Alperin v. Vatican Bank

Volume 1 of 2

FOR PUBLICATION

UNITED STATES COURT OF APPEALS

FOR THE NINTH CIRCUIT

EMIL ALPERIN; JEWGENIJA 

ROMANOVA; MARIA DANKEWITSCH;

VLADIMIR MORGUNOV, on behalf of

themselves and all other persons

similarly situated;

ORGANIZATION OF UKRAINIAN

ANTIFASCIST RESISTANCE FIGHTERS;

UKRAINIAN UNION OF NAZI

VICTIMS AND PRISONERS; VLADIMIR

BRODICH; WILLIAM DORICH; IGOR

NAJFELD, on behalf of themselves

and all other persons similarly No. 03-15208

situated; LIZABETH LALICH; MLADEN

DJURICICH; ROBERT PREDRAG  D.C. No.

GAKOVICH; NEVENKA VUKASOVIC CV-99-04941-MMC

MALINOWSKI; ELI ROTEM; MILORAD

SKORIC; VELJKO MILJUS; FRED

ZLATKO HARRIS; MILJA CONGER;

ALLEN DOLFI HERSKOVICH; BOGDAN

KLJAIC; DAVID LEVY; ZDENKA

BAUM RUCHWARGER; VLADAN

CELEBONOVIC; DESA TOMASEVIC

WAKEMAN; DANIEL PYEVICH;

KOVILJKA POPOVIC; JASENOVAC

RESEARCH INSTITUTE; THE

INTERNATIONAL UNION OF FORMER



6643

6644 ALPERIN v. VATICAN BANK

JUVENILE PRISONERS OF FASCISM OF 

UKRAINE, RUSSIA, AND BELARUS, on

behalf of themselves and all others

similarly situated,

Plaintiffs-Appellants,

v.

VATICAN BANK, aka Institute of

Religious Works aka Instituto per

le Opere Di Religione (IOR);

FRANCISCAN ORDER (OFM), 

INCLUDING CROATIAN FRANCISCANS;

CROATIAN COFRATERNITY OF THE

COLLEGE OF SAN GIROLAMO DEGLI

ILLIRICI, and its successors, Swiss,

Austrian, Argentine, Spanish,

Italian, Portuguese, Vatican &

German Banking Institutions;

CROATIAN LIBERATION MOVEMENT

(HOP),

Defendants-Appellees.



EMIL ALPERIN; JEWGENIJA 

ROMANOVA; MARIA DANKEWITSCH; No. 03-16166

VLADIMIR MORGUNOV, on behalf of D.C. No.

themselves and all other persons CV-99-04941-MMC

similarly situated;

ORGANIZATION OF UKRAINIAN  AMENDED

OPINION AND

ANTIFASCIST RESISTANCE FIGHTERS; AMENDED

UKRAINIAN UNION OF NAZI CONCURRENCE/

VICTIMS AND PRISONERS; VLADIMIR DISSENT

BRODICH; WILLIAM DORICH; IGOR



ALPERIN v. VATICAN BANK 6645

NAJFELD, on behalf of themselves 

and all other persons similarly

situated; LIZABETH LALICH; MLADEN

DJURICICH; ROBERT PREDRAG

GAKOVICH; NEVENKA VUKASOVIC

MALINOWSKI; ELI ROTEM; MILORAD

SKORIC; VELJKO MILJUS; FRED

ZLATKO HARRIS; MILJA CONGER;

ALLEN DOLFI HERSKOVICH; BOGDAN

KLJAIC; DAVID LEVY; ZDENKA

BAUM RUCHWARGER; VLADAN

CELEBONOVIC; DESA TOMASEVIC

WAKEMAN; DANIEL PYEVICH;

KOVILJKA POPOVIC; JASENOVAC

RESEARCH INSTITUTE; THE

INTERNATIONAL UNION OF FORMER

JUVENILE PRISONERS OF FASCISM OF



UKRAINE, RUSSIA, AND BELARUS, on

behalf of themselves and all others

similarly situated;

ORGANIZATION OF UKRAINIAN

ANTIFASCIST RESISTANCE FIGHTERS;

UKRAINIAN UNION OF NAZI

VICTIMS AND PRISONERS,

Plaintiffs-Appellants,

v.

VATICAN BANK, aka Institute of

Religious Works aka Instituto per

le Opere Di Religione (IOR);

FRANCISCAN ORDER (OFM),

INCLUDING CROATIAN FRANCISCANS;



6646 ALPERIN v. VATICAN BANK

CROATIAN COFRATERNITY OF THE 

COLLEGE OF SAN GIROLAMO DEGLI

ILLIRICI, and its successors, Swiss,

Austrian, Argentine, Spanish,

Italian, Portuguese, Vatican & 

German Banking Institutions;

CROATIAN LIBERATION MOVEMENT

(HOP),

Defendants-Appellees.



Appeal from the United States District Court

for the Northern District of California

Maxine M. Chesney, District Judge, Presiding

Argued and Submitted

October 7, 2004—San Francisco, California

Filed April 18, 2005

Amended June 9, 2005

Before: Stephen S. Trott, M. Margaret McKeown,

Circuit Judges, and Milton I. Shadur, Senior Judge.*

Opinion by Judge McKeown

Partial Concurrence and Partial Dissent by Judge Trott

*The Honorable Milton I. Shadur, Senior United States District Judge

for the Northern District of Illinois, sitting by designation.

6650 ALPERIN v. VATICAN BANK

COUNSEL

Kathryn Lee Boyd, Pepperdine University Law School,

Malibu, California; Jonathan H. Levy, Cincinnati, Ohio;

Thomas Easton, Eugene, Oregon, for the plaintiffs-appellants.

Jeffrey S. Lena, Berkeley, California; Paul E. Vallone, Hin-

shaw & Culbertson, San Francisco, California, for the

defendants-appellees.

OPINION

McKEOWN, Circuit Judge:

We are faced here with the question whether claims for

losses allegedly suffered at the hands of a Nazi puppet regime

during World War II are cognizable in our courts today.

Because these claims, at least superficially, touch on foreign

relations and potentially controversial political issues, it is

tempting to jump to the conclusion that such claims are barred

by the political question doctrine. The Supreme Court has

counseled, however, that “it is error to suppose that every case

or controversy which touches foreign relations lies beyond

judicial cognizance.” Baker v. Carr, 369 U.S. 186, 211

(1962). The justiciability inquiry is limited to “ ‘political

questions,’ not . . . ‘political cases,’ ” id. at 217, and should

be made on a “case-by-case” basis, id. at 211.

ALPERIN v. VATICAN BANK 6651

Although the political question doctrine often lurks in the

shadows of cases involving foreign relations, it is infrequently

addressed head on. See, e.g., Hwang Geum Joo v. Japan, 332

F.3d 679, 682 (D.C. Cir. 2003), vacated and remanded by 124

S. Ct. 2835 (2004) (explaining that because the district court

did not have subject matter jurisdiction in case involving

World War II-era claims against Japan, “[n]or . . . need we

consider whether the political question doctrine would also

bar its adjudication”). The procedural posture of this case,

however, places the issue squarely before us.

With these principles in mind, in determining the threshold

issue of justiciability, we scrutinize each claim individually.

Indeed, in our system of separation of powers, we should not

abdicate the court’s Article III responsibility—the resolution

of “cases” and “controversies”—in favor of the Executive

Branch, particularly where, as here, the Executive has

declined a long-standing invitation to involve itself in the dis-

pute. We conclude that some of the claims are barred by the

political question doctrine and some of the claims are justicia-

ble. Although the parties have multiple procedural and sub-

stantive challenges to overcome down the road, they are

entitled to their day—or years—in court on the justiciable

claims.

A group of twenty-four individuals and four organizations

(the “Holocaust Survivors”) claim that the Vatican Bank,

known by its official title Istituto per le Opere di Religione,

the Order of Friars Minor, and the Croatian Liberation Move-

ment (Hrvatski Oslobodilacki Pokret), profited from the geno-

cidal acts of the Croatian Ustasha political regime (the

“Ustasha”), which was supported throughout World War II by

Nazi forces. That profit allegedly passed through the Vatican

Bank in the form of proceeds from looted assets and slave

labor. The Holocaust Survivors brought suit in federal court

claiming conversion, unjust enrichment, restitution, the right

to an accounting, and human rights violations and violations

of international law arising out of the defendants’ alleged

6652 ALPERIN v. VATICAN BANK

involvement with the Ustasha during and following World

War II.

The Vatican Bank and the Order of Friars Minor moved to

dismiss the Holocaust Survivors’ complaint on multiple

grounds; by agreement of the parties the district court limited

its discussion to the issue of whether the Holocaust Survivors’

claims should be dismissed under the political question doc-

trine. The district court reasoned that the political question

doctrine bars consideration of the merits of the claims in their

entirety. The district court dismissed the action against the

Croatian Liberation Movement, which never appeared in the

action, on the grounds that the claims were barred by both the

political question doctrine and the lack of personal jurisdic-

tion over this defendant. We reverse in part because certain of

the Holocaust Survivors’ claims—those with respect to lost

and looted property (conversion, unjust enrichment, restitu-

tion, and an accounting)—are not barred by this doctrine. In

contrast, the broad human rights allegations tied to the Vati-

can Bank’s alleged assistance to the war objectives of the

Ustasha present nonjusticiable controversies. Like the district

court, we hold that the court did not have personal jurisdiction

over the Croatian Liberation Movement.1 Consequently, we

see no reason to reach the political question doctrine vis-à-vis

this defendant.

Bearing in mind that “[t]he decision to deny access to judi-

cial relief is not one we make lightly,” Liu v. Republic of

1

Even though a plaintiff need make only a prima facie showing of juris-

diction at this stage in a litigation, Glencore Grain Rotterdam B.V. v. Shiv-

nath Rai Harnarain Co., 284 F.3d 1114, 1119 (9th Cir. 2002), the

Holocaust Survivors’ bare-bones assertions that the Croatian Liberation

Movement has been “active” within the United States at some point and

at least a few members have ties to this country are insufficient for us to

conclude that the exercise of jurisdiction “does not offend ‘traditional

notions of fair play and substantial justice.’ ” Int’l Shoe Co. v. Washing-

ton, 326 U.S. 310, 316 (1945) (quoting Milliken v. Meyer, 311 U.S. 457,

463 (1940)).

ALPERIN v. VATICAN BANK 6653

China, 892 F.2d 1419, 1433 (9th Cir. 1989) (quoting Int’l

Ass’n of Machinists & Aerospace Workers v. OPEC, 649 F.2d

1354, 1360 (9th Cir. 1981)), we conclude that the political

question doctrine does not create an absolute barrier to the

Holocaust Survivors’ property claims. To conclude otherwise

would be to shirk our judicial role as “[c]ourts in the United

States have the power, and ordinarily the obligation, to decide

cases and controversies properly presented to them.” W.S.

Kirkpatrick & Co. v. Envtl. Tectonics Corp., Int’l, 493 U.S.

400, 409 (1990).

That said, it bears noting that our initial determination of

justiciability in no way reflects any judgment on the threshold

legal hurdles that must be overcome or the merits of the

claims. Much of the dissent focuses on downstream issues

related to potential procedural and substantive pitfalls of the

claims. We do not discount the difficulties that may lie ahead;

however, consideration of those issues is premature. Given

the passage of time, the generality of the allegations, the ques-

tion of the applicability of the Foreign Sovereign Immunities

Act, intricacies of the alleged claims, the class certification

issues, whether the claimants have a cognizable legal claim,

and a myriad of other procedural and jurisdictional hurdles,

the Holocaust Survivors may indeed face an uphill battle in

pursuing their claims. But this spectre of difficulty down the

road does not inform our justiciability determination at this

early stage of the proceedings.

Our conclusion is rooted in the principles of Baker v. Carr.

Despite the dissent’s cataclysmic and speculative projections

about the sweep of our opinion, our decision boils down to

letting the common law property claims proceed to the next

stage and foreclosing the political, human rights, and war-

related claims. In so doing, we respect the limits of our juris-

diction as a national court, recognize the role of the Executive

in foreign relations, and stick to our role of interpreting the

law.

6654 ALPERIN v. VATICAN BANK

I. BACKGROUND

A. WORLD WAR II AND THE USTASHA TREASURY

The events at issue relate back to the actions of the Vatican

during and in the years following World War II.2 Following

Germany’s blitzkrieg through Yugoslavia in 1941, a govern-

ment composed of members of the Ustasha was proclaimed

the head of a protectorate of Italy. See Ustasha Treasury Report3

at 141. The Ustasha regime was supported throughout World

War II by German and Italian occupation forces. Id.

2

Regarding terminology, the Vatican City and the Holy See are closely

related but not interchangeable entities:

The term “Holy See” refers to the composite of the authority,

jurisdiction, and sovereignty vested in the Pope and his advisers

to direct the worldwide Roman Catholic Church. . . . . Created in

1929 to provide a territorial identity for the Holy See in Rome,

the State of the Vatican City is a recognized national territory

under international law. The Holy See, however, enters into inter-

national agreements and receives and sends diplomatic represen-

tatives.

See U.S. Dep’t of State, Background Note: The Holy See (Oct. 2004),

available at http://www.state.gov/r/pa/ei/bgn/3819.htm (“Vatican Back-

ground Note”). See generally Robert John Araujo, The International Per-

sonality and Sovereignty of the Holy See, 50 Cath. U. L. Rev. 291 (2001)

(providing historical overview of the Holy See’s foreign relations and

arguing that it is a subject of international law). These nuances are not crit-

ical for purposes of this opinion. Therefore, for convenience, the term

“Vatican” will be used to refer generally to the Catholic leadership cen-

tered in the Vatican City.

3

In the late 1990s, the U.S. Government prepared a report on the

Ustasha wartime treasury as part of a larger effort “to confront the largely

hidden history of Holocaust-related assets after five decades of neglect.”

Bureau of Public Affairs, U.S. Dep’t of State, Pub. No. 10557, U.S. Allied

Wartime and Postwar Relations and Negotiations With Argentina, Portu-

gal, Spain, Sweden, and Turkey on Looted Gold and German External

Assets and U.S. Concerns About the Fate of the Wartime Ustasha Trea-

sury, Supplement to the Preliminary Study on U.S. and Allied Efforts to

Recover and Restore Gold and Other Assets Stolen or Hidden by Germany

During World War II iii (1998) (“Ustasha Treasury Report”).

ALPERIN v. VATICAN BANK 6655

Although the United States and its allies were aware to

some extent of the Ustasha’s atrocities, “It is not clear if the

Allied leaders clearly grasped that as many as 700,000 vic-

tims, most of them Serbs, had been killed at the Ustasha death

camps . . . .” Id. at 142. The State Department’s report

describes the Vatican’s role in less generous terms: “The Vat-

ican, which maintained an ‘Apostolic visitor’ in Zagreb from

June 1941 until the end of the War, was aware of the killing

campaign . . . . Croatian Catholic authorities condemned the

atrocities committed by the Ustashi, but remained otherwise

supportive of the regime.” Id. at 143.

The connections between the Vatican and the Ustasha

reportedly continued in the years following World War II:

With the defeat in May 1945 of Hitler and his satel-

lites, including puppet Croatia, the leaders of the

Ustasha fled to Italy, where they found sanctuary at

the pontifical College of San Girolamo in Rome.

This College was most likely funded at least in part

by the remnants of the Ustasha treasury, and

appeared to operate with at least the tacit acquies-

cence of some Vatican officials.

Id. at xviii. It is unclear to what extent the Vatican was aware

of these activities, but the State Department is dubious that

they were oblivious to the Ustasha’s presence:

Although no evidence has been found to directly

implicate the Pope or his advisers in the postwar

activities of the Ustasha in Italy, it seems unlikely

that they were entirely unaware of what was going

on. Vatican authorities have told us they have not

found any records that could shed light on the

Ustasha gold question.

Id. at 156.

6656 ALPERIN v. VATICAN BANK

The size and nature of the Ustasha treasury remains in con-

siderable doubt. According to the State Department, “The fig-

ure of 350 million Swiss francs (over $80 million) of Ustasha

gold that U.S. intelligence reported in 1946 remains the only

attempt to estimate the total financial resources available to

the Ustashi at the end of World War II.” Id. at 150. The State

Department cautions that this estimate “remains unsubstan-

tiated and may not include some or all of the sums reported

elsewhere.” Id.

B. THE HOLOCAUST SURVIVORS’ CLAIMS

This background section on the claims is drawn from the

Holocaust Survivors’ Third Amended Class Action Complaint

(the “Complaint”), which is detailed and lengthy and refer-

ences a number of outside sources, such as the Ustasha Trea-

sury Report. At this stage of the proceedings, we accept the

allegations as true. See California v. United States, 104 F.3d

1086, 1089 (9th Cir. 1997) (when reviewing a district court’s

grant of a motion to dismiss, this court accepts the facts

alleged in the complaint as true).

1. PLAINTIFFS

The Complaint was filed on behalf of the named plaintiffs

and the following class:

[A]ll Serbs, Jews, and former Soviet Union citizens

(and their heirs and beneficiaries), who suffered

physical, monetary and/or property losses including

slave labor, due to the systematic and brutal extermi-

nation of Jews, Serbs, and Romani by the [Ustasha],

and as a result of the occupation of the former Soviet

Union by Croatian military forces in concert with

their German occupation forces.

The potential class is massive: Plaintiff Ukrainian Union of

Nazi Victims And Prisoners “represents over 300,000 former

ALPERIN v. VATICAN BANK 6657

slave and forced laborers, prisoners, concentration camp, and

ghetto survivors.” The geographic scope of the class is also

far reaching with the Ustasha’s destruction extending beyond

Croatia to Bosnia, Yugoslavia, and the Soviet Union, includ-

ing Ukraine, Belarus, and Russia.

The jurisdictional bases of the Holocaust Survivors’ claims

are similarly expansive. They claim jurisdiction pursuant to

the Alien Tort Statute, 28 U.S.C. § 1350 (“ATS”), the Foreign

Sovereign Immunities Act, 28 U.S.C. § 1605 (“FSIA”), 28

U.S.C. § 1331, federal common law as it incorporates custom-

ary international law and treaties, diversity jurisdiction, and

California state law.4

4

The viability of the Holocaust Survivors’ claims apart from the issue

of the political question doctrine is not before us. Nevertheless, looking

ahead, we note that the statutory grounds on which the Holocaust Survi-

vors base their claims have, for the most part, not fared well in recent liti-

gation. Just last term, the Supreme Court limited the ATS in Sosa v.

Alvarez-Machain, 124 S. Ct. 2739, 2764 (2004) (curtailing the scope of

actionable international norms under the ATS but explaining that “the

door is still ajar subject to vigilant doorkeeping”); see also Weiss v. Am.

Jewish Comm., 335 F. Supp. 2d 469 (S.D.N.Y. 2004) (dismissing claim

under the ATS for injunctive relief in connection with the construction of

a Holocaust memorial in light of the Court’s holding in Sosa). The con-

tours of the FSIA have also changed with the Supreme Court’s holding in

Republic of Austria v. Altmann, 541 U.S. 677, 124 S. Ct. 2240 (2004), that

the FSIA applies retroactively. See also Abrams v. Societe Nationale des

Chemins de Fer Francais, 389 F.3d 61, 64-65 (2d Cir. 2004) (dismissing

case for lack of subject matter jurisdiction because the French govern-

ment’s acquisition of defendant railroad company immunized it from suit

under the FSIA). In Deutsch v. Turner Corp., 324 F.3d 692, 719 (9th Cir.

2003), we held that a California statute on which the Holocaust Survivors’

claims are based in part, Cal. Civ. Proc. Code § 354.6, unconstitutionally

intruded on the foreign affairs power of the federal government. We leave

the district court to determine in the first instance to what extent the Holo-

caust Survivors have correctly invoked these and other jurisdictional

bases.

6658 ALPERIN v. VATICAN BANK

2. DEFENDANTS

The Complaint does not name the Vatican itself as a defen-

dant but rather focuses on a closely related entity, the Vatican

Bank.5 The exact relationship between the Vatican and the

Vatican Bank is less than clear at this stage of the proceed-

ings. We are in no position to make a substantive judgment

about the nature of the Vatican Bank.6 The Complaint, which

we accept at face value, distinguishes between the two enti-

ties. The Vatican Bank has its principal place of business in

the Vatican City and is headed by a Bishop, but it conducts

transactions worldwide including “for-profit merchant bank-

ing transactions in the United States, California, and else-

where.”

The actual dealings of the bank, however, are murky.

Indeed, the Vatican Bank’s holdings and its specific transac-

tions are opaque. In his declaration in support of the Holo-

caust Survivors’ motion for early jurisdictional discovery,

John Loftus—a former prosecutor with the U.S. Department

5

The Complaint also names “Unknown Catholic Religious Orders,” a

number of banking institutions (both named institutions and “Does #1-

100”) and “unknown recipients of Nazi and Ustasha loot” as defendants.

The Holocaust Survivors voluntarily dismissed their claims against defen-

dant Swiss National Bank in 2002.

6

Like its other ominous projections, the dissent jumps ahead to conclude

that this suit is “functionally” against “the Vatican itself” and “the Vatican

Bank, which is an instrumentality of the sovereign state of the Vatican,”

and possibly even the Pope. Dissent at 6705. But we are nowhere near the

point of making such an assessment. Because this case comes to us at the

motion to dismiss stage, we must accept the Complaint’s demarcation

between the Vatican Bank, which is named as a defendant, and the Vati-

can, which is not named as a defendant. Further, the potential overtones

that this case may have on relations with the Vatican leadership do not,

as the dissent suggests, warrant dismissal. See Antolok v. United States,

873 F.2d 369, 392 (D.C. Cir. 1989) (Wald, C.J., concurring in judgment

only) (“I read [Baker v. Carr] as a reminder that our focus should be on

the particular issue presented for our consideration, not the ancillary

effects which our decision may have on political actors.”).

ALPERIN v. VATICAN BANK 6659

of Justice’s Nazi-hunting unit—attests, “The Vatican Bank is

one of the most secretive financial institutions in the world.

The exact nature and ownership of the Vatican Bank is diffi-

cult to ascertain owing to the secrecy surrounding it.”

The bank’s dealings and ownership may be shrouded in

mystery, but the Vatican considers itself to have a stake in the

outcome of these proceedings. In specific reference to this

case, the Vatican’s Secretariat of State sent a Verbal Note of

Protest, dated October 23, 2000, to the U.S. Embassy in Rome

requesting as follows:

Basing itself upon the diplomatic relations which

exist between the United States of America and the

Holy See, as well as the recognition which the Gov-

ernment of the United States has accorded to the

sovereignty of the Holy See and of Vatican City

State, the Secretariat of State requests the interven-

tion of the Federal Government of the United States

of America.

The Order of Friars Minor joined the Vatican Bank in

bringing the motion to dismiss. A religious brotherhood

founded by St. Francis Assisi, the organization includes “sev-

eral Croatian Franciscan Orders in California, the United

States, Croatia, and Italy.” During World War II, “Many high

officials of the Ustasha government were Roman Catholic

clergy and, in particular, Franciscans.” These ties continued

after the war with the Order of Friars Minor providing aid to

former Ustasha.

Neither the district court nor the Holocaust Survivors dis-

tinguished between the Vatican Bank and Order of Friars

Minor in the treatment of the political question doctrine. Like-

wise, because no distinction can be made on the basis of the

pleadings, we also address the two defendants together. For

ease of reference, from this point on in the opinion we refer

to them collectively as the “Vatican Bank.”

6660 ALPERIN v. VATICAN BANK

The third defendant, the Croatian Liberation Movement, is

identified “as the successor to the Ustasha government.” The

Croatian Liberation Movement allegedly “functioned as a

government in exile and coordinated terrorist activities in the

United States and elsewhere.”

3. CAUSES OF ACTION

The Complaint describes in detail the atrocities inflicted on

the Holocaust Survivors during World War II by the Ustasha

and, more generally, by allied Fascists “believed to be Cro-

atians.” In addition to describing the looting of assets, the

Complaint recites genocidal acts of the Ustasha, including

those carried out at the “Jasenovac Concentration Camp com-

plex, termed by historians as the ‘Auschwitz of the Bal-

kans.’ ”

Upon the collapse of the Ustasha regime in 1945, the Holo-

caust Survivors maintain that “all or a portion of the Ustasha

Treasury was transferred to cooperative Roman Catholic cler-

gyman [sic] and Franciscans for transport to Rome where

Franciscans sympathetic to the Ustasha were based.” These

funds eventually found their way into the hands of the Vatican

Bank, among other recipients. As alleged in the Complaint,

“A 1948 U.S. Army Intelligence reports [sic] confirmed 2,400

kilos of Ustasha stolen gold were moved from the Vatican to

one of the Vatican’s secret Swiss bank accounts.” In the dec-

ades following World War II, the Holocaust Survivors con-

tend that the Vatican Bank and the Croatian Liberation

Movement continued to profit from transactions involving the

Ustasha treasury.

Having set forth these general allegations, the Complaint

advances five causes of action:

Conversion: The Holocaust Survivors first allege, “Defen-

dants . . . have willfully and wrongfully misappropriated and

ALPERIN v. VATICAN BANK 6661

converted the value of [property taken from the Holocaust

Survivors] and its derivative profits into their own property.”

Unjust Enrichment: Second, defendants were unjustly

enriched by “receiv[ing] stolen property given to them by

members of the Ustasha Regime, which rightfully belongs to

[the Holocaust Survivors], as well as the value of slave labor

performed.”

Restitution: The Holocaust Survivors allege in their third

claim that their “goods and property have been taken, thus

denying [them] the use and enjoyment thereof; Defendants

have wrongfully used and profited from that property.” Main-

taining that “compensation in damages is inadequate in that

the property taken cannot be replaced and the harm inflicted

cannot be undone by mere compensation,” the Holocaust Sur-

vivors call for “equitable remedies.”

Accounting: Fourth, the Holocaust Survivors request “the

equitable remedy of accounting,” alleging that “Defendants

have never accounted for or paid the value of Plaintiffs’ prop-

erty or the profits which Defendants have derived from that

property, either during World War II or since World War II

ended.”

Human Rights Violations and Violations of International

Law: Finally, the Holocaust Survivors allege:

Defendants participated in the activities of the

Ustasha Regime in furtherance of the commission of

war crimes, crimes against humanity, crimes against

peace, torture, rape, starvation, physical and mental

abuse, summary execution and genocide. Specifi-

cally, the actions and conduct of Defendants, in addi-

tion to being profitable, actively assisted the war

objectives of the Ustasha Regime.

6662 ALPERIN v. VATICAN BANK

The Complaint condemns the defendants’ aiding and abetting

of war criminals after World War II by helping them to evade

prosecution and to preserve the Ustasha treasury.

The Holocaust Survivors cite a multitude of legal bases for

these claims: “Defendants’ actions were in violation of

numerous international treaties and the fundamental human

rights laws prohibiting genocide, war crimes, crimes against

humanity and crimes against peace. Defendants’ actions vio-

lated customary international law . . . .” They also claim that

“Defendants committed torts under the laws of the United

States, requiring Defendants to pay . . . appropriate compensa-

tory and punitive damages for . . . injuries and losses.”

C. OVERVIEW OF THE POLITICAL QUESTION DOCTRINE

Our inquiry proceeds from the age-old observation of Chief

Justice Marshall that “[q]uestions, in their nature political, or

which are, by the constitution and laws, submitted to the exec-

utive, can never be made in this court.” Marbury v. Madison,

5 U.S. (1 Cranch) 137, 170 (1803). Although the principle

behind the political question doctrine was announced over

two hundred years ago in Marbury, the Supreme Court has

addressed the doctrine in surprisingly few cases. See Atlee v.

Laird, 347 F. Supp. 689, 693-703 (E.D. Pa. 1972) (three-

judge court), aff’d sub nom. mem., Atlee v. Richardson, 411

U.S. 911 (1973), (detailed “case by case” analysis of the

development of the doctrine).

[1] In the landmark case of Baker v. Carr, the Supreme

Court provided its most comprehensive discussion on the

application of the doctrine. Recognizing that the attributes of

the political question doctrine “diverge, combine, appear, and

disappear in seeming disorderliness” in various settings, the

Court set out to illuminate the “contours” of the doctrine. 369

U.S. at 210-11; see also Erwin Chemerinsky, Constitutional

Law: Principles and Policies § 2.8.1 (1997) (“In many ways,

the political question doctrine is the most confusing of the jus-

ALPERIN v. VATICAN BANK 6663

ticiability doctrines.”). The Court explained that the political

question doctrine has its roots in the separation of powers and

set forth six formulations for courts to consider in determining

whether they should defer a case to the political branches:

Prominent on the surface of any case held to involve

a political question is found [1] a textually demon-

strable constitutional commitment of the issue to a

coordinate political department; or [2] a lack of judi-

cially discoverable and manageable standards for

resolving it; or [3] the impossibility of deciding

without an initial policy determination of a kind

clearly for nonjudicial discretion; or [4] the impossi-

bility of a court’s undertaking independent resolution

without expressing lack of the respect due coordinate

branches of government; or [5] an unusual need for

unquestioning adherence to a political decision

already made; or [6] the potentiality of embarrass-

ment from multifarious pronouncements by various

departments on one question.

369 U.S. at 217.

[2] Dismissal on the basis of the political question doctrine

is appropriate only if one of these formulations is “inextrica-

ble” from the case. Id. Although termed as “formulations” in

Baker, the plurality in Vieth v. Jubelirer, 541 U.S. 267, 124

S. Ct. 1769, 1776 (2004), recently described these criteria as

“six independent tests.” But these tests are more discrete in

theory than in practice, with the analyses often collapsing into

one another. See Nixon v. United States, 506 U.S. 224, 228-29

(1993) (describing interplay between the first and second

Baker tests). This overlap is not surprising given the common

underlying inquiry of whether the very nature of the question

is one that can properly be decided by the judiciary.

Addressing foreign affairs specifically, Baker cautioned

against “sweeping statements” that imply all questions involv-

6664 ALPERIN v. VATICAN BANK

ing foreign relations are political ones. 369 U.S. at 211 (citing

Oetjen v. Cent. Leather Co., 246 U.S. 297, 302 (1918) (“The

conduct of the foreign relations of our Government is com-

mitted by the Constitution to the Executive and Legislative—

‘the political’—Departments of the Government, and the pro-

priety of what may be done in the exercise of this political

power is not subject to judicial inquiry or decision.”)).

Instead, the Court instructed that courts should undertake a

discriminating case-by-case analysis to determine whether the

question posed lies beyond judicial cognizance. 369 U.S. at

211. Informing this inquiry are considerations of “the history

of [the question’s] management by the political branches,” its

“susceptibility to judicial handling,” and “the possible conse-

quences of judicial action.” Id. at 211-12.

Despite this caution that it is impossible to decide cases

raising the political question doctrine “by any semantic

cataloguing,” id. at 217, certain families of cases have

emerged in the foreign affairs realm. See, e.g., Japan Whaling

Ass’n v. Am. Cetacean Soc’y, 478 U.S. 221, 229-31 (1986)

(interpretation of statutes involving foreign affairs is a justi-

ciable question); Goldwater v. Carter, 444 U.S. 996, 1002-04

(1979) (four-justice plurality concluding that a challenge to

the President’s unilateral termination of a treaty presents a

political question); Ludecke v. Watkins, 335 U.S. 160, 168

(1948) (termination of war is a political question); Oetjen, 246

U.S. at 302 (Executive’s recognition of a foreign government

is a political question). In general, however, Baker’s admoni-

tion has proved true that most cases involving foreign affairs

fail to fall neatly into categories on one side or the other of

the justiciable/nonjusticiable line. As a result, the overarching

Baker tests remain the starting point of our inquiry.

Following Baker, the Supreme Court has not retreated from

the analytical framework it established. See Vieth, 124 S. Ct.

at 1776 (reiterating Baker formulations); Davis v. Bandemer,

478 U.S. 109, 121-27 (1986) (reciting Baker formulations and

declining Justice O’Connor’s implicit invitation to rethink

ALPERIN v. VATICAN BANK 6665

that approach). Subsequent decisions have elaborated on the

various criteria. In particular, the Vieth plurality’s observation

that the Baker tests “are probably listed in descending order

of both importance and certainty,” 124 S. Ct. at 1776, is borne

out by the disproportionate emphasis on the first two tests in

both Supreme Court and lower court cases. See, e.g., Powell

v. McCormack, 395 U.S. 486, 548-49 (1969) (dismissing five

Baker formulations as inapplicable in two paragraphs after an

extensive discussion of the first test); see also El-Shifa

Pharm. Indus. Co. v. United States, 378 F.3d 1346, 1367

(Fed. Cir. 2004) (focusing on first Baker formulation in hold-

ing that the Constitution, “in its text and by its structure, com-

mits to the President the power to make extraterritorial enemy

property designations”); Made in the USA Found. v. United

States, 242 F.3d 1300, 1312-19 (11th Cir. 2001) (briefly

addressing “prudential considerations” after analyzing the

first and second Baker formulations at length in concluding

that the question of what constitutes a treaty is a political

question); In re African-American Slave Descendants Litig.,

304 F. Supp. 2d 1027, 1056-63 (N.D. Ill. 2004) (discussing

first and second Baker formulations extensively in determin-

ing that slave reparation claims were not justiciable). But see

United States v. Munoz-Flores, 495 U.S. 385, 390-93 (1990)

(briefly dismissing other Baker formulations after explaining

that mere judicial scrutiny of a congressional enactment does

not show a lack of respect for Congress under the fourth

Baker formulation). Similarly, the district court in this case

addressed only the first and second considerations and found

that both counseled in favor of dismissal.

Perhaps not surprisingly, our analysis also focuses on the

first two considerations because they are the most significant

in the face of the specific allegations of the Complaint. Before

we proceed to evaluate the Holocaust Survivors’ claims, it is

useful to take a short detour through the World War II Holo-

caust claims cases as they pertain to the political question

doctrine.

6666 ALPERIN v. VATICAN BANK

D. THE POLITICAL QUESTION DOCTRINE AND WORLD WAR

II-ERA CLAIMS

The late 1990s saw a flurry of legal activity over

Holocaust-era claims after years of quietude. See Michael J.

Bazyler, Nuremberg in America: Litigating the Holocaust in

United States Courts, 34 U. Rich. L. Rev. 1, 19 (2000) (“A

total of ten cases involving Holocaust-era claims were filed in

the United States between the end of World War II and Octo-

ber 1996, the start of the new era of Holocaust-claim litiga-

tion.”).7 The cases break down into several categories: finding

of justiciability, finding of no justiciability, and skirting the

political question doctrine or not reaching the doctrine.

The Eleventh Circuit’s recent decision involving claims

against banks falls into the first category. The court held that

claims against two German banks that profited from the prac-

tice of Aryanization during World War II were not political

questions. See Ungaro-Banages v. Dresdner Bank AG, 379

F.3d 1227, 1235-37 (11th Cir. 2004).

In contrast, the district court in this case relied heavily on

litigation in federal district courts in New Jersey in which the

courts determined that various Holocaust claims raised non-

justiciable political questions.8 See Burger-Fischer v. Degussa

7

In addition to Michael Bazyler’s comprehensive review of Holocaust-

era litigation, Burt Neuborne, counsel to various parties in Holocaust liti-

gation, provides a helpful overview of the path of these cases. See Burt

Neuborne, Preliminary Reflections on Aspects of Holocaust-era Litigation

in American Courts, 80 Wash. U. L.Q. 795 (2002).

8

The Holocaust Survivors argue that it was improper for the district

court to rely on these out-of-circuit district court cases. Although these

cases cannot be viewed as precedent, it certainly was not improper for the

district court to reference them and consider analogous principles. See

Hart v. Massanari, 266 F.3d 1155, 1169 (9th Cir. 2001) (acknowledging

practice of considering out-of-circuit cases when ruling on a novel issue

of law). The Holocaust Survivors further challenge the use of these cases

as improper in light of Deutsch. See 324 F.3d at 713 n.11. In Deutsch, we

did not, however, reject the New Jersey cases wholesale but rather criti-

cized the district court for invoking the political question doctrine when

all that was required was “the simple application of the requirements of

a treaty to which the United States is a party.” Id.

ALPERIN v. VATICAN BANK 6667

AG, 65 F. Supp. 2d 248 (D.N.J. 1999); Iwanowa v. Ford

Motor Co., 67 F. Supp. 2d 424 (D.N.J. 1999).9

Other courts fielding Holocaust-era claims have skirted the

political question doctrine. See, e.g., Garb v. Republic of

Poland, 72 Fed. Appx. 850, 855 n.1 (2d Cir. 2003), vacated

and remanded by 124 S. Ct. 2835 (2004) (cautioning in

remanding claims brought by Jews against defendant states

and their instrumentalities that the district court’s “necessary

factual inquiry should be conducted with appropriate attention

to separation-of-powers concerns, inasmuch as the conduct of

foreign relations is delegated to the political branches, and the

adjudication of claims that risk significant interference with

foreign relations policy may raise justiciability concerns”)

(citations omitted); Goldstein v. United States, No. 01-0005,

2003 U.S. Dist. LEXIS 19266 (D.D.C. Apr. 23, 2003) (mem-

orandum opinion) (failing to reach political question doctrine

because claims were barred by the doctrine of sovereign

immunity in suit by Hungarian Jews against the United States

for failure to take action to prevent the deaths of Jews during

World War II and for recovery of stolen assets); Bodner v.

Banque Paribas, 114 F. Supp. 2d 117, 129 n.9 (E.D.N.Y.

2000) (explaining in case alleging French banks had failed to

return assets seized during the Holocaust that the political

question doctrine was “not even raised by the defendants here

and [is] irrelevant to these facts in any event”).

Still other courts have not reached the issue because the

cases were settled prior to ruling on the defendants’ motions

to dismiss. See In re Austrian & German Bank Holocaust

Litig., 80 F. Supp. 2d 164 (S.D.N.Y. 2000) (overseeing settle-

9

Following the district courts’ dismissals of Burger-Fischer and Iwa-

nowa, the plaintiffs pursued expedited appeals to the Third Circuit Court

of Appeals. Neuborne, supra note 7, at 815. The appeals were adjourned

in light of the impending establishment of a foundation to handle claims

against German companies, and the appeals were “ultimately voluntarily

dismissed in May 2001 in connection with the establishment of the Ger-

man Foundation.” Id.

6668 ALPERIN v. VATICAN BANK

ment proceedings in case against Austrian banks); In re Holo-

caust Victim Assets Litig., 105 F. Supp. 2d 139 (E.D.N.Y.

2000) (overseeing settlement proceedings in Swiss Bank liti-

gation).

With these varied views as a backdrop, we turn to consider-

ation of the Holocaust Survivors’ claims.

II. DISCUSSION

On appeal, the Holocaust Survivors address the first, sec-

ond, and sixth Baker tests. The Vatican Bank maintains that

the Holocaust Survivors’ claims present political questions

under all of the Baker tests. Because any single test can be

dispositive, we address each in our discussion. Just as signifi-

cantly, while we agree with the district court that certain types

of claims arising out of World War II are properly left to the

political branches, we take a surgical approach rather than a

broad brush in benchmarking the Baker formulations against

the individual claims. It is incumbent upon us to examine

each of the claims with particularity.

The dissent would have the political question doctrine

remove from our courts “all matters that fall by their constitu-

tional DNA into this sphere [of conduct involving foreign

relations].” Dissent at 6705. This over-inclusive approach

threatens to sweep all cases touching foreign relations beyond

the purview of the courts—a practice warned against in

Baker. See 369 U.S. at 210-11 (“Much confusion results from

the capacity of the ‘political question’ label to obscure the

need for case-by-case inquiry.”). The Court’s emphasis in

Baker on “the necessity for discriminating inquiry into the

precise facts and posture of the particular case,” id. at 217, “is

not merely hortatory,” McMellon v. United States, 387 F.3d

329, 374 (4th Cir. 2004) (en banc) (Luttig, J., dissenting). We

therefore decline from reflexively invoking the doctrine

merely because the Holocaust Survivors’ claims implicate

ALPERIN v. VATICAN BANK 6669

foreign relations and instead proceed with a discriminating

inquiry.

We conclude that the claims for conversion, unjust enrich-

ment, restitution, and an accounting10 with respect to lost and

looted property are not committed to the political branches

(the “Property Claims”). Recovery for lost and looted prop-

erty, however, stands in stark contrast to the broad allegations

tied to the Vatican Bank’s alleged assistance to the war objec-

tives of the Ustasha, including the slave labor claims, which

essentially call on us to make a retroactive political judgment

as to the conduct of war (the “War Objectives Claims”). Such

judgment calls are, by nature, political questions. With this

bifurcation as a framework, we first address the Property

Claims.

A. PROPERTY CLAIMS

None of the Baker formulations are inextricable from the

Property Claims. Simply because a foreign bank is involved

and the case arises out of a “politically charged” context does

not transform the Property Claims into political questions. See

Kadic v. Karadzic, 70 F.3d 232, 249 (2d Cir. 1995) (holding

10

The Holocaust Survivors are asking the court to order the Vatican

Bank to provide the necessary information to conduct an accounting. This

request contrasts with cases in which plaintiffs have asked courts to

require the political branches to take action. See, e.g., Earth Island Inst.

v. Christopher, 6 F.3d 648, 653-54 (9th Cir. 1993) (denying request that

the court compel the Secretary of State to initiate negotiations with foreign

nations); see also Koohi v. United States, 976 F.2d 1328, 1332 (9th Cir.

1992) (“Damage actions are particularly judicially manageable” whereas

“the framing of injunctive relief may require the courts to engage in the

type of operational decision-making . . . constitutionally committed to

other branches.”). It is an open question whether the Holocaust Survivors

will be able to gain access to the information needed for an accounting

without diplomatic intervention considering that “[a] full accounting of the

events of the Ustasha period . . . has to be found in the archives of other

nations and possibly the Vatican.” Ustasha Treasury Report, supra note 3,

at 154.

6670 ALPERIN v. VATICAN BANK

that political question doctrine did not bar adjudication of

claims brought under the ATS against a Bosnian-Serb leader

for committing genocide and other atrocities).

As these excerpts from the Complaint demonstrate, the

Property Claims consist of garden-variety legal and equitable

claims for the recovery of property:

• “Looted Assets” is defined in the Complaint as

including, inter alia, “cash, securities, silver,

gold, jewelry, businesses, art masterpieces,

equipment and intellectual property” that were

improperly taken by any person or entity acting

in furtherance of the Nazi or Ustasha regime.

• The second largest apparel factory in Yugoslavia

was confiscated from the family of plaintiff Fred

Zlatko Harris, including “50 advanced industrial

Singer sewing machines.” The family’s invest-

ment real estate, car, and motorcycle were also

confiscated by Ustasha forces.

• The “Ustasha and Germans” looted property

“valued by the Tito government in 1948 in excess

of $1,500,000 in prewar dollars” from the textile

manufacturing assets of plaintiff Allen Dolfi

Herskovich’s family.

• Plaintiff Desa Tomasevic Wakeman describes

how “money and other belongings including

gold” were taken from her mother and grand-

mother by Ustasha forces.

• The looted assets were collected from a wide

geographic area, with “[t]he Ustasha Treasury

contain[ing] plunder from Ukraine and assets

seized from the Ustasha victims in Yugoslavia.”

ALPERIN v. VATICAN BANK 6671

• The Complaint lists whether the Vatican Bank

“improperly retained or converted looted assets”

belonging to the Holocaust Survivors as one of

the common questions of fact for the proposed

class.

• The Vatican Bank was unjustly enriched by “re-

ceiv[ing] stolen property given to [it] by mem-

bers of the Ustasha Regime.” The Holocaust

Survivors further seek restitution for their “goods

and property” that the Vatican Bank “wrongfully

used and profited from.”

• The Holocaust Survivors request that the court

direct the Vatican Bank “to return all identifiable

property looted from Plaintiffs and received by

Defendants” and pay “the value [plus interest] of

any identified property deposited by, or looted

from, Plaintiffs and received by Defendants.”

1. TEXTUALLY DEMONSTRABLE COMMITMENT

[3] Beginning logically with the first Baker test, we divine

no explicit constitutional reference that is applicable to this

case. Cf. Gilligan v. Morgan, 413 U.S. 1, 5-11 (1973) (noting

the Constitution’s explicit vesting of power in Congress to

“organiz[e] . . . the Militia” in holding that a suit seeking to

restrain the Governor’s use of National Guard troops pre-

sented political questions). More often, however, “there are

few, if any, explicit and unequivocal instances in the Consti-

tution of this sort of textual commitment. . . . The courts

therefore are usually left to infer the presence of a political

question from the text and structure of the Constitution.”

Nixon, 506 U.S. at 240-41 (White, J., concurring). In Nixon,

the Court undertook an expansive review of the history of the

Impeachment Trial Clause in concluding that the language

and structure of the Constitution textually commits impeach-

ment determinations to the Senate. Id. at 233-36; see also

6672 ALPERIN v. VATICAN BANK

Powell, 395 U.S. at 520-48 (1969) (engaging in a similarly

extensive review of the text and history behind the expulsion

power in Article I, Section 5, to discern whether it grants

Congress judicially unreviewable power to set qualifications

of membership).

Here we are not faced with analyzing a specific clause of

the Constitution but rather proceed from the understanding

that the management of foreign affairs predominantly falls

within the sphere of the political branches and the courts con-

sistently defer to those branches. See, e.g., Am. Ins. Ass’n v.

Garamendi, 539 U.S. 396, 422 n.12 (2003) (“[I]n the field of

foreign policy, the President has the ‘lead role.’ ”) (quoting

First Nat’l City Bank v. Banco Nacional de Cuba, 406 U.S.

759, 767 (1972)); Oetjen, 246 U.S. at 302 (emphasizing that

the conduct of foreign relations is committed to the political

branches and is not subject to judicial inquiry); Mingtai Fire

& Marine Ins. Co. v. United Parcel Service, 177 F.3d 1142,

1144 (9th Cir. 1999) (quoting United States v. Pink, 315 U.S.

203, 222-23 (1942)) (“[T]he conduct of foreign relations is

committed by the Constitution to the political departments of

the Federal Government; [and] . . . the propriety of the exer-

cise of that power is not open to judicial review.”). Notwith-

standing this general commitment of foreign relations to the

political branches, in Baker, the Court cautioned that whether

a court should defer to the political branches is a case-by-case

inquiry because “it is error to suppose that every case or con-

troversy which touches foreign relations lies beyond judicial

cognizance.” 369 U.S. at 211.

Our inquiry is further based on the premise that, unlike

some World War II-era claims, the Holocaust Survivors’

claims are not expressly barred by treaty.11 U.S. Const. art. II,

11

The dissent suggests that the Treaty of Peace with Italy, Feb. 10, 1947,

art. 75, 61 Stat. 1245, 1400-01, controls this case. See Dissent at 6709-10.

This emphasis is misplaced. The treaty was concluded with Italy, not the

Vatican. See Vatican Background Note, supra note 2 (“Lateran Pacts con-

ALPERIN v. VATICAN BANK 6673

§ 2, cl. 1 (granting the President the power to make treaties);

see, e.g., In re World War II Era Japanese Forced Labor

Litig., 114 F. Supp. 2d 939, 945 (N.D. Cal. 2000), aff’d,

Deutsch v. Turner Corp., 324 F.3d 692 (9th Cir. 2003), (deter-

mining that the 1951 Peace Treaty with Japan essentially pre-

cludes all claims arising out of actions taken by Japan and its

nationals during World War II).

Nor are the Holocaust Survivors’ claims against the Vati-

can Bank the subject of an executive agreement. See Gara-

mendi, 539 U.S. at 415-16 (“Historically, wartime claims

against even nominally private entities have become issues in

international diplomacy, and three of the postwar settlements

dealing with reparations implicating private parties were

made by the Executive alone.”); Dames & Moore v. Regan,

453 U.S. 654, 680 (1981) (“Crucial to our decision today is

the conclusion that Congress has implicitly approved the prac-

tice of claim settlement by executive agreement.”).

In other circumstances, the Executive Branch has taken for-

mal steps to intervene in certain claims arising out of the

Holocaust. Most notably, the United States and Germany

signed an executive agreement in July 2000 in which Ger-

many agreed to enact legislation establishing a foundation

(the “Foundation”) to oversee the compensation of those

“who suffered at the hands of German companies during the

National Socialist era and World War II.” Agreement Con-

cerning the Foundation “Remembrance, Responsibility and

firming independence and sovereignty of The Holy See signed with Italy

on February 11, 1929.”). Further, as previously noted, because this case

comes to us at the motion to dismiss stage, we must accept the Com-

plaint’s demarcation between the Vatican Bank, which is named as a

defendant, and the Vatican, which is not named as a defendant. To the

extent further discovery resolves the legal and political status of the Vati-

can bank vis-à-vis the Vatican and/or Italy, the treaty could have some

bearing. At this juncture, however, it is not applicable to the claims as

plead.

6674 ALPERIN v. VATICAN BANK

the Future,” July 17, 2000, U.S.-F.R.G., 39 I.L.M. 1298, 1298

(“Foundation Agreement”);12 see also Garamendi, 539 U.S. at

405-08 (describing the Foundation Agreement and similar

agreements concluded with Austria and France).

The Holocaust Survivors’ case is distinguishable from

those involving the Foundation in that there is no analogous

executive agreement covering claims to the Ustasha treasury.

Despite the dearth of formalized accords, the Vatican Bank

counters—and the district court agreed—that the absence of

an agreement covering the Holocaust Survivors’ claims is not

dispositive of the issue. We agree. The question then comes

back to whether the Property Claims are the type of claims

committed to the political branches for resolution.

[4] We do not have much guidance in evaluating the nature

of the non-treaty, non-executive agreement claims. At bottom,

the Property Claims simply seek restitution for looted assets

belonging to purported class members. Reparation for steal-

ing, even during wartime, is not a claim that finds textual

commitment in the Constitution.

The Holocaust Survivors do not, for example, seek back

rent due a New York landlord from a country whose diplo-

12

Courts have been inconsistent as to whether the Foundation Agree-

ment precludes private litigation. Compare Ungaro-Banages, 379 F.3d at

1235 (explaining in holding that the political question doctrine did not act

as a bar that “the plain text of the Foundation Agreement anticipates that

federal courts will consider claims against German corporations”) with In

re Nazi Era Cases Against German Defendants Litig., 334 F. Supp. 2d

690, 696-97 (D.N.J. 2004) (holding claim against German company aris-

ing out of so-called Nazi “medical experiments” was nonjusticiable on the

basis of “[t]he history of foreign policy commitments devoted to the reso-

lution of Holocaust-era claims, coupled with the relatively recent creation

of the Foundation”); see also Neuborne, supra note 7, at 824 n.101

(“[The] precatory Statement of Interest [called for in the Foundation

Agreement] has no preclusive effect. It leaves to the discretion of an Arti-

cle III court whether additional Holocaust-era litigation should be enter-

tained.”).

ALPERIN v. VATICAN BANK 6675

mats were expelled from the United States, 767 Third Ave.

Assocs. v. Consulate Gen. of the Socialist Fed. Republic of

Yugoslavia, 218 F.3d 152 (2d Cir. 2000), or request an asset

freeze based on a declaration that the Communist Vietnam

government is an enemy of the United States, Can v. United

States, 14 F.3d 160 (2d Cir. 1994), or challenge the executive

power under the Hostage Act, Smith v. Reagan, 844 F.2d 195

(4th Cir. 1988), or raise a claim contingent on the safety and

effectiveness of a military exercise, Aktepe v. United States,

105 F.3d 1400 (11th Cir. 1997), or present claims arising out

of the CIA’s involvement in the anti-Allende coup in Chile,

Schneider v. Kissinger, 310 F. Supp. 2d 251 (D.D.C. 2004), or

question the recognition of a foreign government, Antolok,

873 F.2d at 379-85.

Instead, the claims here bear more similarities to the prop-

erty claims considered by the Supreme Court last year in Alt-

mann. See 124 S. Ct. at 2243. Altmann brought suit against

Austria and its national art gallery seeking to recover six

Klimt paintings that were allegedly wrongfully obtained by

the gallery after Nazi forces seized them during World War

II. Id. The Court granted certiorari on the limited question of

whether the FSIA applies retroactively, id., and did not

address the political question doctrine. Nonetheless, that the

Court allowed the case to proceed underscores that courts

have a place in deciding Holocaust-era claims concerning

looted assets. Cf. Rosner v. United States, 231 F. Supp. 2d

1202, 1204 (S.D. Fla. 2002) (denying motion to dismiss, in

part, in case alleging that the United States seized valuables

belonging to Hungarian Jews after World War II).

Significantly, the United States itself brought an action in

federal district court in New York seeking civil forfeiture of

a painting that the United States claimed was about to be

exported in violation of the National Stolen Property Act. See

United States v. Portrait of Wally, No. 99 Civ. 9940, 2002

U.S. Dist. LEXIS 6445 (S.D.N.Y. Apr. 12, 2002). “Wally,”

which was on loan from a museum in Austria, was taken from

6676 ALPERIN v. VATICAN BANK

victims of the Holocaust during World War II. Id. at *6. The

court rejected Austria’s argument, as amicus curiae, that the

court should not hear the case because of the political ques-

tion doctrine. Id. at *38 (determining that none of the six

Baker formulations was present). Although the claim was in

rem in nature, rather than for damages, the consideration

under Baker’s first test is the same.

[5] As with Portrait of Wally and Altmann, the Property

Claims ultimately boil down to whether the Vatican Bank is

wrongfully holding assets. Deciding this sort of controversy

is exactly what courts do. The presence of a foreign defendant

with some relationship to a foreign government and claims

stemming from World War II atrocities tinge this case with

political overtones, but the underlying property issues are not

“political questions” that are constitutionally committed to the

political branches.

The dissent’s rhetoric aside, the question here is whether

the suit should be stopped dead because of the political ques-

tion doctrine. If Judge Trott contests the broad jurisdiction of

U.S. courts to hear suits involving foreigners, or the scope of

the FSIA—issues that are not even presented at this stage of

the proceeding—then his recourse is with Congress, not a

quarrel with the majority. Our holding does not, as the dissent

contends, “extend[ ] the concept of judicial authority into

unknown territory and mistakenly exercise[ ] power and com-

petence that plainly belongs to the President and to Con-

gress.” Dissent at 6715-16. Nor does it raise the spectre of a

“World Court . . . with breathtaking and limitless jurisdiction

to entertain the World’s failures.” Dissent at 6712. Rather, we

hold true to a fundamental principle behind our separation of

powers design, namely that “[i]t is emphatically the province

and duty of the judicial department to say what the law is.”

Marbury, 5 U.S. (1 Cranch) at 177. Because the Property

Claims do not raise questions “entrusted to one of the political

branches or involv[ing] no judicially enforceable rights,”

ALPERIN v. VATICAN BANK 6677

Vieth, 124 S. Ct. at 1776, we fulfill our duty to say what the

law is.

2. JUDICIALLY DISCOVERABLE AND MANAGEABLE

STANDARDS

The Supreme Court discussed the second Baker test at

length last term in Vieth. The plurality explained that political

gerrymandering claims are nonjusticiable because no judi-

cially discernible and manageable standards for adjudicating

such claims exist: “One of the most obvious limitations

imposed by that requirement is that judicial action must be

governed by standard, by rule.” 124 S. Ct. at 1777. In

response to Justice Kennedy’s concern that the plurality’s

decision was premature,13 Justice Scalia replied, “But it is the

function of the courts to provide relief, not hope.” Id. at 1791.

The crux of this inquiry is thus not whether the case is unman-

ageable in the sense of being large, complicated, or otherwise

difficult to tackle from a logistical standpoint. Rather, courts

must ask whether they have the legal tools to reach a ruling

that is “principled, rational, and based upon reasoned distinc-

tions.” Id. at 1777.

In conducting this inquiry, the refusal of five Justices in

Vieth to hold that no manageable standard existed despite

what the plurality termed “[e]ighteen years of essentially

13

Abiding by the rule that when “no single rationale explaining the

result enjoys the assent of five Justices, the holding of the Court may be

viewed as that position taken by those Members who concurred in the

judgments on the narrowest grounds,” Marks v. United States, 430 U.S.

188, 193 (1977) (internal quotation marks omitted), we treat the position

enunciated in Justice Kennedy’s concurrence as controlling. Although

agreeing with the majority that the Court should refrain from intervention

in the case at bar, Justice Kennedy declined to join the plurality in holding

that all political gerrymandering claims are nonjusticiable. Vieth, 124

S. Ct. at 1793 (Kennedy, J., concurring) (“I would not foreclose all possi-

bility of judicial relief if some limited and precise rationale were found to

correct an established violation of the Constitution in some redistricting

cases.”).

6678 ALPERIN v. VATICAN BANK

pointless litigation,” id. at 1792, counsels against holding a

case nonjusticiable under the second Baker test without first

undertaking an exhaustive search for applicable standards. See

id. at 1795-96 (Kennedy, J., concurring) (calling for “err[ing]

on the side of caution” in refraining from concluding that no

manageable standards will emerge in the future). As Justice

Ginsburg optimistically wrote, although “courts have been

trying to devise practical criteria for political gerrymandering

for nearly 20 years” without reaching a workable solution, “I

do not accept it as sound counsel for despair.” Id. at 1815-16

(Ginsburg, J., dissenting).

The district court determined that the second Baker test

required dismissal, explaining that the Holocaust Survivors’

case presents “intractable problems,” including the task of

identifying and notifying potential class members, the “multi-

tude of sources” from which relevant materials would be

gathered, and the likelihood that the parties would be able to

gather all of the “pertinent data.” It is not surprising that the

district court zeroed in on “manageable standards” for decid-

ing the case. The Baker language is not crystal clear in this

regard and, understandably, other courts have similarly

focused on case management. See, e.g., Iwanowa, 67

F. Supp. 2d at 488-89 (“[T]he relevant materials come from a

multitude of sources, which . . . are voluminous and poten-

tially unmanageable for individual courts to handle.”)

Lest there be any doubt, Vieth refines and redirects the

inquiry. In light of the Court’s clarification in Vieth, we take

a slightly different approach to interpreting the phrase “judi-

cially discoverable and manageable standards.” Instead of

focusing on the logistical obstacles, we ask whether the courts

are capable of granting relief in a reasoned fashion or, on the

other hand, whether allowing the Property Claims to go for-

ward would merely provide “hope” without a substantive

legal basis for a ruling. See Vieth, 124 S. Ct. at 1791. We con-

clude that there are sound bases for providing relief.

ALPERIN v. VATICAN BANK 6679

The Holocaust Survivors’ most straightforward claims

involve identifiable personal property for which federal stat-

utes, common law, state law, and well-established case law

provide concrete legal bases for courts to reach a reasoned

decision. See, e.g., 28 U.S.C. § 1605(a)(3) (providing an

expropriation exception to sovereign immunity in certain

cases involving “rights in property taken in violation of inter-

national law”); Altmann, 124 S. Ct. at 2245 (asserting juris-

diction under the FSIA’s expropriation exception for return of

artwork taken by Nazi forces); Gruber v. Pac. States Sav. &

Loan Co., 88 P.2d 137, 139 (Cal. 1939) (“It is settled that

conversion is any act of dominion wrongfully exerted over

another’s personal property in denial of or inconsistent with

his rights therein.”).

[6] Altmann involved six paintings that were linked to a

single plaintiff through an imperfect, but at least fairly well

documented, chain of ownership. More difficult is tracking

gold, silver, and other fungible assets, like money, especially

those without bank account records or other reliable docu-

mentation. We are well aware that the Holocaust Survivors

have a difficult task ahead of them in establishing the path

that the looted funds followed. See Ustasha Treasury Report,

supra note 3, at 154-55 (“The Croatian delegation [at the Lon-

don Conference on Nazi Gold held in December 1997] stated

that there were 22 lists specifying the gold [of the Ustasha],

but the lists have not been found, and further documentation

regarding the gold was assumed to be with the National Bank

of Yugoslavia.”); id. at 155 (“There is some evidence that at

least part of the Croat Foreign Ministry archives was sent to

the Vatican at the end of the War.”). These looming evidenti-

ary and proof obstacles do not change the fact that, at heart,

the Holocaust Survivors seek compensation for stolen prop-

erty, a claim that is very familiar in our courts. Cf. Klinghoffer

v. S.N.C. Achille Lauro, 937 F.2d 44, 49 (2d Cir. 1991) (con-

cluding that the second Baker test did not act as a bar in case

against the Palestine Liberation Organization “because the

6680 ALPERIN v. VATICAN BANK

common law of tort provides clear and well-settled rules on

which the district court can easily rely”).

It would be premature for us to foreclose the Holocaust

Survivors’ claims because of such impending hurdles: The

second Baker prong is not a proxy for the class certification

analysis. See Fed. R. Civ. P. 23. As with every prospective

class action, this one must pass through the Rule 23 filter, a

process that could preclude the class or perhaps result in the

reshaping of the class or in some other modification of the

dispute. Concerns about class composition and size, as well as

questions about access to relevant documents, should be left

to Rule 23 proceedings and the discovery process.

Accordingly, the district court was misplaced in its reliance

on the somewhat anachronistic Kelberine v. Societe Interna-

tionale, 363 F.2d 989 (D.C. Cir. 1966), to support the view

that the Holocaust Survivors’ claims present “intractable

problems” that defy manageable judicial resolution. In Kel-

berine, the District of Columbia Circuit affirmed the dismissal

of World War II-era claims against a Swiss holding corpora-

tion “for failure to state a claim upon which relief can be

granted.” 363 F.2d at 995. Without mentioning the political

question doctrine, the court explained, “The procedure sought

—adjudication of some two hundred thousand claims for mul-

tifarious damages inflicted twenty to thirty years ago in a

European area by a government then in power—is too com-

plicated, too costly, to justify undertaking by a court without

legislative provision of the means wherewith to proceed.” Id.

Most significantly, Kelberine does not address the second

Baker test. Nor can Kelberine serve as a guide to logistical

infringement.

Since Kelberine was decided in 1966, the class action land-

scape has changed dramatically. Coincidentally, this same

year marked the emergence of “modern class action practice,”

Ortiz v. Fibreboard Corp., 527 U.S. 815, 833 (1999), with the

“innovative 1966 revision” to Rule 23, Amchem Prods., Inc.

ALPERIN v. VATICAN BANK 6681

v. Windsor, 521 U.S. 591, 613 (1997). Kelberine was also

decided prior to creation of the Manual for Complex Litiga-

tion which, first published in 1969, is now in its fourth incar-

nation. See Fed. Judicial Ctr., Manual For Complex

Litigation, Fourth (2004). This manual offers “an array of liti-

gation management techniques and procedures,” and recog-

nizes that due to the presence of much “sparsely charted

terrain[,] . . . judges are encouraged to be innovative and cre-

ative to meet the needs of their cases.” Id. at 2-3.

While acknowledging the innovative and creative means

that the judiciary has employed to tackle class actions, we are

well aware that this is a behemoth of a case. Even so, courts

have repeatedly risen to the challenge of handling cases

involving international elements as well as massive, complex

class actions. See generally Kenneth R. Feinberg, Reporting

From the Front Line — One Mediator’s Experience With

Mass Torts, 31 Loy. L.A. L. Rev. 359, 371 (1998) (discussing

“some of the practical problems which arise in attempting to

resolve [mass tort] litigation and the pragmatic solutions

offered to deal with these problems”). Courts also have fash-

ioned innovative solutions to surmount similar obstacles in

the Holocaust-claims context. See, e.g., D’Amato v. Deutsche

Bank, 236 F.3d 78, 82 (2d Cir. 2001) (explaining in class

action against German and Austrian banks that “the notice

campaign also utilized newspaper advertisements, direct mail-

ing to organizations throughout the world, and a world wide

web home page”); In re Holocaust Victim Assets Litig., 105

F. Supp. 2d at 147 (noting in context of reviewing settlement

agreement that “some 550,000 Initial Questionnaires had been

received from class members worldwide”). Our conclusion

that this case is judicially “manageable” does not diminish our

understanding that burdening a district court with a case of

this magnitude and complexity may prove to present a Sisy-

phean task: Just when the court appears to be making progress

towards reaching legal peace, the rock rolls back down and

the court must tackle the next issue.

6682 ALPERIN v. VATICAN BANK

[7] The Holocaust Survivors unrealistically “anticipate that

there will be no difficulty in the management of this litiga-

tion.” Of course there will be litigation management difficul-

ties, but that does not mean that courts “lack . . . judicially

discoverable and manageable standards” for resolving the

Property Claims. Baker, 369 U.S. at 217. Concerns about

class certification, discovery, and allocation, among other

issues, are matters to be resolved at a later time. Today we

conclude only that a legal framework exists by which courts

can evaluate these claims in a reasoned manner.

ALPERIN v. VATICAN BANK 6683

Volume 2 of 2

ALPERIN v. VATICAN BANK 6687

3. INITIAL POLICY DETERMINATION

[8] Nor do we think that adjudicating the Property Claims

will be impossible “without [making] an initial policy deter-

mination of a kind clearly for nonjudicial discretion.” Baker,

369 U.S. at 217. The Property Claims focus on the extent to

which the Holocaust Survivors were wrongfully deprived of

personal property and the value of such property that was

transferred to the Vatican Bank. Adjudicating these discrete

issues will not require the court to make pronouncements on

foreign policy or otherwise trigger the third Baker test. Cf.

Aktepe, 105 F.3d at 1404 (wrongful death claims arising out

of a NATO training exercise raised nonjusticiable political

questions in part because a decision would require “a policy

determination regarding the necessity of simulating actual

battle conditions”).

4. LACK OF RESPECT FOR COORDINATE BRANCHES

The fourth Baker test requires us to consider whether it

would be impossible for the courts to resolve the Property

Claims without expressing a lack of respect for the political

branches. See Baker, 369 U.S. at 217. As evidenced by the

Vatican’s protest to the State Department, this case implicates

foreign relations. Whether the court’s involvement would

inevitably express a lack of respect for the Executive

Branch’s handling of U.S.-Vatican relations,14 as well as rela-

tions with other foreign states, is a separate matter.15 We con-

clude that judicial handling of the Property Claims will not

run afoul of this fourth test.

14

The United States and the Vatican established diplomatic relations on

January 10, 1984. Vatican Background Note, supra note 2.

15

In addition to relations with the Vatican, we recognize that, theoreti-

cally, this case could bear on the United States’ relationship with Croatia,

as well as other countries. But this theoretical possibility—even if com-

mon sense—does not dictate the confines of a political question.

6688 ALPERIN v. VATICAN BANK

More than four years have passed since the Vatican sent its

protest to the State Department. The Holocaust Survivors rep-

resented to the court that the State Department has been

apprised of this appeal but has said that its decision not to

intervene is not reflective of its view on the merits of this

case.

[9] Had the State Department expressed a view, that fact

would certainly weigh in evaluating this fourth Baker formu-

lation. In Altmann, the Court explained that “should the State

Department choose to express its opinion on the implications

of exercising jurisdiction over particular petitioners in con-

nection with their alleged conduct, that opinion might well be

entitled to deference as the considered judgment of the Execu-

tive on a particular question of foreign policy.” 124 S. Ct. at

2255 (footnote omitted); see also 28 U.S.C. § 517 (“The

Solicitor General, or any officer of the Department of Justice,

may be sent by the Attorney General to any State or district

in the United States to attend to the interests of the United

States in a suit pending in a court of the United States . . . .”).

It is unclear, however, how courts should construe executive

silence. We are not mind readers. And, thus, we cannot dis-

cern whether the State Department’s decision not to intervene

is an implicit endorsement, an objection, or simple indiffer-

ence. At best, this silence is a neutral factor.

A few weeks after Altmann was decided, the Supreme

Court considered “a policy of case-specific deference to the

political branches” as a possible limitation on the determina-

tion whether an international norm is sufficiently definite to

support a cause of action. Sosa, 124 S. Ct. at 2766 n.21. The

Court saw no need to apply this policy in Sosa. Nonetheless,

the Court pointed to “several class actions” pending in federal

district court seeking damages from corporations in connec-

tion with South Africa’s former apartheid regime. Id. (citing

In re South African Apartheid Litig., 238 F. Supp. 2d 1379

(J.P.M.L. 2002) (granting a motion to transfer the cases to the

Southern District of New York)). In the South Africa cases,

ALPERIN v. VATICAN BANK 6689

the State Department filed a statement in support of South

Africa’s position that the cases interfered with the policy

embodied by its Truth and Reconciliation Commission. 124

S. Ct. at 2766 n.21. The Court concluded, “In such cases,

there is a strong argument that federal courts should give seri-

ous weight to the Executive Branch’s view of the case’s

impact on foreign policy.” Id.

Such case-specific intervention is not uncommon in cases

involving foreign affairs. See Sarei v. Rio Tinto PLC, 221

F. Supp. 2d 1116, 1179-80 (C.D. Cal 2002) (listing numerous

examples where the Executive Branch submitted its opinion

in cases involving foreign affairs). In the Holocaust-era

claims context, the United States agreed as part of the Foun-

dation Agreement that whenever a German company was

sued in a U.S. court over a Holocaust-era claim, the U.S. Gov-

ernment would submit a statement that foreign policy interests

recommend recognition of the Foundation as the exclusive

forum for such claims and “that U.S. policy interests favor

dismissal on any valid legal ground.” Foundation Agreement,

39 I.L.M. at 1304. The United States stopped short, however,

of expressly precluding all claims. See Garamendi, 539 U.S.

at 436 (Ginsburg, J., dissenting) (“The [Foundation] agree-

ment makes clear, however, that ‘the United States does not

suggest that its policy interests concerning the Foundation in

themselves provide an independent legal basis for dismiss-

al.’ ”) (quoting Foundation Agreement, 39 I.L.M. at 1304).

Courts have varied in their interpretation of the amount of

deference these statements merit. Compare Ungaro-Benages,

379 F.3d at 1236 n.12 (statement of interest filed by U.S.

Government under the Foundation Agreement is “entitled to

deference, [but] does not make the litigation non-justiciable”)

with Frumkin v. JA Jones, Inc. (In re Nazi Era Cases Against

German Defendants Litig.), 129 F. Supp. 2d 370, 388-89

(D.N.J. 2001) (“If [the statement of interest filed by U.S.

Government under the Foundation Agreement] does not

clearly demonstrate that the claims against German Industry

presently before the Court constitute political questions best

6690 ALPERIN v. VATICAN BANK

left to the political branches, it is unclear to the Court what

would.”). Here, we are not even faced with evaluating the

State Department’s position because the Department has

issued no statement in this case.

[10] Nor does allowing the Holocaust Survivors’ claims to

proceed mean that the political branches will be shut out from

having any input as the case develops. As a State Department

Deputy Legal Adviser explained: “Whether the U.S. Govern-

ment agrees to facilitate the resolution of [future Holocaust-

era disputes that are between private parties], will be, I think,

a case-by-case decision, based on a judgement of the United

States government interests involved in the circumstances

presented.” Ronald J. Bettauer, The Role of the United States

Government In Recent Holocaust Claims Resolution, Keynote

Address at the Stefan A. Riesenfeld Symposium 2001 (Mar.

8-9, 2001), in 20 Berkeley J. Int’l L. 1, 10 (2002). Such gov-

ernment involvement is not limited to a specified period dur-

ing the judicial process, such as the motion to dismiss stage.

Cf. Kadic, 70 F.3d at 250 (describing statement of interest

filed by the government after oral argument on appeal).

Accordingly, going forward, we respect the political

branches’ right to weigh in and to play a role in the resolution

of the Holocaust Survivors’ claims. See generally Neuborne,

supra note 7, at 796 (analogizing process of resolving

Holocaust-era claims to a “three-legged stool” made up of

class action litigation, diplomacy, and community involve-

ment). Given the Executive Branch’s continuing silence on

the Holocaust Survivors’ claims, however, we follow Sosa’s

lead that at this time “we need not apply here . . . a policy of

case-specific deference to the political branches.” 124 S. Ct.

at 2766 n.21.

This case will proceed with foreign relations considerations

as a backdrop, and the district court should and “can consider

the nation’s foreign policy interests and international comity

concerns in [its] decisions.” Ungaro-Banages, 379 F.3d at

1237; see also Abu Ali v. Ashcroft, 350 F. Supp. 2d 28, 65

ALPERIN v. VATICAN BANK 6691

(D.D.C. 2004) (refusing to dismiss case but commenting that

the court “will carefully construct the future course of this

proceeding” bearing “concerns founded in the principles of

the political question, separation of powers, and act of state

doctrines firmly in mind”). Despite these delicate consider-

ations, the district court is fully capable of resolving the Prop-

erty Claims without expressing a lack of respect for the

political branches.

5. ADHERENCE TO A POLICY DECISION

[11] We see no concern that judicial handling of the Prop-

erty Claims will involve “an unusual need for unquestioning

adherence to a political decision already made.” Baker, 369

U.S. at 217; cf. Klinghoffer, 937 F.2d at 50 (concluding that

the fifth Baker test did not bar adjudication “because no prior

political decisions are questioned—or even implicated—by

the matter before us”). Indeed, this case is before us not

because the Holocaust Survivors disagree with a political

decision made regarding their claims, but rather because there

simply has been no decision. See Northrop Corp. v. McDon-

nell Douglas Corp., 705 F.2d 1030, 1047 (9th Cir. 1983)

(adjudicating case would not require the court to “challenge

the wisdom or legality of any governmental act or decision”).

Because of the lack of a policy decision on point, we do not

reach the question posed by the fifth Baker test whether there

is an “unusual need for unquestioning adherence” thereto.

Baker, 369 U.S. at 217.

6. MULTIFARIOUS PRONOUNCEMENTS

[12] The only question remaining is whether adjudicating

the Property Claims would “cause the potentiality of embar-

rassment from multifarious pronouncements by various

departments on one question.” Baker, 369 U.S. at 217; see

also Japan Whaling Ass’n., 478 U.S. at 230 (rejecting argu-

ment that the Court should defer adjudication on the basis of

the sixth Baker test). On the contrary, this case is marked by

6692 ALPERIN v. VATICAN BANK

the absence of “pronouncements” by the political branches

regarding the resolution of claims to the Ustasha treasury.

We reject the Vatican Bank’s argument that despite this

vacuum, any adjudication of the Holocaust Survivors’ claims

would cause potential embarrassment because it would be

inconsistent with the political branches’ stated intent to

resolve claims arising out of World War II by way of inter-

governmental negotiations and diplomacy. See Garamendi,

539 U.S. at 421 (explaining that the “consistent Presidential

foreign policy has been to encourage European governments

and companies to volunteer settlement funds in preference to

litigation or coercive sanctions”).

[13] We are mindful of stepping on the toes of the political

branches, but we disagree that any adjudication of the claims

would implicate this final test. As discussed with regard to the

War Objectives Claims, the district court should refrain from

hearing those claims that require passing judgment on foreign

policy decisions. On the other hand, fulfilling our

constitutionally-mandated role to hear controversies properly

before us does not threaten to cause embarrassment or multi-

ple pronouncements. Cf. Johnson v. Collins Entm’t Co., 199

F.3d 710, 729 (4th Cir. 1999) (Luttig, J., concurring in the

judgment) (“If the Congress sees fit to provide citizens with

a particular cause of action, then we as federal courts should

entertain that action—and unbegrudgingly.”).

In the landscape before us, this lawsuit is the only game in

town with respect to claimed looting and profiteering by the

Vatican Bank. No ongoing government negotiations, agree-

ments, or settlements are on the horizon. The outside chance

that the Executive Branch will issue a statement in the future

that has the “potentiality of embarrassment” when viewed

against our decision today does not justify foreclosing the

Holocaust Survivors’ claims, especially when “[t]he age and

health of many of the class members also presses for a prompt

ALPERIN v. VATICAN BANK 6693

resolution.” In re Holocaust Victim Assets Litig., 105

F. Supp. 2d at 148.

[14] In sum, none of the Baker formulations is “inextrica-

ble” from the Property Claims. See Baker, 369 U.S. at 217.

The Holocaust Survivors have presented a justiciable controver-

sy.16

B. WAR OBJECTIVES CLAIMS

In contrast to the Property Claims, the Holocaust Survi-

vors’ allegations that “[t]he actions and conduct of Defen-

dants, in addition to being profitable, actively assisted the war

objectives of the Ustasha Regime” strike at the heart of the

Ustasha’s wartime conduct. The Holocaust Survivors catalog

a litany of claimed international law violations:

• “Defendants knowingly facilitated and aided and

abetted the activities of war criminals . . . .

Defendants created a ‘ratline’ or ‘pipeline’ to

help the war criminals flee from prosecution.”

• “Defendants . . . by assisting the Nazi backed

Ustasha Regime in preserving their Treasury for

the purpose of continuing a Government in Exile

. . . and evading justice for genocidal war

crimes[,] . . . committed war crimes, crimes

against peace and crimes against humanity . . . .”

• “The [Vatican Bank] abused its position as the

16

Despite the dissent’s protest that “[t]his is not our ‘game,’ period,”

Dissent at 6705, the Constitution does not relegate us to the sidelines. We

are a player in adjudicating claims, and a crucial one at that. Abdicating

that role and reflexively tossing the ball into the political branches’ court

without the requisite analysis of the individual claims would be tanta-

mount to shirking our “obligation[ ] to decide cases and controversies

properly presented to [us].” W.S. Kirkpatrick & Co., 493 U.S. at 409.

6694 ALPERIN v. VATICAN BANK

Papal bank of Vatican City by a clear pattern of

violation of diplomatic norms . . . .”

• “Serbs, Jews, and the Roma were slaughtered in

their villages after unspeakable tortures or burned

alive in their churches. . . . Many were used as

slave laborers. The remaining people were taken

to concentration camps where the majority per-

ished.”

• “Jasenovac Concentration Camp complex . . .

was the home of indescribable brutality . . . . Not

only were inmates butchered but slave and forced

labor was performed for the benefit of the

Ustasha regime.”

These claims, which we have denominated as the “War

Objectives Claims,” present a nonjusticiable political ques-

tion.

[15] It is axiomatic that the Constitution vests the power to

wage war in the President as Commander in Chief, U.S.

Const. art. II, § 2, cl. 1, and the ability to “seize and subject

to disciplinary measures those enemies who in their attempt

to thwart or impede our military effort have violated the law

of war” is “an important incident to [this power].” Ex parte

Quirin, 317 U.S. 1, 28-29 (1942); Doe v. Bush, 323 F.3d 133,

137 (1st Cir. 2003) (“The Constitution reserves the war pow-

ers to the legislative and executive branches.”). A plurality of

the Supreme Court recently reaffirmed that the judicial branch

“accord[s] the greatest respect and consideration to the judg-

ments of military authorities in matters relating to the actual

prosecution of a war, and recognize[s] that the scope of that

discretion necessarily is wide.” Hamdi v. Rumsfeld, 124 S. Ct.

2633, 2649 (2004).17 Wartime context aside, as discussed pre-

17

We stress, however, that courts are not powerless to review the politi-

cal branches’ actions during wartime for, as the plurality cautioned in

ALPERIN v. VATICAN BANK 6695

viously, “cases interpreting the broad textual grants of author-

ity to the President and Congress in the areas of foreign

affairs leave only a narrowly circumscribed role for the Judi-

ciary.” Made in the USA Found., 242 F.3d at 1313.

Following World War II, the Executive Branch exercised

its authority in a number of ways, including through the

Nuremberg Trials, which included prosecution for “murder,

extermination, enslavement, [and] deportation” among other

crimes against humanity, war crimes, and crimes against

peace. Charter of the International Military Tribunal, Aug. 8,

1945, 59 Stat. 1546, 1547, 82 U.N.T.S. 279 (“Nuremberg

Charter”). See generally Steven Fogelson, Note, The Nurem-

berg Legacy: An Unfulfilled Promise, 63 S. Cal. L. Rev. 833

(1990). Simply because the Nuremberg Charter does not

expressly preclude national courts from trying war criminals,

Nuremberg Charter, supra, 59 Stat. at 1545, does not mean

that it is our place to step in a half-century later and condemn

the Vatican Bank and related parties for “participat[ing] in the

activities of the Ustasha Regime in furtherance of the com-

mission of war crimes, crimes against humanity, [and] crimes

against peace.” We are not a war crimes tribunal. To act as

such would require us to “intrud[e] unduly on certain policy

choices and value judgments that are constitutionally commit-

ted to [the political branches,]” Koohi, 976 F.2d at 1331, for

we do not and cannot know why the Allies made the policy

choice not to prosecute the Ustasha and the Vatican Bank. See

Crosby v. Nat’l Foreign Trade Council, 530 U.S. 363, 386

(2000) (acknowledging that “the ‘nuances’ of ‘the foreign

policy of the United States . . . are much more the province

of the Executive Branch and Congress than of this Court’ ”)

(quoting Container Corp. of Am. v. Franchise Tax Bd., 463

U.S. 159, 196 (1983)).

Hamdi, “Whatever power the United States Constitution envisions for the

Executive in its exchanges with other nations or with enemy organizations

in times of conflict, it most assuredly envisions a role for all three

branches when individual liberties are at stake.” Hamdi, 124 S. Ct. at

2650.

6696 ALPERIN v. VATICAN BANK

Indeed, the Holocaust Survivors’ allegations that the Vati-

can Bank violated international law by “creat[ing] a ‘ratline’

or ‘pipeline’ to help the war criminals flee from prosecution”

could also be levied against the United States, which provided

similar aid driven by the sudden shift in priorities from fight-

ing the Nazis to driving back Communism:

[The College of San Girolamo in Rome] helped fugi-

tive Croatian war criminals escape to the Western

Hemisphere in the early postwar years, and cooper-

ated with the “rat line” being used by the U.S. Army

Counter Intelligence Corps after the War to assist the

escape from Europe of anti-Communists. The fact

that the “rat line” later facilitated the escape even of

a Nazi war criminal like Klaus Barbie underscores

the shift in the Allies’ attitudes: World War II was

over; the Cold War was on.

Ustasha Treasury Report, supra note 3, at xviii. The United

States has acknowledged that “conflicting priorities on the

part of the Allies—particularly the need to rebuild a war-torn

Europe and assemble a Western coalition against Soviet

aggression with the onset of the Cold War—led to an insuffi-

cient recovery of looted gold and other assets.” Id. at iv. It is

not our role to sit in judgment as to whether the perceived

Communist threat justified assisting alleged war criminals.

Rather, we are mindful of the Supreme Court’s admonition

that it is up to the political branches to come to terms with

these “delicate [and] complex” foreign policy decisions “for

which the Judiciary has neither aptitude, facilities nor respon-

sibility and which has long been held to belong in the domain

of political power not subject to judicial intrusion or inquiry.”

Chicago & S. Air Lines, Inc. v. Waterman S.S. Corp., 333

U.S. 103, 111 (1948).

Whether the Holocaust Survivors’ claims related to slave

labor are justiciable is a more nettlesome question. The exact

nature of the slave labor claims against the Vatican Bank is

ALPERIN v. VATICAN BANK 6697

not entirely clear from the Complaint. The Holocaust Survi-

vors allege that class members share a common question of

fact whether “Defendants were directly and/or indirectly

involved with the . . . conversion of . . . Plaintiffs’ labor” and

further allege that “Defendants have failed to . . . pay to Plain-

tiffs . . . the value of slave labor performed.” Although the

Complaint maintains that many of the Ustasha officials were

Roman Catholic clergy, it does not indicate that the Vatican

Bank itself directly exploited the slave labor. Unlike cases in

which the defendants were the enslaving entities, the slave

labor claims against the Vatican Bank are, in effect, derivative

claims: The Ustasha profited from slave labor, these profits

benefitted the Ustasha treasury, and portions of these tainted

funds were transferred to the Vatican Bank. Cf. Deutsch, 324

F.3d at 704 (plaintiffs “were forced to work as slaves” for

defendant corporation); Iwanowa, 67 F. Supp. 2d at 431

(defendants forced plaintiffs “to perform forced labor under

inhuman conditions”).

[16] Determining whether the Vatican Bank was unjustly

enriched by profits derived from slave labor would therefore

necessitate that we look behind the Vatican Bank and indict

the Ustasha regime for its wartime conduct.18 We are not will-

ing to take this leap. Condemning—for its wartime actions—

a foreign government with which the United States was at war

would require us to “review[ ] an exercise of foreign policy

judgment by the coordinate political branch to which author-

ity to make that judgment has been ‘constitutional[ly] com-

18

In rejecting the Holocaust Survivors’ slave labor claims, we distin-

guish profits derived from slave labor from those derived from investing

seized assets. In the former case, the court would need to evaluate the

Ustasha’s wartime use of slave labor, quantify the monetary value of this

labor, and then determine the portion thereof that flowed to the Vatican

Bank. In contrast, if the Holocaust Survivors can surmount the daunting

evidentiary obstacles and establish that seized assets came to rest with the

Vatican Bank, then the Property Claims could encompass both the value

of the assets themselves as well as any profits earned by the Vatican Bank

from the subsequent investment of the seized assets.

6698 ALPERIN v. VATICAN BANK

mit[ted].’ ” Goldwater, 444 U.S. at 1006 (Brennan, J.,

dissenting) (quoting Baker, 369 U.S. at 217); cf. Linder v.

Portocarrero, 963 F.2d 332, 337 (11th Cir. 1992) (holding in

case involving the murder of an American by the Nicaraguan

Contras that “the broad allegations . . . which comprise the

entire military and political opposition in Nicaragua, are non-

justiciable”).

[17] This determination that the slave labor claims run

afoul of the first Baker test is reinforced by the third Baker

test, which asks whether the issue can be decided “without an

initial policy determination of a kind clearly for nonjudicial

discretion.” Baker, 369 U.S. at 217. It is not our place to

speak for the U.S. Government by declaring that a foreign

government is at fault for using forced labor during World

War II. Any such policy condemning the Ustasha regime must

first emanate from the political branches.

Our conclusion that the slave labor claims are not justicia-

ble comports with our decision in Deutsch. The two cases are

superficially similar in that they address the same general sub-

ject matter of Holocaust-era slave labor claims. In Deutsch,

however, we based our holding on federal-state relations

rather than separation of powers concerns.19 324 F.3d at 705-

16. And, unlike this case where there are no treaties on point,

we emphasized in Deutsch that “the United States resolved

the war against Germany by becoming a party to a number of

treaties and international agreements.” Id. at 712 n.15. Conse-

quently, although in both cases we reach the same ultimate

conclusion that the slave labor claims cannot proceed, we do

so here because adjudicating these claims would entail med-

19

The district court in Deutsch dismissed the action as presenting a non-

justiciable political question. See Deutsch, 324 F.3d at 705 (citing Deutsch

v. Turner, No. CV 00-4405 (C.D. Cal. Aug. 25, 2000)). On appeal, we dis-

agreed with the court’s application of the doctrine on the basis that the

mere application of treaties concluded with Germany did not raise a politi-

cal question. 324 F.3d at 713 n.11.

ALPERIN v. VATICAN BANK 6699

dling in matters reserved to the political branches and not

because this result is compelled by treaties.

Nor does our decision conflict with the Second Circuit’s

reasoning in Kadic, a case which, in addition to geographic

parallels, involved claims tied to similar genocidal acts. See

70 F.3d at 236-37. In Kadic, Croats and Muslims brought suit

against Radovan Karadzic under the ATS alleging that he

oversaw the genocidal campaign conducted by Bosnian-Serb

military forces. Id. In holding that the claims were not barred

by the political question doctrine, the court cautioned that

“judges should not reflexively invoke the[ ] doctrine[ ] to

avoid difficult and somewhat sensitive decisions in the con-

text of human rights.” Id. at 249. We agree. Unlike in Kadic,

however, we think that “weigh[ing] carefully the relevant

considerations” at stake in this particular case, adjudicating

the slave labor claims in the context presented here would

“compromis[e] the primacy of the political branches in for-

eign affairs.” Id. Not only did the State Department “ex-

pressly disclaim[ ] any concern that the political question

doctrine should be invoked” in Kadic, id. at 250, but the

claims in Kadic focused on the acts of a single individual dur-

ing a localized conflict rather than asking the court to under-

take the complex calculus of assigning fault for actions taken

by a foreign regime during the morass of a world war. The

slave labor claims present no mere tort suit. On the contrary,

these claims fundamentally rest on “controversies which

revolve around policy choices and value determinations con-

stitutionally committed for resolution to the halls of Congress

or the confines of the Executive Branch.” Japan Whaling

Ass’n, 478 U.S. at 230.

[18] Our decision to affirm the district court’s dismissal of

the War Objectives Claims is not a result we reach lightly.20

20

We caution that our holding does not signify that slave labor claims

automatically raise issues that are committed to the political branches. As

with all claims, this determination must be based on the circumstances of

6700 ALPERIN v. VATICAN BANK

We do not wish to imply in the slightest that these claims do

not represent gravely serious harms for which the Holocaust

Survivors deserve relief. The difficulty is that relief lies else-

where. As the court observed in In re Austrian and German

Bank Holocaust Litigation, “Those persecuted by the Nazis

were the victims of unspeakable acts of inhumanity. At the

same time, however, it must be understood that the law is a

tool of limited capacity. Not every wrong, even the worst, is

cognizable as a legal claim.” 80 F. Supp. 2d at 177. In this

case, the Holocaust Survivors must look to the political

branches for resolution of the War Objectives Claims which,

at base, are political questions.

III. CONCLUSION

We REVERSE the district court’s grant of the Vatican

Bank’s motion to dismiss with regard to the Holocaust Survi-

vors’ Property Claims for conversion, unjust enrichment, res-

titution, and an accounting. We AFFIRM the district court’s

grant of the Vatican Bank’s motion to dismiss with regard to

all other claims in the Complaint, specifically the War Objec-

tives Claims. We also AFFIRM the district court’s order dis-

missing the action against the Croatian Liberation Movement

for lack of personal jurisdiction.

AFFIRMED IN PART, REVERSED IN PART, and

REMANDED. Costs shall be awarded to appellants.

TROTT, Circuit Judge, concurring in part, and dissenting in

part:

It is unlikely that a better case could be made for the major-

ity’s view that some of these matters are justiciable than the

the particular case. See, e.g., In re African-American, 304 F. Supp. 2d at

1056-60 (concluding that slave reparation claims were not justiciable in

part because “reparations to former slaves following the Civil War[ ] was

considered and rejected by the Representative Branches”).

ALPERIN v. VATICAN BANK 6701

one made by Judge McKeown in her well written opinion.

Nevertheless, and with all due respect to my esteemed col-

leagues, I find part of their analysis unconvincing. In the

main, the segregation for analytical purposes of the plaintiffs’

claims into two distinct groups — “Property Claims” as dis-

tinguished from “War Objective Claims” — splits the atom

where it is not divisible. In this respect, I agree with the

defendants/appellees: “All claims asserted by plaintiffs are

‘inextricably intertwined’ with the Executive Branch’s powers

over war-related crimes, such that the judiciary is powerless

to adjudicate them.” Accordingly, although I agree that the

so-called War Objective Claims are not justiciable, I respect-

fully dissent as to the others.

I concur in and adopt the district court’s view that appel-

lants’ complaint unmistakably and inextricably raises issues

that our Constitution commits to the legislative and executive

branches of our government, not to the judiciary. Alperin v.

Vatican Bank, 242 F. Supp. 2d 686 (N.D. Cal. 2003). This

case fatally falls into at least two of the off-limits political

question categories — defined as “formulations” — in Baker

v. Carr, 369 U.S. 186, 217 (1962): (1) “a textually demonstra-

ble constitutional commitment of the issue to a coordinate

political department;” and (2) “a lack of judicially discover-

able and manageable standards for resolving it.” Id.

I

As to the primary formulation — a constitutional commit-

ment of the issue to a political department — the record com-

pels us to take our lead from Chief Justice Marshall who said

that “[q]uestions, in their nature political, or which are, by the

Constitution and laws, submitted to the executive, can never

be made in this court.” Marbury v. Madison, 5 U.S. (1

Cranch) 137, 170 (1803) (emphasis added). The Baker court

repeated this “clearly settled” principle, which emanates from

our Constitution’s careful allocation and separation of powers

between our three branches, and in so doing identified “for-

6702 ALPERIN v. VATICAN BANK

eign relations” as one of the areas in which nonjusticiable

political questions routinely arise, citing Oetjen v. Cent.

Leather Co., 246 U.S. 297, 302 (1918): “The conduct of the

foreign relations of our Government is committed by the Con-

stitution to the executive and legislative — ‘the political’ —

departments of the government, and the propriety of what

may be done in the exercise of this political power is not sub-

ject to judicial inquiry or decision.” Baker, 369 U.S. at 211 n.

31. In elaboration of this doctrine, the Oetjen court said,

The principle that the conduct of one independent

government cannot be successfully questioned in the

courts of another is as applicable to a case involving

the title to property brought within the custody of a

court, such as we have here, as it was held to be to

the cases cited, in which claims for damages were

based upon acts done in a foreign country, for it rests

at last upon the highest considerations of interna-

tional comity and expediency. To permit the validity

of the acts of one sovereign state to be reexamined

and perhaps condemned by the courts of another

would very certainly “imperil the amicable relations

between governments and vex the peace of nations.”

246 U.S. at 303-04.

One of the earliest cases involving the respective authority

of courts and Congress appears to be United States v. Palmer,

16 U.S. (3 Wheat.) 610 (1818), a case involving inter alia a

robbery committed on the high seas by a non-citizen on board

a ship belonging exclusively to subjects of a foreign state. The

Court held (1) that a specific act of Congress criminalizing

piracy did not give authority to our federal courts to take cog-

nizance of, try, and punish such an act on the high seas as rob-

bery, and (2) that the courts are not empowered to so act

without authority from Congress. Id. at 633-35. In explanation

of this decision, Chief Justice Marshall said,

ALPERIN v. VATICAN BANK 6703

Those questions which respect the rights of a part of

a foreign empire, which asserts, and is contending

for its independence, and the conduct which must be

observed by the courts of the union towards the sub-

jects of such section of an empire who may be

brought before the tribunals of this country, are

equally delicate and difficult.

As it is understood that the construction which has

been given to the act of Congress, will render a par-

ticular answer to them unnecessary, the court will

only observe, that such questions are generally rather

political than legal in their character. They belong

more properly to those who can declare what the

law shall be; who can place the nation in such a

position with respect to foreign powers as to their

own judgment shall appear wise; to whom are

entrusted all its foreign relations; than to that tribu-

nal whose power as well as duty is confined to the

application of the rule which the legislature may

prescribe for it. In such contests a nation may

engage itself with the one party or the other — may

observe absolute neutrality — may recognize the

new state absolutely — or may make a limited rec-

ognition of it. The proceeding in courts must depend

so entirely on the course of the government, that it

is difficult to give a precise answer to questions

which do not refer to a particular nation. It may be

said, generally, that if the government remains neu-

tral, and recognizes the existence of a civil war, its

courts cannot consider as criminal those acts of hos-

tility which war authorizes, and which the new gov-

ernment may direct against its enemy. To decide

otherwise, would be to determine that the war prose-

cuted by one of the parties was unlawful, and would

be to arrange the nation to which the court belongs

against that party. This would transcend the limits

prescribed to the judicial department.

6704 ALPERIN v. VATICAN BANK

Id. at 634-35 (emphasis added).

The Court registered a similar observation in Foster v. Neil-

son:

In a controversy between two nations concerning

national boundary, it is scarcely possible that the

courts of either should refuse to abide by the mea-

sures adopted by its own government. There being

no common tribunal to decide between them, each

determines for itself on its own rights, and if they

cannot adjust their differences peaceably, the right

remains with the strongest. The judiciary is not that

department of the government to which the assertion

of its interests against foreign powers is confided;

and its duty commonly is to decide upon individual

rights, according to those principles which the polit-

ical departments of the nation have established.

27 U.S. (2 Pet.) 253, 307-08 (1829), overruled on other

grounds by United States v. Percheman, 32 U.S. (7 Pet.) 51

(1833) (emphasis added).

The Supreme Court has spoken frequently about this issue,

and each time it has reiterated the structural and prudential

proposition that the “President also possesses in his own right

certain powers conferred by the Constitution on him as

Commander-in-Chief and as the Nation’s organ in foreign

affairs.” Chicago & S. Air Lines, Inc. v. Waterman S.S. Corp.,

333 U.S. 103, 109 (1948). Accordingly, the Court has made

it clear that

the very nature of executive decisions as to foreign

policy is political, not judicial. Such decisions are

wholly confided by our Constitution to the political

departments of the government, Executive and Leg-

islative. . . . They are decisions of a kind for which

the Judiciary has neither aptitude, facilities nor

ALPERIN v. VATICAN BANK 6705

responsibility and have long been held to belong in

the domain of political power not subject to judicial

intrusion or inquiry.

Id. 333 U.S. at 111. See also Schroeder v. Bush, 263 F.3d

1169, 1175 (10th Cir. 2001).

Parenthetically, unlike the majority, I read this principle to

include all matters that fall by their constitutional DNA into

this sphere, whether the political branches have done anything

about them or not. With all respect to my valued colleagues,

I see it as a mistake to measure this issue of justifiability by

a “this lawsuit is the only game in town” standard. This is not

our “game,” period, and we do not become vested with juris-

diction by default of the other branches. The majority opinion

indicates that Executive silence is somehow relevant. I hum-

bly disagree. The silence of another Branch cannot give us

jurisdiction we do not otherwise have. The non-existence of

an executive agreement is meaningless.

Notwithstanding appellants’ lawyers’ ability to cast this

dispute in “garden-variety” legal terms, i.e., conversion,

unjust enrichment, restitution, etc., the ineffable fact remains

that this functionally is a lawsuit against (1) the Vatican itself,

(2) the Vatican Bank, which is an instrumentality of the sov-

ereign state of the Vatican, and (3) untold others — including

probably the Pope — seeking relief for World War II wrongs

against foreigners committed by the Nazis and their allies in

Europe almost sixty years ago. As Judge Debevoise said in

Burger-Fischer v. DeGussa AG, 65 F. Supp. 2d 248, 281

(D.N.J. 1999), “It is not accurate to characterize the present

actions as simply [typical] controversies between private par-

ties.” Much more is clearly at stake. Stripped to its essentials,

this is a derivative lawsuit against a sovereign seeking “repa-

rations” for injuries and losses suffered during wartime at the

hands of the Nazis and their alleged accomplices. As

acknowledged by the majority, the Vatican has filed a note of

protest and asked our State Department to intervene. This set

6706 ALPERIN v. VATICAN BANK

of facts and circumstances involving a foreign sovereign

strikes me as demanding a “single-voiced statement” of our

government’s views, not a series of judgments by our courts.

Baker, 369 U.S. at 211. I conclude, therefore, that the foreign

policy quintessence of this case renders it as a subject matter

beyond the power of the judiciary to intrude or to inquire.

Judge Greenaway’s astute analysis in Iwanowa v. Ford

Motor Company, 67 F. Supp. 2d 424, 485 (1999) is apposite:

The executive branch has always addressed claims

for reparations as claims between governments. His-

torically, at the end of a war, there has always been

a declaration of victorious nations and defeated

nations. As part of that process, the victorious

nations invariably discuss the reparations that the

defeated nations must pay to compensate the prevail-

ing countries and their nationals for the loss that the

aggressor country has caused. The nature of war is

such that the governments of the victorious nations

determine and negotiate the resolution of the claims

of their nationals by way of agreements between the

nations involved or affected by the war. This is evi-

dent from the reparations provisions in the Treaty of

Versailles following World War I, and the discussion

of reparations in the Yalta Conference, the Potsdam

Conference and the Paris Reparations Treaty at the

end of World War II. More recently, at the end of the

Gulf War, the United Nations established an interna-

tional claims resolution tribunal to resolve claims

against Iraq. See Elyse J. Garmise, The Iraqi Claims

Process and the Ghost of Versailles, 67

N.Y.U.L.Rev. 840, 841 (1992). Thus, it is evident

that responsibility for resolving forced labor claims

arising out of a war is constitutionally committed to

the political branches of government, not the judi-

ciary.

ALPERIN v. VATICAN BANK 6707

In a footnote to this discussion, the court observed that the

“ ‘concept of reparations encompasses all international law

claims for compensation related to war [including] individual

claims by injured citizens of victorious powers.’ ” Id. at 485

n.84 (quoting Ministerial Director Horst Teltschik).

When California attempted by legislation to insert itself

into Holocaust-era insurance policies, the Supreme Court

stepped in and held that California’s law was preempted

because it interfered with the President’s conduct of our

Nation’s foreign policy. In reversing our Ninth Circuit opin-

ion to the contrary, see Gerling Global Reinsurance Corp. of

Am. v. Low, 296 F.3d 832 (9th Cir. 2002), the Court made cer-

tain observations about the authority of the President that add

considerable weight against the view that Alperin’s claims are

justiciable:

Nor is there any question generally that there is

executive authority to decide what that [foreign rela-

tions] policy should be. Although the source of the

President’s power to act in foreign affairs does not

enjoy any textual detail, the historical gloss on the

“executive Power” vested in Article II of the Consti-

tution has recognized the President’s “vast share of

responsibility for the conduct of our foreign rela-

tions.”

Am. Ins. Ass’n v. Garamendi, 539 U.S. 396, 414 (2003) (cita-

tion omitted). The Garamendi court continued:

At a more specific level, our cases have recog-

nized that the President has authority to make “exec-

utive agreements” with other countries, requiring no

ratification by the Senate or approval by Congress,

this power having been exercised since the early

years of the Republic. See Dames & Moore v.

Regan, 453 U.S. 654, 679, 682-683, 101 S.Ct. 2972,

69 L.Ed.2d 918 (1981); United States v. Pink, 315

6708 ALPERIN v. VATICAN BANK

U.S. 203, 223, 230, 62 S.Ct. 552, 86 L.Ed. 796

(1942); United States v. Belmont, 301 U.S. 324, 330-

331, 57 S.Ct. 758, 81 L.Ed. 1134 (1937); see also L.

Henkin, Foreign Affairs and the United States Con-

stitution 219, 496, n. 163 (2d ed.1996) (“Presidents

from Washington to Clinton have made many thou-

sands of agreements . . . on matters running the

gamut of U.S. foreign relations”). Making executive

agreements to settle claims of American nationals

against foreign governments is a particularly long-

standing practice, the first example being as early as

1799, when the Adams administration settled

demands against the Dutch Government by Ameri-

can citizens who lost their cargo when Dutch priva-

teers overtook the schooner Wilmington Packet. See

Dames & Moore, supra, at 679-680, and n. 8, 101

S.Ct. 2972.

* * *

To begin with, resolving Holocaust-era insurance

claims that may be held by residents of this country

is a matter well within the Executive’s responsibility

for foreign affairs. Since claims remaining in the

aftermath of hostilities may be “sources of friction”

acting as an “impediment to resumption of friendly

relations” between the countries involved, Pink,

supra, at 225, 62 S.Ct. 552, there is a “longstanding

practice” of the national Executive to settle them in

discharging its responsibility to maintain the

Nation’s relationships with other countries, Dames

& Moore, 453 U.S., at 679, 101 S.Ct. 2972. The

issue of restitution for Nazi crimes has in fact been

addressed in Executive Branch diplomacy and for-

malized in treaties and executive agreements over

the last half century, and although resolution of pri-

vate claims was postponed by the Cold War, secur-

ing private interests is an express object of

ALPERIN v. VATICAN BANK 6709

diplomacy today, just as it was addressed in agree-

ments soon after the Second World War. Vindicating

victims injured by acts and omissions of enemy cor-

porations in wartime is thus within the traditional

subject matter of foreign policy in which national,

not state, interests are overriding, and which the

National Government has addressed.

Id. at 415, 420-21 (emphasis added).

Finally, as we recognized in Deutsch v. Turner Corp., 324

F.3d 692, 712-13 (9th Cir. 2003),

The United States has already exercised its own

exclusive authority to resolve the war, including

claims arising out of it. It did not choose, however,

to incorporate into that resolution a private right of

action against our wartime enemies or their nation-

als. The United States resolved the war against Ger-

many by becoming a party to a number of treaties

and international agreements, beginning with the

1945 agreements at Yalta and Potsdam, in which the

United States, Britain, and the Soviet Union agreed

to extract reparations from Germany and its nation-

als but did not include a private right of action

against either. . . . Most recently, the Foundation

Agreement of July 17, 2000, an executive agreement

between the governments of Germany and the

United States, provided a limited form of remedy for

claimants such as Deutsch.

I would add that we entered into a similar treaty with Italy

in 1947. Article 75 of that Treaty provides with respect to res-

titution as follows:

1. Italy accepts the principles of the United

Nations Declaration of January 5, 1943, and shall

return, in the shortest possible time, property

6710 ALPERIN v. VATICAN BANK

removed from the territory of any of the United

Nations.

2. The obligation to make restitution applies to

all identifiable property at present in Italy which was

removed by force or duress by any of the Axis Pow-

ers from the territory of any of the United Nations,

irrespective of any subsequent transactions by which

the present holder of any such property has secured

possession.

....

8. The Italian Government shall restore to [the

United Nation] all monetary gold looted or wrong-

fully removed to Italy.

Treaty of Peace with Italy, Feb. 10, 1947, U.S.-Italy, United

States Statutes At Large, Vol. 61, pp. 1400-01.

II

As recognized by the majority, “the potential class is mas-

sive,” and, as the district court concluded, the case as pleaded

would be unmanageable. This unimpeachable observation

brings this lawsuit within Baker’s second category: the task is

beyond the competence of a court of law. The district court

relied, in this respect, on Kelberine v. Societe Internationale,

363 F.2d 989 (D.C. Cir. 1966), which correctly said,

The span between the doing of the damage and the

application of the claimed assuagement is too vague.

The time is too long. The identity of the alleged tort-

feasors is too indefinite. The procedure sought —

adjudication of some two hundred thousand claims

for multifarious damages inflicted twenty to thirty

years ago in a European area by a government then

in power — is too complicated, too costly, to justify

ALPERIN v. VATICAN BANK 6711

undertaking by a court without legislative provision

of the means wherewith to proceed.

Id. at 995.

I agree with our prudent district court’s carefully consid-

ered opinion, which echos the Supreme Court’s concerns in

Waterman about the aptitude and facilities in this context, that

this case as presented would lack judicial reins:

Here, by contrast, plaintiffs do not seek recovery

of money and assets withheld from specific accounts

but, rather, the undetermined value of property

stolen in untold ways in a multiplicity of regions by

both military personnel and civilians. Moreover,

plaintiffs seek such recovery out of an undivided

portion of the Ustasha Treasury transferred to the

IOR. Such claims require a review of materials from

a multitude of foreign sources that, “by sheer bulk

alone,” are likely to be unmanageable. See Atlee, 347

F. Supp. [689, 701 (E.D. Pa. 1972)]. Compounding

the problem, “there is a distinct possibility that the

parties might not be able to compile all of the rele-

vant information, thus making any attempt to justify

a ruling on the merits of an issue that will affect the

nation difficult and imprudent.” See Iwanowa, 67

F. Supp. 2d [424, 483-84 (D.N.J. 1999)]; see also

Atlee, 347 F. Supp. at 702 (noting “the inherent

inability of a court to predict the international conse-

quences flowing from a decision on the merits.”)

Further, plaintiffs’ claims require this Court to

resolve the competing rights to the Ustasha Treasury

of potentially hundreds of thousands of citizens of

various nations, funds as to which any number of

persons harmed by the Ustasha regime, both repre-

sented and not represented in these proceedings,

might equally assert a claim.

6712 ALPERIN v. VATICAN BANK

Alperin, 242 F. Supp. 2d at 694-95. It will be interesting to

say the least to watch the district court struggle on remand to

enforce its rulings against the Vatican. Based on my experi-

ence with litigation involving foreign nations, it will be just

a matter of time until the State and Justice Departments are

dragged into this case as the district court begins to reach out

for evidence and witnesses and to exercise its power to

enforce its orders.

III

No one could possibly be comfortable identifying a barrier

to the relief sought by these plaintiffs, persons who suffered

some of the most unspeakably grievous injuries to their lives

and families. As Judge Reinhardt said in Deutsch, the Holo-

caust was “the most atrocious act ever perpetrated by a civi-

lized (or uncivilized) people, an act unparalleled in history.”

324 F.3d at 704. Nevertheless, our courts are not the appropri-

ate fora for redress. 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. The consequences

of this holding are overwhelming. I need go no deeper than

the third amended class action complaint to illustrate this

point:

1. This is a civil action arising under customary

international law and the laws of the United States of

America on behalf of named Plaintiffs and a class of

all Serbs, Jews, and former Soviet Union citizens

(and their heirs and beneficiaries), who suffered

physical, monetary and/or property losses including

slave labor, due to the systematic and brutal extermi-

nation of Jews, Serbs, and Romani by the Nazi pup-

pet Regime, The Independent State of Croatia

ALPERIN v. VATICAN BANK 6713

(NDH) led by Pavelic’s Ustasha Regime, and as a

result of the occupation of the former Soviet Union

by Croatian military forces in concert with their Ger-

man occupation forces. This is an action against the

Vatican Bank, Franciscan Order and Unknown Cath-

olic Religious Orders, Croatian Liberation Move-

ment (HOP), Swiss National Bank (SNB) and as yet

unnamed recipients of Nazi and Ustasha Loot,

Swiss, Austrian, Argentine, Spanish, Italian, Portu-

guese, and German banking institutions and Califor-

nia and other United States correspondent banks for

their participation in and benefit from the Ustasha

Regime’s acts of cruelty and violence.

2. Plaintiffs and their heirs and beneficiaries seek

accounting, restitution, disgorgement, and to recover

damages arising out of the participation of Defen-

dants, Vatican Bank or Istituto Per Le Opere Di

Religione (hereinafter referred to as IOR), the Fran-

ciscan Order (OFM) and Unknown Catholic Reli-

gious Orders, Croatian Liberation Movement (HOP),

Swiss National Bank (SNB), unknown recipients of

Nazi and Ustasha loot, and other banking institutions

and correspondent banks and religious orders and

organizations in a common scheme and course of

conduct: (a) to profit from, both directly and indi-

rectly, the inhumane and genocidal system instituted

by the Nazi-directed Ustasha Regime in Croatia and

territories subject to Croatian civil or military occu-

pation upon those peoples that it viewed, not as

human beings, but as subhuman according to Nazi

and Ustasha ideology; (b) to obtain, accept, conceal,

convert and profit from assets looted by the Ustasha

Regime and deposited in, or liquidated through, the

IOR, SNB, unnamed Doe Defendant Banks, and

Franciscan Order during the ascendancy of the

Ustasha Regime and following the demise of the

Regime at the behest of the former Ustasha and Nazi

6714 ALPERIN v. VATICAN BANK

leaders through the offices of the Franciscan Order;

and (c) to retain and convert assets deposited in their

institutions by the Croatian Liberation Movement,

Ustasha and/or the Franciscan Order and Unknown

Catholic Religious Orders.

3. Defendants committed, conspired to commit,

and aided and abetted others who committed crimes

against peace, war crimes and crimes against human-

ity. Defendants assisted the Ustasha Regime and its

leaders as well as prominent Nazis to successfully

evade justice for their genocidal crimes by conceal-

ing and making available the considerable assets of

the Ustasha Treasury.

* * *

WHEREFORE, Plaintiffs pray that the Court:

1. Certify this action as a class action pursuant to

FEDERAL RULE OF CIVIL PROCEDURE 23, and

designating named Plaintiffs as the class representa-

tives and counsel for Plaintiffs as Class counsel.

2. Declare that Defendants by trafficking in,

retaining, disposing of and concealing assets looted

from targets of the Ustasha Regime with knowledge

that the assets had been obtained through the system-

atic persecution, torture, slave labor, force, and mur-

der, violated international treaties and customary

international law enforceable in this Court as federal

common law, the law of the nations and international

law.

3. Order Defendants to make available all infor-

mation relating to the Ustasha Treasury in order that

an accounting of assets may be realized.

ALPERIN v. VATICAN BANK 6715

4. Direct Defendants to return all identifiable

property looted from Plaintiffs and received by

Defendants.

5. Award Plaintiffs the value of any identified

property deposited by, or looted from, Plaintiffs and

received by Defendants plus interest compounded

annually since 1941.

6. Award Plaintiffs compensatory and punitive

damages arising out of Defendants’ unlawful behav-

ior in trafficking in, retaining, disposing and con-

cealing Looted Assets or profits of the Ustasha

Regime with knowledge that the assets or profits

were the fruits of Nazi-Ustasha violations of interna-

tional law and were used to assist war criminals to

evade justice.

7. Order Defendants to disgorge any profits

earned by trafficking in, disposing of or concealing

the Ustasha Treasury which was the fruits of viola-

tions of international law.

8. Grant Plaintiffs a jury trial on all issues so tri-

able.

9. Award Plaintiffs the costs of this action,

including reasonable attorneys’ fees and expert fees;

and,

10. Grant such other and further relief as shall

seem just to the Court.

Our unauthorized transformation of our district courts into

an open-door international tribunal far overreaches the author-

ity of “the least dangerous branch” of our government. This

opinion, albeit well-intentioned, extends the concept of judi-

cial authority into unknown territory and mistakenly exercises

6716 ALPERIN v. VATICAN BANK

power and competence that plainly belongs to the President

and to Congress. Today, it is the Vatican and the Holocaust.

Tomorrow, will it be horrors from Haiti, Cuba, Rwanda,

South Africa, the Soviet Union, Bosnia, Sudan, Somalia,

North Korea, Iraq, and who knows where? The majority opin-

ion sends our district judges on a crusade from which they are

not equipped and which is doomed to flounder. As a class

action, it will make all others seem like cakewalks. One can

only wonder if the filing of this lawsuit is nothing more than

a ploy to force the President and the State Department to take

action. Similarly, one can only wonder why the beleaguered

State Department would stand silently by and allow this case

to continue — in the Ninth Circuit no less, where mistakenly

we would have allowed the Garamendi litigation to proceed.

Thus, I respectfully disagree that Alperin’s unseverable

“garden-variety” claims are justiciable.