contract, Takings, And Exaction Claims Are Money Mandating
Implied-in-fact contract claims are money mandating. Hatzlachh Supply Co. v. United States, 444 U.S. 460, 466 (1980); Quality Tooling, Inc. v. United States, 47 F.3d 1569, 1575 (Fed. Cir. 1995). The Tucker Act provides a waiver of immunity for Plaintiffs’ contract claims to proceed, as the Court has implicitly held. Rosner, 231 F. Supp. 2d at 1210 n.9.
Fifth Amendment Takings claims are money mandating.[66] Plaintiffs have briefed this issue extensively already and hereby incorporate that briefing by reference.[67]  In short, the Just Compensation Clause of the Fifth Amendment provides its own independent waiver of sovereign immunity and requires compensation whenever property is taken for public use. Jacobs v. United States, 290 U.S. 13, 16 (1933); Yearsley v. W. A. Ross Constr. Co., 309 U.S. 18, 22 (1940); Davis v. Passman, 442 U.S. 228, 242-43 n.20 (1979); First English Evangelical Lutheran Church v. County of Los Angeles, 482 U.S. 304, 315 (1987); Alder v. United States, 785 F.2d 1004, 1009 (Fed. Cir. 1986); El-Shifa Pharmaceutical Industries Co. v. United States, 55 Fed. Cl. 751 (2003) (rejecting Ashkir, relied upon by the Court); Turney v. United States, 115 F. Supp. 457 (Ct. Cl. 1953).
Illegal Exaction claims are money mandating. An illegal exaction claim is a due process claim for money that has been improperly retained by the Government (in violation of law). It is viable even where the money is not paid directly to the Government. By definition, such a claim is money mandating. Aerolineas Argentinas v. United States, 77 F.3d 1564, 1572-73 (Fed. Cir. 1996) (en banc); Eastport S.S. Corp. v. United States, 178 Ct. Cl. 599, 605 (1967); Eversharp, Inc. v. United States, 125 F. Supp. 244, 247 (Ct. Cl. 1954); Pan Amer. World Airways Inc., v. United States, 122 F. Supp. 682, 683-84 (Ct. Cl. 1954); Bernaugh v. United States, 38 Fed. Cl. 538, 543 (1997), aff’d, 168 F.3d 1319 (Fed. Cir. 1998) (taking of property); Bowman v. United States, 35 Fed. Cl. 397, 401 (1996) (taking of property). The failure of a plaintiff to establish that the exaction was contrary to law does not deprive a court of jurisdiction, but is an adjudication on the merits. Aerolineas Argentinas, 77 F.3d at 1574.
Plaintiffs’ illegal exaction claim is that the Government retained their property in violation of the law based on the Constitution (due process and takings), Decree No. 3, and other policies and laws in effect in occupied Austria. As the Government explained in the Portrait of Wally case:
Under the military decrees and policies in effect in post-war Austria, property, including artwork, seized by the United States Forces in Austria was sorted and turned over to the country from which the object had been taken.
Portrait of Wally, at 109, Ex. 17 Walton Decl.; In re Portrait of Wally, at *47 (all property taken under Decree No. 3 must be returned to country of origin). Accordingly, because the Government violated the law and, in doing so, received money in effect from the sale of Plaintiffs’ property to help pay for programs that the Government was obliged to fund,[68] Plaintiffs state an illegal exaction claim.
B. The Court Has Jurisdiction To Determine Which Of Plaintiffs’ International Law Claims Are Money Mandating, And Adjudicate The Merits Of Those That Are[69]
The Supreme Court has clarified that the Court has jurisdiction to decide the merits of Plaintiffs’ so-called international law claims. Rasul v. Bush, 124 S. Ct. 2686, 2004 U.S. Lexis 4760 (2004). In Rasul, the Court of Appeals held the federal courts “lack jurisdiction to consider challenges to the legality of detention of foreign nationals captured abroad in connection with hostilities and incarcerated at the Guantanamo Bay Naval Base, Cuba.” Id. at 2690. The Supreme Court reversed.
The Supreme Court’s most relevant discussion concerns the Al Odah detainees. They alleged that the Government’s failure to inform them of the charges against them, restrictions on the right to counsel, and their lack of access to the courts violated the Constitution, international law, and treaties of the United States. Id. at 2691. They asserted federal jurisdiction. Relying on Johnson v. Eisentrager, 339 U.S. 763 (1950), the Court of Appeals had held, among other things, that aliens outside the United States could not assert these constitutional rights, and therefore dismissed the complaint for lack of jurisdiction. Id. at 2691-92.
The Supreme Court explained that the decision in Eisentrager rested on “six critical facts.” Id. at 2693. In Eisentrager, the individuals were (a) enemy aliens; (b) who has been or resided in the United States; (c) and captured outside the territory of the United States and held in military custody as a prisoner of war; (d) where he or she was tried and convicted by a Military Commission sitting outside the United States; (e) for offenses against laws of war committed outside the United States; (f) and was at all times imprisoned outside the United States. Id. Moreover, the Court emphasized that the petitioners could assert all of their claims because the U.S. exercised custody over them, even though that custody was outside the territorial jurisdiction of the courts. Id. at 2695.
The Court distinguished at length the Guantanamo detainees from the Nazi war criminals (known enemy aliens) at issue in Eisentrager, and in the end concluded that nonresident aliens are entitled to the privilege of litigation in federal courts.
The courts of the United States have traditionally been open to nonresident aliens. Cf. Disconto Gesellschaft v. Umbreit, 208 U.S. 570, 578 (1908) (“Alien citizens, by the policy and practice of the courts of this country, are ordinarily permitted to resort to the courts for the redress or wrongs and the protection of their rights”). And indeed, 28 U.S.C. §1350 explicitly confers the privilege of suing for an actionable “tort . . . committed in violation of the law of nations or a treaty of the United States” on aliens alone.
Id. at 2698-99. Rasul clearly holds that the Court has jurisdiction to decide Plaintiffs’ claims.
Moreover, and perhaps more importantly, the Supreme Court recently confirmed that Congress granted an implied private right of action to aliens when it enacted 28 U.S.C. § 1350. Congress limited this cause of action to those claims having definite content and an almost universal degree of international acceptance among civilized nations. Sosa v. Alvarez-Machain, 124 S. Ct. 2739, 2004 U.S. Lexis 4763, at *71 (June 29, 2004).[70] The Court explained that district courts can and should recognize these federal common law claims and enforce such norms, just as the courts have been doing since the nation’s founding. Citing to the watershed rulings of the modern era, including Filartiga v. Pena-Irala, 630 F.2d 876, 890 (2d Cir. 1980), Judge Edwards’ concurrence in Tel-Oren v. Libyan Arab Republic, 726 F.2d 774, 781 (D.C. Cir. 1984), and In re Estate of Marco Human Rights Litig., 25 F.3d 1467, 1475 (9th Cir. 1994), the Court explained that these rulings are “generally consistent” with the Court’s decision in Sosa. Sosa, at *71.[71]
The Constitutional authority that a federal court possesses to create or find a cause of action is derived from the court’s “general jurisdiction to decide all cases ‘arising under the Constitution, laws, or treaties of the United States.’” Correctional Services Corp. v. Malesko, 534 U.S. 61, 66 (2001). Therefore, although the nomenclature is to describe these claims as international law claims, that description is incorrect. Of legal necessity, the claims are ones that “arise under” federal law either through the “Constitution, laws, or treaties of the United States.”
Expropriation of private property without any compensation has attained the special status to become federal law and actionable under 28 U.S.C. § 1350. Restatement (Third) of Foreign Relations Law § 712; Banco Nacional de Cuba v. Chase Manhattan, 658 F.2d 875, 891 (2d Cir. 1981) (“the failure to pay any compensation to the victim of an expropriation constitutes a violation of international law”); West v. Multibanco Comermex, S.A., 807 F.2d 820, 831-32 (9th Cir. 1987) (same); Kalamazoo Spice Extraction Co. v. The Provisional Military Gov’t of Ethiopia, 729 F.2d 422, 426 (6th Cir. 1984) (same); Shanghai Power Co. v. United States, 4 Cl. Ct. 237, 240 (1983); 1 L. Oppenheim, International Law, § 155, at 352 (8th ed. Lauterpacht 1955) (which also reflects a correct statement of law from earlier editions); see also H.R. Rep. No. 1487, 94th Cong., 2d Sess. 19-20, reprinted in 1976 U.S.C.C.A.N. 6604, 6618 (taking violates international law if it is done “without payment of the prompt adequate and effective compensation required by international law” or is “arbitrary or discriminatory in nature”).
The Government has resolutely adhered to this principle, until now. See generally 8 M. Whiteman, Digest of International Law 1085-1136 (1967). This view, consistently adhered to by the Government until now, is commonly referred to as the Hull Doctrine because the most celebrated expression of this opinion came from United States Secretary of State Cordell Hull to the Government of Mexico in 1938 on the subject of Mexico’s agrarian takings. Hull explained: “under every rule of law and equity, no Government is entitled to expropriate private property, for whatever purpose, without provision for prompt, adequate, and effective payment therefor.” Note of Secretary of State Hull, Aug. 22, 1938, 19 Dept. of State Press Releases No. 465, Aug. 27, 1938, at 140;[72] Shanghai Power, 4 Cl. Ct. at 240. Moreover, this fact, among others, helped convince the court in Shanghai Power that it was obliged to apply international law consistent with U.S. policy to the facts of the case.
There is no doubt that rights created by virtue of an expropriation are backed by accepted principles of international law. Moreover, recognition of such rights is not contrary to our public policy, but, indeed, is consistent with the repeated expressions of our State. . . .
Our Government has, however, been among the strongest proponents of the view that the right to full and fair compensation exists and must be respected by other nations. It would be inappropriate for this court to adopt a contrary position.
Shanghai Power, 4 Cl. Ct. at 241. This claim is money mandating.
Notably, the Government recently confirmed this view of the law in the most emphatic of terms, stating to the court in the Portrait of Wally case:
The principles preventing seizure of property from private citizens during wartime and governing restitution of such property, particularly after World War II, have been unambiguously subscribed to by scores of nations, including Austria and the United States. In the Hague Convention of 1907,[73] forty-one nations, including Austria and the United States, agreed to the prohibition of the seizure of property during wartime from private citizens. Hague Convention of 1907, Article 56 (“All seizure of, destruction of, willful damage done to institutions of this character, historic monuments, works of art and science, is forbidden, and should be made subject to legal proceedings.”). During World War II, these principles were reiterated by the Allies in the London Declaration of 1943,[74] in which eighteen nations warned the Nazi regime that all confiscations of property were subject to restitution. And Article 26 of the Austrian State Treaty of 1955 confirmed the adoption of these principles of restitution by Austria and the Allies.
Portrait of Wally, at 161-62, Ex. 17 Walton Decl.
Courts have recognized that disgorgement and/or restitution are proper forms of civil relief for violations of international law, and that such claims are privately actionable under 28 U.S.C. § 1350. Bolchos v. Darrel, 3 F.Cas. 810 (D.S.C. 1795); Respublica v. Delongchamps, 1 U.S. (1 Dall.) 111, 116 (Pa. Oyer & Terminer 1784); see, e.g., The Venus, 12 U.S. (8 Cranch) 253, 297 (1814) (“The law of nations is a law founded on the great and immutable principles of equity and natural justice”).
Plaintiffs bring this claim against the United States under the waiver of sovereign immunity provided in the Tucker Act. The claim is money mandating and founded on an Act of Congress, specifically 28 U.S.C. § 1350. No additional waiver is required.[75]
C. Provisional Handbook And The Army Field Manual Are Binding On The Conduct Of The U.S. Army As Its Own Regulation And Create Substantive Rights That Are Money Mandating
The Supreme Court has expressly held that military powers during war-related foreign occupation are “regulated and limited . . . directly from the laws of war . . . from the law of nations.” Dooley v. United States, 182 U.S. 222, 231 (1901); 11 Ops Att’y Gen. 297, 299-300 (1865) (laws of war and general laws of nations “are of binding forced upon the departments and citizens of the Government”). The codification of those laws is found in the Army Field Manual 27-10, The Rules of Land Warfare. See Morrison v. United States, 492 F.2d 1219, 1225 & n.8 (Ct. Cl. 1974) (explaining it a “compilation of legal principles that relate to land warfare. It is based upon treaties ratified by the United States, statutory law, and applicable custom,” and indicating provisions tied to statutes and texts of treaties are binding law).
Certain statutes or regulations require compensation for violations, while others are money mandating because they are “reasonably amenable” to an interpretation, drawing all “fair inferences,” that violations demand compensation. Fisher v. United States, 364 F.3d 1372, 1377 (Fed. Cir. 2004). They include provisions of substantive law or regulations that Plaintiffs allege the Government violated which require compensation when hostilities cease and include, Decree No. 3 and Paragraphs 323, 326, 331, and 345 of the Army Field Manual. Therefore, the Tucker Act provides a waiver of sovereign immunity. Plaintiffs state a claim in which they are entitled to relief.
VI. THE GOVERNMENT FAILS TO ESTABLISH THAT PLAINTIFFS’ CLAIMS ARE TIME-BARRED
The Court has already rejected the Government’s argument on statute of limitations on a motion to dismiss. The Government has provided no valid reason for the Court to reconsider its decision. “Expiration of the statute of limitations does not divest a district court of subject matter jurisdiction, but rather constitutes an affirmative defense, which the defendant can waive.” United States v. Najjar, 283 F.3d 1306, 1308-09 (11th Cir. 2002). The Government contends otherwise, and argues that principles of equitable tolling should not apply under the facts. (Def. Br. at 25.)
A. The Statute Of Limitations Is Not Jurisdictional
Despite the Court’s initial ruling in this case that statute of limitations “must be strictly observed” as a “condition of Congress’s waiver of sovereign immunity,” 231 F. Supp. 2d at 1206, recent Supreme Court authority clarifies that this aspect of the Court’s ruling was erroneous. The generic statute of limitations applicable to claims brought under the Tucker Act is not jurisdictional. White Mountain, supra.
Under Irwin v. Department of Veterans Affairs, 498 U.S. 89 (1990), once sovereign immunity is waived, limitations periods that run in favor of the Government are not jurisdictional unless Congress explicitly so provides. When Congress has waived the Government’s immunity, common law treatment and exceptions to statute of limitations apply “in the same way” as they do in “private suits.” Id. at 95. Thus, unless Congress indicates a contrary intent, the “general rule” is that statutory time limits running in favor of the Government are not “jurisdictional.” Id. at 95-96; see also Franconia Associates v. United States, 536 U.S. 129, 145 (2002) (Tucker Act claim and rejecting special accrual rule where Government is defendant noting “limitations principles should generally apply to the Government ‘in the same way’ that they apply to private parties”); Scarborough v. Pincipi, 124 S. Ct. 1856, 1869 (2004) (same, though not Tucker Act).
The Solicitor General agrees that the Supreme Court “has made clear that, unless strict compliance with a filing deadline is a prerequisite to the jurisdiction of the court, ‘statutory filing deadlines are generally subject to the defenses of waiver, estoppel, and equitable tolling.’” Brief for the U.S., Kontrick v. Ryan, No. 02-819, at 10 (July 17, 2003) (quoting United States v. Locke, 471 U.S. 84, 94 n.10 (1985)). And, according to the Government, a filing period cannot be “jurisdictional” if, by its terms, it “does not limit jurisdiction to those cases in which there has been a timely filing.” Id. at 13 (quoting Zipes, 455 U.S. at 393.)
In Kontrick, the Supreme Court concluded that Bankruptcy Rule 4004(a) was not “jurisdictional” (i.e., not related to subject matter jurisdiction of federal courts) because it did not serve to “delineate” a “class of cases” “within a court’s adjudicatory authority.” 124 S. Ct. 906, 915 (2004); see also United States v. Cotton, 535 U.S. 625, 630 (2000) (lamenting the Court’s sometimes loose use of the term “jurisdictional” and making clear “what the term means today, i.e., ‘the courts’ statutory or constitutional power to adjudicate the case’”) (quoting Steel Co. v. Citizens for a Better Environment, 523 U.S. 83, 89 (1998)) (emphasis added). Furthermore, the Court provided valuable insight into identifying “a rule governing subject-matter jurisdiction:” it is one that “cannot be expanded to account for” the parties’ conduct. Id. at 916.
The Tucker Act’s waiver of sovereign immunity, which specifies certain kinds of claims for which Congress has authorized and provided its consent to be sued, does not condition the waiver of sovereign immunity upon a timely filing. And, just as courts are powerless to find a waiver of sovereign immunity when Congress has not provided one, courts are equally powerless narrow the waiver Congress grants. Indeed, the Court in Irwin emphasized that courts must “be careful not to assume the authority to narrow the waiver that Congress intended, or construe the waiver unduly restrictively.” Irwin, 498 U.S. at 94. Thus, where a statute, such as the Tucker Act, waives sovereign immunity for a class of claims without conditioning that waiver on a timely filing, judicially implying such a requirement improperly narrows the waiver Congress intended. Nothing in section 2401(a) makes any mention of jurisdiction. And, in such a case, the Supreme Court explains that the statute is only a procedural bar which permits recognition of traditional common law doctrines such as equitable tolling, waiver, and estoppel does not broaden Congress’ waiver but instead is “likely to be a realistic assessment of the legislative intent as well as a practically useful principle of interpretation.” Id. at 95; cf. United States v. Texas, 507 U.S. 529, 534 (1993) (courts presume “retention of long-established and familiar principles, except when a statutory purpose to the contrary is evident”).
Moreover, the Supreme Court ruled in Franconia Associates that the statute of limitations applicable here is not to be read restrictively. More specifically, the Court held that language contained in section 2401(a), through ruling on a Tucker Act section 2501 claim, should be applied in the same way as it does to private parties, and that any other reading would be an “unduly restrictive” reading of Congress’ intent in waiving sovereign immunity for claims brought under the Tucker Act. 536 U.S. at 145. Thus, the statute of limitations is an ordinary procedural rule and affirmative defense. See, e.g., Cedars-Sinai Medical Center v. Shalala, 125 F.3d 765, 770 (9th Cir. 1997) (holding § 2401(a) is not jurisdictional); accord Washington v. Garrett, 10 F.3d 1421, 1437 (9th Cir. 1993); Hughes v. United States, 263 F.3d 272, 278 (3d Cir. 2001); Glarner v. United States, 30 F.3d 697, 701 (6th Cir. 1994); Slaaten v. United States, 990 F.2d 1038, 1043 n.5 (8th Cir. 1993); Schmidt v. United States, 933 F.2d 639, 640 (8th Cir. 1991); see also Sandvik v. United States, 177 F.3d 1269, 1271 (11th Cir. 1999) (“garden-variety statute of limitations” are “not a jurisdiction bar that would escape equitable tolling”); Milam v. United States Postal Service, 674 F.2d 860, 862 (11th Cir. 1982) (construing Title VII with a similar statute of limitations, stating “[t]imely filing is not a prerequisite to federal jurisdiction”).
B. Plaintiffs’ Claims Are Not Time-Barred As A Matter of Law
According to the Government, Plaintiffs’ claims are governed by the generic catchall 6-year statute of limitations contained in 28 U.S.C. § 2401(a). Edwards v. Shalala, 64 F.3d 601 (11th Cir. 1995); (Def. Br. at 25).
Although Plaintiffs bear the burden of proving subject matter jurisdiction, the Government carries the laboring oar in establishing all affirmative defenses, which include affirmatively proving that Plaintiffs failed to comply with the limitations period. Fed. R. Civ. P. 8(c); Morton’s Market, 198 F.3d at 832-33; Krueger v. Saiki, 19 F.3d 1285, 1286 (8th Cir. 1994). This means that the Government, as the moving party, must affirmatively prove in the record that “demonstrates conclusively” Plaintiffs (a) “had notice of their claims,” and (b) “that, had they exercised reasonable diligence, they would have discovered adequate grounds” to file this lawsuit during the limitations period. Morton’s Market, 198 F.3d at 832-33. The Government fails if all it can do is show that facts “might have caused a plaintiff to inquire” or “could have led to evidence supporting his claim.” Id. The Government has failed to carry that burden here. Its motion should be denied.
1. The Government cannot show the Plaintiffs were on notice in the 1940s
As the Government argues, accrual of a cause of action “occurs ‘when the Plaintiff discovers, or by the exercise of due diligence would have discovered, that he has been injured and who caused the injury.’” (Def. Br. at 28 (quoting United States v. Rodriquez-Aguirre, 264 F.3d 1195, 1212 (10th Cir. 2001), and citing Chappell v. Rush, 340 F.3d 1279, 1283 (11th Cir. 2003); United States v. Duke, 223 F.3d 627, 630 (7th Cir. 2000)):
Plaintiffs were put on notice of the claims they bring in this action when they discovered, or by exercising due diligence would have discovered, that, (1) at the end of World War II, the United States took possession of a train that had come from Hungary and was loaded, in part, with the personal property of Jews, and (2) that the United States did not return the contents of the train to the Hungarian Government, or to them. With that information, they would have known that they had been injured, and by whom (e.g., that their property had been taken from them, that the United States found property that may have been theirs, and that it did not return the property to the Hungarian Government, or to them).
(Def. Br. at 28-29.)
It is the Government’s burden to produce “undisputed” facts that “demonstrate conclusively” the Plaintiffs could have and should have discovered the Government’s involvement or the cause of action earlier. Morton’s Market, supra; Richards v. Mileski, 662 F.2d 65, 71 (D.C. Cir. 1981); Smith v. Nixon, 606 F.2d 1183, 1191 (D.C. Cir. 1979).
After depositions of the Plaintiffs, the record is clear: before 1999, none of the Plaintiffs had any knowledge that a trainload of Jewish property from Hungary came into the possession of the United States, much less that the Government had refused to return the property. In short, they did not know “that they had been injured, [or] by whom”[76] until after the facts about the Gold Train were first revealed by PCHA in 1999.
As the Court is aware, whether one could have, by the exercise of due diligence, discovered that they had been injured and that the Government caused their injury, is so fact intensive that it “is [not] even an appropriate question for summary judgment.” Rosner, 231 F. Supp.2d at 1209 n.7; Rodriquez-Aguirre, 264 F.3d at 1211. Plaintiffs had no particular reason to believe that the U.S. had received their property. It was just as likely that their property had been destroyed in the maelstrom of war at the end of World War II, or kept by the Hungarian Government or banks to whom it had been surrendered, or looted by fleeing Nazis and fascists, or looted by invading Soviet troops, or some combination of all the foregoing possibilities.
Plaintiffs never suspected that their property fell into the hands of the United States, whose troops never even entered Hungary. At his deposition, George Rasko explained a very common attitude of the Hungarian Jews toward the United States after the war and liberation:
For us, United States – I mean, we had some personal experiences with the Russians – I mean the Soviets, but for us the Americans were always the liberators who actually didn’t do anything wrong, you know what I mean?
So we never thought in our wildest imagination that United States or people who represented the United States – I don’t really say that the Government in a sense, but the people who represented the United States would have taken stuff which didn’t belong to them. That was kind of inconceivable. We kind of expected that from the Russians, we seen the Germans firsthand, but United States, kind of we never assumed anything like that. That was kind of inconceivable to us.[77]
The logical place to have inquired would have been the banks, the Hungarian Government or the Soviet occupation authorities; they, at least, were might have been expected to know something about their property. Plaintiffs did make such inquiries, but came up empty-handed.[78]
Considerations of the reasonableness of Plaintiffs’ actions cannot be separated from the context in which they occurred. Having escaped death in the Holocaust, some Plaintiffs were struggling to survive day to day in a devastated post-war Hungary,[79] while others were languishing in DP camps.[80] By 1949, and continuing for decades, many Plaintiffs then began suffering under an oppressive Communist dictatorship where making waves was dangerous.[81] And yet others were struggling to learn new languages and build new lives in foreign lands. To suggest that it was incumbent on Plaintiffs living under such circumstances to have made any inquiry—let alone sufficient inquiry—that would have led them to discover their injuries and the perpetrator flies in the face of reality.
a. Obscure articles in American newspapers do not give notice to Holocaust survivors, many of whom were teenagers living in DP camps
The Government argues that these Holocaust survivors should have read about the Gold Train in the newspapers. Then they would have discovered America’s role in causing their injuries. (Def. Br. at 29.)
As an initial matter, the Government’s assertion is not borne out by inspecting the articles cited. The Government encloses four documents that purport to be articles from The New York Times.[82] Only two mention that the property in question came from Jews (October 10, 1946 and December 30, 1948) and one (November 9, 1946), clearly has nothing to do with the Gold Train at all. In any event, it is extremely unlikely that an article buried in the inside pages of a newspaper in New York was widely seen in Hungary or the DP camps of Europe, let alone read by those who speak Magyar.
The Government also encloses two “unofficial” translations by the US Embassy of articles purportedly appearing in Szabadsag in June 1948.[83] Neither specifically identifies the property in question as Jewish. Moreover, the newspaper is identified as the Communist daily, hardly trustworthy.[84] It is impossible to infer from these that the news of the Gold Train was widely broadcast in Hungary. In short, none of these articles establishes that Plaintiffs should have learned of their injury from the press had they only been diligent. The assertion that a few news stories is sufficient to impute knowledge to the Plaintiffs is contrary to the law. Morton’s Market, 198 F.3d at 832-33; O’Connor, 311 F.3d at 1152-53.
b. Government has failed to prove agency relationship to impute knowledge to Plaintiffs and absent all class members
The Government also argues that Plaintiffs could and should have learned of their injuries from “representatives of the surviving Hungarian Jewish community, who themselves are members of the putative class.” (Def. Br. at 29.) Certain individuals in the Hungarian Jewish community were aware that the Gold Train was in the Government’s possession. (Kádár Aff. at ¶¶ 74-76, Ex. 1 Walton Decl.) But inquiry notice by some class members can only be imputed to other class members if there is an agency or other relationship among the class members that would support such imputed knowledge. Briskin v. Ernst & Ernst, 589 F.2d 1363, 1369 (9th Cir. 1978). In the absence of any proof as to who these individuals were, how they acquired their information, which organizations they represented, which Jews were included in their membership, evidence on how monolithic the Jewish community in Hungary was, whether any Plaintiffs knew any of them, and a host of other unanswered questions, one cannot conclude that their knowledge should be imputed to Plaintiffs.
Indeed, the notion that knowledge about the Gold Train was widespread and easily acquired with a modicum of diligence is belied by Zweig’s admitted ignorance. He had never heard of the Gold Train until the 1980s, when he “stumbled” across a mention of it in the British archives. (See supra at § II.J.) And, he readily admits that understanding the Gold Train requires a breadth of expertise and hard research. (Zweig Dep., 36:6-14.)
2. Assuming Plaintiffs’ claims accrued earlier, the doctrine of equitable tolling applies and tolled claims until 1999
If Plaintiffs’ claims accrued before 1999, equitable tolling permits a court to deem preserve the claim when “principles of equity would make the rigid application of a limitation period unfair.” Miller v. New Jersey State Dept of Corrections, 145 F.3d 616, 618 (3d Cir. 1998). The policy of repose reflected in limitations period is outweighed by the “interests of justice [that] require vindication of the plaintiff’s rights.” Burnett v. New York Central R.R. Co., 380 U.S. 424, 428 (1965).
The Government recognizes that equitable tolling applies to suits against the Government. Irwin, 498 U.S. 89 (1990). The Government, however, seeks to impose a straightjacket on the doctrine, limiting it to the two situations mentioned in Irwin, i.e., when the claimant filed a defective pleading during the statutory period or when he was induced or tricked by his adversary’s misconduct into allowing the filing deadline to pass. (Def. Br. at 26 n. 19.) But as the Supreme Court and this Court have recognized, the Irwin list is not exhaustive and tolling may apply in other situations. Young v. United States, 535 U.S. 43 (2002); Rosner, 231 F. Supp. 2d at 1208-1209. The Eleventh Circuit has applied the doctrine to other situations. For example, in Ferreiro v. United States, No. 96-4963 (11th Cir. Sept. 30, 1997)[85] the claimant missed the deadline for filing a claim in admiralty because counsel for the Customs Service mistakenly told him he must file his claim under the Federal Tort Claims Act. Although the court assumed that the Government’s mistake was inadvertent, it nevertheless found that equitable tolling applied, noting that one should be able to put reasonable reliance on information and instructions from a Government lawyer in a responsible position. Slip op. at 6-7. In concluding, the court stated:
Irwin does not draw an unrealistic or unfair hard line which must be applied to all equitable tolling cases. 498 U.S. 89, 95-96. The doctrine’s use is not confined to fraudulent or intentionally harmful and misleading conduct. Its application, though limited, is not totally inflexible. This approach may cause the Government to be more responsible in its dealings with citizens and to realize it cannot always shift the burden of its own unfortunate conduct to an innocent party.
Id. at 9; see also, Furnes v. Reeves, 362 F.3d 702 (11th Cir. 2004) (equitable tolling held to apply under International Child Abduction Remedies Act when child is secreted); Sandvik v. United States, 177 F.3d 1269, 1272 (11th Cir. 1999) (equitable tolling may apply to prisoner petition untimely due to extraordinary circumstances beyond petitioner’s control, unavoidable even with diligence).
Federal courts have found equitable tolling in a number of circumstances. It applies when the plaintiff knows that he has been injured but is unaware that his injury is the result of misconduct. Cada v. Baxter Healthcare, 920 F.2d 446, 451 (7th Cir. 1990); Chung v. Department of Justice, 333 F.3d 273, 279 (D.C. Cir. 2003). It applies after the Government converts war surplus property until Plaintiffs have evidence of Government’s dominion over the property. Aleutco Corp. v. United States, 244 F.2d 674, 679-80 (3d Cir. 1957). It applies when war gets in the way. Burnett, 380 U.S. at 429.
The evidence developed in this case demonstrates clearly that the conduct of the Government was deceptive, and moreover, that the extraordinary circumstances of the Holocaust warrant equitable tolling. The Government knew from the beginning that the Gold Train property was loot stolen from Hungarian Jews. (Supra; Zweig Dep., 94:9-19.) As early as December 20, 1945, representatives of the surviving Jewish community were requesting return of the Gold Train property from the U.S. Legation in Budapest.[86] They were told, however, that they could not assert a claim; only the Hungarian Government could assert a claim on their behalf. Furthermore, their requests to inspect the property or help inventory the property or assist the Government in finding individual owners were rebuffed. (Kádár Aff. at ¶¶ 74-78; Supra, § II.F.)
Heeding Schoenfeld’s instruction and advice, the Jewish representatives enlisted the Hungarian Government’s assistance to recover the Gold Train property on behalf of the Jews.[87] (Supra.) After a few months of negotiating, these efforts by Hungary eventually led to a promise by the Secretary of State to the Hungarian Government that all identifiable looted property would be returned to Hungary, its country of origin, and that Hungary took this to be a promise to return the Gold Train as looted property. (Kádár Aff. at ¶¶ 68-73, 79-91). The Government, however, reneged on that promise as well and turned over most of what Gold Train property remained to the PCIRO. (Kádár Aff. at ¶¶ 96-98). The ostensible reason and the one that was given was that the property was “unidentifiable,”[88] but this was only after the Government unilaterally redefined Article 8 to create a legal pretext to immunize itself from takings and other claims over the Hungarian Jews’ property.
Under applicable restitution policy and laws, all that was required to be known about property was its country of origin and that it had been forcibly removed by the Nazis or a puppet Government.[89] Under Decree No. 3, not even this knowledge was required; the Government just needed to know that it came from Hungary. The Government had known since the beginning that the Gold Train came from Hungary.
It was a pretext because the Government had other ulterior motives for wanting to dispose of the Gold Train property through the PCIRO. Sale of the property by the PCIRO (and other property like the Gold Train) would help relieve the substantial drain imposed on the Treasury by its decision to support masses of displaced persons.[90] (Supra, § II.I; Plunder and Restitution, at 9; FAC at ¶¶ 409-11.) Additionally, disposal of the property – without taking a proper inventory – would conceal the substantial wastage to the property caused by the depredatory conduct of high ranking officers and others. (FAC at ¶¶ 258-279, 300-301.) And, the disposal of the property itself, together with all the accompanying indicia of ownership, whether or not it rises to the level of sanctionable spoliation, certainly made future claims by the rightful owners more difficult, permitting the Government to argue, as it does here, that Plaintiffs cannot prevail because they cannot prove that their property was on the Gold Train.
In addition, the Government concealed from the public its conduct by classifying documents as secret that might have revealed its role in causing Plaintiffs’ injury. The Government had an affirmative duty not to “cause or permit to be done any act of commission or omission which results in damage to or concealment of any of the properties covered by” Decree No. 3. This is sufficient to toll all limitations until the disabling secret classification has been lifted, at the earliest. Zweig informs us that the declassification began in 1998. (GT at x-xi.; see also Kádár Dep., 230:3-8; 243-244) (noting that he was in the United States when documents relevant to the Gold Train were declassified).
But for the Government’s possession of the property and its failure to follow the governing restitution laws, the Hungarian Jews would have been able to obtain their property and/or pursue other remedies adequately.[91] In this situation, and even pre-Irwin, the Supreme Court held that the principles of equitable tolling preserve the causes of action. Burnett, 320 U.S. at 360).[92] Plaintiffs’ claims should be tolled under the doctrine of equitable tolling.
VII. PLAINTIFFS ASSERT VIABLE APA CLAIMS
Plaintiffs seek non-monetary relief under the APA including an accounting and return of the property still in the Government’s possession as required under Decree No. 3, WARX 99226,[93] and other applicable laws, and a declaration that the Government’s failure to restitute the Gold Train property to Hungary was arbitrary, capricious, an abuse of discretion, and not in accordance with law. As the Court is aware, the APA provides a waiver of sovereign immunity for such claims. Rosner, 231 F. Supp. 2d at 1211 (quoting 5 U.S.C. § 702).
The Government contends that the military authority exception insulates it from these claims, or that the challenged actions are nonreviewable under §701(a)(2) because they are committed to agency discretion. (Def. Br. at 33-43.) As explained below, the Government is mistaken.
A. Applicable Standards
Section 702 of the APA provides “[a] person suffering legal wrong because of agency action, or adversely affected or aggrieved by agency action within the meaning of the relevant statute, is entitled to judicial review thereof.” The review perforce grants a right of equitable or declaratory relief for legal challenges to federal agencies’ or officials’ action as contrary to law. Japan Whaling Ass’n. v. American Cetacean Soc’y, 478 U.S. 221, 230-31 n.4 (1986). This right also includes the right to challenge agency action that violates a treaty. Indeed,
[v]ery rarely do statutes withhold judicial review. It has never been the policy of Congress to prevent the administration of its own statutes from being judicially confined to the scope of authority granted or to the objectives specified. Its policy could not be otherwise, for in such a case statutes would in effect be blank checks drawn to the credit of some administrative officer or board.
Bowen v. Michigan Academy of Family Physicians, 476 U.S. 667, 671 (1986); see also Heckler v. Chaney, 470 U.S. 821 (1985) (the APA is applicable in instances where statutes are “drawn so that a court would have [a] meaningful standard against which to judge the agency’s exercise of discretion”).
The strong presumption in favor of judicial review is subject to few exceptions, and those exceptions are narrowly construed. For example, the exception to judicial review provided in subsection § 701(a)(2) applies only in those rare instances where statutes and regulations are so broad that a reviewing court cannot find law to apply. Thus, the exception is very narrow. Citizens to Preserve Overton Park, Inc. v. Volpe, 401 U.S. 402, 410 (1971). Moreover, it has no application here, as there is ample law to apply, as spelled out in the FAC, paragraphs 302-322.
B. The Court May Review Army Conduct To Ensure Compliance With The Law And Its Regulations
The Government’s position is further undercut by the numerous cases in which the courts of appeal have held review available where military officials have violated their own regulations. See, e.g., Feliciano v. Laird, 426 F.2d 424 (2d Cir. 1970); Van Bourg v. Nitze, 388 F.2d 557 (D.C. Cir.1967); Bluth v. Laird, 435 F.2d 1065 (4th Cir. 1970); Nixon v. Secretary of Navy, 422 F.2d 934 (2d Cir. 1970); Schatten v. United States, 419 F.2d 187 (6th Cir. 1969); Smith v. Resor, 406 F.2d 141 (2d Cir. 1969).
Thus, the Court can review the requisitions that occurred for compliance with the Constitution[94] and military regulations;[95] and other applicable regulations set forth in the Army Field Manual,[96] and can decide questions about whether property is war booty or captured enemy property.[97] In these instances, the Courts are not second-guessing authorized decisions. Instead, the court is determining whether the exercise of military authority was authorized at all. And, deciding whether the exercise is with or without authority is within the expertise of the Judiciary. See Service v. Dulles, 354 U.S. 363 (1957); Sampson v. Murray, 415 U.S. 61 (1974); Adkins v. United States, 68 F.3d 1317, 1323 (Fed. Cir. 1995) (military regulations limit and provide standards against which courts are equipped to judge military conduct); Murphy v. United States, 993 F.2d 871, 873 (Fed. Cir. 1993) (military is bound to follow its own regulations once promulgated); Harmon v. Brucker, 355 U.S. 579 (1958) (federal courts may review internal military affairs to determine if actions were outside the scope of powers); Mindes v. Seaman, 453 F.2d 197 (5th Cir. 1971) (discussing and citing cases).
C. The Government Has Presented No Reason For This Court To Reverse Its Previous Holding That The Actions Complained Of Were Not Military In Nature
In spite of the Court’s prior ruling that the actions for which Plaintiffs’ seek review under the APA were non military in nature, Rosner, 231 F.Supp.2d at 1212, the Government again seeks to travel under the military authority exception.
The Court’s reasoning in denying the government’s first motion to dismiss based upon the APA’s military authority exception was sound: “the allegations of the Complaint refer to events that occurred after World War II;” the Court’s deference to the political branches with respect to military matters “does not [and has never] extend[ed] to all actions which could arguably be traced back to an exercise of military authority [citing Owens v. Brown, 455 F. Supp. 291, 300 (D.D.C. 1978)];” something more is required.[98] The exception is limited to an authorized military official “exercising” his or her discretionary authority on the field of battle, readying the troops for war—including training—second guessing lawful orders, and other situations anticipated by Doe v. Sullivan, 938 F.2d 1370 (D.C. Cir. 1991) (APA exception limited to “military commands made in combat zones or in preparation for, or in the aftermath of, battle,” . . . i.e. disputes over military strategy or discipline, or between soldiers and their superiors). See also Reid v. Covert, 354 U.S. 1, 34 (1957) (“‘in the field’ means in the area of actual fighting”).[99]
Further, as this Court previously held: “Plaintiffs’ Complaint makes specific allegations regarding conduct that, although exercised by military personnel, is decidedly non-military in nature.” Rosner, 231 F.Supp.2d at 1212. The operative allegations of the FAC regarding the Government’s actions in violation of law, and the discovery in this case, all confirm the non-military nature of the conduct at issue. The Government seems to admit as much when it characterizes its obligations with respect to the property in question as administrative. (Def. Br. at 37.) Even as described by the Government, “the Army’s storage and security of Gold Train property, the Army’s making available for requisitioning property from the warehouse where Gold Train property was stored, and the United States’ decision to turn over Gold Train property to the IGCR” (Def. Br. at 34) are non-military in nature. Further, it simply cannot be said that conduct that is illegal under the military’s own rules and regulations involved the exercise of military authority in the field.
 The Government, in effect, renews its effort to obtain a reconsideration of the Court’s prior rulings, rather than presenting any facts that would rebut the non-military character of the conduct in question. It argues that the technical state of war did not end until December 1951, but evades the fact that hostilities ended much earlier, and, moreover, fails to address the underlying and controlling reality that the conduct in question was not military in nature, and was therefore outside of the exception. In essence, the Government disregards the case law, including this Court’s ruling, that the exception does not apply to conduct that is non-military in nature (even when exercised by military personnel).
The Government also relies on a prior version of the APA which allegedly excluded review of WWII military actions, arguing that its repeal precludes the application of the current exclusion to the conduct at issue. “As originally enacted, the APA contained an even more explicit exception covering “functions which by law expire on the termination of present hostilities [meaning WWII] . . . That exclusion was omitted through 1966 amendments to the Act on the ground that those functions had been fully executed and the exclusion had become superfluous. . . . The subsequent 1966 amendments should not be applied retroactively to permit review of those acts now.” (Def. Br. at 36.)
The Government’s argument is wrong, factually, legally, and logically. To begin with, it omitted language from the provision it cites. The previous exclusion applied to “functions which by law expire on the termination of present hostilities, within any fixed period thereafter, or before July 1, 1947.” 5 U.S.C.A. Section 701, Historical and Statutory Notes, page 389 (emphasis supplied). So, even if this prior incarnation of the APA supercedes the current version, it would not help the Government. To the contrary, it also reflects concern about functions related to the conduct of hostilities. The end of the war was declared on May 8, 1945. The “termination of hostilities” was proclaimed by the President as of December 31, 1946.[100] Here, the Government’s obligations regarding the property did not terminate with the hostilities and Plaintiffs allege that the Government’s final decision not to return the Plaintiffs’ property to Hungary was made no earlier than December 2, 1947, the date the United States informed Hungary that it considered the matter “closed.” In short, the prior APA provision would not have precluded APA review of the Plaintiffs’ claim.
D. The Government’s Construction Asks For A Blank Check On Military Action
Here, the Government contends that simply by virtue of the Gold Train being in possession of an occupying power, review is precluded. No matter how military an exercise may be, Congress did not intend the exception to swallow the rule and the strong presumption that judicial review is generally available. Were it otherwise, the military could engage in plunder or pillage without any legal consequence.
Indeed, courts have their “time-honored and constitutionally mandated role of reviewing and resolving claims.” One of these roles is to determine “the allowable limits of military discretion, and whether or not they have been overstepped in a particular case.” Sterling v. Constantin, 287 U.S. 378, 401 (1932). Congress has not exempted the Court from reviewing the Government’s conduct here. Indeed, as the Court recently held, when civilians are involved the military must “subject itself to the judicial process of having its reasonableness determined and its conflicts with other interests reconciled.” Hamdi v. Rumsfeld, 124 S. Ct. 2633, 2650 (2004).
Plaintiffs are requesting that the Court perform its established function of reviewing and resolving claims that seek to hold the military to its own standards, as well as the standards established by the Constitution, to have the Government’s conduct declared in violation of Decree No. 3, the Fifth Amendment, its treaty obligations, manuals and regulations.[101] Such an exercise of judicial authority is not second-guessing military discretion or the exercise of military authority in the field. It is fulfilling the promise of the Constitution, and exercising judicial expertise where Congress has not excluded it and individuals have sought it. APA review is permitted.
E. Plaintiffs’ Claim for Prospective Relief of an Accounting of Property In U.S. Possession Is Valid
Finally, a significant part of the non-monetary relief sought here is an order from the Court to compel the Government to search its Army Posts and warehouses for property that was on the Gold Train and provide an accounting of it. This requests mirrors what was ordered in Britain in 1999. (See Petropoulos Dep., 179-180). The documentary evidence reveals that in 1956 the Government had in its possession at a Quartermasters Depot in Virginia property from the Gold Train.[102] The Government gave this property to Austria, again in violation of Decree No. 3 and all of the other laws cited in the complaint. Moreover, the Government did not even attempt to benefit Jews anywhere in 1956 in its handling of this persecutee property nor did it comply with its own (albeit unlawful) interpretation of Article 8.
The Plaintiffs’ APA claim clearly seeks relief based on the Government’s failure to act since the war. Although the military authority exception might preclude review of some Army actions that occurred “in time of war or in occupied territory,” 5 U.S.C. § 701(b)(1)(G), it certainly does not apply to claims that concern the Government’s failure to act in the years since. Jaffee v. United States, 592 F.2d 712, 719-20 (3d Cir. 1979). Accordingly, the Court has jurisdiction to determine the merits of Plaintiffs’ claim for an accounting of Gold Train inventory still in the Government’s possession, as well as to require the Government to return any property found. As the Supreme Court has held, because “relief by injunction operates in futuro,” a case seeking only prospective relief is governed by the law in effect at the time of decision. Landgraf v. USI Film Products, 511 U.S. 244, 273-74 (1994) (quotation omitted).
Plaintiffs’ prospective relief claim here in no way interferes with the exercise of military personnel decisions, training or weaponry, nor does it involve issues of expertise or judgment that require military decision making or involve a policy choice that pertains to our national defense. What Plaintiffs ask is no more than what the Government has asked of other nations, and imposed on itself in the creation of the Holocaust Commission: openness about the Government’s dealings concerning Holocaust Era Assets. As former Secretary of State Madeline Albright stated during the Washington Conference on Holocaust Era Assets:
Our imperative must be openness. Because the sands of time have obscured so much, we must dig to find the truth. This means that researchers must have access to old archives and by that I don’t mean partial, sporadic or eventual access — I mean access in full, everywhere. . . . The obligation to seek the truth and act on it is not the burden of some but of all. It is universal, . . . every nation, every business, every organization . . . is obliged to do so. In this arena, none of us are spectators, none are neutral; for better or worse, we are all actors on history’s stage.
Proceedings of Washington Conference on Holocaust Era Assets, December 1, 1998. There is no reason that the Government should not also roll up its sleeves and dig in its warehouses to find the truth.
The Government itself has represented to one federal court (and correctly so) that it was required to return all property seized by U.S. Forces in Austria, which includes property seized pursuant to Decree No. 3, to the “country from which the object had been taken.” Moreover, “the United States Forces were required to transfer all seized property—whether stolen, aryanized, or legitimately acquired—back to the designated agency of the appropriate national Government.”[103] The Government’s failure to abide by Decree No. 3 in 1948 aggrieved Plaintiffs, the very least the Government can be required to do is search its facilities for whatever property might be left.
VIII. GOVERNMENT’S 12(B)(6) MOTION SHOULD BE DENIED AS A MATTER OF LAW; PLAINTIFFS STATE CLAIMS UPON WHICH RELIEF MAY BE GRANTED
A. The Government’s Motion Violates Rule 12(g) And Is Contrary To Court Rulings
The Government previously attempted to dismiss Plaintiffs’ claims. As a consequence of the Government’s choice, it is now precluded from challenging this action in a second motion to dismiss for failure to state a claim upon which relief could be granted on the claims asserted in the original complaint. Moreover, the Government is barred from asserting any defense in a motion to dismiss that was available to it in the first motion but which it neglected to raise. Rule 12(g); see Albany Ins. Co. v. Almacenadora Somex, 5 F.3d 907, 909 (5th Cir. 1993); 5A Wright & Miller, Federal Practice and Procedure § 1388, at 736 (2d ed. 1990). The fact that Plaintiffs have filed an amended complaint does not alter the impact of this rule; the Government is expressly precluded from asserting such a defense in a second pre-answer motion. Id. at §§ 1392 & 1388; Wafra Leasing Corp. v. Prime Capital Corp., 247 F. Supp.2d 987, 999 (N.D. Ill. 2002); United States Fidelity & Guaranty Co. v. Jepsen, 1991 WL 249706 (N.D. Ill. Nov. 14, 1991).[104]
IX. GOVERNMENT’S 12(B)(6) MOTION SHOULD BE DENIED AS A
MATTER OF LAW; PLAINTIFFS STATE CLAIMS
UPON WHICH RELIEF MAY BE GRANTED
A. The Government’s Motion Violates Rule 12(g) And Is Contrary To Court Rulings
The Government previously attempted to dismiss Plaintiffs’ claims. As a consequence of the Government’s choice, it is now precluded from challenging this action in a second motion to dismiss for failure to state a claim upon which relief could be granted on the claims asserted in the original complaint. Moreover, the Government is barred from asserting any defense in a motion to dismiss that was available to it in the first motion but which it neglected to raise. Rule 12(g); see Albany Ins. Co. v. Almacenadora Somex, 5 F.3d 907, 909 (5th Cir. 1993); 5A Wright & Miller, Federal Practice and Procedure § 1388, at 736 (2d ed. 1990). The fact that Plaintiffs have filed an amended complaint does not alter the impact of this rule; the Government is expressly precluded from asserting such a defense in a second pre-answer motion. Id. at §§ 1392 & 1388; Wafra Leasing Corp. v. Prime Capital Corp., 247 F. Supp.2d 987, 999 (N.D. Ill. 2002); United States Fidelity & Guaranty Co. v. Jepsen, 1991 WL 249706 (N.D. Ill. Nov. 14, 1991).[105]
B. Plaintiffs Assert A Valid Contract Claim
The Court has upheld the bailment claim twice already. Nevertheless, the Government contends for the third time that Plaintiffs fail to state this claim. The first time the Court denied the Government’s motion the Court ruled that plaintiffs had “alleged sufficient facts to survive a motion to dismiss.” Rosner, 231 F. Supp.2d at 1215.  The Court added, “given the fact intensive nature of such a claim, such is more appropriately addressed on summary judgment.” Id. (footnote omitted). The Court ruled the same way the second time. Id. at 1217. The Court further held that discovery on contract formation issues would follow the Court’s resolution of its subject matter jurisdiction. Id. at 1218. There Government has not presented any reason to depart from the Court’s prior rulings. Moreover, the Government is precluded from asserting yet another challenge pre-answer.[106]
Even if the Court considers this issue again,[107] the Court should nevertheless uphold the claim. The Government argues that the claim must be dismissed because it is “implausible” on its face, again raising issues regarding contracting authority and consideration. (Def. Br. at 51-52.) But, as the Court has already found, these are fact intensive issues not susceptible to resolution on a motion to dismiss. The Government is simply attempting an end run around the Court’s order deferring discovery on these issues until after resolution of its subject matter jurisdiction.
The Government also baldly asserts that members of an Army detail “would not have possessed” contracting authority, and even if they did they would not have had such authority vis a vis an enemy Government. (Def. Br. at 51-52.) No authority for this proposition is offered. The Court is left to speculate. The Government advances equally speculative arguments about what authority the Hungarian guardians of the train possessed. Again no authority is offered.[108] Finally, the Government argues that there could be no consideration because the Hungarians were in no position to bargain. (Id. at 52 & n. 41.) This argument is belied by the allegation, among others, that armed Hungarians continued to assist the Army to guard the train for two months after the Hungarians first sought out the Army to transfer custody. (FAC at ¶¶ 189-192, 194.) Clearly these are questions of fact not susceptible to resolution on a Rule 12(b)(6) motion.
Finally, the Government argues that, even if there were an implied-in-fact contract of bailment, there could be no claim for its breach because of the 1947 Treaty of Peace and the 1973 Settlement Agreement. (Def. Br. at 52-53.) This is simply a rehash of the Government’s argument that the Court lacks subject matter jurisdiction because of these agreements, and for the same reasons pointed out below, they are unavailing.
C. International Agreements Do Not Bar Plaintiffs’ Claims
Almost three years after the Government first moved to dismiss Plaintiffs’ case it argues—for the first time—that, “beyond doubt,” “plaintiffs can prove no set of facts in support of their allegations which would entitle them to relief” because their claims have been waived by two international agreements. (Def. Br. at 44.) If it is clear beyond doubt that these agreements scotch Plaintiffs’ claims, one can only wonder why the Government did not assert this supposed bar in September 2001 and save the Plaintiffs additional years of anguish and anxiety as well as the burden of appearing for depositions, not to mention adding to the burden on the Court’s limited resources. It is inconceivable that the Government was unaware of these agreements until now. After all, the Government is a party to those agreements. Moreover, the Government has shown the ability to assert such defenses at the outset of the litigation where applicable. E.g., In re: World War II Era Japanese Forced Labor Litig., 114 F. Supp.2d 939 (N.D. Cal. 2000). Moreover, if the treaty waiver were so clear-cut, one would have expected the Government’s experts to opine or indicate as a matter of history that this was the real reason for the Government’s refusal to restitute the train to Hungary in 1947. Yet, none of the Government’s experts mention the 1947 Treaty as the reason for the decision. See supra § II.I (reason was to alleviate burdens on the taxpayers).
More importantly, if the 1947 Treaty waived Hungary’s claim to restitution of the Gold Train property one would have expected contemporaneous documents to mention this as the reason for the Government’s refusal to restitute the property. But none do. In fact, the only contemporaneous document that even mentions the treaty in the context of the Gold Train restitution discussions says that the decision to refuse restitution might be “inconsistent with . . . the spirit of Articles 27 and 30 of the Treaty.”[109] The dearth of contemporaneous documents supporting the Government’s belated and novel theory is compelling evidence that it is utterly without merit. Nor do the ambiguous circumstances surrounding the 1973 agreement rescue this argument.
1. The 1947 Treaty of Peace does not bar Plaintiffs’ claims
The Government relies primarily on one section of the 1947 Treaty of Peace with Hungary to support its waiver argument. Article 32 provides:
Hungary waives all claims of any description against the Allied and Associated Powers on behalf of the Hungarian Government or Hungarian nationals arising directly out of the war or out of actions taken because of the existence of a state of war in Europe after September 1, 1939, whether or not the Allied or Associated Power was at war with Hungary at the time, including the following: (a) Claims for losses or damages sustained as a consequence of acts of forces or authorities of Allied or Associated Powers; (b) Claims arising from the presence, operations or actions of forces or authorities of Allied or Associated Powers in Hungarian territory; . . . (d) Claims arising out of the exercise or purported exercise of belligerent rights.
Article 32 also provides that its provisions “shall bar, completely and finally, all claims of the nature referred to herein, which shall be henceforward extinguished, whoever may be the parties in interest.”
This is the language that the Government argues beyond doubt works a waiver of plaintiffs’ claims, although it does not specify which subsection of Article 32 supposedly controls. And it is this language which the Government argues the Court has “no power to insert an amendment” to. Chan v. Korean Air Lines, Inc., 490 U.S. 122, 134 (1989). While it is true that a court may not amend the clear language of a treaty, it is equally true that a court may be called upon to construe a treaty and, in the face of ambiguous language, consider extrinsic sources in doing so. Moreover, “[t]he clear import of treaty language controls unless application of the words of the treaty according to their obvious meaning effects a result inconsistent with the intent or expectations of its signatories.” Sumitomo Shoji America, Inc. v. Avagliano, 457 U.S. 176, 180 (1982) (quotation omitted).
Plaintiffs do not ask the Court “to alter, amend or add” to the Treaty. The Amiable Isabella, 19 U.S. 1, 71 (1841). If the Court deems the issue to have been properly raised at this time, it would then be incumbent on the Court to construe the Treaty. Upon inspection of the Treaty language and the surrounding facts, it is inconceivable that any such waiver was intended, nor that the Treaty, properly construed, embodies such a waiver.
In the first place, the forcible seizure of the property of Hungary’s Jews by the Hungarian Fascist Government did not arise out of belligerent acts in World War II. While it happened during the war, it was not itself an act of war at all. It was, rather, a monstrous act of the Hungarian Government against its own citizens. While the Army’s act of taking the Gold Train into its custody arguably arose “because of the existence of a state of war,”[110] Plaintiffs are grateful because it was done for Plaintiffs’ benefit, as the Army took custody of the Gold Train intending to return its contents to the rightful owners. It is the Government’s later actions regarding the property, including most particularly, the ultimate refusal to restitute the property, but instead to use it for its own purposes and assistance with the “DP problem,” that gives rise to Plaintiffs’ claims. These actions, however, did not – in the words of the introductory paragraph of Article 32, which modify all its subsections – “arise directly out of the war,” at least not in time to waive them as the Government’s actions here with its firm refusal to restitute the property and the actual transfer of the property to the refugee organizations occurred after September 15, 1947, the effective date of the treaty. Furthermore, the actions did not take place “in Hungarian territory” or as an “exercise or purported exercise of belligerent rights.”
Plaintiffs reading of the Treaty is plausible, indeed likely. See Francis Gabor Decl, Ex. 3 Walton Decl. First, look at the context of the Treaty. This was not a treaty negotiated between equals. Hungary was a conquered nation and the Treaty was imposed on it by the victors. Thus it had punitive aspects, not the least of which was the one-sided waiver of claims embodied in Article 32. But the Jews of Hungary were not enemies of the Allied Powers. They had not contributed voluntarily to Hungary’s aggressive war. To the contrary, the Jews of Hungary suffered as much, if not more, at the hands of the Hungarian Government than any of the Allied Powers. This was recognized as early as March 24, 1944, when President Roosevelt issued a statement conferring the special protection on the Hungarian Jews.[111]  In light of this history, it is simply inconceivable that the treaty signatories intended that any of the claims of the Jews of Hungary would be lumped together with the claims of the enemy Hungarians and extinguished.
Second, the language of the Treaty demonstrates this point. Under Article 27, Hungary undertook:
that in all cases where the property, legal rights or interests in Hungary of persons under Hungarian jurisdiction have, since September 1, 1939, been the subject of measures of sequestration, confiscation or control on account of the racial origin or religion of such persons, the said property, legal rights and interests shall be restored together with their accessories or, if restoration is impossible, that fair compensation shall be made.
At the time the Treaty was entered, the parties to the Treaty knew that there was a substantial amount of confiscated Jewish property in Austria. In light of President Roosevelt’s statements concerning the protection of the Jewish population of Hungary, it is inconceivable that the U.S. would have extinguished Hungary’s right to claim the return of the property that was the subject of this obligation. To do so would render this provision a cruel nullity.
Moreover, in part 6, Article 20, the Treaty provides that “identifiable property of Hungary and all Hungarian nationals removed by force or duress from Hungarian territory . . . shall be eligible for restitution.” How does this provision acquire any meaning if all claims for restitution against the U.S. are waived? Nor is it any answer to point to the obligation to pay fair compensation if restoration was impossible. Hungary’s economy was devastated by the war. Practically speaking, there was no way it could compensate the surviving Jews of Hungary for their lost property unless the property outside Hungary, including the Gold Train property, was returned.[112] It simply would have made no sense to impose such a “Catch 22” on the Hungarian Government, especially when the ultimate losers would have been the Jews and thus ensuring a certain moral victory for the Nazis who annihilated them.
Further support for Plaintiffs’ interpretation of the Treaty is found in the contemporaneous conduct of both Government and Hungarian officials. The “meaning attributed to treaty provisions by the Government agencies charged with their negotiation and enforcement is entitled to great weight.” Sumitomo, 457 U.S. at 184-85, citing Kolovrat v. Oregon, 366 U.S. 187, 194 (1961) (meaning given treaties by “departments of Government particularly charged with their negotiation and enforcement is given great weight”) (emphasis added).[113] Similar deference is given to the interpretation of the foreign party as well. Id. at 185.
Here, there is ample evidence that neither U.S. nor Hungarian officials at the time the treaty was in the process of adoption thought that it controlled the pending restitution discussions or claims. Indeed, such discussions continued after adoption and even when the Government ultimately denied restitution the stated reason was the supposed “unidentifiability” of the property. The following chronology makes clear that restitution decisions were made independent of the Treaty:

· On February 10, 1947, the language of the Treaty was agreed to.
· Property belonging to the Weiss family is not restituted directly to them because restitution is made to governments and Treaty obliges Hungary to return property to them (Petropoulos Supp. Aff. ¶ 51, GT 14021-14023).
· On March 20, 1947, the US Legation in Budapest told the representatives of the Hungarian Jewish community that “the subject of the so-called gold train will receive careful attention by competent authorities.” (FAC ¶ 442.) No mention was made of the treaty.
· On May 19, 1947, the US Legation told the Jewish community representatives that the Gold Train property would not be restituted, but rather would be turned over to the IGCR. The reason given was that the “it was impracticable to return individual items to the original owners or heirs...”. No mention was made of the treaty. (FAC ¶ 445.)
· On May 29, 1947, Secretary Marshall told the US Legation that the Hungarian Government had been told in February that the Gold Train property would not be returned. No mention was made of the treaty. (FAC ¶ 447.)
· On September 2, 1947, the Government continued its restitution to Hungary of property from the Hungarian National Bank. Evidently, the treaty did not preclude such restitution.
· On October 23, 1947, after the treaty was ratified on September 15, 1947, the US Legation cabled Secretary Marshall that the decision not to return the Gold Train property “might be inconsistent with our previous liberal policy for restitution of identifiable Hungarian displaced property and with the spirit of Articles 27 and 30 of the Treaty.” (FAC ¶ 448.)
· On December 2, 1947, the Government told the Hungarian Government that it was “impossible to identify the claimed property with the given description [of Gold Train found at Werfen]. Most of property which could have come into consideration is no longer available for restitution. Unless further information can be given it will be necessary to consider these claims closed.” (FAC ¶ 449.) No mention was made of the treaty.
· On December 15, 1947, the Hungarian Government requested clarification about what “further information” was needed, but no answer was received from the U.S.
· In July 1948, Secretary Marshall cabled the US Legation that the Gold Train property was unidentifiable as to owners and national origin and therefore restitution to Hungary was “not feasible.” The stated basis for the decision was the Paris Reparation Agreement of December 1945 and the Five Power Agreement of June 1946. (FAC ¶ 452.) No mention was made of the treaty.
The Government has not produced documents to suggest that the U.S. or the Hungarian Government at the time was of the opinion that the Treaty had any bearing on the Hungarian claim for restitution of the Gold Train. Indeed, almost twenty years later the Hungarian Government was still demanding restitution of property removed from Hungary at the close of World War II. The belated assertion by the U.S., at that time, made as it was in the context of negotiations over numerous claims made by both the Government and Hungary against each other, should be given little weight. In fact, in the actual negotiations over the Gold Train property, the Government did not rely upon the alleged treaty waiver. According to the Government’s expert, “[n]either side was very familiar with the facts, and the archives of the State Department and the Hungarian Foreign Ministry could not provide enough information to illuminate what had really happened;” negotiations “reached a dead end.” (GT at 214.)
2. Case Law Does Not Support Government’s Position
The Government cites several cases in support of its argument that the 1947 treaty bars Plaintiffs’ claims. Only one has any bearing on the subject,[114] and it is not controlling, and, in any event, easily distinguished. That case, Pauly v. United States, 152 Ct. Cl. 838 (1961), is an advisory opinion to the House of Representatives on a reference from that body on a private bill for compensation to the plaintiff. Such an opinion “has no binding value as precedent.” Kanehl v. United States, 38n Fed. Cl. 89, 96 (Fed. Cl. 1997). Moreover, the facts are wholly inapposite to the Gold Train. Pauly sought compensation for certain privately-owned Hungarian horses that were seized by the Army on the battlefield in Germany on April 25, 1945 as an exercise of belligerent rights and taking of war booty in which case one is not entitled to compensation. 152 Ct. Cl. at 842-43. In contrast, the Army did not take custody of the Gold Train property while the war was “flagrant,” but after hostilities had ceased. The train was not found on the battlefield, nor during military operations. Nor was it carrying private property that could legally be seized as war booty.[115] Simply stated, Holocaust loot is not the sort of property, unlike horses, “which an enemy may make use of.”  Id. at 842 (quoting 2 Oppenheim, International Law 406 (Lauterpacht 7th ed.)). Indeed, Pauly specifically found that the horses “could have been used in military operations.” Id. at 853.
After determining that Pauly had no legal claim to compensation for the horses, the court turned to the second question referred by the House of Representatives, viz., whether the US had a moral obligation to pay compensation. It found that it did not, relying, in part, on the treaty. But the treaty barred claims “arising out of the exercise or purported exercise of belligerent rights.” Art. 32, sec. 1(d). It is unquestionable that seizure of war booty on the battlefield while war is flagrant is an exercise of belligerent rights. In contrast, the Army’s entire course of conduct with respect to the Gold Train property was that it was not being seized as war booty, but was being taken into custody for safeguarding under Decree No. 3 and thus was required to be returned.[116] In short, neither Pauly, nor any other case cited by the Government shows that the treaty bars Plaintiffs’ claims.
The Government also argues that the treaty bars Hungary’s claims to the Gold Train property and that therefore, Plaintiffs’ claims, being derivative of Hungary’s, are barred. For all the same reasons that the treaty does not bar Plaintiffs’ claims, it does not bar Hungary’s claims. Moreover, as pointed out above, Plaintiffs’ claims are not derivative of any claims Hungary might have.
3. The 1973 settlement agreement does not bar this suit
Perhaps recognizing the weakness of its claim that Hungary waived its claims, and the claims of its nationals, for the Gold Train property in the 1947 treaty, the Government also argues that Hungary waived the same claims in a 1973 agreement settling claims between Hungary and the U.S. This agreement is of no aid to the Government’s position for several reasons.
First, the claims which were settled and discharged by the agreement were those of “nationals and the Government of the United States” against Hungary, not claims against the United States. Art. 2. In settling, Hungary agreed to pay to the U.S. a lump sum.
The Government attempts to get around this obstacle by pointing to ambiguous language stating that Hungary declares that the lump sum was “arrived at by taking into account” claims for, among others, “Hungarian property lost as a result of World War II.” Art. 6(2)(iii). What is meant by this cryptic phrase is unclear, as opposed to the clear language of Article 6(1), in which the U.S. “declares that full payment of the lump sum referred to in Article 1 shall discharge the Government of [Hungary] and Hungarian nationals from their obligations to the Government of the United States and its nationals in respect of all claims referred to in Article 2. . . . Upon their discharge, the Government of the United States will consider as finally settled all claims for which compensation is provided under Article 1.” Nor is “property” defined or explained. The Government tries to get around this gap by pointing to negotiations years before, citing a 1965 document. (Def. Br. at 49 n. 36, Exh. 11.) There is nothing in the record that ties this document to the 1973 agreement. In fact, as pointed out above, the Government’s expert says that the “negotiations reached a dead end in 1967, and both Governments decided to allow bilateral relations to develop without reaching a final claims settlement between them.”[117]
Yet another problem with the Government’s reliance on the 1973 agreement is that even if Hungary waived any claims of its own, it did not waive any claims by its nationals. In the 1947 treaty Hungary waived whatever it waived “on behalf of the Hungarian Government or Hungarian nationals.” Art. 32, sec. 1. In contrast, in the 1973 agreement it is agreed that “neither Government will present to the other on its behalf or on behalf of any persons included in the definition of United States or Hungarian nationals any claims which have been referred to in this Agreement and neither Government will support such claims.” Art. 6(3).
Lastly, even if Hungary did waive claims of its nationals for property lost as a result of World War II, including the Gold Train property, only one of the plaintiffs – Tamás May – was a Hungarian national as of 1973. Most, in fact, were U.S. citizens by that date. Hungary has no authority to waive the claims of U.S. citizens against their own Government.
X. THE COURT SHOULD RECONSIDER ITS TAKINGS CLAIM IN LIGHT OF NEW DEVELOPMENTS
Plaintiffs recognize that the Court has dismissed their takings claim with prejudice and only after thoughtful consideration. However, since then, and only after having access to the Clinton Library, Plaintiffs have come to understand that the facts are different and have plead these different facts in an amended complaint. Additionally, since the Court’s ruling, the Supreme Court has substantially undermined the validity and applicability of Johnson v. Eisentrager, which is the judicial foundation for Verdugo-Urquidez and Ashkir and the Court’s ruling, to such an extent that reconsideration of this issue is warranted.
The critical factual differences are (i) some of the named Plaintiffs were U.S. citizens before the Gold Train ever ventured into Austria; (ii) the U.S. specifically undertook to protect the Hungarian Jews in March 1944 as outlined in paragraphs 165-169 of the FAC; and (iii) the taking did not occur until on or after December 1947, which is the date the government informed Hungary that the issue of the Gold Train was “closed.” (FAC at ¶ 449.) The impact of both new facts is that there are named Plaintiffs that satisfy the “substantial connection” test established by the Court, including Edith Amster, Jonas Stern, and David Mermelstein,[118] all of whom were residing in America when the taking occurred. In contrast, before the Court found that “none of the Plaintiffs were United States citizens, and none had espoused any voluntary association with the United States.” Rosner, 231 F. Supp.2d at 1214. Because these essential facts have changed, Plaintiffs respectfully request that the Court reconsider the decision.
Additionally, the Supreme Court’s recent landmark ruling in Rasul v. Bush, 124 S. Ct. 2686 (2004), substantially erodes the precendential authority of Eisentrager, effectively tying the case to its unique facts of convicted Nazi war criminals who were enemy-aliens, while simultaneously reaffirming that alien friends (and some enemies) outside the territory of the United States have the right to assert and claim the protections of the Constitution, even if they are in military custody outside the U.S. Indeed, the Court reaffirmed in unmistakable tones the importance of opening our courts to nonresident aliens whose claims go to the heart of the Constitution.
[N]othing in Eisentrager or in any of our other cases categorically excludes aliens detained in military custody outside the United States from the “privilege of litigation” in U.S. courts. . . . The courts of the United States have traditionally been open to nonresident aliens. Cf. Disconto Gesellschaft v. Umbreit, 208 U.S. 570, 578, 52 L. Ed. 625, 28 S. Ct. 337 (1908) (“Alien citizens, by the policy and practice of the courts of this country, are ordinarily permitted to resort to the courts for the redress of wrongs and the protection of their rights”). And indeed, 28 U.S.C. § 1350 explicitly confers the privilege of suing for an actionable “tort . . . committed in violation of the law of nations or a treaty of the United States” on aliens alone. The fact that petitioners in these cases are being held in military custody is immaterial to the question of the District Court’s jurisdiction over their nonhabeas statutory claims.
Rasul, 124 S. Ct. at 2698-99 (emphasis added). Given that enemy and friendly detainees could challenge the constitutionality of military conduct in a court of law, there is no reason that Holocaust victims, once alien friends and now citizens can not do the same.
XI. CONCLUSION
Today, Plaintiffs seek some acknowledgment and payment from the Government as partial restitution for the Government’s broken promises and flagrant violations of the most basic of laws protecting private property. For the foregoing reasons, Plaintiffs respectfully request that the Court deny the Government’s motions and proceed to the merits of this case.
DATED: August ___, 2004.
DUBBIN & KRAVETZ, LLP


By
Samuel J. Dubbin, P.A.
Fla. Bar No. 328189
Jeffrey L. Kravetz, P.A.
Commerce Bank Center
220 Alhambra Circle, Suite 400
Coral Gables, FL 33134
(305) 357-9004