Hungary v. Simon

Background

A group of Jewish survivors of the Hungarian Holocaust and their heirs sued the Hungarian government and its national railway (MÁV), seeking money for property they say was seized during World War II. They allege Hungary and MÁV sold the seized property, deposited the proceeds into government and railway accounts, and mixed those proceeds with other funds. Years later, Hungary and MÁV used money from those commingled accounts in activities connected to the United States, such as issuing bonds and buying equipment. Lower courts found those commingling allegations enough to let the case proceed under the Foreign Sovereign Immunities Act (FSIA) expropriation exception, which allows some suits when expropriated property or property exchanged for it has a U.S. commercial connection.

Reasoning

The Court addressed whether merely alleging that proceeds were mixed with other funds and later used in the United States satisfies the FSIA’s requirement that the property (or what it was exchanged for) have a commercial nexus to the United States. The Justices explained that the statute requires plaintiffs to trace either the specific expropriated property or the particular property received in exchange to the United States. Money is property, but commingling alone normally prevents plausible tracing. The opinion gave examples where tracing would work (a U.S. account holding sale proceeds or rapid spending of commingled funds in the United States) and emphasized that a bare commingling allegation, especially across decades and global transactions, is insufficient.

Real world impact

The decision makes it harder to bring U.S. suits based only on long-ago liquidations mixed into general treasuries. Victims must plead facts that plausibly trace specific proceeds to the United States. The ruling does not bar all commingling-based claims and remands the case for further proceedings, so future evidence or different factual allegations could still allow relief.