Karstadt Appeal Denied. Court Affirms Rights of Nazi Victims to Claim Disputed Properties

Osen LLC - March 4, 2005




Berlin, Germany (March 4, 2005)-- A German court today upheld the Berlin Restitution Authority ruling that Nazi persecution was directed against the Wertheim family and rejected legal claims by German retail giant KarstadtQuelle AG that it was entitled to reconveyance of former Wertheim holdings in eastern Germany. Barbara Principe, a New Jersey woman whose grandfather was one of the founding members of the Wertheim company, sat in the courtroom as the decision was read by the chief judge.


“It’s a great day for the Wertheim family and I’m very grateful,” said Mrs. Principe, “but I know it won’t be over until Karstadt quits or the courts make them.”


Mrs. Principe’s lawyer, Gary M. Osen, was also on hand when the court decision was  announced. “The law was always quite clear,” he said, “but Karstadt has never been willing to  accept the fact that its position is untenable.”


KarstadtQuelle AG, Germany’s largest retailer, had appealed a 2002 decision of the Berlin Restitution Authority which had previously determined that the Jewish Claims Conference – as legal representative of the claims of the Wertheim family – was entitled to be recognized as the proper legal successor of the Wertheim company’s property in the former East Germany.


KarstadtQuelle appealed that decision claiming that it -- not the Jewish Claims Conference or  the Wertheim family -- stands in the shoes of the former Nazi victims. In 2001, The Wall Street Journal  described the Wertheim case as “one of the largest single-family Holocaust claims ever.” Following a key decision of the German High Court last December, the stakes are now higher than ever because the court ruled that the so-called Lenné-Dreieck, an 8 acre site  adjacent to the Sony Center at Potsdamer Platz, is in fact subject to Germany’s post-unification Restitution Laws.  In 2000, KarstadtQuelle sold more than 60% (5 acres) of that tract of land  which formerly belonged to the Wertheim family to a development consortium headed by Otto  Beisheim (Metro Group) which built office towers and two luxury hotels on the site. 


The German Court also denied KarstadtQuelle an appeal as of right. KarstadtQuelle must now petition the Court for permission to appeal, and should KarstadtQuelle file such a petition, a separate ruling will be made as to whether or not its appeal will be heard. The decision of the German High Court could void the 2000 sale to the Beisheim Group entirely if KarstadtQuelle’s appeal is rejected.


Efforts by the Jewish Claims Conference to settle the dispute have been summarily rejected by  the German retail giant which claims to be the legal successor of the former Nazi victims.


“The outcome,” said Gary M. Osen, “isn’t really in doubt after today – only the timing.”