United States (U.S.) Court of Appeals for the Ninth Circuit: Alperin, Romanova, Organization of Ukrainian Antifascist Resistance Fighters et al. v. Vatican Bank, Croatian Liberation Movement et al. (April 18, 2005)

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The U.S. Court of Appeals for the Ninth Circuit (“the Court”) allowed the claimants to proceed with their claims for conversion, unjust enrichment, restitution and an accounting against the Vatican Bank and other defendants. The Court affirmed the district court’s grant of the Vatican Bank’s motion to dismiss, however, with regard to all other claims in the complaint, including allegations that the Vatican Bank assisted the Nazi-supported Ustasha regime in committing genocide and other war crimes.

The background to the complaint relates to actions of the Vatican both during and following World War II. After Germany’s blitzkrieg through Yugoslavia in 1941, a government comprised of members of the Croatian Ustasha political regime (the “Ustasha”) was proclaimed to be the head of a protectorate of Italy. German and Italian occupation forces supported the Ustasha regime during World War II. According to a State Department Report, as many as 700,000 victims, most of whom were Serbs, were killed in Ustasha death camps. Also according to this State Department Report, “The Vatican, 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 Ustasha, but remained otherwise supportive of the regime.” (Bureau of Public Affairs, U.S. Department of State, Pub. No. 10557, “The Ustasha Treasury Report”) The report also noted that following Hitler’s defeat in 1945, the leaders of the Ustasha fled to Italy where they found sanctuary at the pontifical college of San Girolamo in Rome. The report also observes that the college of San Girolamo was most likely funded in part by what remained of the Ustasha treasury. The State Department report, noting that the size of the Ustasha treasury remains in doubt, estimates that it was over $80 million of Ustasha gold in 1946.

The complaint was filed on behalf of several individuals, including Serbs, Jews and other individuals from the former Soviet Union, in addition to four organizations.  The plaintiffs, the “Holocaust Survivors”, named the Vatican Bank, the Order of Friars Minor and the Croatian Liberation Movement as defendants and claimed that the defendants profited from acts of genocide committed by the Ustasha. Their complaint advanced five causes of action, for conversion, unjust enrichment, restitution, an accounting, human rights violations and violations of international law. They alleged that the defendants’ profit passed through the Vatican Bank in the form of proceeds from looted assets and slave labor.

The district court had dismissed all of the claims on the grounds that they should be barred by the political question doctrine. The Ninth Circuit disagreed, finding that, unlike some other claims from World War II, the Holocaust Survivors’ claims were not barred by a treaty, nor was there any executive agreement covering claims against the Vatican Bank. (In contrast to the Garamendi case). It also held that the U.S. courts should be able to have a role in adjudicating claims for looted assets, noting in this regard that the property claims at issue here were similar to those claims considered by the U.S. Supreme Court last year in Altmann.  However, in regard to the claims against the Vatican Bank for its wartime conduct and for providing assistance and refuge to war criminals, the Court found that such claims could also be levied against the United States, which provided similar assistance to war criminals due to the shift in the U.S. priorities to fight communism following World War II. It found that such claims involved questions of foreign policy and were therefore barred as political questions not fit for adjudication before a court.