Opinion ID: 180861
Heading Depth: 3
Heading Rank: 2

Heading: Preemption By the Claims Agreement and the War Claims Act

Text: In 1922, the United States and Germany entered into an executive agreement establishing a commission to resolve all claims concerning debts owing to American citizens by the German government or by German nationals. 42 Stat. 2200 (1922) (the Claims Agreement). In 1928, the Settlement of War Claims Act (the War Claims Act) provided for payment of Claims Agreement awards. Z & F Assets Realization Corp. v. Hull, 114 F.2d 464, 466 (App.D.C.Cir.1940), aff'd, 311 U.S. 470, 61 S.Ct. 351, 85 L.Ed. 288 (1941). The Claims Agreement and War Claims Act, if applicable, have preemptive effect. See Garamendi, 539 U.S. at 416, 123 S.Ct. 2374; Medellin, 552 U.S. at 532, 128 S.Ct. 1346. Munich Re argues that the Claims Agreement and War Claims Act apply to claims against German insurance companies by Armenian Genocide victims. We disagree. The insurance policies were the private property of insured Armenian citizens of the Ottoman Empire, not German debts owing to American citizens. Munich Re's reliance on Deutsch v. Turner, 324 F.3d 692 (9th Cir.2003), is misplaced. In Deutsch, we invalidated a California statute that allowed World War II slave laborers to bring war-related claims against wartime enemies of the United States. Deutsch, 324 F.3d at 712. We held that California's attempt to create a private right of action for war-related injuries intruded upon the federal government's exclusive power over matters related to war. Id. at 712-716. Here, in contrast, § 354.4 does not implicate the government's exclusive power over war. Section 354.4 covers private insurance claims, not wartime injuries. See Alperin v. Vatican Bank, 410 F.3d 532, 548 (9th Cir.2005) (distinguishing garden-variety private property interests from war injuries). Furthermore, as the district court noted, the Claims Agreement was signed before the end of the Armenian Genocide. According to the California legislature, the Armenian Genocide ended in 1923, a year after the Claim Act was signed at Berlin. We reject Munich Re's assertion that the Claims Agreement, which resolved claims from the concluded fighting in World War I, has any bearing on life insurance policies issued to citizens of the Ottoman Empire. The Claims Agreement and War Claims act therefore do not preempt § 354.4.