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FindLaw Forum: Did IBM aid the Holocaust? By Anthony J. Sebok FindLaw Columnist Special to CNN.com

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(FINDLAW) -- Five Holocaust survivors filed a lawsuit against IBM on February 9 alleging the U.S. parent of the giant business machine company assisted Nazi Germany "in the commission of crimes against humanity" before and during World War II.

The suit alleges that IBM sold, maintained and controlled the punch card machines that were used by the German government between 1933 and 1945. Therefore, the suit alleges, IBM "implemented, aided, assisted or consciously participated in the commission of crimes against humanity and violations of human rights."

The class action lawsuit was filed in U.S. District Court in Brooklyn, New York, by the law firm of Cohen, Milstein, Hausfeld & Toll on behalf of the five Holocaust survivors.

By abetting the Nazis, the complaint contends, IBM's actions were no different from those of various German businesses and businessmen who were prosecuted after the end of World War II for crimes against humanity.

The same day the suit was filed, IBM posted a notice on its electronic bulletin board warning of the imminent arrival of a new book, "IBM and the Holocaust," by Edwin Black. The book generated significant media coverage when it was published two days later.

It is very likely that Michael Hausfeld, one of the lead attorneys in the lawsuit, timed his filing to coincide with Black's book. It is not clear, however, to what extent Hausfeld and Black are cooperating: Hausfeld's complaint does not refer to Black's book, and Black said recently that he wishes the lawyers would "disappear."

This new episode in the ongoing effort to determine who was, and still is, responsible for the Holocaust reveals certain recurring themes.

Black's book and Hausfeld's suit represent two ways of trying to confront the moral and legal legacy of large-scale evil. But are the two approaches complementary, or in tension?

IBM's global reach

Black's book is worth reading even if, as some historians suggest, he is not a good historian. Black's great contribution is that he has tenaciously collected a lot of information and combined it in an original way. Few others have thought to place this information in the same context, to see what inferences can be drawn.

Black's history makes two chilling observations. The first is that the Holocaust was possible because the Nazis had access not only to guns and gas but also to cutting-edge census technology.

The second is that the Nazis had access to this technology because IBM, in its paranoid zeal, worked very hard to maintain its market dominance of the global market in data processing.

IBM did this even in Germany and other Axis nations, even during the Holocaust, and even if it meant working through dummy corporations and corporate shells in neutral nations such as Sweden and Switzerland.

It is hard to read the description in "IBM and the Holocaust" of Thomas Watson, IBM's iron-willed founder and president for more than 30 years, and not think about fellow monopolist Bill Gates. As is Gates, Watson was obsessed with preventing another company from entering the data processing market.

IBM's predecessor corporation had purchased the patent of the "Hollerith" machine -- a simple mechanical, punch card-driven tabulator.

Watson saw the machine's potential, and throughout the late 1920s and 1930s IBM helped governments and companies around the world develop new applications for it. IBM engineers worked with railway companies, manufacturers and mining firms from South America to Europe to devise new uses for data management.

Modern parallels

Watson especially coveted governments as customers. IBM helped the United States and most major European nations exploit the Hollerith system for their national censuses. As war grew more likely, IBM sold Hollerith machines to the war ministries of Yugoslavia, Rumania, Hungary, Poland, Sweden, Holland and France.

In February 1940, through its subsidiaries, IBM sold and maintained Holleriths to France to replace Holleriths destroyed by bombing runs designed by Holleriths in Germany.

All Watson demanded was that his customers be loyal to IBM: Nothing could be used in a Hollerith system that was obtained outside the IBM network. Even the punch cards had to be printed by an IBM-owned printer.

Black shows in detail how the German government worked with IBM's German subsidiary to use the Hollerith system to manage demographic information. Starting with the 1933 census in Prussia, Nazi data processors began to gather more and more information about who lived where.

The 1937 and 1939 censuses, designed with the assistance to IBM through its German subsidiary, could calculate the degree of Jewish heritage for any given citizen.

By 1942 the data processing was more macabre: IBM's German subsidiary (now cut off from New York by the war) was helping to maintain Hollerith machines that could record a concentration camp inmate's identity (Jewish, homosexual, etc.), his treatment in the camp, and, often inevitably, his method of death.

What the suit alleges

Hausfeld's suit asks for two things. First, it asks that IBM be enjoined from destroying documents related to its role in the Holocaust. Second, it asks that IBM disgorge any ill-gotten gains it acquired from its conduct.

The basis of the claim is that by abetting the Nazi government IBM may be sued under the Alien Tort Claims Act, which permits anyone (including but not limited to U.S. citizens) to sue a foreign entity in federal court claiming the commission of certain torts, or civil wrongs, that are governed by U.S. treaty or the law of nations.

For the Hausfeld suit, there is a statute of limitations problem. The complaint acknowledges this problem and answers it but in a very unsatisfying way.

It asserts that since the end of World War II IBM has actively concealed the information upon which the complaint is based.

Granted, concealment by the defendant can toll (effectively, extend) the statute of limitations. But I do not think the question raised by this suit should or will be decided on such a technicality.

The real question is, did IBM commit a crime against humanity, as the complaint claims?

What did IBM really do?

One of the most contentious issues related to this question is whether IBM in America ever "lost control" over its subsidiary in Germany.

Black suggests Watson at least fought to retain control and documents the extreme lengths to which Watson went to resist efforts by his German managers at the end of 1940 to "Aryanize" IBM's German subsidiary.

Watson was able to maintain legal ownership of the subsidiary. From a practical point of view, however, the German government enforced its control over the company. Nonetheless, the U.S. government began to suspect as late as 1943 that IBM was continuing to communicate with its German subsidiary.

Hausfeld's suit and Black's book leave one with the impression that the best case that can and should be made against IBM would not be based upon human rights offenses, but rather of treason.

It is clear that the Hollerith system was used by the entire Nazi war machine, ranging from coordinating troop transports to planning Luftwaffe raids and organizing slave labor.

One suspects that Watson knew very well what the war ministry of Germany was hoping to do with the systems that IBM energetically sold to Germany and the other Axis nations.

One is left with the impression that until the war broke out, IBM intended to continue to "arm" Germany as long as it could.

But did IBM "abet" the Holocaust? If so, at what point?

A moral, not a legal issue

The problem with Hausfeld's suit is that most of the successful Alien Tort Claim Act suits involve individuals who had the specific intent to commit an act proscribed by international law.

Even the German businessmen prosecuted after the war (on legal bases other than the tort claim act) were directly involved with the management of slave labor.

It will be very hard to prove that IBM, the American corporation, had that type of specific intent before 1940, and it will be even harder to prove that the American corporation exercised much control over Germany's IBM after that date.

Hausfeld's main point really seems to be that, regardless of its intent or control, IBM profited from its relationship with an extremely immoral and murderous state. But that is not illegal under the tort claims act, even if it is a failure of corporate character and individual morality.

Black's point, as I understand it, is that the lesson that we should take from the IBM story is moral, not legal.

IBM seems to have allowed itself, partly through individual decisions of its top management, to become a tool of evil. In this its actions are different in degree, but not in kind, from those of many international actors just before (and during) World War II.

One of the consequences of "litigating" the Holocaust is that actions are painted in very stark terms: A company's acts are either illegal or legal, which often translates into their being either intentionally evil or innocent.

This area of law is like that: It needs clearly defined states of mind in order to make sense of the past. But the truth is, some of the guilty parties involved in the Holocaust are not so easy to pigeonhole.

If Black's account is correct, then IBM seems to have developed a certain sort of blindness in its obsessive desire to maintain a monopoly on a new form of technology.

It is not clear that we have legislated, or ever could legislate, against this sort of blindness.

I would rather we think hard about how such blindness comes about, and recognize that it is a quality many of us may develop, not just certain "evil" actors.

Anthony J. Sebok is a professor of law at Brooklyn Law School. Anthony J. Sebok is also a FindLaw columnist.

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