''Alperin v. Vatican Bank'' was an unsuccessful

class action A class action, also known as a class-action lawsuit, class suit, or representative action, is a type of lawsuit where one of the parties is a group of people who are represented collectively by a member or members of that group. The class actio ...

suit by

Holocaust survivors Holocaust survivors are people who survived the Holocaust, defined as the persecution and attempted annihilation of the Jews by Nazi Germany and its allies before and during World War II in Europe and North Africa. There is no universally accep ...

brought against the

Vatican Bank The Institute for the Works of Religion ( it, Istituto per le Opere di Religione; la, Institutum pro Operibus Religionis; abbreviated IOR), commonly known as the Vatican Bank, is a financial institution situated inside Vatican City and run by a ...

("Institute for the Works of Religion" or "IOR") and the Franciscan Order ("Order of Friars Minor") filed in

San Francisco, California San Francisco (; Spanish for " Saint Francis"), officially the City and County of San Francisco, is the commercial, financial, and cultural center of Northern California. The city proper is the fourth most populous in California and 17th ...

, on November 15, 1999. The case was initially dismissed as a

political question In United States constitutional law, the political question doctrine holds that a constitutional dispute that requires knowledge of a non-legal character or the use of techniques not suitable for a court or explicitly assigned by the Constitution ...

by the District Court for the Northern District of California in 2003, but was reinstated in part by the

Court of Appeals for the Ninth Circuit The United States Court of Appeals for the Ninth Circuit (in case citations, 9th Cir.) is the U.S. federal court of appeals that has appellate jurisdiction over the U.S. district courts in the following federal judicial districts: * District ...

in 2005. That ruling attracted attention as a precedent at the intersection of the

Alien Tort Claims Act The Alien Tort Statute ( codified in 1948 as ; ATS), also called the Alien Tort Claims Act (ATCA), is a section in the United States Code that gives federal courts jurisdiction over lawsuits filed by foreign nationals for torts committed in viol ...

(ATCA) and the

Foreign Sovereign Immunities Act The Foreign Sovereign Immunities Act of 1976 (FSIA) is a United States law, codified at Title 28, §§ 1330, 1332, 1391(f), 1441(d), and 1602–1611 of the United States Code, that established criteria as to whether a foreign sovereign nation ( ...

(FSIA). Part of the complaint against the IOR was dismissed in 2007 on the basis of

sovereign immunity Sovereign immunity, or crown immunity, is a legal doctrine whereby a sovereign or state cannot commit a legal wrong and is immune from civil suit or criminal prosecution, strictly speaking in modern texts in its own courts. A similar, stronger ...

, and the remainder of the claim against that defendant was dismissed on the ground that the property claim had no nexus to the United States, a decision confirmed in February 2010 by the Ninth Circuit. The case against the Franciscan Order, who by then were the sole defendants, ended in March 2011 when the Ninth Circuit affirmed the district court's judgment dismissing the claim, and the case was not appealed further. No part of the claim, therefore, ever came to trial and none of the plaintiffs' allegations of fact were ever established in Court.

Historical context

Campo Marzio - san Girolamo degli Schiavoni 00523

The factual background as alleged in the claim was that

Ustaše The Ustaše (), also known by anglicised versions Ustasha or Ustashe, was a Croatian fascist and ultranationalist organization active, as one organization, between 1929 and 1945, formally known as the Ustaša – Croatian Revolutionary Move ...

hiding in the Pontifical Croatian College of St. Jerome (the Croatian Seminary near the Vatican) brought a large amount of looted gold with them and that it was later moved to other Vatican extraterritorial property and/or the

.Phayer, 2008, p. 219. Although this gold would be worth hundreds of thousands of 2008 US dollars, it allegedly constituted only a small percentage of the gold looted during World War II, mostly by the Nazis.Phayer, 2008, p. 208. According to Phayer, "top Vatican personnel would have known the whereabouts of the gold", but he gives no evidence that they did, nor does he name any. The lawsuit was made possible by a 1997

executive order In the United States, an executive order is a directive by the president of the United States that manages operations of the federal government. The legal or constitutional basis for executive orders has multiple sources. Article Two of t ...

of U.S. President

Bill Clinton William Jefferson Clinton ( né Blythe III; born August 19, 1946) is an American politician who served as the 42nd president of the United States from 1993 to 2001. He previously served as governor of Arkansas from 1979 to 1981 and agai ...

that directed all branches of the US government to open their

World War II World War II or the Second World War, often abbreviated as WWII or WW2, was a world war that lasted from 1939 to 1945. It involved the vast majority of the world's countries—including all of the great powers—forming two opposing ...

records to scrutiny. The order came in the aftermath of evidence that

Swiss banks Banking in Switzerland dates to the early eighteenth century through Switzerland's merchant trade and has, over the centuries, grown into a complex, regulated, and international industry. Banking is seen as emblematic of Switzerland, along with ...

were destroying evidence of deposit records by Jews. Fourteen European nations, Canada, and Argentina followed suit, but

Vatican City Vatican City (), officially the Vatican City State ( it, Stato della Città del Vaticano; la, Status Civitatis Vaticanae),—' * german: Vatikanstadt, cf. '—' (in Austria: ') * pl, Miasto Watykańskie, cf. '—' * pt, Cidade do Vati ...

did not. Much of the evidence that has come to light since the executive order was not available to the

Tripartite Commission for the Restitution of Monetary Gold The Tripartite Commission for the Restitution of Monetary Gold, also known as the Tripartite Gold Commission, was a panel established in September 1946 by the United Kingdom, United States and France to recover gold stolen by Nazi Germany from othe ...

before it disbanded, although Yugoslavia was among the recipients of restitution.

Arguments

Plaintiffs

The class action was brought on behalf of "all Serbs, Jews, and former Soviet Union citizens (and their heirs and beneficiaries), who suffered" at the hands of the Ustaše. The named plaintiffs claimed to be victims of personal or property crimes committed by the Ustaše. Four organizations that represent

holocaust survivor Holocaust survivors are people who survived the Holocaust, defined as the persecution and attempted annihilation of the Jews by Nazi Germany and its allies before and during World War II in Europe and North Africa. There is no universally accep ...

s or

human rights Human rights are moral principles or normsJames Nickel, with assistance from Thomas Pogge, M.B.E. Smith, and Leif Wenar, 13 December 2013, Stanford Encyclopedia of PhilosophyHuman Rights Retrieved 14 August 2014 for certain standards of hu ...

issues were named as plaintiffs. Surviving victims of the Ustaše and their next of kin living in California brought a class action suit against the Vatican bank and others in US federal court, ''Alperin v. Vatican Bank''.Phayer, 2008, p. 208. However, the total potential class, if the Court had recognised the claim, would have included "over 300,000 former slave and forced laborers, prisoners, concentration camp, and ghetto survivors".

Causes of action A cause of action or right of action, in law, is a set of facts sufficient to justify suing to obtain money or property, or to justify the enforcement of a legal right against another party. The term also refers to the legal theory upon which a p ...

included "conversion, unjust enrichment, restitution, the right to an accounting, human rights violations and violations of international law". Subject-matter jurisdiction was asserted under federal law, California state law,

international law International law (also known as public international law and the law of nations) is the set of rules, norms, and standards generally recognized as binding between states. It establishes normative guidelines and a common conceptual framework for ...

, and

common law In law, common law (also known as judicial precedent, judge-made law, or case law) is the body of law created by judges and similar quasi-judicial tribunals by virtue of being stated in written opinions."The common law is not a brooding omnipres ...

. According to plaintiffs, defendants "accepted, concealed, hypothecated, laundered, retained, converted and profited from assets looted by the Ustasha Regime during April 1941 through May 1945 and deposited in, or converted, concealed, hypothecated, trafficked, credited, pledged, exchanged, laundered or liquidated through, the IOR, and OFM after the demise of the NDH-Independent State of Croatia in May 1945. 2007 U.S. Dist. LEXIS 95529, ND CA 2007. Specifically, the Vatican bank was said to have laundered and converted "the Ustaša treasury, making deposits in Europe and North and South American, nddistributing the funds to exiled Ustaša leaders including Pavelić".Phayer, 2008, p. 209. Since the case was dismissed at a preliminary stage, these claims were never proved. A principal piece of evidence against the Vatican was to have been the "Bigelow dispatch", an October 16, 1946 dispatch from Emerson Bigelow in Rome to

Harold Glasser Harold Glasser (November 24, 1905 – November 16, 1992) was an economist in the United States Department of the Treasury and spokesman on the affairs of the United Nations Relief and Rehabilitation Administration (UNRRA) 'throughout its whole ...

, the director of monetary research for the U.S. Treasury Department. Former OSS agent William Gowen also made a deposition as an

expert witness An expert witness, particularly in common law countries such as the United Kingdom, Australia, and the United States, is a person whose opinion by virtue of education, training, certification, skills or experience, is accepted by the judge as ...

that in 1946 Colonel Ivan Babić transported 10 truckloads of gold from Switzerland to the Pontifical College.Phayer, 2008, p. 210. The plaintiffs sought an accounting and restitution of the Ustaše Treasury that, according to the US State Department, had allegedly been transferred illicitly to the Vatican, the Franciscan Order and other banks after the end of the war, in order to further the goals of the Ustaše regime in exile and fund the Vatican ratline. The principal movers were allegedly Fr.

Krunoslav Draganovic Krunoslav and its contraction Kruno is a Croatian male given name. Notable people with this name include: * Krunoslav Babić (1875–1953), Croatian zoologist * Krunoslav Draganović (1903–1983), Bosnian Croat priest and Ustaše functionary * K ...

, Fr. Dominik Mandic OFM, and the war criminal

Ante Pavelić Ante Pavelić (; 14 July 1889 – 28 December 1959) was a Croatian politician who founded and headed the fascist ultranationalist organization known as the Ustaše in 1929 and served as dictator of the Independent State of Croatia ( hr, l ...

Defendants

The named defendants included the

, but not

(as naming the Vatican City State could have caused the suit to be dismissed on the grounds of

). The Ninth Circuit accepted for the purposes of the

motion to dismiss In United States law, a motion is a procedural device to bring a limited, contested issue before a court for decision. It is a request to the judge (or judges) to make a decision about the case. Motions may be made at any point in administrati ...

the plaintiffs' argument that the Vatican City and the Vatican Bank are separate institutions. The other named defendants were the

Order of Friars Minor The Order of Friars Minor (also called the Franciscans, the Franciscan Order, or the Seraphic Order; postnominal abbreviation OFM) is a mendicant Catholic religious order, founded in 1209 by Francis of Assisi. The order adheres to the teachi ...

("Franciscans"), the

Croatian Liberation Movement The Croatian Liberation Movement ( hr, Hrvatski oslobodilački pokret, HOP) is a minor far-right political party founded in 1956 in Buenos Aires, Argentina, by Ante Pavelić, poglavnik of the Independent State of Croatia and its ruling party Ustas ...

, as well as "other unknown Catholic religious organizations and known and unknown banking institutions from a variety of countries". The Vatican Bank and Order of Friars Minor filed separate motions to dismiss. The Vatican's lawyers did not contest the allegation that a large shipment of gold arrived by truck in Rome in 1946, although they did assert that the plaintiffs had "put forward conclusory 'facts'".Phayer, 2008, p. 217. The defense did argue that there was "no evidentiary connection between the losses of the plaintiffs and the gold deposited in the Vatican bank". The defendants also argued that, under the

(Reagan recognized Vatican sovereignty in 1984), they had no obligation to return the looted Ustaše gold to Yugoslavia in 1946 because the country was ruled by a hostile Communist regime, saying:

The decision by a sovereign instrumentality to give funds to a foreign anti-Communist political movement rather than to a Communist regime, at the time where the Cold War was beginning in earnest in Europe, is not a "commercial" act; it is ''jure imperii'', a deeply sovereign act.

Finally, the defendants argued that the plaintiffs did not have

standing Standing, also referred to as orthostasis, is a position in which the body is held in an ''erect'' ("orthostatic") position and supported only by the feet. Although seemingly static, the body rocks slightly back and forth from the ankle in the s ...

because the Vatican was only a third party to the plaintiff's injury.Phayer, 2008, p. 219.

Disposition

First District Court ruling (2003)

The original lawsuit was filed in the District Court for the Northern District of California in San Francisco in 1999. The parties agreed in the district court to limit their initial arguments to the question of whether the case constituted a

. The district judge dismissed the case in 2003 on the grounds that it constituted a political question. In a separate opinion, the district court dismissed the claims against the

on the grounds of lack of

personal jurisdiction Personal jurisdiction is a court's jurisdiction over the ''parties'', as determined by the facts in evidence, which bind the parties to a lawsuit, as opposed to subject-matter jurisdiction, which is jurisdiction over the ''law'' involved in the ...

First Ninth Circuit appeal (2005)

The

reinstated some of the plaintiffs claims in 2005, and the Supreme Court declined in January 2006 to grant '' certiorari'' to review that ruling.James Vicini. 2006, January 17. "Court won't review Vatican Bank Holocaust suit". Reuters. The Ninth Circuit held that the property claims were not political questions, while it agreed that the "war objectives claims" (including human rights violations, violations of international law, and slave labor) were political questions. The Ninth Circuit wrote that because the case "touched on foreign relations and potentially controversial political issues, it astempting to jump to the conclusion that such claims are barred by the political question doctrine" but that the court should "scrutinize each claim individually" rather than "abdicate the court's Article III responsibility".Symeon C. Symeonides. 2005. "Choice of Law in the American Courts in 2005: Nineteenth Annual Survey". 53 Am. J. Comp. L. 559. The Ninth Circuit also determined that the U.S. government had not yet taken a position on the issue and that it was not the subject of a treaty or executive agreement. The Ninth Circuit distinguished the case from '' Kadic v. Karadzic'' because "the claims in Kadic focused on the acts of a single individual during a localized conflict rather than asking the court to undertake the complex calculus of assigning fault for actions taken by a foreign regime during the morass of a world war". Although the Ninth Circuit allowed the plaintiffs to proceed with their claims of conversion, unjust enrichment, restitution, and an accounting against the Vatican Bank, it agreed to the dismissal of the claims against the

and the claim that the Vatican Bank supported the Ustaše in committing genocide and other war crimes.John R. Crook. 2005. "CONTEMPORARY PRACTICE OF THE UNITED STATES RELATING TO INTERNATIONAL LAW: STATE JURISDICTION AND IMMUNITIES: Ninth Circuit Allows Some Claims Alleging Vatican Bank Complicity with World War II Ustasha Regime to Proceed". 99 A.J.I.L. 701. The majority opinion was written by Judge M. Margaret McKeown, with Senior Judge Milton Irving Shadur concurring. Judge Stephen S. Trott dissented in part, arguing that the district court had correctly dismissed the case. Trott wrote: "What the majority has unintentionally accomplished in embracing this case is nothing less than the wholesale creation of a World Court, an international tribunal with breathtaking and limitless jurisdiction to entertain the World's failures, no matter where they happen, when they happen, to whom they happen, the identity of the wrongdoer, and the sovereignty of one of the parties."

Second Ninth Circuit appeal (2009)

The Second Ninth Circuit Appeal on the issue of sovereign immunity of the Vatican Bank was heard on December 10, 2009, in San Francisco. The case was dismissed on December 28, 2009. Plaintiffs have indicated they may appeal further.

Later District Court rulings (2006–2009)

On June 15, 2006, Judge Elizabeth Laporte of the Northern District of California denied without prejudice the plaintiff's motion for jurisdictional discovery and granted in part the plaintiffs motion to provide materials pursuant to Federal Rules of Civil Procedure. On December 27, 2007, Judge Maxine M. Chesney granted the Vatican Bank's motion to dismiss the fourth amended complaint; this effectively ended the case against the Vatican Bank on the basis of

. On April 14, 2009, Judge Chesney granted a plaintiff's motion for leave to file a sixth amended complaint no later than May 1, 2009. The sixth amended complaint was filed, naming the Franciscan Order as a defendant, and removing the Vatican Bank. On September 11, 2009, the District court dismissed the case against the Franciscans without prejudice on grounds of lack of federal jurisdiction and denied Plaintiffs' motion to amend the complaint on November 13, 2009. Plaintiffs appealed this to the Ninth Circuit on grounds that the Vatican Bank engages in commercial activity in the United States but lost this appeal.

Complaint to European Central Bank (2010)

On July 1, 2010, the Plaintiffs submitted a request that the

European Central Bank The European Central Bank (ECB) is the prime component of the monetary Eurosystem and the European System of Central Banks (ESCB) as well as one of seven institutions of the European Union. It is one of the world's most important centr ...

initiate an investigation of Vatican Bank money laundering and dealing in Nazi gold. They based this on Article 8 of The Monetary Agreement between the European Union and The Vatican City State which forbids Euro issuing entities from money laundering.

Legal analysis

The initial dismissal of the case on the

doctrine was an extension of the precedent in ''

Baker v. Carr ''Baker v. Carr'', 369 U.S. 186 (1962), was a landmark United States Supreme Court case in which the Court held that redistricting qualifies as a justiciable question under the Fourteenth Amendment, thus enabling federal courts to hear Fourteen ...

''. According to Prof. Gwynne Skinner, "most of the claims arising out of the Holocaust have been dismissed based on this doctrine either because decisions were already made regarding reparations, or because the Allied forces had already made decisions about who would be prosecuted for the various crimes committed during the Holocaust". According to Prof. Hannibal Travis: "Initially, U.S. courts dismissed claims by Holocaust survivors on the grounds that international law only gave rise to claims between states and was not self-executing in the absence of implementing legislation in Congress. This erroneous interpretation of §1350 was corrected within a few years, and since 1980, the U.S. federal courts have exercised universal jurisdiction in a nearly unbroken line of cases involving offenses properly alleged to have been committed elsewhere in violation of international law." The case has been compared to several other 2003 lawsuits against private actors for wrongs committed during World War II, such as '' Anderman v. Federal Republic of Austria'' (also determined to be a political question).Symeon C. Symeonides. 2004. "Choice of Law in the American Courts in 2003: Seventeenth Annual Survey". 52 Am. J. Comp. L. 9. It has been cited as an example of an

(ATCA) case where the courts did not require the exhaustion of foreign legal remedies. The Ninth Circuit decision has been criticized on the grounds that: "while the court's demarcation between property claims and war objectives claims may be a sound analytical method for addressing political question doctrine issues, the slave labor claims should not have been excluded from the scope of the property claims". The plaintiffs attempted to coordinate with pending

Catholic sex abuse cases There have been many cases of sexual abuse of children by Catholic priests, nuns, Popes and other members of religious life. In the 20th and 21st centuries, the cases have involved many allegations, investigations, trials, convictions, a ...

to "avoid divergent findings on the issue of Vatican amenability to suit in the United States." The precedent from the 2005 appellate court ruling has already been applied in '' Mujica v. Occidental Petroleum Corporation''.Amy Apollo. 2006. "Mujica v. Occidental Petroleum Corporation: A Case Study of the Role of the Executive Branch in International Human Rights Litigation". 37 Rutgers L. J. 855.

Notes

References

* Phayer, Michael. 2008. ''Pius XII, The Holocaust, and the Cold War''. Indianapolis: Indiana University Press. {{ISBN, 978-0-253-34930-9.

External links

Vatican Bank Claims website
with the Plaintiffs' 6th amended class action Complaint filed 14 April 2009 (subsequently dismissed). No other trial documents are available on that site which (so far as concerns the viability of the claim) asserts via

link only that "The Court has not yet certified this case as a class action, no claims may be accepted". The claim, however, is no longer pending – a fact not mentioned on the website.
Defendant documents
at

WikiLeaks WikiLeaks () is an international non-profit organisation that published news leaks and classified media provided by anonymous sources. Julian Assange, an Australian Internet activist, is generally described as its founder and director and ...

"The Fate of the Ustasha Wartime treasury"
(US State Department report) Pope Pius XII and the Holocaust Holocaust charities and reparations Foreign Sovereign Immunity Act case law Independent State of Croatia United States class action case law Holy See–United States relations Alien Tort Statute case law 2007 in United States case law United States Court of Appeals for the Ninth Circuit cases Law of Vatican City