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German Industry Ready To Pay Up

German industry indicated Tuesday it is ready to free its half of a 10 billion mark ($4.6 billion) compensation fund for Nazi-era slave and forced laborers, clearing the last major hurdle for payments to aging survivors.

A statement by German industry said a U.S. judge's dismissal of a crucial lawsuit signaled the protection from legal action that German companies have demanded as their part of the deal, the decisive step in a painstaking two-year process.

Even before the announcement, a spokesman for German companies contributing to the government-industry fund, Wolfgang Gibowski, said Monday's decision by District Judge Shirley Wohl Kram made it "very well possible" that money would be paid to survivors by July.


Reuters
Manfred Gentz, finance chief of founding fund member DaimlerChrysler, smiles during the Frankfurt news conference after declaring conditions were in place to start payments to Nazi-era slave laborers who have waited 56 years for compensation for their suffering under the Third Reich.

And Chancellor Gerhard Schroeder's envoy on slave labor, Otto Lambsdorff, said he believes German companies now had the "legal peace" they have demanded for payments to begin to an estimated 1 million survivors of Nazi labor, mostly non-Jews from Eastern Europe.

Schroeder issued a statement welcoming the industry announcement and voicing confidence that compensation would start quickly.

However, Czech chief negotiator Jiri Sitler said he would only be satisfied when German industry actually transfers the 5 billion marks ($2.3 billion) it has collected to the fund.

"Only at the moment this happens we can talk about a breakthrough," said Sitler, who represents some 80,000 Czech forced laborers who have applied for payments. "That would really mean that German firms are finally ready to meet their obligations."

Under the fund rules, the German parliament has to declare itself satisfied that German companies are adequately protected from future lawsuits by victims of Nazi labor. Lawmakers said that decision could come as early as next week.

"I hope we can establish legal security at the very latest in June, perhaps even in the next week, and that the foundation will share this opinion," said Wolfgang Bosbach of the opposition Christian Democrats.

Gibowski noted that several other cases against German companies by former slave and forced laborers are pending in the United States, including what he called a key case in California.

But the New York ruling was expected to speed other courts to dismiss remaining suits, clearing th way for long-delayed payouts after two years of negotiations on a settlement for the forgotten group of Holocaust survivors.

Tuesday's statement by German industry said the dismissal of the New York suit against German banks "has created the conditions under which the German parliament can declare adequate legal security."

Industry "has from the very beginning stressed that offering these funds is a humanitarian measure aimed at reconciliation and understanding," the statement said. "It thereby recognizes the historic and moral responsibility of German industry due to its integration into the Nazi regime."

Industry also defended its decision to hold out for full legal closure since last July's international agreement setting up the fund, saying protection from lawsuits was a critical part of the accord.

Judge Kram on Monday signed an order dismissing Gutman vs. Deutsche Bank, saying, "It's my hope and expectation that the German Foundation will begin payments almost immediately."

The case involved plaintiffs who during the Holocaust lost money deposited in Austrian banks. Kram wanted the Austrian plaintiffs to be eligible for payments from the German fund because, following Germany's 1938 annexation of Austria, Germany controlled that country's banks.

But she came under pressure from plaintiffs in the slave labor litigation to drop the case because German industry cited it as an obstacle.

A federal appeals court ruled Thursday that Kram exceeded her authority when she tried to impose conditions for dismissing the earlier consolidated claims.

German government and industry representatives had objected to a condition that the parliament declare legal peace before its summer recess and an apparent possibility that the foundation cover the claims against Austrian banks.

By TONY CZUCZKA
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