WASHINGTON (CN) — The Supreme Court worried Tuesday that greenlighting a lawsuit brought by the families of Holocaust victims against Hungary would put the United States in conflict with the international order.
“It’s a big deal to hail a foreign country in a U.S. court,” Justice Brett Kavanaugh, a Donald Trump appointee, remarked.
As the only country with a pathway to put sovereigns before foreign courts, the justices expressed concerns about creating international discord against the U.S.
“This is really just throwing out sovereign immunity principles under which the rest of the world operates,” Chief Justice John Roberts, a George W. Bush appointee, said.
Heirs of Holocaust victims filed a suit against Hungary and its state-owned railway, Magyar Államvasutak Zrt or MÁV, over the collaboration with the Nazis to exterminate Hungarian Jews and expropriate their property. They say MÁV aided in the Hungarian government’s effort by stealing Hungarian Jews’ belongings and transporting them to death camps.
The heirs want compensation for the belongings seized by MÁV.
The Foreign Sovereign Immunities Act typically absolves countries from having to defend themselves in U.S. courts, but the heirs argue their suit falls under an exception for stolen property that is exchanged for goods tied up in the U.S. economy.
Kavanaugh noted that the immunity exception falls on the outer boundaries of international law.
“Extending this further would seem to really push us into noncompliance with international norms and law, I would think,” Kavanaugh said.
For over a decade, the case has ping-ponged through the lower courts. The current dispute stems from a 2023 ruling from the D.C. Circuit that allowed the lawsuit to proceed.
Hungary asked the justices to reverse, comparing the case to a hypothetical lawsuit related to the United States’ troubled past.
“Imagine that a trial court in a European capital city declared that it had the authority to adjudicate claims for the internment of Japanese Americans during World War II,” Joshua Glasgow, an attorney with Phillips Lytle representing Hungary, said. “Claims that could result against the United States in the billions of dollars and permit attachment of U.S. property abroad.”
The Holocaust survivors’ claim is based on commingling theory, which links the victims’ stolen property to other government funds. Hungary said that would be similar to saying every dollar the U.S. spent over the last 80 years was given in return for personal property taken from a few interned individuals.
Justice Sonia Sotomayor, a Barack Obama appointee, said it was hard to imagine how a piece of the original stolen funds would still be connected to government funds today.
“It’s a fiction that takes quite an imagination,” Sotomayor said.
Justice Ketanji Brown Jackson, a Joe Biden appointee, tried to nail down the nexus between the stolen property and Hungarian funds. She worried about what limits would exist for suits against foreign nations under the survivors’ theory.
“What I’m trying to figure out is whether or not you are reading this as a statute that allows for suit against any foreign country that previously expropriated whether we can figure out where that particular property is or not,” Jackson said.
The Holocaust heirs argued plaintiffs must establish the connection between the stolen funds and exchanged goods.
“This is a case where because the Holocaust is a unique situation where we actually do have documentation,” Shay Dvoretzky, an attorney with Skadden Arps representing the families, said.
Justice Elena Kagan, a Barack Obama appointee, offered a salient defense of the lower court ruling.
“Doesn’t this provide a roadmap to any country that wants to expropriate property?” Kagan asked. “In other words, just sell the property, put it into your national treasury, insulate yourself from all claims for all time.”
Kagan said that even if a country were “stupid enough to establish a Holocaust expropriation fund” it wouldn’t be enough for the victims to bring a lawsuit under her colleagues’ understanding of the law.
A lower court previously ruled that the lawsuit could be brought in Hungary.
“I’ll acknowledge that Hungary has a European civil legal system that differs in many respects from the American system, but that doesn’t make a forum unavailable,” Glasgow said. “There’s also the traditional method of espousal or bilateral settlement agreements. Hungary has entered into multiple such agreements, including with the United States regarding World War II era claims.”