Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-ca7-13-03073/USCOURTS-ca7-13-03073-0/pdf.json

Nature of Suit Code: 890
Nature of Suit: Other Statutory Actions
Cause of Action: 

---

In the

United States Court of Appeals

For the Seventh Circuit ____________________

No. 13-3073

PAUL CHAIM SHLOMO FISCHER, et al.,

Plaintiffs-Appellants,

v.

MAGYAR ÁLLAMVASUTAK ZRT.,

Defendant-Appellee.

____________________

Appeal from the United States District Court for the

Northern District of Illinois, Eastern Division.

No. 1:10-cv-00868—Samuel Der-Yeghiayan, Judge.

____________________

No. 14-1319

MICHAEL J. ALBERT, et al.,

Plaintiffs-Appellants,

v.

MAGYAR NEMZETI BANK and ERSTE GROUP BANK,

Defendants-Appellees.

____________________

Appeal from the United States District Court for the

Northern District of Illinois, Eastern Division.

No. 1:10-cv-01884—Samuel Der-Yeghiayan, Judge.

____________________

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2 Nos. 13-3073 & 14-1319

ARGUED SEPTEMBER 30, 2014 — DECIDED JANUARY 23, 2015

____________________

Before KANNE, WILLIAMS, and HAMILTON, Circuit Judges.

HAMILTON, Circuit Judge. These appeals arise from suits 

brought by Holocaust survivors and the heirs of other Holocaust victims against the Hungarian national railway, the 

Hungarian national bank, and several private banks for the 

roles they or their predecessors played in carrying out genocide against Hungarian Jews during World War II. These 

claims for takings of property arise from events in Hungary 

70 years ago. They are asserted against both foreign sovereign entities and private banks with relatively few ties to the 

United States. The cases bring to the United States courts aspects of the horrific crimes of the Holocaust, but the cases 

have also posed difficult questions about whether they 

might be heard in a United States court.

In the earlier 2012 appeals in these cases, we held that the 

national railway and national bank—both instrumentalities 

of the Hungarian government—could be sued on these 

claims in a United States federal court, but only if the plaintiffs could demonstrate on remand that they had exhausted 

any avail-able Hungarian remedies or had a legally compelling reason for their failure to do so. Abelesz v. Magyar 

Nemzeti Bank, 692 F.3d 661 (7th Cir. 2012). In addition, while 

we mandated dismissal of claims against two private banks 

for lack of personal jurisdiction, Abelesz v. OTP Bank, 692 F.3d 

638 (7th Cir. 2012), we denied interlocutory requests by Erste 

Group Bank AG (“Erste Bank”), a private Austrian bank that 

had acquired a Hungarian bank that plaintiffs alleged had 

participated in the Holocaust, to review the denial of its moCase: 13-3073 Document: 62 Filed: 01/23/2015 Pages: 43
Nos. 13-3073 & 14-1319 3

tion to dismiss on several grounds. Abelesz v. Erste Group 

Bank AG, 695 F.3d 655 (7th Cir. 2012).

On remand, the national bank, national railway, and 

Erste Bank all continued to seek dismissal. As to the national 

bank and railway, the district court held that the plaintiffs 

had not exhausted Hungarian remedies and had not provided a legally compelling reason for not doing so. For that reason, the district court concluded that it could no longer entertain plaintiffs’ international law claims and dismissed the 

claims against the national defendants. 

Following that dismissal, the district court also dismissed 

Erste Bank from the suit on forum non conveniens grounds. 

Al-though the district court had previously denied Erste 

Bank’s motion to dismiss based on forum non conveniens, it 

took a fresh look at the issue once the national defendants 

were not subject to suit in the United States. The court concluded that dismissal on these grounds was appropriate. 

Plaintiffs have appealed.

We affirm all the dismissals. First, as we held in 2012, international law does not require exhaustion of domestic 

remedies before plaintiffs can say that international law was 

violated. But principles of international comity make clear 

that these plaintiffs must attempt to exhaust domestic remedies before foreign courts can provide remedies for those violations. These plaintiffs have not exhausted available Hungarian remedies, and the district court did not abuse its discretion when it found that plaintiffs should not be excused 

from doing so. In addition, because the national bank was 

properly dismissed from the case against the banks, the district court properly granted Erste Bank’s motion to reconsider dismissal for forum non conveniens. Nevertheless, while the 

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4 Nos. 13-3073 & 14-1319

doors of United States courts are closed to these claims for 

now, they are not locked forever. All dismissals are without 

prejudice. If plaintiffs find that future attempts to pursue 

remedies in Hungary are frustrated unreasonably or arbitrarily, a United States court could once again hear these 

claims. 

I. Factual and Procedural Background

A. Overview of Claims

We summarize briefly the more detailed account of the 

facts from our 2012 Abelesz opinions. Plaintiffs’ complaints 

describe the seizure, transport, and murder of hundreds of 

thousands of Hungarian Jews during the Holocaust, particularly during 1944 and 1945. The Foreign Sovereign Immunities Act bars jurisdiction in United States federal courts 

against foreign sovereigns for claims for death or personal 

injury or damage to or loss of property that does not occur in 

the United States. See Abelesz v. Magyar Nemzeti Bank, 692

F.3d at 677, citing 28 U.S.C. § 1605(a)(5). Nevertheless, the 

FSIA permits jurisdiction over foreign sovereigns for claims 

for takings of property in violation of international law. 28 

U.S.C. § 1605(a)(3). As a result, plaintiffs’ claims focus on the 

role that the Hungarian national railway and Hungarian 

banks played in expropriating money and other property 

from Jews. Plaintiffs allege that these expropriations were 

essential to finance the continued German war effort and

even the Hungarian genocide itself. See Abelesz, 692 F.3d at 

675.

Plaintiffs brought two separate suits: one against a group 

of Hungarian banks (along with an Austrian bank) and another against the Hungarian national railway. Against the 

Case: 13-3073 Document: 62 Filed: 01/23/2015 Pages: 43
Nos. 13-3073 & 14-1319 5

banks, plaintiffs allege seven causes of action: genocide, aiding and abetting genocide, bailment, conversion, unjust enrichment, constructive trust, and accounting. Plaintiffs allege 

nine causes of action against the national railway: takings in 

violation of international law, aiding and abetting genocide, 

complicity in genocide, violations of customary international 

law, unlawful conversion, unjust enrichment, fraudulent 

misrepresentations, accounting, and declaratory relief pursuant to 28 U.S.C. § 2201.

Plaintiffs seek to hold the national and private banks 

jointly and severally responsible for damages of approximately $75 billion. They seek damages of approximately 

$1.25 billion from the national railway. Plaintiffs rely on several bases of jurisdiction, including the Foreign Sovereign 

Immunities Act (FSIA), 28 U.S.C. § 1330(a), the Alien Tort 

Statute, 28 U.S.C. § 1350, diversity jurisdiction under the 

Class Action Fairness Act (CAFA), 28 U.S.C. § 1332(d), and 

federal question jurisdiction, 28 U.S.C. § 1331.

B. The Prior Appeals

In 2012 we considered several appeals and mandamus 

petitions seeking review of the district court’s denial of defendants’ motions to dismiss on multiple grounds. In Abelesz 

v. Magyar Nemzeti Bank, 692 F.3d 661 (7th Cir. 2012), we considered whether and under what circumstances the district 

court could exercise subject matter jurisdiction over the two 

instrumentalities of Hungary—the national bank and national railway. We held that the district court could exercise 

jurisdiction under the expropriation exception to the FSIA, 

but only if plaintiffs could demonstrate on remand that they 

either exhausted available Hungarian remedies or could 

show a legally compelling reason for not doing so. Id. at 684. 

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6 Nos. 13-3073 & 14-1319

Because exhaustion is also at the center of these appeals, we 

repeat our earlier conclusions.

The national bank and national railway of Hungary are 

instrumentalities of a foreign sovereign under the FSIA. See 

28 U.S.C. § 1603(b). Accordingly, the FSIA is the exclusive 

basis for exercising jurisdiction over those entities in United 

States courts. Argentine Republic v. Amerada Hess Shipping 

Corp., 488 U.S. 428, 434–36 (1989). Under the FSIA, foreign 

sovereigns and their instrumentalities are immune from suit 

in United States courts unless a specific statutory exception 

applies. 28 U.S.C. § 1604. 

Plaintiffs argued that two FSIA exceptions might allow 

jurisdiction over the national bank: the waiver exception in 

§ 1605(a)(1) and the expropriation exception in § 1605(a)(3). 

We rejected the waiver exception. While the Hungarian constitution recognized international law norms, it did not go so 

far as to waive sovereign immunity for those claims. Abelesz, 

692 F.3d at 670–71. 

The expropriation exception presented a closer and more 

complex question. We explained that the expropriation exception defeats sovereign immunity only where “(1) rights in 

property are in issue; (2) the property was taken; (3) the taking was in violation of international law; and (4) at least one 

of the two nexus requirements is satisfied.” Id. at 671, citing 

Zappia Middle East Constr. Co. v. Emirate of Abu Dhabi, 215 

F.3d 247, 251 (2d Cir. 2000). We held that “plaintiffs have sufficiently alleged that rights in property are at issue, that their 

property was taken, and that the national bank meets the 

nexus requirement.” Id. at 695. It was less clear that the national railway met either of the nexus requirements; accordCase: 13-3073 Document: 62 Filed: 01/23/2015 Pages: 43
Nos. 13-3073 & 14-1319 7

ingly, we remanded for jurisdictional discovery on whether 

the railway meets the nexus requirements. Id. 

That left the most important and complex problem: 

whether plaintiffs alleged expropriations that could have violated international law. Abelesz, 692 F.3d at 673. We rejected 

defendants’ federal preemption argument, id. at 677–78, and 

made clear that because plaintiffs based their claims upon 

violations of customary international law, they had actionable rights, id. at 685–86. At the same time, because “a sovereign could expropriate the property of its own nationals 

within its own territory without violating international law,” 

id. at 674, the national bank and railway argued that the alleged expropriations taking place during the Holocaust did 

not violate international law and would not be justiciable 

under the FSIA. We recognized that courts should tread 

carefully in this field of property expropriation: “Actions that 

might appear to one regime or nation as unfair expropriations might seem to another to be a just remedy for decades 

or more of exploitation of the poor and downtrodden.” Id. at 

675. Nevertheless, we held that the domestic takings rule did 

not apply where the expropriations funded the transport 

and murder of a country’s nationals in a campaign of genocide, which also sought to leave any survivors of that genocide impoverished. Id.

The national bank and railway defendants also argued 

that either the FSIA itself or international law norms required exhaustion of domestic remedies before plaintiffs 

could assert a violation in a United States court. Id. at 678. 

We rejected the statutory exhaustion argument, finding that 

nothing in the language of the FSIA expropriation exception 

suggests that plaintiffs must exhaust domestic remedies beCase: 13-3073 Document: 62 Filed: 01/23/2015 Pages: 43
8 Nos. 13-3073 & 14-1319

fore resorting to United States courts. Id., citing § 1605(a)(3). 

In so doing, we joined the Ninth and D.C. Circuits. See id., 

citing Cassirer v. Kingdom of Spain, 616 F.3d 1019, 1034–37 (9th 

Cir. 2010), and Agudas Chasidei Chabad of U.S. v. Russian Fed’n, 

528 F.3d 934, 948–49 (D.C. Cir. 2008). 

Even though § 1605(a)(3) itself does not require exhaustion, we went on to conclude that the provision’s reliance on 

international law norms made clear that plaintiffs would 

need to exhaust domestic remedies before they could assert 

a violation of customary international law in a United States 

court. This exhaustion principle, based on comity, is a wellestablished rule of customary international law. The Supreme Court has suggested that customary international law 

may require exhaustion. See Abelesz, 692 F.3d at 679, citing 

Sosa v. Alvarez-Machain, 542 U.S. 692, 733 n.21 (2004). This 

rule has also been invoked in other foreign and domestic situations, including by the United States government itself 

when defending against takings claims. Id. at 679–80 (collecting cases). At bottom, international law favors giving a state 

accused of taking property in violation of international law 

an opportunity to “redress it by its own means, within the 

framework of its own legal system” before the same alleged 

taking may be aired in foreign courts. Id. at 680.

For these reasons, we required plaintiffs “either to pursue

and exhaust domestic remedies in Hungary or to show convincingly that such remedies are clearly a sham or inadequate or that their application is unreasonably prolonged.” 

Id. at 681, citing Restatement (Third) of the Foreign Relations 

Law of the United States § 713 cmt. f. Keeping in mind that 

hearing these claims in a United States court “without even 

giving Hungarian courts an opportunity to address them” 

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Nos. 13-3073 & 14-1319 9

would be an “extraordinary step,” we addressed and found 

unpersuasive some reasons offered by plaintiffs that the 

domestic exhaustion rule should not bar their claims. Id. at 

684. And although we held that “plaintiffs [had] not presented a legally compelling reason for why the domestic exhaustion rule does not apply to their claims,” we found it prudent to remand the cases and to direct the district court to do 

“a more detailed examination of this pivotal exhaustion issue.” Id.

In particular, we directed the defendants to specify the 

Hungarian remedies that might be available to individuals 

in plaintiffs’ position. Id. We said that plaintiffs would then 

have three options on remand: 

(1) They can voluntarily dismiss their claims against 

the national bank and national railway without prejudice and pursue their claims in Hungary using the 

remedies identified by defendants, with a possibility 

that they might refile their case in a U.S. court if and 

when they exhaust their remedies in Hungary. (2) 

They can ask the district court to stay their cases 

against the national bank and national railway while 

they pursue the Hungarian remedies identified by defendants. (3) They can ask the district court for an opportunity to develop further their arguments regarding the actual adequacy and availability of those remedies and the applicability of the domestic exhaustion 

rule.

Id.

In the separate but related appeals by the private banks, 

we issued a writ of mandamus directing the district court to 

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10 Nos. 13-3073 & 14-1319

dismiss the claims against two banks for lack of personal jurisdiction. Abelesz v. OTP Bank, 692 F.3d 638. At the same 

time, we concluded that Erste Bank—a private Austrian 

bank over which personal jurisdiction was not disputed—

could not immediately appeal the district court’s denial of its 

motion to dismiss on other grounds and was not entitled to a 

writ of mandamus because it had not “demonstrated a clear 

and indisputable right to relief on par” with those of the 

other two banks. Abelesz v. Erste Group, 695 F.3d at 658. Thus, 

Erste Bank remained in the bank case. 

C. Remand

On remand, the national bank and railway summarized 

potential Hungarian remedies for individuals in plaintiffs’ 

position. Plaintiffs elected not to dismiss voluntarily or to 

ask for a stay while they pursued those remedies. They 

sought to show why exhaustion of Hungarian remedies 

should not be required at all, either because it is not legally 

required or because the political situation in Hungary, including rising levels of anti-Semitism, makes exhaustion futile. The district court determined that the plaintiffs had 

failed to demonstrate that they had exhausted available 

Hungarian remedies or that there was a legally compelling 

reason for their failure to do so. Abelesz v. Magyar Nemzeti 

Bank, No. 10 C 1884, Dkt. 353 (N.D. Ill. Aug. 20, 2013); Fischer 

v. Magyar Allamvasutak Zrt., No. 10 C 868, 2013 WL 4525408, 

at *1 (N.D. Ill. Aug. 20, 2013) (railway case). The district 

court found that plaintiffs had not convincingly shown “that 

the Hungarian courts are clearly a sham or inadequate, or 

that such court proceedings will be unreasonably prolonged.” Id. Accordingly, the district court dismissed the 

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Nos. 13-3073 & 14-1319 11

claims against the national bank and railway without prejudice. 

Erste Bank also sought dismissal on two separate 

grounds. First, following the dismissal of the national bank, 

Erste Bank sought reconsideration of the district court’s earlier decision to deny its motion to dismiss for forum non conveniens. Second, Erste Bank moved to dismiss for lack of subject matter jurisdiction in light of the Supreme Court’s decision in Kiobel v. Royal Dutch Petroleum Co., 133 S. Ct. 1659 

(2013). The district court opted to dismiss the case on forum 

non conveniens grounds without reaching subject matter jurisdiction. 

Plaintiffs appeal both dismissals, and we address each in 

turn. First, we affirm the district court’s dismissal of claims 

against the national bank and national railway because 

plaintiffs have not exhausted apparently available Hungarian remedies. Second, we affirm dismissal of Erste Bank for 

forum non conveniens. Like the district court, we do not reach 

subject matter jurisdiction regarding Erste Bank.

II. Foreign Sovereign Immunity and Domestic Remedies

Plaintiffs make two principal arguments that the district 

court erred by dismissing claims against the national bank 

and railway for failure to exhaust domestic remedies. First, 

they argue the district court should not have imposed an exhaustion requirement in the first place. Second, they argue 

that they offered sufficient reasons to excuse exhaustion in 

these cases.

A. Exhaustion Requirement for Expropriation Claims

Plaintiffs argue first, in essence, that the first appeals 

were wrongly decided in 2012. We rarely consider arguCase: 13-3073 Document: 62 Filed: 01/23/2015 Pages: 43
12 Nos. 13-3073 & 14-1319

ments seeking to re-litigate issues already decided in earlier 

appeals. The proper way to argue that this court erred 

would have been to file a petition for rehearing, either by the 

panel or en banc. See Morrison v. Duckworth, 898 F.2d 1298, 

1299 n.2 (7th Cir. 1990) (invoking law of the case doctrine). A 

party who is not satisfied with the outcome of the prior appeal should not try to reargue the point on remand to a district court that is required to follow our mandate, nor in a 

later appeal. At the same time, plaintiffs’ arguments here indicate that there may be some lingering ambiguity about the 

role that exhaustion of domestic remedies plays with respect 

to the expropriation exception to foreign sovereign immunity. We therefore address the issue and may perhaps clarify 

the earlier opinion. 

Plaintiffs argue that we should revisit the exhaustion 

analysis in Abelesz v. Magyar Nemzeti Bank because we did 

not consider that the expropriations alleged here were “discriminatory.” Plaintiffs rely on § 712(1) of the Restatement 

(Third) of the Foreign Relations Law of the United States, 

which says that a state is responsible under international law 

for injury resulting from a taking by the state of the property 

of a national of another state that (a) is not for a public purpose, or (b) is discriminatory, or (c) is not accompanied by 

provision for just compensation. Plaintiffs reason that § 712 

teaches that a “discriminatory” taking is always a violation 

of international law, whether or not a domestic remedy offers just compensation, so no exhaustion should be required. 

For non-discriminatory takings, by contrast, the violations 

arise only when the plaintiffs can demonstrate that the takings occurred without just compensation. Plaintiffs argue 

that they have alleged discriminatory takings that violated 

international law regardless of whether Hungarian law has 

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Nos. 13-3073 & 14-1319 13

offered any procedure to obtain compensation, so that they 

should not be required to exhaust domestic remedies in 

Hungary.

This argument misunderstands the relationship between 

finding a violation of international law and whether exhaustion is required. An exhaustion requirement could serve two 

distinct roles. On one hand, plaintiffs might be required to 

exhaust domestic remedies before they can even say that international law was violated. This might be the case, for example, when the violation is based on a taking without just 

compensation. There is no violation until the plaintiff has 

sought redress and has been unfairly denied just compensation. On the other hand, even if plaintiffs can allege a violation of international law, customary international law may 

impose an exhaustion requirement that limits plaintiffs’ ability to bring that claim outside the country against which 

they bring suit. To bring that claim in courts outside of the 

potentially offending nation—here, Hungary—plaintiffs 

would need to demonstrate that they exhausted remedies or 

that it could not be worthwhile to bring suit in that nation.

To be clear, our prior decision invoked the second form 

of exhaustion. The opinion in Abelesz v. Magyar Nemzeti Bank, 

692 F.3d 661, cited case law and other sources invoking both 

sorts of exhaustion, so we understand how someone might 

read the opinion as implying that international law would 

not be violated unless plaintiffs could show they exhausted 

domestic remedies. Understood correctly, however, the prior 

opinion imposed an exhaustion requirement that limits 

where plaintiffs may assert their international law claims. 

We did not hold that plaintiffs failed to allege violations of 

international law in the first instance. We made clear that the 

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14 Nos. 13-3073 & 14-1319

question was whether “international law require[s] plaintiffs 

to exhaust domestic remedies before pursuing expropriation 

claims elsewhere.” Abelesz, 692 F.3d at 679. We said yes, but 

we did not ask or answer the question whether plaintiffs 

needed to exhaust domestic remedies before they might say 

that international law was violated. Without answering that 

question, we found that plaintiffs had alleged violations of 

international law due to the genocidal nature of the expropriations. 

Plaintiffs also argue that a separate basis supported finding violations of international law: that the takings were 

“discriminatory” within the meaning of § 712. But this argument misunderstands both the nature of “discrimination” 

in international expropriation cases and the role of §§ 712 

and 713 of the Restatement in our analysis.

Section 712 applies, by its terms, only to a state’s takings 

of property of nationals of other states, not to its takings of 

property from its own nationals, as alleged in these cases. 

The discrimination that concerns § 712 is discrimination 

against aliens, not discrimination among a state’s own nationals based on race, religion, ethnicity, or similar grounds, 

however despicable such discrimination might be. Comment 

f explains that § 712 refers to discrimination against aliens 

generally, or against aliens of a particular nationality or particular aliens. 

There is no doubt that the genocidal expropriations alleged by plaintiffs would be considered discriminatory 

based on religion and/or ethnicity. But that is not the concern 

of § 712, which does not suggest that another nation’s discriminatory takings of property from its own nationals based 

on race, religion, or ethnicity violate international law and 

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Nos. 13-3073 & 14-1319 15

can be the subject of litigation in the United States or any 

other nation.

In our decision in 2012, we acknowledged the general 

“domestic takings” rule, under which international law does 

not address a nation’s taking of property from its own nationals. Abelesz, 692 F.3d at 674–75. We concluded, however, 

that genocide is so different and so universally condemned 

by international law that plaintiffs’ allegations of takings as 

an integral part of and a means of funding the genocidal 

campaign against Hungary’s Jews should not be subject to 

the domestic takings rule. Id. at 675–77. It was the strong 

links to genocide, not a broader concept of discrimination, 

that led us to find that plaintiffs had alleged takings in violation of international law. If we had not considered the genocidal nature of the takings, we could not have found that 

violations of international law had been alleged. We would 

have applied the domestic takings rule to find that the Hungarian government’s expropriations of property from its own 

nationals did not violate international law, consistent with 

the text of § 712(1) of the Restatement. 

Though we agreed then and now that violations were alleged, that does not mean that international law allows those 

claims to be heard in any court in the world. We found that 

the comity at the heart of international law required plaintiffs either to exhaust domestic remedies in Hungary or to 

show a powerful reason to excuse the requirement. So long 

as plaintiffs might get a fair shake in a domestic forum, international law expects plaintiffs at least to attempt to seek a 

remedy there first.

The text and structure of the Third Restatement of Foreign Relations Law confirm this understanding of the role 

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16 Nos. 13-3073 & 14-1319

exhaustion plays with respect to any takings claim under international law. No matter what type of taking is alleged 

under § 712—whether discriminatory or otherwise—§ 713 

explains that the same remedial scheme applies. And comment f of § 713 indicates that international law typically requires exhaustion of domestic remedies before any § 712 takings claim can be heard in a foreign court. In other words, 

comment f’s domestic exhaustion requirement applies equally to either type of taking specified in § 712, whether discriminatory or not. See Restatement (Third) of Foreign Relations Law § 713 and cmt. f.

The general requirement to exhaust domestic remedies as 

a matter of comity is not inconsistent with our comments in 

Flomo v. Firestone Nat’l Rubber Co., 643 F.3d 1013, 1025 (7th 

Cir. 2011), to the effect that no one could imagine requiring 

victims of genocide to have sued in Nazi Germany. The same 

point could have been made if these plaintiffs or their relatives had sought relief in 1945 in Hungary. There is of course 

no need to exhaust futile or imaginary domestic remedies. In 

these cases, though, plaintiffs filed suit in 2010, when the political and legal landscapes were entirely different. See 

Abelesz, 692 F.3d at 681–82. We cannot reject out of hand the 

principle of comity calling for exhaustion of domestic remedies.1

Plaintiffs contend that we have impermissibly implied an 

exhaustion requirement in the FSIA. After all, § 1605(a)(3) 

says nothing about a prudential exhaustion requirement 

1 United States law even today does not authorize suits against foreign sovereigns for personal injury and death inflicted in genocide that 

occurs outside the United States. See 28 U.S.C. § 1605(a)(5), cited in 

Abelesz, 692 F.3d at 677.

 

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Nos. 13-3073 & 14-1319 17

based on international comity concerns.2 As the Supreme 

Court recently held in Republic of Argentina v. NML Capital, 

Ltd., 134 S. Ct. 2250, 2256 (2014), “any sort of immunity defense made by a foreign sovereign in an American court 

must stand on the Act’s text. Or it must fall.” 

But here defendants need not rely on a special immunity 

defense found in the FSIA. Rather, they seek to invoke the 

customary rule itself: the well-established rule that exhaustion of domestic remedies is preferred in international law as 

a matter of comity. And there is no reason to think that this 

well-established rule is limited to foreign sovereigns. See Sosa, 

542 U.S. at 733 n.21 (indicating that “in an appropriate case” 

international law may require that “the claimant must have 

exhausted any remedies available in the domestic legal system”); Kiobel, 133 S. Ct. at 1674 (Breyer, J., concurring in the 

judgment) (highlighting the limiting principles, such as exhaustion and forum non conveniens, that “help to minimize 

international friction”). The Court in NML Capital was addressing when a foreign sovereign can override the normal 

rule of post-judgment execution discovery and receive special treatment solely because it is a foreign sovereign. See 

NML Capital, 134 S. Ct. at 2255 (“The single, narrow question 

before us is whether the Foreign Sovereign Immunities Act 

specifies a different rule when the judgment debtor is a foreign state.”). Because the FSIA’s text did not provide for special treatment, the foreign sovereign was subject to the normal rule of post-judgment execution discovery. Id. at 2258. 

2 Other circuit courts have declined to consider whether prudential 

exhaustion should apply to expropriation claims but have not foreclosed 

that possibility. See Cassirer, 616 F.3d at 1036–37; Agudas Chasidei Chabad, 

528 F.3d at 949.

 

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18 Nos. 13-3073 & 14-1319

When foreign sovereigns rely on the normal rule of international law, however, as in these cases, the FSIA’s silence on 

the issue does not prevent them from doing so. 

If the FSIA were read as preventing foreign nations from 

asking United States courts to apply a well-established international law principle—requiring exhaustion of domestic 

remedies—the result would be quite anomalous. It would 

become easier to sue foreign sovereigns than to sue private 

foreign entities in a United States court. The private entities 

could of course invoke the more general rule. Moreover, 

such a reading of the FSIA would call into question whether 

other settled practices such as forum non conveniens could still 

be invoked by foreign sovereigns.

B. Reasons for Failing to Exhaust

Thus, as we held in 2012, plaintiffs needed to show either 

that they exhausted any available Hungarian remedies or 

that there was a legally compelling reason to excuse such an 

effort. See Abelesz, 692 F.3d at 684. Plaintiffs have not argued 

that they have actually tried to exhaust available Hungarian 

remedies. They argue that circumstances in Hungary should 

excuse them from the domestic exhaustion rule. 

Before turning to the new arguments in these appeals, we 

note our earlier holdings that certain reasons would not establish that “Hungarian courts would be so obviously incapable of providing a fair and impartial hearing” that a United States court should step in. Abelesz, 692 F.3d at 684. Relying on guidance from the Restatement, plaintiffs made three 

main arguments attempting to demonstrate that the seemingly available remedies were in fact not available. Id. at 682–

83 & n.12, citing § 713 cmt. f. First, they argued that the naCase: 13-3073 Document: 62 Filed: 01/23/2015 Pages: 43
Nos. 13-3073 & 14-1319 19

tional defendants’ denial of the factual allegations of the 

complaint meant that Hungary denied responsibility. Second, plaintiffs argued that a 1993 Hungarian Constitutional 

Court decision finding a lack of compliance with Hungary’s 

obligations to pay reparations meant that the domestic remedies were inadequate. Finally, plaintiffs argued that any 

remedy would have been unreasonably prolonged given the 

delay between the events leading to the suit and the time 

when the Hungarian courts might redress the wrong. Id. at 

682–83. These arguments did not amount to “a persuasive 

showing that Hungarian law is unresponsive.” Abelesz, 692

F.3d at 684. 

Remand provided an opportunity for plaintiffs to show 

further reasons that exhaustion should not be required. As 

explained below, we agree with the district court that the 

Hungarian remedies identified by defendants provide a facially adequate mechanism for plaintiffs to seek redress. 

Plaintiffs have not established that procedural rules would 

arbitrarily or unreasonably bar their claims. Plaintiffs also 

have not shown that structural or political circumstances 

would prevent Hungarian courts from providing a fair and 

impartial hearing for these claims. To be sure, plaintiffs have 

offered explanations for their understandable doubts about 

the ability of Hungarian courts to treat them fairly. We believe, however, that in the face of uncertainty, international 

comity requires that those courts be given the first opportunity to hear the claims rather than have foreign courts assume the worst about them.

1. Existence of Hungarian Remedies

In the district court the defendants identified various 

Hungarian remedies that might be available (or have been 

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20 Nos. 13-3073 & 14-1319

available) to plaintiffs. See AA 163–73 (national railway); AA 

1170–87 (national bank).3 The national defendants pointed to 

the First, Second, and Third Compensation Acts, as well as 

the Jewish Heritage Public Foundation, as remedies that 

may have been available to plaintiffs. The district court held 

that such non-judicial remedies “were not truly available to 

Plaintiffs due to the time and circumstances surrounding the 

application for such remedies and certain limitations placed 

on recoveries under such remedies.” Fischer, 2013 WL 

4525408, at *1. Whether these compensation acts provide(d) 

an adequate remedy is no longer an issue on appeal.

The national defendants also identified judicial remedies 

that may be available in a civil action in Hungary. These 

primarily include property-based claims and contractual 

claims that plaintiffs could assert against the banks. Hungarian courts will also entertain international law claims. AA 

1179 & n.16 (national bank explaining that “Hungarian 

courts would be receptive” to international law based on its 

reading of the former and new Constitutions, Hungarian 

Constitutional Court decisions, and a Hungarian law expert’s opinion), citing AA 928 (Act XX of 1949 Constitution 

[Former Constitution], art. 7(1)), AA 772 (Translation of The 

Fundamental Law [New Constitution] Apr. 25, 2011, art. Q), 

AA 892–901 (Constitutional Court Decision No. 53/1993), 

and AA 985–86 (Dr. Sonnevend Declaration ¶¶ 43–45). Plaintiffs have not shown that the remedies identified by defendants are illusory. For this reason, the district court concluded 

3 The parties have provided record documents in various appendices 

to which we refer throughout the opinion. Citations are to the Short Appendix (SA), Appellees’ Appendix (AA), and Erste Bank Group Appendix (EA).

 

Case: 13-3073 Document: 62 Filed: 01/23/2015 Pages: 43
Nos. 13-3073 & 14-1319 21

that defendants had “shown that Plaintiffs can bring a civil 

action in the Hungarian courts to seek a remedy for the

wrongs” alleged in their complaints. Fischer, 2013 WL 

4525408, at *1. 

We agree that these judicial remedies are sufficiently 

promising that plaintiffs should be required to bring suit in 

Hungary before their suits may proceed in the United States. 

Given the sort of international law and property claims 

available in Hungary, the claims are congruent enough to 

those that plaintiffs assert here that requiring plaintiffs to 

sue first in Hungary will not deprive plaintiffs of the remedy 

they seek. As we explained in the first appeal, remedies 

available in Hungary “need not be perfectly congruent with 

those available in the United States to be deemed adequate.” 

See Abelesz, 692 F.3d at 685. 

2. Potential Procedural Difficulties

Plaintiffs suggest that several procedural obstacles might 

still deny them access to the remedies defendants identified. 

In the related context of forum non conveniens, the Supreme 

Court has made clear that an “unfavorable change in law 

may be given substantial weight” only when “the remedy 

provided by the alternative forum is so clearly inadequate or 

unsatisfactory that it is no remedy at all.” See Piper Aircraft 

Co. v. Reyno, 454 U.S. 235, 254 (1981). “[T]he relief need not 

be as comprehensive or as favorable as a plaintiff might obtain in an American court.” Chang v. Baxter Healthcare Corp., 

599 F.3d 728, 736 (7th Cir. 2010). None of the asserted procedural obstacles deny relief to the extent that plaintiffs can 

claim that Hungary provides no remedy at all. 

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22 Nos. 13-3073 & 14-1319

First, plaintiffs argue that the lack of a class action device 

in Hungary ensures that these claims will never be brought. 

But the absence of a class action device does not mean as a 

matter of law that a nation’s courts fail to offer effective remedies. See Aguinda v. Texaco, Inc., 303 F.3d 470, 478 (2d Cir. 

2002) (finding adequate a forum that lacked a class action 

device but allowed unlimited joinder of parties with similar 

claims arising out of the same facts); In re Union Carbide Corp. 

Gas Plant Disaster at Bhopal, India, 809 F.2d 195, 199, 202 (2d 

Cir. 1987) (finding adequate a forum that allowed representative suits in place of class actions). Until recently, rules 

allowing for group litigation were rare outside of the United 

States. Deborah R. Hensler, The Future of Mass Litigation: 

Global Class Actions and Third-Party Litigation Funding, 79 

Geo. Wash. L. Rev. 306, 306 (2011). Even though many nations have joined the United States in adopting group litigation procedural devices, American-style class actions remain 

uncommon. Id. at 307–08. A nation need not allow the relatively uncommon American-style class action to be considered an adequate forum. See Aguinda, 303 F.3d at 478; see also Howe v. Goldcorp Investments, Ltd., 946 F.2d 944, 952 (1st 

Cir. 1991) (Breyer, C.J.).

While Hungary does not have an identical class action 

device, it permits plaintiffs to use a joinder-like mechanism 

to enforce jointly claims arising out of the same legal relationship or where the claims are based on similar legal and 

factual grounds. AA172 (national railway identifying in its 

submission on remedies a joinder mechanism), citing section 

51 of Act III of 1952 on the Civil Procedure Code. While the 

lack of an identical class action device may well impose additional burdens on plaintiffs, the equivalent mechanism in 

Hungary does not appear to be so burdensome as to deprive 

Case: 13-3073 Document: 62 Filed: 01/23/2015 Pages: 43
Nos. 13-3073 & 14-1319 23

plaintiffs of an effective remedy. See Aguinda, 303 F.3d at 478 

(“While the need for thousands of individual plaintiffs to authorize the action in their names is more burdensome than 

having them represented by a representative in a class action, it is not so burdensome as to deprive the plaintiffs of an 

effective alternative forum.”). 

Second, to the extent that plaintiffs worry that their 

claims may be time-barred, Hungary appears to have formally extended the statute of limitations for Holocaustrelated claims. See AA1177 (national bank explaining in its 

submission on remedies that Hungary had formally extended “the statute of limitations regarding Holocaust-era 

claims”), citing Decree No. 11 of 1960, art. 85(3); Abelesz, 692

F.3d at 682 n.11 (“Plaintiffs have advised [the Court] that 

Hungary has amended its constitution to declare that there 

are no statutes of limitations on crimes visited upon the 

Hungarian people during World War II.”). Moreover, counsel for the national defendants told us at oral argument that 

if plaintiffs bring these claims in Hungary, the national defendants would not assert any statute of limitations defenses. The parties have not presented nor could we find any 

reason to think that Hungarian courts would not enforce 

such a waiver. With this waiver, we need not consider the 

effect such defenses might have on the adequacy of Hungarian remedies. Cf. Chang, 599 F.3d at 736 (noting that an alternative forum might be inadequate if the plaintiff’s suit 

would be time-barred unless defendant agrees to waive the 

statute of limitations and the waiver would be enforced in 

the alternative forum). 

Finally, plaintiffs argue that changes in the Hungarian 

constitution might subject them to a risk of prosecution if 

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24 Nos. 13-3073 & 14-1319

they brought these Holocaust-era claims in Hungary. On the 

record before us, this fear of prosecution is too speculative to 

show that the Hungarian courts could not hear these claims 

fairly. Hungarian courts have ruled that good-faith arguments put forward during civil litigation cannot be used as a 

basis for civil and criminal defamation charges. See AA 497–

516 (collecting translations of case law explaining when litigants might be liable for statements made during litigation). 

The cases provided by the litigants indicate that liability 

might attach for statements made during litigation only if 

they are unreasonably offensive or false. 

3. Structural Issues Concerning Hungarian Courts

Plaintiffs also raise structural issues on the adequacy of 

Hungarian courts. They argue that even if remedies might be 

available to them in theory, limits on judicial independence 

would prevent those remedies from being effective. See generally Sarei v. Rio Tinto, PLC, 550 F.3d 822, 832 (9th Cir. 2008) 

(en banc) (explaining that a “remedy must be available, effective, and not futile” and that “a court must look at the circumstances surrounding the access to a remedy” to measure 

effectiveness). For example, in Flomo v. Firestone Natural Rubber Co., 643 F.3d 1013, 1025 (7th Cir. 2011), we said it would 

“border on the ridiculous” to require litigants “to file suit in 

a court in Nazi Germany complaining about genocide” before being allowed to bring suit in the United States. But we 

also made clear that as a “matter of international comity” we 

might also “give the courts of the nation in which the violation had occurred a chance to remedy it, provided that the 

nation seemed willing and able to do that.” Id. The courts of 

Nazi Germany—or those of the regime in Hungary at that 

time—would have been unable to handle genocide claims 

Case: 13-3073 Document: 62 Filed: 01/23/2015 Pages: 43
Nos. 13-3073 & 14-1319 25

fairly. But we should not presume that the modern regimes 

replacing them many decades later are unwilling or unable 

to remedy the wrongs asserted by plaintiffs, absent specific 

evidence to that effect. 

Accordingly, plaintiffs offer two theories why Hungary is 

not willing and able to provide otherwise available remedies. First, they argue that the Hungarian government—and 

in particular, the judicial system—has been restructured so 

that claims like these would not receive a fair hearing in 

Hungary. Second, they contend that rising anti-Semitic attitudes in Hungary suggest that they would not receive a fair 

and impartial hearing and that their safety would be jeopardized if they sued there.

In the years leading up to 2012, all parties agree, plaintiffs could have trusted Hungary to handle these claims fairly. Plaintiffs’ own expert witness on Hungarian law agreed 

with the defendants’ expert that prior to 2012, “Hungary 

[was] a well-established European state, with a well functioning legal system that operates under established and 

cognizable rules of law.” AA 219–20 (plaintiffs’ expert agreeing with this characterization before questioning whether 

the situation had changed and whether that system would 

allow for effective remedies for Holocaust victims), quoting 

Declaration of Dr. Sonnevend. In the 2012 appeals, the record supported our conclusion that Hungary had “a functional and independent judiciary” with an “apparent ability 

to provide an adequate remedy to plaintiffs.” Abelesz, 692

F.3d at 683. While we were sympathetic to plaintiffs’ concerns about anti-Semitism, there was not sufficient evidence 

to conclude that “Hungarian courts would be so obviously 

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26 Nos. 13-3073 & 14-1319

incapable of providing a fair and impartial hearing” that 

United States courts should step in. Id. at 684. 

For this reason, plaintiffs focus on how the situation has 

changed since 2012. Plaintiffs first point to new language in 

the 2011 New Constitution’s preamble as evidence that 

Hungary implicitly disavows responsibility for the Holocaust. The preamble dates Hungary’s “restoration of our 

country’s self-determination, lost on the nineteenth day of 

March 1944, from the second day of May 1990.” That date is 

considered “the beginning of [Hungary’s] new democracy 

and constitutional order.” AA 767 (translation of New Constitution, Apr. 25, 2011). Though this was brought to our attention during the prior appeal, plaintiffs present additional 

opinion evidence that this provision should be read as the 

Hungarian government’s denial of responsibility for the 

Hungarian Holocaust. At the same time, others have read 

the provision as serving different ends, including a desire to 

emphasize the nation’s constitutional heritage. See, e.g., AA 

467–68 (European Centre for Law and Justice Memorandum 

on the Hungarian New Constitution). Either way, absent a 

clear interpretation of that provision, the language of the 

preamble falls well short of the firm denial required by the 

Restatement to excuse the need for exhaustion. § 713 cmt. f 

(excusing domestic exhaustion for expropriation claim when 

the “state firmly denies responsibility”). 

Plaintiffs also stress that a combination of laws passed by 

the government and the Fourth Amendment to the New 

Constitution enabled the Hungarian government to undermine the judiciary’s independence. The government lowered 

the retirement age for judges from 70 to 62, added six judges 

to the Constitutional Court, created a National Judicial OfCase: 13-3073 Document: 62 Filed: 01/23/2015 Pages: 43
Nos. 13-3073 & 14-1319 27

fice with power to control dockets, and eliminated the precedential value of twenty years of Constitutional Court decisions. 

In response, defendants explain that the most controversial measures are either not to be worried about or no longer 

in place. The later Fifth Amendment eliminated the National 

Judicial Office’s power to assign cases. AA 1431, 1438 (declaration of defendants’ expert). The European Court of Justice 

rejected the proposed change in retirement age, and the government allowed any forcibly retired judges to return to 

their jobs. AA1437–38. Finally, defendants clarify that the 

provision rendering prior decisions of the Constitutional 

Court no longer binding was not meant to undermine the 

legal effects of those decisions. Rather, defendants argue that 

it was designed to clarify that, going forward, the Constitutional Court should endeavor to interpret the new Constitution. AA 1430. 

Though one might worry that the speed with which 

change has been made to the judiciary signifies a lack of respect for the rule of law, we are also encouraged by the 

Hungarian government’s willingness to revisit these provisions. By doing so, the government has responded to international criticisms and shown some effort to respect international norms and values, including an independent judiciary. 

Again, we believe we understand plaintiffs’ concerns, but we 

believe they are too speculative to override the norm of requiring exhaustion of domestic remedies before resorting to 

foreign courts.

In addition to these concerns about the independence of 

the Hungarian courts, plaintiffs argue that growing antiSemitic attitudes coupled with attempts to minimize HungaCase: 13-3073 Document: 62 Filed: 01/23/2015 Pages: 43
28 Nos. 13-3073 & 14-1319

ry’s role in the Holocaust make Hungary unable or unwilling 

to hear Holocaust-era claims. They also argue that their safety could be jeopardized if they visited Hungary to testify in 

court. 

More specifically, plaintiffs point to troubling evidence 

that anti-Semitism is on the rise in Hungary and that Hungary may be among the worst in Europe today on that score. 

AA 240 (declaration of Dr. Halmai pointing to survey evidence), citing Anti-Defamation League, Attitudes Toward Jews 

in Ten European Countries, March 2012. The plaintiffs’ expert 

expressed concern that some factions would take political 

advantage of these sentiments and push the governing party 

to do the same. AA 237–39 (declaration of Dr. Halmai), citing 

The Trajectory of Democracy—Why Hungary Matters: Hearing 

Before the Commission on Security & Cooperation in Europe

(2013) (written and oral statements of Paul A. Shapiro, Director, Center for Advanced Holocaust Studies). Along these 

lines, plaintiffs highlight testimony explaining that the Hungarian government has attempted to minimize Hungary’s 

role in the Holocaust and to rehabilitate the reputations of 

historical and cultural figures known to have been antiSemitic or perpetrators of the Holocaust. Id. These events 

have led some Hungarian Jews to question whether there 

might now be good reason to leave Hungary. AA 1213–15 

(Lisa Abend, Ancient Fear Rises Anew, Time Magazine, Apr. 1, 

2013). 

At the same time, plaintiffs’ own expert testified clearly

that the “current governing parties in Hungary are certainly 

not anti-Semitic.” AA 222 (Dr. Halmai declaration). The 

Prime Minister of Hungary has expressed a zero-tolerance 

policy with respect to anti-Semitism. AA 327–28 (Prime MinCase: 13-3073 Document: 62 Filed: 01/23/2015 Pages: 43
Nos. 13-3073 & 14-1319 29

ister: Anti-Semitism is Unacceptable and Intolerable, Prime Minister’s Office—News (May 6, 2013)); AA 330–31 (Speech by 

Prime Minister Viktor Orbán at the 14th Plenary Assembly of the 

World Jewish Congress, Prime Minister’s Office—Speeches 

(May 6, 2013)). Unlike the United States, Hungary has made 

public denial of the Holocaust a criminal offense. AA 492 

(translation of section 269/C of Act IV of 1978 on the Criminal Code). And while there are some political groups who 

do not adhere to that positive vision of how Jews should be 

treated, the same might be said of other countries throughout Europe and the world. As plaintiffs acknowledge, antiSemitism unfortunately has been on the rise throughout Europe and is also present in the United States. But absent governmental policies or other evidence that such discrimination is barring access to or punishing resort to domestic remedies, United States courts should not take the step of hearing these claims without first giving the Hungarian courts a 

chance to rule on them. To hold otherwise would imply that 

United States courts should presume that the courts of other 

nations cannot fairly hear claims brought by historically persecuted groups. 

Altogether, the evidence in the record supports understandable concerns about whether plaintiffs can receive a fair 

hearing in Hungary. But those concerns remain too speculative to justify taking this case from Hungarian courts. One 

could easily imagine that Thurgood Marshall and the 

NAACP Legal Defense and Educational Fund had similar 

concerns about many United States courts’ ability to hear 

claims by African Americans in 1950 and later. Yet our courts 

by and large rose to the challenge in the following decades. 

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30 Nos. 13-3073 & 14-1319

We are not persuaded that “Hungarian courts would be 

so obviously incapable of providing a fair and impartial 

hearing” that United States courts should intervene. Abelesz, 

692 F.3d at 684; cf. Stroitelstvo Bulgaria Ltd. v. BulgarianAmerican Enterprise Fund, 589 F.3d 417, 421 (7th Cir. 2009) 

(finding anecdotal complaints insufficient to allow a federal 

court to declare a foreign legal system inadequate). The record identifies developments that signal that the Hungarian 

government or people might do troubling things if confronted with these claims. As far as we can tell from the record 

here, though, plaintiffs have not offered examples where 

other people have attempted to bring Holocaust claims only 

to have the Hungarian courts close their doors to them or 

otherwise treat them unfairly. For this reason, we agree with 

the district court that plaintiffs “offer mere speculation and 

unsupported fears that they may not be treated fairly in the 

Hungarian court system.” Fischer, 2013 WL 4525408, at *1. 

In fact, other evidence in the record indicates that plaintiffs’ fears are unlikely to be realized if they file suit in Hungary. The Hungarian government and courts appear to have 

ably handled discussion of the Holocaust as well as Holocaust-era litigation. Defendants have cited cases where Holocaust victims sued in Hungary for the return of works of art 

and antique furniture taken during the Holocaust. AA 290–

92 (return of stolen artwork); AA 337–38 (return of paintings). In these cases, plaintiffs successfully sued instrumentalities of the government and won return of their property. 

More recently, the Hungarian government itself has established a program to return artwork that the state owns but 

may have obtained through unclear circumstances or 

wrongdoing. AA 342–43 (new office designed to review 

goods entrusted to the state). On top of these examples, deCase: 13-3073 Document: 62 Filed: 01/23/2015 Pages: 43
Nos. 13-3073 & 14-1319 31

fendants show that the Hungarian government recently 

complied with a request by an attorney in the United States 

to depose a Hungarian war criminal. See Charles S. Fax, “A 

Tale of Discovery under the Hague Convention,” American 

Bar Association: Litigation News, Fall 2013. While these examples do not guarantee, of course, that plaintiffs’ claims 

will be treated fairly, they tend to indicate that such claims 

can be heard fairly. 

In sum, the district court did not err in finding that plaintiffs had not presented a legally compelling reason for their 

failure to exhaust remedies in Hungary. We emphasize, 

however, that the district court’s dismissal of claims against 

the national railway and bank was properly without prejudice. If plaintiffs attempt to bring suit in Hungary and are 

blocked arbitrarily or unreasonably, United States courts 

could once again be open to these claims against the national 

railway and bank. 

III. Forum Non Conveniens 

We now turn to the district court’s dismissal of the claims 

against Erste Bank based on the doctrine of forum non conveniens. When the district court dismissed for forum non conveniens, Erste Bank had also moved to dismiss for lack of subject 

matter jurisdiction in light of the Supreme Court’s decision 

in Kiobel v. Royal Dutch Petroleum Co., 133 S. Ct. 1659 (2013). A 

district court may grant a motion to dismiss for forum non 

conveniens before it first determines its own subject matter 

jurisdiction over an action. Sinochem Int’l Co. v. Malaysia Int’l 

Shipping Corp., 549 U.S. 422, 429 (2007). We affirm on forum 

non conveniens, so we do not decide whether the district 

court could exercise subject matter jurisdiction over the 

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32 Nos. 13-3073 & 14-1319

claims against Erste Bank under the Alien Tort Statute or any 

other jurisdictional statute.4

A district court may dismiss a case on forum non conveniens grounds when it determines that there are “strong reasons for believing it should be litigated in the courts of another, normally a foreign, jurisdiction.” Abad v. Bayer Corp., 

563 F.3d 663, 665 (7th Cir. 2009), citing Sinochem, 549 U.S. at 

429–30, and In re Factor VIII or IX Concentrate Blood Products 

Litigation, 484 F.3d 951, 954–56 (7th Cir. 2007). While many 

considerations are part of this inquiry, the focus is “the convenience to the parties and the practical difficulties that can 

attend the adjudication of a dispute in a certain locality.” Sinochem, 549 U.S. at 429 (internal quotation marks and citation omitted); see also Kamel v. Hill-Rom Co., 108 F.3d 799, 802 

(7th Cir. 1997) (forum non conveniens dismissal appropriate 

when dismissal “best serves the convenience of the parties 

and the ends of justice”), citing Gulf Oil Corp. v. Gilbert, 330 

U.S. 501, 507 (1947), and Koster v. Lumbermens Mutual Casualty Co., 330 U.S. 518, 527 (1947). Thus, when an alternative forum has jurisdiction to hear a dispute, a case can be dismissed if trial in the plaintiff’s chosen forum would be more 

oppressive to the defendant than it would be convenient to 

the plaintiff or if the forum otherwise creates administrative 

and legal problems that render it inappropriate. See Sinochem, 549 U.S. at 429; Kamel, 108 F.3d at 802.

4 While we do not resolve the merits of the jurisdictional dispute Kiobel raises, at least some Justices have indicated that forum non conveniens

may limit the international frictions threatened by hearing cases such as 

these in non-domestic courts. Kiobel, 133 S. Ct. at 1674 (Breyer, J., concurring in the judgment).

 

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Nos. 13-3073 & 14-1319 33

Given the variety of relevant factors, their case-specific 

nature, and the absence of any formula for weighing them 

precisely, a district court’s decision to dismiss a suit for forum 

non conveniens is “committed to the sound discretion of the 

trial court” and “may be reversed only when there has been 

a clear abuse of discretion.” Piper Aircraft Co. v. Reyno, 454 

U.S. 235, 257 (1981); see also Abad, 563 F.3d at 665–66. 

“Where a district court has contemplated all relevant public 

and private interest factors and where its balancing of these 

factors is reasonable, its forum non conveniens determination 

warrants substantial deference.” Kamel, 108 F.3d at 802, citing 

Piper, 454 U.S. at 254. Accordingly, we must take care not to 

“substitute[] [our] own judgment for that of the District 

Court.” Piper, 454 U.S. at 257.

To decide an appeal of a forum non conveniens dismissal, 

we determine first whether there is an adequate alternative 

forum available to hear the case. Kamel, 108 F.3d at 802. If so, 

we evaluate the various private and public interest factors to 

see whether a finding that the balance counseled in favor of 

dismissal was reasonable. Id. at 803. 

A. The Adequacy of Hungary as an Alternative Forum

A forum meets the adequate alternative forum requirement when the forum is both available and adequate. Kamel, 

108 F.3d at 802. The availability requirement is satisfied here. 

An alternative forum is “available if all parties are amenable 

to process and are within the forum’s jurisdiction.” Id. at 803. 

The other parties that plaintiffs sought to hold jointly and 

severally liable with Erste Bank—including private Hungarian banks and the national Hungarian bank—are all located 

in Hungary. All should be subject to the jurisdiction of the 

Hungarian courts. Also, the Austrian party (Erste Bank) conCase: 13-3073 Document: 62 Filed: 01/23/2015 Pages: 43
34 Nos. 13-3073 & 14-1319

sented to jurisdiction of the Hungarian courts. EA 171–72 

(declaration of Erste Bank’s chief legal officer). With all parties subject to jurisdiction in Hungary, it counts as an available forum. See Stroitelstvo Bulgaria Ltd. v. Bulgarian-American 

Enterprise Fund, 589 F.3d 417, 421 (7th Cir. 2009). 

As shown by our discussion of the domestic exhaustion 

issue above, the adequacy of Hungary as a forum for these 

claims is hotly disputed. An “alternative forum is adequate 

when the parties will not be deprived of all remedies or 

treated unfairly.” Kamel, 108 F.3d at 803. Because jurisdiction 

would otherwise be appropriate in the foreign forum, it is 

not enough to say that the transfer will “lead to a change in 

applicable law unfavorable to the plaintiff.” In re Factor VIII 

or IX Concentrate, 484 F.3d at 956, citing Piper, 454 U.S. at 247, 

254. Rather, only if “‘the remedy provided by the alternative 

forum is so clearly inadequate or unsatisfactory that it is no 

remedy at all’ should the unfavorable change be given substantial—or even dispositive—weight.” Id., quoting Piper, 

454 U.S. at 254. 

For the reasons stated above on the exhaustion issue, the 

district court correctly determined that the remedies provided by Hungary would not be so clearly inadequate so as to 

provide no remedy at all. To be sure, the burden of proof differs between the two inquiries. In the exhaustion analysis, it 

was up to plaintiffs to point to a legally compelling reason 

that the remedies might be inadequate. Here, by contrast, the 

burden ultimately falls on defendants to establish that the 

remedies are adequate. Sinochem, 549 U.S. at 430 (“A defendant invoking forum non conveniens ordinarily bears a heavy 

burden in opposing the plaintiff’s chosen forum.”); 14D 

Wright & Miller, Federal Practice and Procedure Jurisdiction 

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Nos. 13-3073 & 14-1319 35

§ 3828.3 (4th ed.). Thus, it would be at least theoretically possible for a district court to find that neither side had met its 

burden of persuasion on the adequacy of remedies in the 

other forum. 

That theoretical possibility is not a problem on this record. Between the briefing in support of domestic exhaustion 

and the briefing in support of the forum non conveniens motion, Erste Bank—along with its co-defendants—presented 

the evidence needed to determine the adequacy of Hungary’s remedies. The district court had before it a list of the 

available remedies, plaintiffs’ concerns with bringing suit in 

Hungary, and expert testimony from both sides on whether 

those concerns were enough to render the forum inadequate. 

The court did not err by finding that “there is no evidence 

that the Hungarian courts do not offer an adequate alternative forum for the claims brought against Erste.”

Starting from that baseline, we address plaintiffs’ remaining contentions that the adequacy of Hungarian remedies 

was not established. As discussed above, plaintiffs’ arguments relating to the lack of a class action procedure and the 

safety concerns posed by anti-Semitism are not enough to 

defeat adequacy. 

Plaintiffs also suggest that a “loser pays” fee-shifting 

mechanism renders any possible relief too burdensome. But 

that approach to attorney fees is common throughout the 

world. In re Factor VIII or IX Concentrate, 484 F.3d at 958 (noting that the “United States stands almost alone in its approach toward attorneys’ fees”); see also Piper, 454 U.S. at 

252 n.18. That it might be more expensive for plaintiffs to litigate in the alternative forum is not a sufficient reason, 

standing alone, to find that forum inadequate. See In re FacCase: 13-3073 Document: 62 Filed: 01/23/2015 Pages: 43
36 Nos. 13-3073 & 14-1319

tor VIII or IX Concentrate, 484 F.3d at 958; Stroitelstvo, 589 F.3d 

at 424 (holding that financial hardship caused by additional 

filing fees did not render alternative forum inadequate). We 

have rejected this particular difference in forum rules as a 

reason to find that a forum non convenience dismissal was inappropriate. In re Factor VIII or IX Concentrate, 484 F.3d at 

958. The district court properly concluded there was an adequate alternative forum.

B. Balance of the Interests

Where another adequate forum is available, to dismiss on 

forum non conveniens the district court must also balance the 

private interests of the parties and the public interests of the 

alternative forums and find that those balances favor a different forum. Stroitelstvo, 589 F.3d at 424; Kamel, 108 F.3d at 

803, citing Gilbert, 330 U.S. at 508. More specifically, courts 

evaluate the private interest by focusing on the “(1) relative 

ease of access to sources of proof; (2) availability of compulsory process and costs for attendance of witnesses; (3) possibility of view of premises, if appropriate; and (4) other practical issues, including ease of enforcement of any ultimate 

judgment.” In re Factor VIII or IX Concentrate, 484 F.3d at 958, 

citing Gilbert, 330 U.S. at 508. The court must also consider 

the public interest. Relevant public interest factors 

include the administrative difficulties stemming from 

court congestion; the local interest in having localized 

disputes decided at home; the interest in having the 

trial of a diversity case in a forum that is at home with 

the law that must govern the action; the avoidance of 

unnecessary problems in conflicts of laws or in the 

application of foreign law; and the unfairness of burdening citizens in an unrelated forum with jury duty.

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Nos. 13-3073 & 14-1319 37

Stroitelstvo, 589 F.3d at 425 (citations omitted). 

Plaintiffs argue that the district court erred at a basic level by failing to consider all of these factors in granting Erste 

Bank’s motion for reconsideration. From the court’s initial 

forum non conveniens determination and the shorter order on 

reconsideration, however, we believe it is clear that the district court evaluated the public and private interests relevant 

to the decision. 

In its order granting reconsideration, the district court focused on the relevant factors and explained why the “developments” in the case had pushed it to change its initial ruling. The court’s initial determination in 2011 was that the 

balance tipped in favor of retaining the case. The district 

court found then that the defendants had “not shown that 

the convenience of the parties, or the interests of justice 

would be best served by a dismissal of the instant action.” 

More specifically, the district court focused on the relative 

convenience of the parties, the broad dispersion of the evidence and witnesses, and the interest the United States has 

in providing remedies for human rights violations.

Against that backdrop, the district court limited its explanation on reconsideration to those factors that might have 

changed in light of intervening developments, in terms of 

both this court’s precedent and the fact that all other defendants had been dismissed from the bank case. With all other 

defendants out of the case, and this court having stressed the 

value of Hungarian courts having a chance to hear these 

claims, it is easy to see why the district court would see that 

the balance had shifted. In this way, the district court reasonably determined that what was initially a close question 

decided in favor of retaining the suit had tipped the other 

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38 Nos. 13-3073 & 14-1319

way once the relative burdens of suit and the public interest 

factors started to favor Hungary as a forum. 

Even so, plaintiffs argue there was not sufficiently detailed treatment of each factor. Precedent makes clear that 

substantial deference is warranted when all relevant factors 

are discussed. Kamel, 108 F.3d at 802. Though the oft-quoted 

list is long, the Supreme Court has also noted that it did not 

catalogue all of the circumstances when forum non conveniens 

dismissal might be appropriate. Gilbert, 330 U.S. at 508, accord, Abad, 563 F.3d at 668. Perhaps that’s why the Court has 

made clear that the central focus is on the convenience of the 

parties and the practical difficulties of hearing a dispute in a 

certain locality. See Sinochem, 549 U.S. at 429. And in the past 

we have responded to the “laundry list” of factors provided 

by parties not by proceeding down the list but by considering whether the district judge reasonably concluded that the 

litigation should continue in the foreign forum. Abad, 563 

F.3d at 668. We apply that approach here. 

The district court acted well within its discretion in finding that the balance favored dismissal. It is hard to see how 

the district court might have reached any other result here 

given the weight of international comity concerns in this 

case. Because the national bank and other private banks 

were dismissed from the suit for lack of subject matter and 

personal jurisdiction, respectively, Erste Bank is the only 

bank defendant still subject to suit in the United States. That 

fact alone means that the Erste Bank litigation becomes less 

convenient in the United States and more so in Hungary. 

When dismissal might eliminate the need for similar litigation in multiple places, forum non conveniens is favored. See, 

e.g., Sinochem, 549 U.S. at 435. While it is true that in other 

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Nos. 13-3073 & 14-1319 39

cases the related proceedings in the foreign forum had already begun, it is also true that Hungary is the only forum 

where all the litigation relating to these claims against all defendants might be heard. Requiring suit in Hungary is the

best way to ensure that plaintiffs’ claims against the banks 

are litigated only once on the merits.

Plaintiffs suggest that they can ensure there will only be 

one suit—the one remaining in the United States—because 

they simply will not bring suit in Hungary against the previously dismissed parties. Even if that assurance were binding, plaintiffs seek to hold Erste Bank jointly and severally 

liable for the entire amount of the substantial harm caused to 

plaintiffs as a result of these crimes. For that reason, it is likely that Erste Bank would sue the national bank defendant 

and private bank defendants for either indemnification or 

contribution. 

Such problems can sometimes be resolved by having a 

defendant join additional parties as third-party defendants. 

The fact that the United States does not have jurisdiction 

over the relevant parties precludes that solution here. This 

inability to join the other parties supports holding trial in 

Hungary. See Piper, 454 U.S. at 259. Also, we would be especially wary of ruling on these claims absent these third parties because doing so might affect the interests of a foreign 

sovereign who previously was dismissed from suit. See Republic of Philippines v. Pimentel, 553 U.S. 851, 868–69 (2008) 

(concluding that the immunity sovereigns enjoy is diminished “if an important and consequential ruling affecting the 

sovereign’s substantial interest is determined, or at least assumed, by a federal court in the sovereign’s absence and 

over its objection”). The national bank should have the opCase: 13-3073 Document: 62 Filed: 01/23/2015 Pages: 43
40 Nos. 13-3073 & 14-1319

portunity to participate in any litigation that decides whether the various Hungarian banks are holding property in violation of Hungarian or international law. 

At the end of the day, then, at least some additional litigation would have to occur in Hungary even if plaintiffs 

won their suit against Erste Bank here. The type of evidence 

presented at both trials, which would look to establish the 

culpability of various bank defendants for the expropriations, would likely be similar. For these reasons, the district 

court correctly concluded that dismissing this case against 

the banks will not put additional litigation burdens on plaintiffs.

Beyond the efficiency gains of litigating all claims in 

Hungary, the district court was right to point out that the 

dismissal of Erste Bank’s co-defendants raises concerns 

about access to evidence. As we noted before, “Hungary is 

where much of the evidence and surviving witnesses are located.” Abelesz, 692 F.3d at 684. While we take plaintiffs’ 

point that the testimony of plaintiffs themselves might be the 

most essential, Erste Bank also suggests that at least some 

important evidence is in the control of the dismissed parties. 

Erste Bank casts doubt on whether treaty obligations would 

oblige the national bank to comply with international discovery requests. See EA 173–76 (declaration of Erste Bank’s 

lawyer and attached exhibit laying out Hungary’s reservations to the Hague Evidence Convention). That the district 

court might no longer be able to compel record evidence located in Hungary while plaintiffs could still bring that evidence (their testimony) to Hungary weighs in favor of dismissal. And without some of the bank records in this case, 

the already difficult task of determining the succession of 

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Nos. 13-3073 & 14-1319 41

bank property would become even more difficult if not impossible. 

It is not clear from the record how the costs of obtaining 

evidence will shift if this litigation moves to Hungary. Plaintiffs indicate that the witnesses are widely dispersed. For 

that reason, perhaps moving from the United States to Hungary will not increase costs as much as it might if witnesses 

were concentrated in the United States. But for the same reason, it is also not clear that moving the litigation will reduce 

travel burdens imposed on witnesses. Either way, because 

witnesses are not concentrated in the United States or Hungary, some will need to travel to testify. In terms of document costs, though, it stands to reason that most of the relevant bank records and other documents will be in Hungarian. Though neither party has provided an estimate of the 

costs of translating such materials, see Abad, 563 F.3d at 669, 

it seems obvious that otherwise heavy translation burdens 

will be greatly reduced if the case were litigated in Hungary. 

In addition to the private interest factors tipping in favor 

of litigation in Hungary, public interest concerns make clear 

that Hungary is the better forum. As discussed at length 

above, Hungary has a significant legal interest in hearing 

these claims in Hungarian courts. That is why plaintiffs 

should be required to exhaust in Hungary before bringing 

suit here against the national defendants. Allowing plaintiffs 

to sue a private bank on substantially similar claims might 

unduly prejudice a foreign sovereign in a way that undermines the reason we dismissed the national bank for lack of 

exhaustion of domestic remedies. Dismissal for forum non 

conveniens accommodates international law norms and Hungary’s interest in being able to address these claims first. By 

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42 Nos. 13-3073 & 14-1319

contrast, while the United States has a general interest in ensuring that international law norms are enforced, in this particular case the executive branch has recommended “dismissal of claims against Erste Bank ... on any valid legal 

ground(s).” EA 70 (United States statement of interest). This 

suggests that the United States’ interest in this litigation is 

modest.

And the international comity concerns that would be 

raised if United States courts retained the case say nothing of 

the practical judicial problems. The public interest factors 

“point towards dismissal where the court would be required 

to ‘untangle problems in conflict of laws, and in law foreign 

to itself.’” Piper, 454 U.S. at 251 (citation omitted). It is at best 

uncertain what the basis for subject matter jurisdiction over 

Erste Bank might be. Even if jurisdiction in the United States 

were secure, it is likely that Hungarian law would apply to 

questions not governed by international law. See Abad, 563 

F.3d at 669–72.5 A United States court would have to apply 

Hungarian law to a host of delicate issues, especially those 

concerning remedies. The application of foreign law—

particularly that of a civil law system—favors dismissal in 

favor of a Hungarian forum. Stroitelstvo, 589 F.3d at 426; 

Abad, 563 F.3d at 670. In this case, a Hungarian court would 

be far better able to apply its own law than any United States 

court would be. 

Plaintiffs argue that whatever the outcome of the balance 

might have been, the district court failed to give their choice 

5 At oral argument, plaintiffs indicated that if jurisdiction were based 

on 28 U.S.C. § 1332, Hungarian law would apply. 

 

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Nos. 13-3073 & 14-1319 43

of forum sufficient weight. A plaintiff’s choice is presumed 

convenient to a plaintiff who chooses his home forum. 

Kamel, 108 F.3d at 803. And because at least some of the 

plaintiffs here are United States residents, we assume they 

have opted for the most convenient forum by suing in the 

United States. The district court emphasized this presumption in its first ruling, and it did nothing to suggest it had 

shifted the burden when it considered these factors in its 

motion for reconsideration. That presumption of convenience has been rebutted by the strength of the private and 

public factors discussed above. 

At bottom, the district court did not abuse its discretion 

when it concluded that the more reasonable and convenient 

forum for the suit against Erste Bank is Hungary. Though it 

may seem unfair that Erste Bank was dismissed on forum non 

conveniens grounds in large part due to the prior dismissals 

of its co-defendants, this result should not be unexpected. 

When plaintiffs seek joint and several liability against multiple foreign defendants, dismissal of any one defendant can 

shift the balance. Thus, we uphold the district court’s dismissal of Erste Bank. 

IV. Conclusion

Because plaintiffs have not exhausted their Hungarian 

remedies and have not yet provided a legally compelling 

reason for their failure to do so, their claims against the national defendants were properly dismissed without prejudice. The district court did not abuse its discretion by dismissing the claims against Erste Bank without prejudice 

based on forum non conveniens. The judgments of the district 

court are AFFIRMED.

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