March 30 (Bloomberg) -- KarstadtQuelle AG, the German retailer, paid 88
million euros ($117 million) to the heirs of the Wertheim family to settle
claims over Berlin property seized from the Jewish-owned business by the
Nazis 70 years ago.
The out-of-court agreement is one of the biggest-ever in a
Holocaust-related
restitution case, according to the Jewish Claims Conference. It settles a
legal battle that's dogged the Wertheims, once one of Germany's most
prominent retail families, since Adolf Hitler seized their property in
1937.
``It is a symbolic recognition of a painful chapter in the history of the
Jews of Nazi-era Germany,'' Gideon Taylor, executive vice president of the
Jewish Claims Conference, which has represented the Wertheims, said in a
statement. Karstadt Chief Executive Thomas Middelhoff said ``it was in our
interest to do justice to our responsibility in terms of history.''
The property, which includes the so-called Lenné Triangle on the edge of
Berlin's central Potsdamer Platz, ended up in Karstadt's hands through
decades of military occupation and business transactions. Karstadt bowed
to
pressure from court decisions stating that Wertheim claims superseded
those
of the retailer because the law compensates victims of the Third Reich.
``It shows they know how to behave with responsibility toward the past, as
the rest of German industry did,'' Matthias Druba, a lawyer who has
represented the Wertheim heirs, said in Berlin. Former Chancellor Helmut
Kohl initiated the talks between the two sides, which were ``hard, but
fair,'' Roman Haller, the European director of the JCC, said in an
interview.
Nazi Party Headquarters
Four years after the Nazi regime began ``Aryanizing'' Jewish property,
Hitler in 1937 forced the Wertheim property land into government hands.
His
Reich-chancellery and the Nazi Party headquarters were built on part of
the
land. After Hitler's defeat in World War II, most of it belonged to East
Berlin and was hence under Soviet occupation.
The Berlin Wall's collapse in 1989 and Germany's subsequent reunification
unleashed a wave of claims for real estate that was in East Germany. The
German government initially recognized KarstadtQuelle's claim as the legal
heir of Wertheim assets.
The case took a twist in 2000, when Karstadt sold the Lenné Triangle for
145
million euros to Otto Beisheim, the billionaire founder of retailer Metro
AG, who built the Ritz Carlton Hotel on the site. That became central to
the
Wertheim claim and prompted Karstadt to vow to continue litigation for
years.
In March 2005, a Berlin court rejected Karstadt's reparation claims in
favor
of the Wertheims, arguing that German law aims ``to compensate the fate of
the damaged person during the 1930s and not the fate of the company.''
Karstadt fought on.
Lenné Triangle
Barbara Principe, a New Jersey woman whose grandfather was a founding
member
of Wertheim, told re****ters last September that KarstadtQuelle company
managers ``just want to stall and delay,'' while Karstadt spokesman Joerg
Howe said at the time the JCC was seeking to ``raise public pressure with
emotions.''
In December, the company withdrew claims for four Berlin properties after
determining it wouldn't win the legal cases.
KarstadtQuelle still said that the Lenné Triangle property differed from
the
other Berlin land because it was transferred to West Berlin as part of a
land-swap deal in 1988.
Heirs of the Wertheims, who fled Germany in 1938, said the property never
belonged to Karstadt. They've maintained that the Wertheim assets were
sold
illegally in 1951 to retail chain Hertie, which in turn was purchased by
KarstadtQuelle in 1994.
Karstadt is the latest company to grapple with its connection to the Nazi
past.
Dresdner Bank AG released a re****t last year revealing the bank had
controlled a company that helped build Auschwitz and bankrolled Hitler's
SS.
Others companies that have commissioned studies include carmaker
Volkswagen
AG, chemical producer Degussa AG and clothier Hugo Boss AG.
Deutsche Bank AG, Germany's No. 1 bank, detailed its Nazi past in five
books
listed on the company's Web site.
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