[00:00:00] Speaker 00: Case number 22.7127. [00:00:03] Speaker 00: Peter Toren, executor of the estate of David Toren, a balance, versus Federal Republic of Germany. [00:00:09] Speaker 00: Mr. Orszak for the balance, Mr. Dirks for the appellee. [00:00:13] Speaker 05: Good morning, counsel. [00:00:14] Speaker 05: Mr. Orszak, please proceed when you're ready. [00:00:19] Speaker 06: Good morning. [00:00:19] Speaker 06: Thank you, your honor. [00:00:20] Speaker 06: I may please the court. [00:00:21] Speaker 06: I'm Gary Orszak for plaintiff, Peter Toren. [00:00:26] Speaker 06: The expropriation exception in the Foreign Sovereign Immunities Act [00:00:30] Speaker 06: refers jurisdiction over a claim that property was taken in violation of international law. [00:00:37] Speaker 06: In Philip, the Supreme Court held that the exceptions referenced international law means the international law of expropriation or property, not human rights law. [00:00:49] Speaker 06: And it therefore incorporates the domestic takings rule. [00:00:53] Speaker 06: And because the plaintiffs in that case had as their principal theory of jurisdiction [00:00:59] Speaker 06: that the taking of their property was a genocide, the Supreme Court reversed and remanded. [00:01:07] Speaker 06: But the Supreme Court directed the district court to consider on remand an alternative theory of jurisdiction, which was that the plaintiff's claim was not barred by the domestic takings rule because the plaintiffs, despite having been born in Germany, [00:01:23] Speaker 06: and living in Frankfurt at the time of the taking, nevertheless, were not German nationals at the time of the take. [00:01:31] Speaker 06: In light of Philip, Judge Leon dismissed our case for lack of jurisdiction, but that ruling was an error, and Germany's efforts to prop up the ruling are unpersuasive. [00:01:49] Speaker 06: Judge Leon dismissed the case first by mischaracterizing the essential theory of jurisdiction that we pleaded, and second by misreading Philip. [00:02:00] Speaker 06: First, as he saw it, and as he wrote, the thrust of our theory of jurisdiction was that Germany, during the course of a genocidal course of conduct, sufficiently persecuted [00:02:14] Speaker 06: its Jewish nationals so as to render them stateless. [00:02:19] Speaker 06: And second, he held that the Supreme Court in Philip, quote, made clear that a claim like that one is not encompassed within the expropriation exception. [00:02:30] Speaker 02: Mr. Orszag, assume that I agree with your argument that Mr. Friedman was stateless. [00:02:38] Speaker 02: What is your best affirmative evidence that a stateless, like the seizing of a stateless person's property is cognizable under international law? [00:02:49] Speaker 06: Thank you. [00:02:49] Speaker 06: If you're going to get to it, I'll address it now. [00:02:52] Speaker 06: First, I should note Judge Leon did not reach that question. [00:02:55] Speaker 06: He stated in a footnote that he didn't need to reach it. [00:02:58] Speaker 06: But I think the law ought to be pretty clear on this. [00:03:04] Speaker 06: First, in Philip, the court said, quoting section 185 of the second restatement, which was the version of the restatement enforced at the time of the passage of the FSIA, that the taking of property violates international law when a state deprives an alien of property. [00:03:28] Speaker 06: The restatement goes on to say, in section 171, [00:03:34] Speaker 06: Uh, an alien is any person who quote is not a national of the respondent state and comment G to 171 says quote a stateless person comes within the definition of an alien for these purposes. [00:03:52] Speaker 06: So my first part of the answer is that according to the restatement, [00:03:56] Speaker 06: relied upon or at least cited to by the court in Philip, a stateless person is an alien, a taking from an alien is a violation of international law. [00:04:08] Speaker 06: But if I may add to that, the restatement is simply a reflection of what international law provided at the time. [00:04:16] Speaker 06: As we cited in our brief, United Nations Convention on Statelessness from 1954 specifically affords stateless persons, quote, treatment as favorable as possible, and in any event, not less favorable than that accorded to aliens generally. [00:04:35] Speaker 05: So is your general view, then, that typically with international law, the classic offense was by one state against another state. [00:04:44] Speaker 05: And it can be visited on a national of the other state. [00:04:47] Speaker 05: But usually, it was an offense by one state against another state. [00:04:50] Speaker 05: And so you'd have a state-to-state conflict. [00:04:53] Speaker 05: And that would get worked out through diplomacy. [00:04:56] Speaker 05: And is your view that a stateless person should always be just considered [00:05:02] Speaker 05: for those purposes as if they were the citizen of another state, some other state. [00:05:06] Speaker 05: We don't know which state because they're stateless, but they should be considered the citizen of some other state such that it gives rise to a cognizable offense under international law. [00:05:16] Speaker 06: I don't know that you have to accept that theory to conclude that a taking from a stateless person violates international law, which is to say you need to assume that a stateless person is in effect a foreign national. [00:05:29] Speaker 06: What I'm saying is that the law at the time said that the rights of a stateless person are as favorable as the rights of a foreign national, such that a taking from that stateless person, notwithstanding the body of law that Your Honor just referred to, violates international law. [00:05:48] Speaker 06: And I should add that [00:05:51] Speaker 06: while the court in Philip recited some of the history deriving from the law of nations and up through what we now call international law for the proposition that traditionally the law of nations contemplated affronts by one nation against another nation. [00:06:12] Speaker 06: But if the court in Philip [00:06:16] Speaker 06: had concluded that a taking from a stateless person does not violate international law. [00:06:23] Speaker 06: It simply would have dismissed the case because the plaintiffs in Philip were Germans. [00:06:30] Speaker 06: They were born in Germany. [00:06:32] Speaker 06: They lived in Frankfurt. [00:06:34] Speaker 06: It would have been simple for the Supreme Court to say, uh, in that circumstance, there is no violation of international law. [00:06:43] Speaker 06: Instead, [00:06:44] Speaker 06: It remanded with clear instructions to consider whether those individuals were nevertheless non-nationals, in other words, states. [00:06:53] Speaker 05: Can I ask you about the restatement third? [00:06:56] Speaker 05: Yes. [00:06:56] Speaker 05: I know that it post-states, but just in terms of the principles in the restatement third, so they define the taking that's actionable as a taking by the state of the property of a national of another state. [00:07:11] Speaker 06: Yes. [00:07:12] Speaker 06: Yes. [00:07:12] Speaker 06: I agree. [00:07:14] Speaker 06: That's what it says. [00:07:15] Speaker 06: But I cite you to what the Supreme Court said in Philip, which was that according to consistent Supreme Court practice, it refers for purposes of determining international law to the international law that was in effect in 1976 when the foreign sovereign immunities... So to the restatement third, you... [00:07:38] Speaker 06: you would be out of luck. [00:07:39] Speaker 06: I agree with that. [00:07:41] Speaker 06: If you follow what you just read, that's the case. [00:07:45] Speaker 05: And then there's the comment in 713 that specifically says that stateless people keep the sort of clandestine justice. [00:07:50] Speaker 06: I don't dispute that the restatement third differs in that respect from the second restatement. [00:07:56] Speaker 06: But all I can say is the Supreme Court said you don't follow the third restatement. [00:08:01] Speaker 06: You follow the second restatement. [00:08:02] Speaker 06: And that's what it cited to in Philip. [00:08:07] Speaker 03: But is there a distinction that we need to make between whether the statelessness occurs by de jure statelessness versus de facto statelessness? [00:08:16] Speaker 06: Yes. [00:08:16] Speaker 06: Thank you, Judge Schaaf. [00:08:18] Speaker 06: We argue both. [00:08:20] Speaker 06: We say that Mr. Friedman was rendered de jure and de facto statelessness. [00:08:28] Speaker 06: I think we're right on both, but our stronger argument is on the de jure prong, and that is because [00:08:36] Speaker 06: There have been courts that have said if the court needs to sit at the motion to dismiss stage and must determine, as a matter of fact, whether the violence done to the individual, the deprivations done to the individual are so severe as to render him de facto [00:09:00] Speaker 06: a non-national or non-citizen, then we're sitting as a war tribunal. [00:09:05] Speaker 06: I think that's overstated, but our case doesn't call upon the court to consider any of that because Nazi Germany formally, unmistakably, legalistically rendered Mr. Friedman [00:09:21] Speaker 06: a non-citizen, a non-national, and stateless. [00:09:24] Speaker 06: It did so in 1935 by the first degree issued pursuant to the right citizenship law, declaring that Jews are non-citizens of the right. [00:09:34] Speaker 06: Judge Kaller-Katelli observed this same proposition. [00:09:39] Speaker 06: But more to the point, and I want to emphasize the legalistic nature of this once again, Nazi Germany declared Mr. Friedman [00:09:49] Speaker 06: an enemy of the state. [00:09:51] Speaker 06: We attached that declaration as Exhibit D to the complaint, and it did so [00:09:57] Speaker 06: specifically to provide a legal fig leaf to steal all of his property. [00:10:02] Speaker 06: So regardless what the status of all German Jews was under German law at the time, I think it's clear that they were rendered non-citizens and non-nationals. [00:10:13] Speaker 06: Mr. Friedman certainly was rendered a non-citizen and non-national, and that happened prior to the looting of his property. [00:10:23] Speaker 06: So. [00:10:24] Speaker 03: And what international [00:10:26] Speaker 06: law of property are you professing the international law of property is international takings law and so the law the law as the supreme court held in philip international law is that a taking from an alien taking from an alien at least according to the restatement without just compensation or without an adequate public purpose violates international law so we're citing [00:10:55] Speaker 06: emphatically the international law of property. [00:10:59] Speaker 03: And then when was this particular art taken? [00:11:03] Speaker 03: I don't know that you specifically alleged a time period. [00:11:05] Speaker 06: We did. [00:11:06] Speaker 06: So the art was taken in 1941. [00:11:14] Speaker 06: And then there were securities that the family owned that were taken [00:11:23] Speaker 06: I think in stages, but we've alleged in the complaint, and we've attached once again exhibits to show this, exhibits G and H, and then K through L demonstrate that in 1943 and 1944, subsequent to the Reich Citizenship Law and the declaration that Mr. Friedman was an enemy of the state, securities were stolen. [00:11:52] Speaker 06: And I would like to mention, even though it doesn't go directly to the jurisdictional point, this is an extraordinary Nazi looted art case. [00:12:03] Speaker 06: I realize there have been several before the court, because in this instance, we have contemporaneous inventory created by the Nazis of everything that was stolen. [00:12:16] Speaker 06: We have the orders back and forth from where Mr. Friedman lived, [00:12:21] Speaker 06: to Berlin, ordering the confiscation of the material. [00:12:25] Speaker 06: We also have records demonstrating that the intent after looting the property was to sell it. [00:12:32] Speaker 06: We have documentation attached to the complaint that the purpose was to liquidate [00:12:38] Speaker 06: these stolen items and mix the proceeds with Germany's bank accounts, which goes to your honor, General Boss and holding Simon one, uh, that the co mingling is sufficient to demonstrate the commercial nexus with commercial activity. [00:12:56] Speaker 05: Can I ask you about the, um, uh, Phillips effect on Simon one and, um, the, [00:13:03] Speaker 05: restatement second, just to follow up on that as we double the restating third and we get back to the restating second, which is operative in their purposes. [00:13:09] Speaker 05: So under section 175 of the restatement second says that the responsibility of a state under international law for an injury to an alien cannot be invoked directly by the alien. [00:13:21] Speaker 05: And we'll just assume for these purposes that an alien includes a stateless person. [00:13:26] Speaker 05: against the state, except as provided by the law of the state, international agreement, or agreement between the state and the alien. [00:13:33] Speaker 05: Yes. [00:13:34] Speaker 05: And your theory of qualifying under that is? [00:13:37] Speaker 06: Yes. [00:13:38] Speaker 06: And Judge Childs, I attended the argument on the Simon and Philip remand last month, and the same questions arose. [00:13:46] Speaker 06: The question under the Foreign Sovereign Immunities Act is whether they're taking violated international law. [00:13:52] Speaker 06: And 175 can comment D. [00:13:56] Speaker 06: makes clear that it does, what you're raising are, as the restatement describes it, questions of standing to pursue the relief. [00:14:06] Speaker 06: And I think 175 is not the only place. [00:14:09] Speaker 06: I think it appears in 171 also. [00:14:12] Speaker 06: It raises questions about how a stateless person would avail him or herself [00:14:18] Speaker 06: of legal redress for what it concedes as a violation of international law. [00:14:22] Speaker 06: That's irrelevant for present purposes. [00:14:24] Speaker 05: You just think the FSIA is. [00:14:25] Speaker 06: We have the FSIA, and the FSIA says, here's your venue to vindicate your rights, but we need a hook in international law. [00:14:35] Speaker 06: The restatement says there's a violation of international law. [00:14:38] Speaker 06: So the qualification, and Judge Pillard was pressing on this question last month as well, [00:14:45] Speaker 06: It's simply not a relevant point because we're proceeding under the foreign sub. [00:14:51] Speaker 05: Can I ask just about the role of genocide in your theory? [00:14:55] Speaker 05: Because that's come up in the district court opinions, including in this case. [00:14:58] Speaker 05: And as I understand your theory, it may be that the genocide is factually germane because it's what resulted under your allegations in statelessness. [00:15:12] Speaker 05: But you're not actually resting your theory on proving a genocide or on the international law consequences of a genocide. [00:15:21] Speaker 05: It's just actually what happened is because of the treatment of Jews, they were rendered stateless. [00:15:29] Speaker 06: Respectfully, not exactly. [00:15:31] Speaker 05: OK. [00:15:31] Speaker 06: So we have two different theories. [00:15:34] Speaker 06: One is, and the one that I principally press here, is the de jure rendering of statelessness. [00:15:41] Speaker 06: which I won't say has nothing to do with the genocide because it is hard to imagine that the government would have enacted these laws, but for the fact that it was persecuting the Jews. [00:15:53] Speaker 06: But to illustrate the distinction, suppose a more benign Nazi Germany had enacted laws to strip the Jews of citizenship, but then didn't go about exterminating. [00:16:05] Speaker 06: It just treated them poorly. [00:16:07] Speaker 06: Under our de jure theory, [00:16:10] Speaker 06: The taking from any such Jewish individual wouldn't have been a violation of international law. [00:16:15] Speaker 06: We also say that there's been a de facto stripping of Mr. Friedman's citizenship because someone who's subject or a people that is subject to a genocide cannot be deemed citizens or nationals of the offending state. [00:16:31] Speaker 06: For that prong of our argument, we do rest on the genocide. [00:16:35] Speaker 06: And as I said earlier, I think that argument's right. [00:16:38] Speaker 06: Because all Philip said is, we look to the international law of property, not the international law of human rights. [00:16:47] Speaker 06: And under the international law of property, unless you're a domestic, unless the victim is a domestic, such that domestic takings rule shields the state from jurisdiction, you have a violation of international law. [00:17:00] Speaker 06: But again, I can see that is a harder call in the wake of Philip. [00:17:06] Speaker 05: Our de jure theory is not. [00:17:09] Speaker 05: But under de facto theory, the violation of international law is what? [00:17:14] Speaker 06: It is a taking from a stateless person. [00:17:16] Speaker 06: It is simply that that person has been rendered stateless, de facto, because of the genocide. [00:17:23] Speaker 05: Right, but the violation of international law is not genocide. [00:17:25] Speaker 05: It's not. [00:17:27] Speaker 06: Under none of our theories, we read Philip, under none of our theories is a violation of international law [00:17:33] Speaker 06: the law of genocide or human rights. [00:17:35] Speaker 06: It is simply the distinction is how was our client or our client's forbearer rendered stateless. [00:17:43] Speaker 06: That's the distinction. [00:17:47] Speaker 06: I see them. [00:17:49] Speaker 02: If you could just, I mean, [00:17:52] Speaker 02: So one question really is whether a stateless person is more like a domestic national or more like an alien, I think, for the purposes of the domestic exception. [00:18:03] Speaker 02: And I'm not sure that the second restatement is entirely clear about that. [00:18:08] Speaker 02: I mean, if you can just point me to where you really think the taking of property from a stateless person is contrary to international. [00:18:21] Speaker 06: I have a textual answer, and then I have what I think is the logical reason why that is the case. [00:18:31] Speaker 06: The textual answer is that the second restatement says, in so many words, that taking by a state of property of an alien, reading section 185, is wrongful under international law. [00:18:46] Speaker 06: And then the restatement second goes on to say, [00:18:52] Speaker 06: Section 171, comment G, a stateless person comes within the definition of alien. [00:18:59] Speaker 02: Well, but it says it comes within the definition of alien in this section. [00:19:03] Speaker 02: Yes. [00:19:04] Speaker 06: Yes. [00:19:05] Speaker 02: And does that section include 185? [00:19:07] Speaker 06: I think it does. [00:19:11] Speaker 06: I don't understand any respect in which it would not. [00:19:14] Speaker 06: I think it does. [00:19:18] Speaker 06: But let me give the more [00:19:22] Speaker 06: logical answer that flows from Philip that I think provides color to this. [00:19:28] Speaker 06: Philip was concerned with the scope of the domestic takings rule. [00:19:34] Speaker 06: The premise of which is explained in the Belmont case from 1937 that Philip cited to. [00:19:41] Speaker 06: And it essentially says that a citizen or a national of a particular state, if that person [00:19:51] Speaker 06: is harmed by the actions of that state, should look to that state for redress. [00:19:58] Speaker 06: That's the premise of the domestic takings rule. [00:20:02] Speaker 06: It has also been explained, pursuant to the rationale that you mentioned, Judge Shinobasan, which is that an offense against your own national is not an offense against another state. [00:20:15] Speaker 06: But in this instance, there is no way to apply the domestic takings [00:20:21] Speaker 06: or the rationale of the domestic takings rule, because Mr. Friedman was not a domestic. [00:20:26] Speaker 06: He was stripped of his citizenship and of his nationality. [00:20:31] Speaker 06: And so what the question boils down to is if there's a taking in violation of international law, and Germany doesn't have an escape hatch to jurisdiction under the FSIA because of the domestic takings rule, then [00:20:51] Speaker 06: His descendant has a right to pursue the claim under the foreign sovereign. [00:20:55] Speaker 02: One more question. [00:21:00] Speaker 02: Is there any space between being strict of your citizenship and being strict of your nationality? [00:21:05] Speaker 02: So Germany seems to argue that even if citizenship was legally taken away, that Mr. Friedman still remained a national of Germany. [00:21:15] Speaker 02: I mean, is there any space between those two things in international law or otherwise? [00:21:21] Speaker 06: The law in terms of case law in federal courts in the United States and also in international bodies is pretty thin. [00:21:30] Speaker 06: I will observe that the Supreme Court and Philip used the two terms interchangeably. [00:21:36] Speaker 06: It said that taking from a citizen is shielded by the domestic takings doctrine. [00:21:43] Speaker 06: In other places, it used the word national. [00:21:46] Speaker 06: We've cited scholarship in our opening brief and I think more so in our reply brief. [00:21:54] Speaker 06: that scholars and historians agree that any distinction between those two terms is, to use their words, vanishingly small. [00:22:05] Speaker 06: And I have not seen an articulation for purposes of the FSIA or the domestic takings rule. [00:22:14] Speaker 06: I understand Germany makes that argument, but I don't think there's a basis for that. [00:22:19] Speaker 06: And in any event, [00:22:21] Speaker 06: Our allegations, I think, are sufficient to show that he was stripped of both. [00:22:25] Speaker 06: The strongest evidence of that is that he was declared an enemy of the state, the purpose of which was to denaturalize him so that Germany had a fig leaf to steal his property. [00:22:39] Speaker 06: The last thing I want to say, if I may, one more second. [00:22:42] Speaker 05: You know what, if you want me to sit. [00:22:45] Speaker 05: If it's one second, it's up to you. [00:22:47] Speaker 05: We will give you a little bit of rebuttal time. [00:22:49] Speaker 05: Thank you, Your Honor. [00:22:51] Speaker 06: We urge that if you agree with us that Judge Leon was wrong, that you remand with instructions to deny the motion to dismiss because this extraordinary case was filed seven years ago [00:23:07] Speaker 06: and the alternative grounds for affirmance that Germany raises all have now been thoroughly briefed. [00:23:14] Speaker 06: Judge Leon didn't reach them. [00:23:17] Speaker 06: But if the case is simply remanded on this issue, I fear that we will face years and years of additional district court litigation because of the state's right to an interlock. [00:23:30] Speaker 05: Okay. [00:23:30] Speaker 05: Thank you, counsel. [00:23:31] Speaker 05: Let's hear from Appellee's counsel now, Mr. Dirks. [00:23:36] Speaker 04: Thank you for pronouncing my last name correctly. [00:23:42] Speaker 04: I have a lot of problems with that, as a lot of people do. [00:23:44] Speaker 04: I'm not going to give you a highlight reel of my argument in our briefs. [00:23:50] Speaker 04: They've been fairly briefed by both sides. [00:23:52] Speaker 04: You've got a tremendous amount of information to work with. [00:23:57] Speaker 04: A main point here is that what you're hearing is basically a repackaging of a failed genocide argument. [00:24:05] Speaker 04: trying to crowbar into the law takings post-Philip. [00:24:09] Speaker 04: We've talked in our brief in phases 24 to 28 about the de jure denationalization or not. [00:24:20] Speaker 04: We covered the de facto in 29 to 33. [00:24:23] Speaker 04: I'd prefer not to rehash that and get into some more important things, which we've been talking about here and also in the Philip and in the Hungary cases two weeks ago. [00:24:32] Speaker 04: And that is if someone [00:24:36] Speaker 04: What's the result? [00:24:38] Speaker 04: And when you're talking about a violation of international law, it'd be useful to go back and think about what happened when the Helmer case got remanded to this circuit. [00:24:48] Speaker 04: And they were struggling with, you know, what's international law? [00:24:53] Speaker 04: And they, by and by, along in the brief, they say, the plaintiff has an obligation, has to prove that, in fact, [00:25:01] Speaker 04: you know, whatever the exception they're relying on, has crystallized into an international norm that bears a heft of international law. [00:25:12] Speaker 04: And Paul's talking about ambiguity that's ambiguous or uncertain, but not there. [00:25:16] Speaker 04: It's got to be pretty darn clear. [00:25:18] Speaker 04: And I think that the fact that we're having this extended discussion about what happens if someone's status [00:25:24] Speaker 04: Tells you that perhaps not as clear as the no, I mean, I think every time there's litigation in a case, people have arguments about what the law is. [00:25:33] Speaker 05: So what is the answer? [00:25:36] Speaker 05: What is the state of international law at the relevant time? [00:25:40] Speaker 05: about whether stateless persons are covered by the prohibition against expropriations. [00:25:49] Speaker 05: Because they're either, if they're more like citizens of the state that perpetrated the taking, they're not covered. [00:25:56] Speaker 05: If they're more like persons who are citizens of another state, they are covered. [00:26:00] Speaker 05: Citizen or national of another state, they are covered. [00:26:02] Speaker 05: And we've heard argument on why under the restatement second, which is the one that is from the relevant timeframe, [00:26:09] Speaker 05: we should consider them to be covered. [00:26:12] Speaker 05: But you obviously disagree. [00:26:13] Speaker 04: I obviously disagree, and I think that the point has been made that the second restatement is perhaps not as clear as the appellants would like it to be. [00:26:20] Speaker 05: If you look at the third restatement, one of the things the third restatement says with regard to... I think, counsel, unless you're going to tell us something different, I think counsel on the other side already agrees that under the third restatement, there's no claim. [00:26:33] Speaker 04: Well, except that there's something, there's a comment [00:26:36] Speaker 04: There's a comment here that in section 713 of the third restatement, it says that the third restatement in section 711 and 712, which are where the border meets the road really, the principles in those sections provide no protection to a stateless person. [00:26:54] Speaker 04: But then if you look at in 712, it says that they were really restating the traditional rules of international law of expropriation of alien properties [00:27:06] Speaker 04: and take essentially the same substantive positions as the previous restatement. [00:27:11] Speaker 04: So the third restatement's statements are saying, hey, we haven't changed a thing. [00:27:16] Speaker 02: We're just telling you what the second restatement says. [00:27:18] Speaker 02: Well, let's just focus on the text of the second restatement, though. [00:27:20] Speaker 02: I mean, what the third restatement interprets the second restatement to say isn't necessarily binding. [00:27:28] Speaker 02: So how would you distinguish the arguments about the second restatement itself, just on the text of the second restatement? [00:27:36] Speaker 04: I don't think the second restatement supports their position. [00:27:38] Speaker 04: And I think the third restatements [00:27:40] Speaker 02: But why does the second reason? [00:27:44] Speaker 04: The whole principle, if you go back to what the Philip case talked about, the whole principle of the law of expropriation and international law is that it's an injury to the alien's nation of sovereignty. [00:28:03] Speaker 04: If the injury isn't to the individual, it is to the individual sovereign. [00:28:08] Speaker 02: But the second restatement says that a stateless person comes within the definition of alien. [00:28:14] Speaker 02: So let's focus on the text of the second restatement. [00:28:18] Speaker 02: And why do you think that doesn't cover the argument that was made by your friends on the other side? [00:28:22] Speaker 04: I think the nicest thing you can say about it is it's ambiguous. [00:28:26] Speaker 04: What's ambiguous? [00:28:27] Speaker 04: It's ambiguous in terms of you have to put it in the context of the international law that at the time, and even through the third restatement, [00:28:37] Speaker 04: where the injury is to the alien sovereign. [00:28:40] Speaker 04: We're talking about international law. [00:28:42] Speaker 04: We're not talking about the law of, you know, of individuals having rights. [00:28:45] Speaker 04: We're talking about nations having rights. [00:28:48] Speaker 02: I understand the conceptual distinction and the traditional understanding of international law, but I'm interested in this language in section 171 of the second restatement. [00:28:58] Speaker 04: Well, it says it's an alien, but it doesn't say what that means in the context of other parts of the restatement. [00:29:04] Speaker 04: And what you see in the third restatement is where they [00:29:06] Speaker 04: they lay it out for you and say, we're laying out for you here in the third restatement, is what the second restatement said. [00:29:12] Speaker 04: We're not changing a thing in this area of the international law of expropriation. [00:29:19] Speaker 05: So your theory, it has to be, let's just for argument purposes, I know you're resisting it, but let's just say, we're not gonna consider the third restatement. [00:29:28] Speaker 05: Let's just take it out of our minds for now. [00:29:30] Speaker 05: Just under the second restatement alone, [00:29:32] Speaker 05: Your theory is that even though the second restatement defines alien to include a stateless person in 171, we shouldn't assume that that definition governs in 185. [00:29:44] Speaker 04: Correct. [00:29:45] Speaker 04: I think that a nice thing you can say is ambiguous. [00:29:48] Speaker 05: And if you go back to what... Because if it does govern, would you agree that if 171's definition does govern for 175, then on this theory you lose? [00:30:00] Speaker 04: Well, I think putting it in the broader context of the international law of expropriation, which was explained in Philip, is the theory is that it's the injury to the alien state. [00:30:11] Speaker 04: A stateless person doesn't have a state to be injured on. [00:30:14] Speaker 02: Philip leaves open the question of whether a stateless person is more like an alien or like a domestic citizen or national. [00:30:22] Speaker 02: That's why they remanded that question in Philip. [00:30:25] Speaker 02: So it says nothing one way or the other about [00:30:29] Speaker 02: you know, which way a state, how a stateless person should be conceptualized in this framework. [00:30:33] Speaker 04: That's correct. [00:30:34] Speaker 04: And that's my point. [00:30:35] Speaker 04: If you go to what this court said in the remand in Helmer, it says, if a plaintiff is asserting a violation of international law, it has to be not ambiguous. [00:30:49] Speaker 04: It has to be certain. [00:30:50] Speaker 04: And you get down to also said, [00:30:53] Speaker 04: has to demonstrate that, in fact, it is crystallized into an international norm that bears the heft of international law. [00:30:59] Speaker 04: There's only one United States case that I'm aware of that dealt directly with that and beside it and still have a circuit case that said, you know, stateless person, you know, [00:31:11] Speaker 02: So there's a difference between arguing that that the appellants here have failed to demonstrate this is covered by international law and arguing that a stateless person is not covered. [00:31:25] Speaker 02: by the international law of expropriation. [00:31:27] Speaker 02: I mean, those are two distinct arguments. [00:31:29] Speaker 02: One is that they failed in their burden of proof, and the other is that international law forecloses a stateless person from relying on this law of expropriation. [00:31:39] Speaker 02: I mean, those are distinct arguments. [00:31:40] Speaker 04: I understand it, but I think the burden is on the plaintiff to show that it is, in fact, covered. [00:31:46] Speaker 04: And once again, going back to Helmerick on remand, that's what this court said. [00:31:51] Speaker 04: If it's ambiguous, the plaintiff's had a lot. [00:31:55] Speaker 04: that has to be crystallized into an international norm. [00:31:59] Speaker 04: And the fact that we've had this discussion here, and there was a discussion in the Bill case and in the Hungry case that Charles was at, the fact that we're having this extended discussion tells you everything you need to know about whether this is crystallized into an international norm, and it's not ambiguous. [00:32:14] Speaker 04: So I think that's the problem. [00:32:16] Speaker 03: But I'd like to move on and talk about... But do you agree on the first part about de jure statelessness? [00:32:22] Speaker 03: I'm sorry, what? [00:32:22] Speaker 03: Do you agree on de jure statelessness? [00:32:25] Speaker 04: And then you just know, as I said, as a brief on Texas 24 to 28, we demonstrate that no matter how shabbily and reprehensible the conduct was, it didn't rise to the level of depriving him of his de jure nationality as German. [00:32:43] Speaker 02: What about depriving them of citizenship? [00:32:46] Speaker 02: Do you deny that that Mr. Friedman was stripped of his citizenship? [00:32:50] Speaker 04: He was stripped of a lot of rights. [00:32:53] Speaker 04: There are a lot of cases where people, for want of a better word, are second class citizens. [00:32:59] Speaker 04: I think the thing is that international law uses the term national. [00:33:05] Speaker 04: I think they use the term national because what I didn't realize was until after World War II, citizens of the United Kingdom were not citizens of the United Kingdom, they were subjects of the crown. [00:33:17] Speaker 04: So in a lot of places, you could be a national, [00:33:22] Speaker 04: Everybody understands national more or less, but citizenship wanders all over the place. [00:33:28] Speaker 04: And I think that's why the restatement talks in terms of national because citizenship is it gets you into Murphy territory that wanders around all over the place where [00:33:39] Speaker 04: Nationality is more of sort of the international norm. [00:33:42] Speaker 02: So a person, though, who is stripped of their citizenship by law, I think it seems like Germany's view of that is, although it seems that by law they were stripped of their citizenship, they somehow, Mr. Friedman remained a national of the German state. [00:33:55] Speaker 02: Is that your argument? [00:33:57] Speaker 04: No, I think we're saying that he, as reprehensible the treatment was, it did not rise to the level where he was no longer a citizen and no longer a national. [00:34:07] Speaker 04: He didn't have the same level of rights as some other Germans did. [00:34:13] Speaker 04: But that didn't mean he was no longer a German citizen or a German national. [00:34:17] Speaker 04: He just didn't have the same rights. [00:34:19] Speaker 02: Did he have any rights after those laws were enacted? [00:34:22] Speaker 02: And he was declared an enemy of the state? [00:34:25] Speaker 02: I mean, I'm not sure how a declaration that someone is the enemy of the state could be consistent with the idea that they remain a citizen and a national of that state. [00:34:33] Speaker 04: Well, obviously, I think we disagree with you on that. [00:34:35] Speaker 04: I think our brief goes over this in great detail. [00:34:39] Speaker 04: I'd like to move on to some other things if it's possible. [00:34:42] Speaker 04: There are other problems with the KC that I think need to be, can't get lost in the shuffle. [00:34:53] Speaker 04: And that is when we talk to Helmerick about how in Helmerick the standard really changed to how you're supposed to review these things. [00:35:01] Speaker 04: They're relying on a plausibility standard. [00:35:03] Speaker 04: And I think that, you know. [00:35:05] Speaker 05: This is on the commercial. [00:35:07] Speaker 05: Is that where you're going to now? [00:35:09] Speaker 05: Correct. [00:35:09] Speaker 05: Yeah. [00:35:10] Speaker 05: And so the district court can get into any of this, right? [00:35:12] Speaker 04: That's correct. [00:35:13] Speaker 04: Yeah. [00:35:13] Speaker 04: But I think that these are all alternative grounds, and I think we need to. [00:35:18] Speaker 05: Yeah, I just wanted to see if my colleagues are interested in this, because I think we're focused on the parts of the argument that we've been talking about so far. [00:35:27] Speaker 05: Correct. [00:35:27] Speaker 05: And on that, [00:35:29] Speaker 05: I just want to make sure I understand your theory. [00:35:31] Speaker 05: So 171 says, a stateless person comes within the definition of alien in this section. [00:35:39] Speaker 05: But responsibility for injury, too, and then goes on and says what it says about 175. [00:35:43] Speaker 05: And I know that part of your argument is you have to consider the entirety of the second restatement against the backdrop of international law, which deals in the realm of state-to-state disagreements. [00:35:54] Speaker 04: Which would still see that it talks about. [00:35:57] Speaker 05: Yeah. [00:35:57] Speaker 05: Yes, Phillips does. [00:35:58] Speaker 05: Let's just suppose I'm just trying to understand under the terms of the second restatement itself. [00:36:02] Speaker 05: Let's just assume the second restatement is a statute, and I'm just trying to understand this statute. [00:36:07] Speaker 05: I know it's not, but let's just pretend that it is. [00:36:11] Speaker 05: What's your argument that under the terms of the restatement, the theory [00:36:18] Speaker 05: that the appellant has put forth doesn't work under the terms of the second restatement, because it just seems like a mathematical equation. [00:36:27] Speaker 05: The takings prohibition speaks in terms of an action against an alien, and then the restatement defines an alien to include a stateless person. [00:36:35] Speaker 05: There we go. [00:36:36] Speaker 05: It works. [00:36:37] Speaker 04: I think once again, you have to put it into the context. [00:36:39] Speaker 05: OK. [00:36:40] Speaker 05: So your argument relies on the context, which is a perfectly fair argument. [00:36:43] Speaker 05: I just want to make sure that I understood. [00:36:45] Speaker 05: You don't have something under the terms of the restatement. [00:36:48] Speaker 04: Okay, I understand. [00:36:49] Speaker 05: Let me ask if my colleagues have any additional questions for you this time. [00:36:53] Speaker 05: Okay. [00:36:53] Speaker 04: Okay. [00:36:54] Speaker 05: Thank you for your argument. [00:36:57] Speaker 04: You know, I understood my alternative arguments. [00:36:59] Speaker 05: What's that? [00:36:59] Speaker 04: I want to discuss. [00:37:01] Speaker 05: Yes. [00:37:01] Speaker 05: And we have those from your briefs. [00:37:03] Speaker 05: We do. [00:37:03] Speaker 05: We do. [00:37:04] Speaker 05: We've taken stock of those. [00:37:05] Speaker 05: I mean, if you want to take, I will give you one minute to do your alternate argument if you'd like, but that's to keep it at that because we're focused on a question. [00:37:14] Speaker 04: Something that was admitted in the reply brief is important here. [00:37:19] Speaker 04: But Mr. Torrance's counsel said was that basically their allegations with regard to commingling are basically mirror of what the allegations were in Simon. [00:37:34] Speaker 04: And because it worked in Simon, it ought to work here. [00:37:36] Speaker 04: But putting aside the plausibility issue, which we briefed, and which the Second Circuit adopted in Rokuro, [00:37:44] Speaker 04: The context of Simon was where Hungary did not contest the allegations. [00:37:51] Speaker 04: All the court had before it was allegations and arguments by the government of Hungary. [00:37:57] Speaker 04: We didn't do that here. [00:37:59] Speaker 04: We put in historical facts which demonstrate clearly that there is no plausible way that chaos from 1942 could wind up in the United States in the 21st century as German property. [00:38:15] Speaker 04: And the most important of which is that there was no German government for four and a half years. [00:38:23] Speaker 04: Germany was controlled by the four occupying powers for an entire period. [00:38:27] Speaker 04: So whatever, even if something managed to survive until May of 1945, to suggest that somehow or other, even though Germany didn't exist for four and a half years, it wound up in the German treasury in the 21st century, this isn't plausible. [00:38:44] Speaker 05: All right. [00:38:44] Speaker 05: Thank you, counsel. [00:38:45] Speaker 05: Appreciate your argument. [00:38:46] Speaker 05: Mr. Orsic, we'll give you two minutes for rebuttal. [00:38:52] Speaker 06: Thank you, Your Honor. [00:38:53] Speaker 06: To draw, I'd like to briefly come back to your question about section 171 of the restatement. [00:39:00] Speaker 06: What you quoted to me was comment G, which says that a stateless person comes within the definition of alien in this section. [00:39:10] Speaker 06: That does refer to 171 in this section, but if you look at the text of 171, the rule says, a person is an alien for purposes of the responsibility of a state or injury to an alien. [00:39:25] Speaker 06: So that right there demonstrates that for purposes of 185, which is a question of the responsibility of a state or injury to an alien, [00:39:40] Speaker 06: because that's what it says. [00:39:43] Speaker 06: That's how I get from the comment in 171G to 185. [00:39:49] Speaker 06: You can't ignore the text of 171. [00:39:50] Speaker 05: 171 is just a definition section. [00:39:53] Speaker 05: So it's, I mean, of course it applies because it's just defining what the term is. [00:39:59] Speaker 05: And to say that it's for purposes of this section, it would be pretty tautological to say it's a definition of a definition for purposes of the definition, but nowhere else. [00:40:07] Speaker 06: No, I agree. [00:40:08] Speaker 06: I'm saying it less artfully. [00:40:10] Speaker 06: My point is that 185 is the section I rely upon, and 185 must incorporate the definition of an alien. [00:40:19] Speaker 06: 171 is the definition of an alien, and 185 says a taking from an alien is a violation of international law. [00:40:26] Speaker 02: So does that mean a stateless person is an alien throughout the restatement, because it's in the general? [00:40:31] Speaker 06: I think so. [00:40:32] Speaker 06: I haven't tried to do a study to determine whether there's a respect in which it can't be. [00:40:36] Speaker 06: But 171 says, for purposes of the responsibility of a state, so at least for 185, it must be. [00:40:43] Speaker 02: Because 185 states are responsibility of the state. [00:40:45] Speaker 06: Correct. [00:40:46] Speaker 06: Correct. [00:40:47] Speaker 06: I would like that. [00:40:52] Speaker 06: The declaration of Mr. Friedman being an enemy of the state is in the Joint Appendix at page 95, JA95, where the Gestapo makes that declaration. [00:41:07] Speaker 06: And we have cited law in our brief that says that the purpose of that declaration is to denaturalize an individual and thereby [00:41:17] Speaker 06: under Nazi law be able to steal his property. [00:41:20] Speaker 06: So I take issue with counsel's suggestion that we haven't demonstrated that the enemy of the state declaration was sufficient to deprive him. [00:41:32] Speaker 06: nationality. [00:41:33] Speaker 06: The last thing I'll say, and I realize you don't want to get much into the alternative argument, but this notion that the Homeric case undermines and changes the burden of production we must make at the jurisdictional stage has been exactly that same argument has been rejected by three different [00:41:54] Speaker 06: post Elmerick decisions by this court, Lambia, Shubarth and EIC. [00:42:00] Speaker 06: Uh, and I'm happy to rest on our brief as to why the allegations we made of co mingling are sufficient to, um, allege the necessary doing doing commercial activity in the United States. [00:42:17] Speaker 06: I don't have anything to add. [00:42:20] Speaker 05: Okay. [00:42:20] Speaker 05: Thank you, counsel. [00:42:22] Speaker 05: Thank you to both counsel. [00:42:23] Speaker 05: We'll take this case under submission.