DAVID W. OGDEN
Assistant Attorney General
ROBERT S. MUELLER, III
United States Attorney
DAVID J. ANDERSON
VINCENT M. GARVEY
MARTHA E. RUBIO
(California Bar No. 172492)
Attorneys, U.S. Department of Justice
Civil Division, Federal Programs Branch
Post Office Box 883
Washington, D.C. 20044
Attorneys for the United States
IN THE UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF CALIFORNIA
SAN FRANCISCO DIVISION
In re WORLD WAR II ERA JAPANESE )
FORCED LABOR LITIGATION ) Master MDL Docket No. 1347
THIS DOCUMENT RELATES TO: )
Heimbuch v. Ishihara Sangyo Kaisha Ltd., ) STATEMENT OF INTEREST OF
N.D. Cal. 3:00-0064 ) UNITED STATES OF AMERICA
Alfano v. Mitsubishi Corp., )
C.D. Cal. No. 2:00-3174 )
Corre v. Mitsui & Co., Ltd., ) Judge: Hon. Vaughn R. Walker
C.D. Cal. No. 2:00-999 ) Date: August 17, 2000
Eneriz v. Mitsui & Co., Ltd., ) Time: 10 a.m.
C.D. Cal. No. 2:00-1455 ) Ctrm: 9
Hutchison v. Mitsubishi Materials Corp., )
C.D. Cal. No: 2:00-2796 )
Poole v. Nippon Steel Corp., )
C.D. Cal. No 2:00-189 )
Price v. Mitsubishi Corp., )
C.D. Cal. No. 2:00-5484 )
Solis v. Nippon Steel Corp., )
C.D. Cal. No. 2:00-188 )
Tenney v. Mitsui & Co., Ltd., )
C.D. Cal. No. 2:99-11545 )
Wheeler v. Mitsui & Co., Ltd., )
C.D. Cal. No. 00-2057 )
Titherington v. Japan Energy Corp., )
C.D. Cal. No. 00-4383 )
The United States recognizes our country's great debt to all Americans who fought for the cause of freedom in the Second World War (“World War II”), and especially to those, such as plaintiffs in these actions, who endured horrific hardships as prisoners of war. There can be no dispute about the moral force behind plaintiffs' quest to redress the wrongs done to them. Despite our deep sympathy with and admiration for the plaintiffs, the United States is nonetheless compelled to file this Statement of Interest in order to explain that plaintiffs’ claims are barred by international obligations entered into by the United States at the close of World War II.1
At the conclusion of the Second World War, the United States condemned, in the strongest possible terms, the Japanese Government’s treatment of American prisoners of war (“POWs”). In the Treaty of Peace with Japan of September 8, 1951 ("Peace Treaty" or "Treaty"), the Japanese Government recognized its obligations to pay reparations for the damage and suffering caused by it during the war, and did so by providing reparations to an extent never before seen in modern times. Under the 1951 Treaty, Japan gave the United States and its Allies the right to seize and dispose of public and private Japanese assets located within their territories. In return, in Article 14 of the Treaty, the Allied nations expressly waived – on behalf of themselves and their nationals – claims arising out of actions taken by Japan and its nationals during the war.
In waiving all claims against Japan and its nationals, the Allied nations assumed the responsibility for using seized Japanese assets to provide compensation to their nationals in a manner each Allied government deemed fair and equitable. In the United States, the seized assets were placed into the War Claims Fund established pursuant to the War Claims Act, 28 U.S.C. §§ 2001-2017, and distributed through the War Claims Commission. This fund was intended to compensate former prisoners and others for claims arising out of World War II in accordance with priorities established by the Commission that placed the veterans of Bataan and others who suffered similarly at the top of the list. Thus, the War Claims Act created a monetary remedy for former prisoners of war that was funded with the proceeds of the assets that were seized from Japan and its nationals pursuant to the Peace Treaty.
The decision of the United States to join the 1951 Peace Treaty with Japan — together with 45 other nations — reflected a broad, bipartisan consensus within the Executive and Legislative Branches. The national decision to sign and ratify the Peace Treaty was based on a strong desire to ensure that Japan would develop into a democratic, economically viable ally that would not fall under Communist sway, as well as the hope of avoiding the disastrous consequences of the punitive reparations provisions of the Versailles Treaty that ended World War I. For this reason and in conjunction with the massive reparations paid by Japan and its nationals through the seizure of property by Allied nations, the Executive Branch and the Senate in its advise-and-consent role determined that all claims against Japan and its nationals should be waived.
Over the past five decades, the Treaty of Peace with Japan has served U.S. security interests in Asia and supported peace and stability in the region. The United States must honor its international agreements, including the Peace Treaty with Japan. There is, in our view, no basis for the U.S. or Allied citizens to reopen the question of international commitments and obligations under the 1951 Treaty. It is the United States’ position that the claims of the United States, its nationals and Allied nationals against Japan and its nationals arising out of their conduct during the war were finally settled by the Treaty of Peace with Japan in 1951. Moreover, the United States submits that the Treaty of Peace preempts plaintiffs’ state law causes of action.
For these reasons, and the reasons explained more fully below, plaintiffs claims should be dismissed.
I. THE 1951 TREATY OF PEACE WITH JAPAN
A. Treaty Provisions
Article 14(b) of the 1951 Peace Treaty states that, "[e]xcept as otherwise provided in the present Treaty, the Allied Powers waive all reparations claims of the Allied Powers, other claims of the Allied Powers and their nationals arising out of any actions taken by Japan and its nationals in the course of the prosecution of the war[.]" 3 U.S.T. 3169 (Exhibit 1). Likewise, under article 19(a) of the Treaty, Japan waived all claims of Japan and its nationals against the Allied Powers and their nationals arising out of the war and subsequent occupation, including, for example, claims against the United States, the manufacturers of the atomic and neutron bombs, and the individuals who ordered and performed the bombings of Japan.
B. The Negotiation of the 1951 Peace Treaty
The Treaty was sponsored by the United States as one "that will work," one "which looks to the future, not the past" in order to achieve the goal of restoring "normal relations between Japan and the rest of the world." U.S. Dept. of State, Record of Proceedings of the Conference for the Conclusion and Signature of the Treaty of Peace with Japan, at 33 (1951) (Statement of President Harry S. Truman) (hereafter "Record of Proceedings") (Exhibit 2). In providing for the resolution of all claims against Japan and its nationals arising out of World War II, the Treaty "recognizes the principle that Japan should make reparations to the countries which suffered from its aggression," without "saddl[ing] the Japanese people with a hopeless burden of reparations which would crush their economy in the years to come." Id. at 33-34. Ambassador John Foster Dulles, who was responsible for negotiating the Treaty on behalf of the United States, explained that the Treaty's compensation provisions reflected a resolution of various "conflicting considerations" in a manner "which gives moral satisfaction to the claims of justice and which gives material satisfaction to the maximum extent compatible with political and economic health in the Pacific area." Id. at 83 (Statement of John Foster Dulles).
The United States and Allied approach to reparations and other war-related claims evolved throughout the Occupation period, as conditions changed in Japan and the rest of the World, to reflect various foreign and public policy goals. In the early years of the U.S. Occupation of Japan, there understandably was a great deal of anger towards the Japanese for their war crimes, and a general belief that they should be forced to pay for the damages they caused. See John W. Dower, Embracing Defeat: Japan in the Wake of World War II, 89 (1999). These punitive sentiments eventually gave way to a recognition of the increasing importance, for several reasons, of reconstructing the Japanese economy. See Japanese Peace Treaty and Other Treaties Relating to Security in the Pacific, S. Exec. Rep. No. 82-2, at 2-3 (1952) (Exhibit 3).
First, as it became obvious that the Soviet Union was pursuing expansionist policies in the Far East, the Truman Administration came to the conclusion that Japan would be needed as a key ally, and that the U.S. could not allow Japan to fall into the Communist orbit. Id. It was believed that the Soviets held "a great threat over Japan" and "could, if they wanted to, tempt the Japanese by offering a coalition of Russia, Communist China, and Japan, which, if it should be formed, would . . . afford the Japanese opportunity to carry out their own militaristic aggressive ambitions[.]" Japanese Peace Treaty Negotiations, March 9, 1951, printed in Executive Sessions of the Senate Foreign Relations Committee (Historical Series) Vol. III, Part I, 82nd Cong., 1st Session, 1951, at 261 (1976) (hereafter "Japanese Peace Treaty Negotiations") (Exhibit 4).
Second, it became evident that Japan's economy had been completely devastated by the war, and that industry would need to be allowed to recover in order for Japan to become a viable democratic nation and a strong ally.22 The war had left nearly 9 million Japanese people homeless. See Dower, supra, at 47 48. Starvation, malnutrition and disease ravaged the general populace. "Between 1945 and 1948, over 650,000 people were reported to have contracted cholera, dysentery, paratyphoid, smallpox, epidemic typhus (spotted fever), scarlet fever, diphtheria, epidemic meningitis, polio, and encephalitis. Of this number, official records reported the deaths of 99,654 individuals." Id. at 103. Even without any “reparation burdens,” the United States was “gravely” concerned whether Japan could even “keep alive.” See Japanese Treaty Negotiations, at 267.
Third, the U.S. Government, having taken on sole responsibility for Japan's recovery during the Occupation, eventually realized that any substantial payment of war-related claims ultimately would come out of the American taxpayers' pockets. See Japanese Peace Treaty Negotiations, at 266-67. U.S. officials did not “see any way” in which reparations could “effectively be collected without in essence having the United States pay the bill, as [it] did during the first years of the German reparation under the Treaty of Versailles.” Id. at 266. Moreover, during the first five years of the Occupation, the U.S. Government spent approximately $2 billion just trying to maintain a viable economy in Japan and "prevent [the] spread of Communism." Telegram from the Secretary of State (Acheson) to the Embassy in the Philippines (drafted by Dulles), Washington, July 12, 1951, reprinted in Foreign Relations of the United States 1951, Vol. VI, Asia and the Pacific, at 1191 (1977) (Exhibit 7).
As a result, as early as 1947, the U.S. War Department already was proposing more lenient reparations for Japan than initially had been suggested by the State Department. General Douglas MacArthur, the Commander in Chief of the Armed Forces in the Far East, "proposed rather generous terms to help Japan's economic recovery" and "was against most reparations." Frederick S. Dunn, Peace-Making and the Settlement with Japan, 55 (1963). Others later concurred that there was “no demonstrable capacity on the part of Japan to pay any reparations at all.” Japanese Peace Treaty Negotiations, at 267.
In 1950, President Truman appointed John Foster Dulles as a special Foreign Policy Adviser to the Secretary of State, and assigned him the specific task of negotiating a multilateral peace treaty with Japan. Soon thereafter, Dulles prepared a widely-circulated memorandum proposing that the treaty contain no provision for the payment of war-related claims or economic restrictions of any kind. See Dunn, supra, at 100.33 Dulles fully recognized the possibility that Japan someday would be in a better economic position, and then might be able to afford to pay such claims to its countless victims. Nonetheless, in a statement he wrote for Secretary of State Acheson to deliver to the President of the Philippines in August 1951, he noted that "only vigorous effort and industry by the Japanese will enable them to earn enough foreign exchange to import what they need to live in decency." Memorandum by the Secretary of State (Acheson) to the President, Washington, August 7, 1951, reprinted in Foreign Relations of the United States 1951, Vol. VI, Asia and the Pacific, at 1245 (1977) (enclosing Draft Proposed Statement to the Philippine Government drafted by Dulles) (Exhibit 8). He further observed:
This would be impossible if the Treaty kept alive the right of the Allies to demand monetary reparation payments. That would so impair public and private credit as to make essential capital developments impossible and so contract Japanese ability to finance exports and imports as to endanger Japan's survival as a member of the free world. It would destroy Japanese initiative because the Japanese would know that the greater was their exertion the more would be taken from them.
It may be argued that no one can predict the future with certainty, and that events not now foreseen might give Japan a future ability to pay monetary reparation. That is true. But it is also true that if an economy is set up so that it must bear all unfavorable developments while deprived of the benefit of all favorable developments, there is lacking the balance needed to produce endeavor and to sustain credit, and disaster occurs which is not limited to the area dealt with.
All of these lessons were taught by the Treaty of Versailles. Under it reparations claims destroyed German credit and will to work. The claims were sought to be enforced by the most determined effort that history records. Certain Allied armies occupied the industrial heart of Germany, they arrested the German industrialists for allegedly sabotaging reparations, and they operated mines and factories for reparation account. But the Treaty and all the efforts to enforce it produced no appreciable reparations, but did create grave divisions as between the principal allies and set in motion inflationary forces, first in Germany, and then on a world-wide scale which many observers believe were largely responsible for the tragic economic collapse which began in 1929 and lasted until World War II.
To ensure that all war claims, brought either by individuals or by governments, would be settled by the Peace Treaty, the U.S. suggested the addition of the waiver provision that later became Article 14(b) of the Peace Treaty. The U.S. justified this suggested addition with the following comment:
The insertion of clause (d) is proposed for the reason that the treaty should settle and dispose of all claims of the Allied Powers and their nationals arising out of the war. If no waiver were provided, some Allied governments or Allied nationals might continue to press such claims against Japan after the coming into force of the treaty. Settlement of claims in the treaty assures that no Allied government or Allied national receives preferential treatment. The language of the waiver follows closely the language of Article 19 in which Japan waives claims against the Allied Powers.
Japanese Peace Treaty: Working Draft and Commentary Prepared in the Department of State, Washington, June 1, 1951, reprinted in Foreign Relations of the United States 1951, Vol. IV, Asia and the Pacific, at 1084 (1977) (Exhibit 9).
Ultimately, the Peace Treaty provided, among other things, for the end of the American Occupation, a return of Japan to the family of nations, and reparations by Japan (through the asset-seizure mechanism) for damages caused by wartime aggressions. Although unequivocally requiring Japan to compensate Allied nations for war losses, the Peace Treaty recognized that full payment for all damages was impossible if a "viable economy" were to be created in Japan, see Peace Treaty, Article 14(a); S. Exec. Rep. No. 82-2, at 12, and that it was “the duty and responsibility of each [Allied] government to provide such compensation for persons under its protection as that government deems fair and equitable.” Id. at 13.
C. The Senate Advice and Consent To The 1951 Treaty Of Peace With Japan
As early as March 1951, Ambassador Dulles informed the U.S. Senate Committee on Foreign Relations (the "Committee") in an Executive Session that Japan had "no demonstrable capacity . . . to pay any reparations at all,"and that he did not "see any way in which [reparation liabilities could] effectively be collected without in essence having the United States pay the bill." Japanese Peace Treaty Negotiations, at 266-67. He told the Committee that he had:
encouraged the Japanese to believe that we would not, on the one hand, have reparations burdens imposed on them, but on the other hand they could not count on any continuance of the United States subsidy . . . [W]e have been putting up sums which now amount to $2 billion in aid of Japan's economy during the 5 ½ years of the occupation. I have said that "With peace, that will have to stop and you will have to stand on your own two feet," and I made that perfectly clear that they could not count upon continuing economic help from the United States.
Id. at 267.
The Senate Committee on Foreign Relations unanimously recommended that the Senate give its advice and consent to ratification of the Treaty. See S. Exec. Rep. No. 82-2, at 4. The Foreign Relations Committee warned that requiring payment of war claims "in any proportion commensurate with the claims of the injured countries and their nationals" would be "contrary to the basic purposes and policy of the free nations, the Allied Powers, and the United States in particular" in the Far East. Id. at 12 (emphasis supplied). The Committee described article 14(a) as containing "the unequivocal provision that Japan should pay reparations to the Allied Powers for the damage and suffering it caused during the War," but recognized that, "[a]t the same time, article 14(b) states that, except as otherwise provided, the Allied Powers waive all reparations and claims against Japan." Id. (emphasis supplied).
The Committee informed the Senate that the Treaty's "provisions do not give a direct right of return to individual claimants except in the case of those having property in Japan." Id. at 13; see also Japanese Peace Treaty and Other Treaties Relating to Security in the Pacific: Hearings Before the Senate Comm. on Foreign Relations, 82nd Cong. 2nd Sess., at 144-45 (1952) (hereafter "Committee Hearings") (the Treaty's waiver provision "closes" and "locks" the gate on all avenues of recovery) (Exhibit 10). In recommending that the Senate give its advice and consent to ratification of the Treaty, the Committee emphasized Japan's willingness to "shoulder" reparations, and the unprecedented magnitude of reparations it had already paid. See S. Exec. Rep. No. 82-2, at 12, 14. It also noted that, “[b]ecause of the limited ability of Japan to pay its legitimate claims, our allies in the treaty waive their claims and those of their nationals in the same way we do.” Id. at 13 (emphasis supplied).
The Committee held exhaustive public hearings in January 1952 on the specific issue of reparations claims. The records of these hearings confirm that the Senate was well aware that all individual claims were being waived by Article 14(b), and that such claims would be dealt with exclusively through legislation. See Committee Hearings, at 144-45. During the hearings, various objections and questions were raised concerning compensation for individual claims. In particular, objections were made to the waiver of these claims. One legislator even attempted to limit the effect of Article 14(b) by proposing a reservation to the Treaty stating that "nothing contained in this Treaty shall be construed to abrogate the . . . just and proper claims of private citizens of the United States." See 98 Cong. Rec. 2365, 2567-71 (1952) (Exhibit 11). In a memorandum, Adrian S. Fisher, the Legal Adviser for the U.S. Department of State, informed Secretary of State Acheson that this reservation was "in direct conflict with Article 14(b)," and that, if this reservation were added to the Treaty during the ratification process, "a renegotiation of the Treaty Article would unquestionably ensue." Memorandum to The Secretary from Mr. Fisher (the Legal Adviser), dated March 19, 1952, at 4, 5 (Exhibit 12).
The State Department instead recommended that Congress adopt the War Claims Commission's suggestion that Congress amend the War Claims Act of 1948 "to provide for the receipt, adjudication and payment of claims . . . resulting from mistreatment, personal injury, disability, or impairment of health caused by the illegal actions of any enemy government during World War II." Committee Hearings, at 147. Congress eventually accepted this invitation, and amended the War Claims Act to "createa domestic mechanism for distributing captured Japanese assets," which entitled members of the putative class "to detention benefits for the period of imprisonment in Japan." Aldrich v. Mitsui & Co. (USA), Case No. 87-912-Civ-J-12, slip op. at 3 (M.D. Fla. Jan. 20, 1988) (citing 50 U.S.C.App. §§ 2004 & 2005 (1994)) (Exhibit 13).
The Senate gave its advice and consent to the Treaty on March 20, 1952, by a vote of 66 to 10, without adding a single reservation pertaining to war claims in its resolution of advice and consent. 98 Cong. Rec. 2594 (1952) (Exhibit 14). The Treaty was considered as part of a package with three additional security treaties relating to the Pacific region, reflecting the United States' view of the Treaty as an integral part of its political and foreign relations goals in that region. See, e.g., 98 Cong. Rec. 2327, 2361, 2450, 2462 (1952) (Exhibit 15). The Senate resolutions of its advice and consent for all of these treaties were adopted at the same time. See 98 Cong. Rec. at 2594.
D. Assets Seized Pursuant To The 1951 Peace Treaty
Under the Treaty, the government of Japan volunteered the use of property to provide reparations and compensation for "the damage and suffering" inflicted by Japan and its nationals "during the war." Treaty, Art. 14(a). Indeed, private Japanese nationals who had property or other assets located outside Japan paid a heavy price under the 1951 Peace Treaty to satisfy the requirements of this system. It is customary international practice for nations at war to freeze assets of enemy nationals and hold them in "trust," but it is also the custom to return such assets to their proper owners at the conclusion of hostilities. See James A. Gathings, International Law and American Treatment of Alien Enemy Property, v (1940) (Introduction written by Edwin Borchard).
Nonetheless, this seizure practice was legitimized in Article 14(a)(2) of the 1951 Peace Treaty.44 Pursuant to that Article, assets valued at approximately $ 4 billion located in Allied territory, were confiscated by Allied governments, and their proceeds distributed to Allied nationals in accordance with domestic legislation. See Comments on British Draft, Memorandum by the Officer in Charge of Economic Affairs in the Office of Northeast Asian Affairs (Hemmendinger) to the Deputy to the Consultant (Allison), April 24, 1951, reprinted in Foreign Relations of the United States 1951, Vol. VI, Asia and the Pacific, at 1016 (1977) (Exhibit 16). Pursuant to Article 16, approximately $ 20 million worth of Japanese assets located in ex-enemy and neutral countries were liquidated and the proceeds distributed to Allied POWs and civil internees through the International Red Cross. See Aide-Memoire from the Department of State to the British Embassy, reprinted in Foreign Relations of the United States 1951, Vol. VI, Asia and Pacific, at 924 (1977) (Exhibit 17). The total value of Japanese owned assets located in U.S. territory (including the Philippines) was estimated in 1952 to be worth over $90 million. See Japanese Peace Treaty Negotiations, Feb. 5, 1952, printed in Executive Sessions of the Senate Foreign Relations Committee (Historical Series), Vol. IV, 82nd Cong., 2nd Session, (1952), at 121-22 (1976) (Exhibit 18). Pursuant to the War Claims Act of 1948, these assets were seized by the Office of Alien Property (an office within the U.S. Department of Justice), liquidated, and the proceeds placed into a War Claims Fund, for ultimate distribution to prisoners of war and other claimants. As Ambassador Dulles explained:
The United States gets, under this treaty, the right to use Japanese assets in this country to satisfy whatever claims Congress feels should be satisfied. We have taken under that provision approximately $90 million of Japanese assets in this country. Approximately $ 20 million have been used to take care of claims which have been approved by the Congress on behalf of internees, civilian and prisoners of war, and it remains for Congress to decide what it wants to do with the balance.
Id. at 121 (emphasis supplied). Funds to pay reparations mostly were provided from the confiscation of assets of Japanese businesses, in accordance with United States and Allied policy.55
The Treaty specifies that the payment of reparations and other war-related claims under Articles 14 and 16 of the Treaty were to be a full and final settlement. Moreover, under Article 14(a)(2)(II)(c)(iv) of the Treaty, forfeiture of those assets which came into the jurisdiction of American courts as a consequence of the resumption of trade and financial relations following the war were excepted from forfeiture. “This provision strongly suggests an intention to leave Japan alone to rebuild its economy, a goal incompatible with plaintiff’s unjust enrichment claim, notwithstanding the present economic strength of Japan.” Aldrich, Case No. 87-912-Civ-J-12, slip op. at 3.