The Hindu Business Line : Gypsies' lawsuit against IBM: Law versus morality

THE late June decision of a Swiss appeals court to allow five gypsies to proceed with a lawsuit against IBM in Switzerland relating to the company's role during the Nazi era when the company's technology and products allegedly helped facilitate the Holocaust represents a major development in the protection of human rights worldwide.

In specific, the gypsies have alleged that IBM facilitated the Holocaust by providing the Nazis with punch card machines and computer-related technologies which were deployed in tracking and killing gypsies.

The decision is of significance to activists in India in that it represents the first step towards taking human rights litigation beyond the US and the country's Alien Torts Claims Act (ATCA): It may be recalled that in Bano v. Union Carbide, the victims of the 1984 Bhopal gas disaster had instituted proceedings against the defendants under the ATCA — but a US District Court had dismissed the claims against Union Carbide on the ground that the company had met its obligations to clean up the contamination in and near the Bhopal plant. Subsequently, the Court of Appeal had affirmed lower court's dismissal of the suit under ATCA and had remanded proceedings in part relating to the claimants' common-law environmental claims.

The case in Switzerland against IBM too had been dismissed by a lower court on the grounds that it had no jurisdiction as the Swiss office of IBM was not the headquarters where decisions would have been taken — the lower court had deemed IBM's Geneva office an "antenna" and not its European headquarters — but the appeals court has held that jurisdiction is, in fact, proper. It has done so on the basis of the contention that "IBM's complicity through material or intellectual assistance to the criminal acts of the Nazis during World War II via its Geneva office cannot be ruled out" and that "a significant body of evidence indicates that the Geneva office could have been aware that it was assisting these acts."

All of a sudden, the ATCA is not the only game in town.

It is relevant to note here that in February 2001, an ATCA claim was filed in a US federal court against IBM, alleging that the company had provided punch card technology to the Nazis, thereby assisting them in carrying out the Holocaust, and that IBM had covered up the activities of its subsidiary at the time of World War II, Deutsche Hollerith Maschinen GmbH or Dehomag. (In 1945, Dehomag had become IBM Germany.) However, in April the same year, the class action was dropped because German companies had pressed for a release from further legal actions before contributing to the German Holocaust fund that had been set up to compensate those persecuted by the Nazis and the lawyers representing the petitioners had apprehended that the suit would result in delaying payments from the fund. The action ended with IBM's German division paying $3 million into the fund — without admitting liability.

This time around, the case against IBM has been filed by five plaintiffs, all of whom had family members die in the Holocaust: Swiss law does not allow the kind of massive class actions common in the US. The circumstances leading up to the case make for a fascinating reading. In December 2000, a body called the Gypsy International Recognition and Compensation Action Association (GIRCA) was established in Switzerland with the stated objective of seeking reparations for the Gypsy community members of which were killed by the thousands by the Nazis during the Second World War. The following year, an American author, Edwin Black, published his book, IBM and the Holocaust, which turned out to be a best-seller. In his book, Black had alleged that IBM punch-card machines helped the Nazis in rendering their mass killing operations more efficient. By way of illustration, Black had written that punch-card machines were used to record in code information about people sent to concentration camps.

In 2002, GIRCA, inspired by Black's book, had filed suit against IBM in Geneva's Court of First Instance against IBM. The organisation had selected Switzerland for its lawsuit because IBM's wartime European headquarters had been located in that country.

However, as Switzerland does not allow class actions, five gypsies — four from Germany and France and one Polish-born Swedish gypsy — were selected as plaintiffs. According to their lawyers, the gypsies, if they win, will be able to ask for over $12 billion in damages.

Experts are not willing to speculate on the outcome of the case as it lies in a grey area between law and morality in that the GIRCA plaintiffs are suing IBM for "moral reparation" and damages for "moral wrongdoing" which led to the death of gypsies.

They say that the outcome will depend to a large extent on the ruling on whether IBM was, in fact, responsible for the manner in which its products and technologies were deployed during the Holocaust. IBM has taken the position that they were not deployed.

The company argues that, by the time of the Holocaust, the Nazis had taken over Dehomag and that IBM had no control over Dehomag's operations in Germany and the subsequent use of IBM machines by the Nazis.

The GIRCA plaintiffs, however, maintain that IBM's Geneva office was coordinating European trade with the Nazis at the material time on the basis of orders from the company's global headquarters in New York.

For the moment, the Swiss court has found the accomplice claim to be actionable in that "It does not appear inconsistent to conclude that the respondent (IBM) facilitated the task of the Nazis in their committing of crimes against humanity — acts which were counted and codified by IBM machines."

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