Co-editors: Seán Mac Mathúna • John Heathcote
Consulting editor: Themistocles Hoetis
Field Correspondent: Allen Hougland


The California Cure for Japanese War Crimes
Jonathan Levy

The Other Holocaust: Nanjing Massacre - this site has an excellent links page

Trial of the Nanking Atrocities

Japanese War Crimes In China

Japanese War Crimes against POWs in Japan

Restitution & justice for concentration camp survivors of Serb, Jewish, and Ukrainian background and their relatives  

The International Commission on Holocaust Era Insurance Claims


"Thousands of men were led out of the [Nanjing International Safety] Zone, ostensibly for labour battalions, and lined up and machine-gunned. Sometimes groups were used for bayonet exercises. When the victors grew bored with such mild sport they tied their victims, poured kerosene over their heads, and cremated them alive. Others were taken out to empty trenches, and told to simulate Chinese soldiers. Japanese officers then led their men in assaults to capture these "enemy positions" and bayoneted the unarmed defenders." - Edgar Snow, Scorched Earth, London (1941), p. 62.

According to Professor Michael Bazyler's recent article in the University of Richmond Law Review, "The phrase "opening the floodgates of litigation" connotes a pejorative meaning in American legal argument. Most often, it is used by courts as a reason not to allow a certain case to proceed for fear that it would overburden both courts and society with a new class of lawsuits." (1) However, in the case of Holocaust and World War II related lawsuits, this term has had a more felicitous meaning. Holocaust related lawsuits have been for the most part successful efforts for both the victims in obtaining emotional closure, justice, and restitution and the class action lawyers who reap financial gains in the form of handsome fees from multimillion and billion dollar settlements. (2)

Of particular importance to litigating World War II financial issues is California Code of Civil Procedure Section 354.6. It permits any World War II slave labor or forced labor victim, or their heirs, to bring suit in a superior court of California against any entity or successor in interest for whom the labor was performed, either directly or through a subsidiary or affiliate. An action brought under this section shall not be dismissed on statute of limitations grounds if commenced on or before December 31, 2010. California therefore has created a litigation friendly forum for victims of WWII atrocities and war crimes by legislatively disposing of any legal objections to staleness known as the Statue of Limitations. California is the only state with such a law and not surprisingly has the second-largest population of Holocaust survivors. Bazyler, a leading authority on Holocaust law predicts the next wave of World War II-era slave labor lawsuits will be filed in California. (3)

Class action law firms have enjoyed inordinate success against corporate defendants tainted by involvement with the Third Reich and its allies. These corporate entities became involved in joint ventures with the Nazis and others fascists for the purpose of self-aggrandizement. Profits in the form of stolen loot, slave labor proceeds, and money laundering on behalf of the Axis, enriched banks, insurance companies, and conglomerates. Profits for the most part were not disgorged following the war and the corporations and their successors enjoyed the fruits of their misdeeds.

The class action process in regards to World War II claims rests on three legs: legal, political, and mass media. A successful combination of litigational prowess, media attention, and political support saw successful settlements won or in progress against Swiss, Austrian, German, and French Banks, German Corporations, and some European Insurers. Claims against other entities are ongoing: The Vatican, Insurance companies, and potential suits against South American, Turkish, and Iberian banks. Surprisingly, Nazi profiteers included not only German and Neutral corporations but American multinationals like Ford, General Motors, and Chase Manhattan. Left out of the scenario until 1999 was the vast network of Japanese zaibatsus or wartime conglomerates that powered Japanese militarism.

"For 50 years, the Japanese government and Japanese private companies and banks have rebuffed attempts by victims of Japanese War Crimes during WW II -commonly known as "Holocaust in the Pacific"." (4) Indeed the Japanese War Crimes have a much lower profilet than those of the Nazis and their allies. The victims were mainly Asian but America is partially to blame. The International Military Tribunal for the Far East established in 1946 was supposed to be a counterpart to the Nuremberg Tribunal, it was not and was under the effective control of General MacArthur. (5) Conspicuously, absent from the tribunal's list of defendants were representatives of the zaibatsus. The situation of Japanese national guilt is complicated by the seeming pardon of the Japanese Emperor Hirohito for war crimes and the nuclear annihilation of Hiroshima and Nagasaki. Further American intervention against Communism in East Asia required a stable Japan. Prosecuting former militarists would harm the Japanese economic recovery and was contrary to the American national interest.

Attempts to seek legal recourse against Japanese industry mainly in Japan have been largely ineffective in the past. This is not surprising as similar problems plagued lawsuits against Germany and its wartime allies until 1995. In 1995, three class action lawsuits were filed against Swiss banks by Holocaust survivors, this opened the "floodgates of litigation" that Professor Bazyler noted. Bazyler believes there is no single reason that Holocaust lawsuits have been successful now but notes an evolutionary process in the Federal Court that began in 1980 with "Filartiga v. Pena-Irala [630 F.2d 876] the landmark 1980 Second Circuit Court of Appeals opinion which held that the Alien Tort Claims Act can allow a victim of state-sanctioned torture to bring suit against the torturer in the United States even though the torture took place on foreign soil. (6) The litigational opening up process included successful human rights cases in United States courts involving, Marcos, alleged Serbian war criminal Karadzic, and the 1991 Torture Victim Protection Act in which Congress granted foreign torture victims access to US courts. Declassification of wartime government documents both here and abroad have aided prosecution of Word War II civil cases as has favorable public opinion, the media, and political pressure groups.

California Senate Bill No. 1245 which established Section 354.6 of the California Code of Civil Procedure noted that "California has a moral and public policy interest in assuring that its residents and citizens are given a reasonable opportunity to claim their entitlement to compensation for forced or slave labor performed prior to and during the Second World War." California has the second largest population of Holocaust survivors, an influential Jewish community and an even more important Asian component, Chinese, Koreans, Vietnamese, and Filipinos, all areas occupied by the Japanese during the Second World War.

There are now at least a dozen court cases pending in California against Japanese corporations demanding compensation for Word War II forced labor and atrocities. The defendants read like a roster of Japanese industry. Japanese industry contends it cannot be held responsible for the wartime zaibatsus actions. Corporate defendants claim that even though they carry the same name as the zaibatsus, that in fact the conglomerates were broken up after Word War II by the American authorities. This argument ultimately proved to be an unsuccessful one for corporate defendants in the recently settled ten billion mark German slave labor litigation and will likely prove unhelpful for Japanese defendants too. The reason: there was simply too much unjust enrichment of corporate defendants during the war for a mere name change or reorganization to provide absolution.

There is however a thornier legal defense available to the defendants. Japan has already paid twenty seven billion dollars (7) in reparations mainly under the provisions of the 1951 San Francisco Peace treaty. (8) There have been bilateral agreement with other countries too although the United States, China, and Taiwan waived reparations. Nonetheless, this may not prove an insurmountable obstacle, German corporations had raised similar defenses but ultimately settled their cases and the wording of the 1951 San Francisco treaty is open to interpretation as to whether Japanese corporations come under the treaty provisions or if the treaty is strictly a state to state agreement. (9)

Potential claimants include former prisoners of war and civilian internees, American, Filipino, Australian, British, Dutch, New Zealander, French, Indian and Chinese. Forced labor and financial claims may well involve claimants from every country occupied by the Japanese: Micronesia, Papua-New Guinea, Burma, Malaysia, Indonesia, Korea, Taiwan, Philippines, Vietnam and China. Potential settlement amounts could be in the billions of dollars given the scope of matter. The zaibatsus had a reprehensible record of using slave labor and POW's in mines, factories, and building railroads under inhumane conditions. Shipping companies transported prisoners and comfort women in what has been alleged to be the largest slave shipping operation since the 19th century. Biological weapons were developed using live subjects, with the involvement of wartime industry.

While several lawsuits have been filed mainly in California and more are anticipated, in my estimation, one lawsuit above all typifies the phenomena. (10) The lawsuit press release reads: "On December 7, 1999 at the Superior Court House for Los Angeles County at precisely 10:55 am Dec. 7th (the exact time in LA that Japanese bombed Pearl Harbor 58 years ago" the complaint was filed. Defendants include Nippon Steel, Mitsubishi and Mitsui. Each corporation has a substantial presence in California and the United States and has antecedents as a Japanese zaibatsu that used slave labor. Significantly, Ed Fagan heads up the lawyers behind the lawsuit. The outspoken Fagan has become very successful, very quickly, in Holocaust related cases, his victories include settlements against Swiss and Austrian Banks, European insurance companies, German corporations, and an ongoing claim against the Austrian government that will likely be settled too. Holocaust cases in which he has participated have grossed approximately seven billion dollars.

Fagan's strategy is no secret. The lawsuit (complaint) is a carefully researched blend of legal issues and fact. The complaint includes plaintiffs statements of horrible atrocities: "Hell ships" in which prisoners were packed without food or water, torture by zaibatsu overseers with names like "Dr. Death, the Maggot, the Mad Mongrel, the Boy Bastard, the Boy Bastard's Cobber, the Tiger, Poxy Paws," and statistical death rates of forced labor on the Burma-Thai railroad combine for a desired effect. According to Fagan, the "goal of the suits is to bring so much public pressure on the Japanese that they will opt for a political settlement similar to one being brokered among European firms and the U.S. and German governments."(11)

Fagan's lawsuit and the other are based upon California Code of Civil Procedure § 354.6 and International Law. The defendants must prove § 354.6 to be unconstitutional if they hope to prevail, perhaps by arguing that California has usurped Federal powers by engaging in foreign policy. The sheer volume of claims and potential claims however may soon obscure the legal issues, over a million Filipino forced laborers worked mines and plantations owned by the zaibatsus, (12) victims of biological experiments, and comfort women will all demand their day in court. Even more damaging is a potential assault on the Japanese banking system by Fagan.

Copying a successful tactic from the Swiss bank case, Fagan has linked Japanese banks with the zaibatsus. Fagan alleges zaibatsus "looted and/or laundered personal and business assets during occupation - including forced use of "Japanese script"."

Fagan has made the following allegation in his complaint against Japanese banks:

"With regard to capital, assets and foreign currency, the defendant Japanese Banks participated in, profited from and became unjustly enriched by, among other things (a) the wrongful conversion of business and personal assets of persons and entities in the countries occupied by the advancing Japanese military, (b) the financing of, transaction fees charged for, and commissioned earned through the conversion of local currency to Japanese yen, in each and every country occupied by the Japanese from 1937 to 1945 and (c ) the financing, transaction fees, commissions and other monies earned by, with and/or related to the defendant Japanese companies that employed and/or used slave and/or forced labor of civilians and prisoners of war."

The money involved in such transactions would be staggering, the Japanese were known for their systematic looting of the greater East Asia Coprosperity Sphere, paying back even a fraction of the amount would be painful:

"The defendant Japanese companies and banks actively and/or passively allowed, participated in, profited from and/or became unjustly enriched by a series of systematic human rights violations, including but not limited to cannibalism, slaughter, torture, starvation, rape, forced prostitution, biological and chemical warfare and medical experimentation."

The Japanese corporations are now enmeshed with some of the worst atrocities of the last century, no matter which way they squirm or maneuver; they will become besmirched.

Given the interlocking nature of the keiretsu system and the vagaries of the post war break up of the zaibatsus, Japanese banks and corporations seem particularly vulnerable. And indeed if Fagan's allegation that each zaibatsu had its own wholly owned bank, Mitsui Bank etc., is true and the banks were not made to account for wartime profits nor disgorge them, but enjoy to this day ill gotten gains; the results. The impact of these lawsuits may well dwarf the German slave labor settlement.

Finally, on an emotional level can the Japanese afford to ignore allegations that they were worse than the Nazis? Fagan's claims of genocide, mass prostitution, atrocities, slave labor, human medical experiments, beheadings, torture, cannibalism and the like may have an effect far from California. It must be noted that North Korea has not abandoned wartime claims against Japan (13), forced labor lawsuits have been filed in the Philippines against Japanese corporations, and the Chinese feeling that Japan has not properly atoned for its past deeds may all combine to bring the necessary international pressure on Japan to settle regardless of legal issues.

The Japanese atrocities like their Nazi counterparts are well documented. Cold War politics and American leniency perhaps allowed the Japanese corporations and banks to escape fiscal responsibility. More to the point however, the American legal system has demonstrated it can successfully address human rights issues even fifty years after the fact. The Germans, Swiss, and Austrians have paid for their financial crimes with minimal political effect and only minor backlash (14), it is now time for Japanese corporations to come to terms with their past. California has provided the forum, the question will be whether the Japanese corporations choose to fight and face potentially damaging revelations about past conduct splashed across the headlines or will they seek a compromise as their European counterparts have done?


1 34 U. Rich. L. Rev. 1, p. 5

2 The largest settlements to date have been one and quarter billion dollars in the Swiss Banks litigation and approximately five billion dollars in the German Slave Labor cases.

3 34 U. Rich. L. Rev. 1, p. 46

4 This website is maintained by Ed Fagan, the flamboyant New York attorney who initiated and won the Swiss Bank case and has now targeted the Japanese.

5 Louis Henkin, Human Rights, Foundation Press, New York, 1999, p. 617.

6 34 U. Rich. L. Rev. 1, p. 6.

7 The bulk of this was from the liquidation of overseas assets of the Japanese.

8 Los Angeles Times, Japan's War Victims in New Battle, August 16, 1999.

9 Washington Post, Clamour for WWII era redress shifts to Japan, March 11, 2000.

10 See

11 Los Angeles Times, Japanese Firms sued over WWII, December 8, 1999.

12 CNN, Filipinos to sue Japanese companies for wartime slave labor, March 30, 2000

13 Far Eastern Economic Review, "One Step Forward..." December 16, 1999.

14 Some might claim that the recent success of Joerg Haider of the Austrian Freedom party is related but the allegation that former Austrian President Kurt Waldheim was a Nazi war criminal in Yugoslavia was at least equally alienating to the Austrians.

About the author

Jonathan Levy is a California attorney who has represented organizations and individuals in a variety of Holocaust related lawsuits including banking, insurance, and slave labor matters. He can be contacted at:

The Law Office of Thomas Dewey Easton and Jonathan H. Levy,
PO Box 6080, Cincinnati OH 45206, USA
Tel: (513) 528-0586