Law firm drops Holocaust suit against IBM

A US law firm is dropping a class-action suit against IBM Corp. over its alleged business ties to the Nazis during the Holocaust. The action will be "voluntarily dismissed," the law firm Cohen, Milstein, Hausfeld & Toll PLLC said in a statement Thursday.

The firm had announced the lawsuit last month, charging that IBM "aided and abetted crimes against humanity" by providing the punch-card systems, called Hollerith machines, used to catalogue and process victims of the Nazi concentration camps.

By dropping the suit, the firm seeks to speed payment of compensation to millions of victims of the Nazis, lead plaintiffs' attorney Michael Hausfeld said. German businesses have paid US$2.3 billion to the Remembrance, Responsibility, and the Future Foundation, a fund to compensate former forced labourers. The German Federal Government will match this sum, but payments won't be made until the businesses are assured of immunity from future lawsuits, and have been delayed for many months by ongoing cases filed in US courts. In an interview with ITworldcanada Hausfeld said the lawsuit was dropped not because there was a lack of evidence, but because "the Germans were using this lawsuit as an excuse not to make the payments."

Even though the foundation plan does not cover lawsuits against US parent companies like IBM, Hausfeld said the plaintiffs are dropping the suit "in order to eliminate any obstacles German industry believes would hinder such payments to victims of the Holocaust." A second reason for dropping the lawsuit was that the principle purpose was to get access to archival evidence of IBMs role in the Holocaust, which the government will now do, Hausfeld said. "These are elderly people who, before they pass on, don't want their stories about what happened to them during the Holocaust to be closed," Hausfeld said. In the original lawsuit the plaintiffs were demanding that the records be made public, and that IBM "disgorge all profits made from their service to the Nazis during World War II to a Holocaust relief fund.

The records in question are for IBM's German subsidiary Deutsche Hollerith Maschinen GmbH (Dehomag for short), which sold the punch card technology invented by the engineer Hermann Hollerith in the 1890s. Carol Makovich, vice-president of worldwide media relations for IBM, told ITworldcanada that the company's archives for the period were donated to universities in 1999 and 2000, where they are available to scholars.

"What records we found for this company were donated to both the United States and Germany, and if additional records are found they will be made available," Makovich said.

"IBM was very pleased that a motion was filed to dismiss this case which we believed there was no basis for," Makovich added.

Rick Perera of the IDG News Service contributed to this report.

IBM, in Armonk, N.Y., can be reached at Cohen, Milstein, Hausfeld & Toll can be reached in Washington D.C. at

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