by Ruth Brandon
We have no way of knowing when he first set his sights on Helena Rubinstein’s business, but since Madame was already over eighty when he arrived in New York, he must have realized even before he met her that Helena Rubinstein, Inc., would come into play sooner rather than later. He made a point of getting to know her; and to good effect. Dalle testified that it was Corrèze’s personal friendship with Madame that enabled L’Oréal to acquire Helena Rubinstein Spain—the first step to the eventual takeover of the entire company.66 When the boycott difficulties arose, it was he who insisted on conducting the Israeli end of the negotiations. He dropped hints to the Israelis regarding his past—which helped convince them that he was an honest broker—but as at the Cagoule trial this apparent frankness, whose effect was so disarming, in fact concealed far more than it revealed. And as the saga of the boycott became more and more tangled, his behavior became increasingly flamboyant. At one point he floated a crazy plan that might have come from Deloncle himself: a project called Operation Rocher to create a bogus company in Switzerland, apparently quite unconnected to L’Oréal, that would buy the Helena Rubinstein international operation.67 He would control Helena Rubinstein—at, it seemed, any cost—and ended up occupying its chair in the same way as, during the war, he and his MSR cronies occupied the one-time offices of the Ligue Contre Antisémitisme, Georges Mandel’s apartment, and the Bernheim art gallery. Would anyone realize who he was? Would they make the connection? Eventually, of course, someone did. And then he defeated them after all—by dying.
VI
The story of L’Oréal’s takeover of Helena Rubinstein, and the ensuing explosions, is an almost perfect dramatic construct. Had it not been for the vicious anti-Semitism of Schueller and his friends, Madame would never have rediscovered her Jewish identity and established the Israeli presence that gave rise to the boycott problems. Had Jacques Corrèze not been disgraced in France as an old Nazi he would not have ended up in New York, nor been so enchanted by the prospect of taking over a Jewish business. His and Schueller’s eventual unmasking was a direct, if unforeseeable, consequence of their previous actions.
For the businessman who had to deal with the consequences, however, the scandals were nothing less than a nightmare. Lindsay Owen-Jones, L’Oréal’s fourth CEO, assumed office in the autumn of 1988—just at the moment the boycott storm broke—and spent the next six years firefighting, as successive news stories rose from the dead to rip through L’Oréal’s image.
A large part of his effort to repair the damage was directed at the reestablishment of that image with the Jewish community and Israel. American reaction to the boycott settlement had been angry, and L’Oréal faced a $100 million lawsuit alleging it had broken U.S. laws designed to prevent American firms from cooperating with the Arab boycott of Israel. In June 1994, therefore, L’Oréal announced that it had bought a 30-percent stake in Interbeauty (formerly Helena Rubinstein Israel) at a price of $7 million. Six months later, in January 1995, the company opened a factory in the Israeli town of Migdal Ha-Emek, producing Elseve shampoo, Plenitude antiwrinkle cream, and a line of products for export using Dead Sea minerals, called Natural Sea Beauty. That same year, L’Oréal agreed to pay $1.4 million to the U.S. government to settle its legal problems, and thanked the Anti-Defamation League “for its support of L’Oréal’s business and community services activity in Israel.” Bettencourt had resigned, Corrèze was dead, the Jewish lobby was happy. In 1997, the Union of Orthodox Jewish Congregations of America gave L’Oréal its International Leadership Award. Owen-Jones heaved a sigh of relief and prepared to turn his attention to other matters.
And then, in 2001, ten years after the Corrèze affair, six years after Bettencourt’s exit, the Nazi past returned to haunt L’Oréal once more.
In the freezing winter of 1948, Eugène Schueller announced to his protégé François Dalle that they were going to visit L’Oréal’s German subsidiary, which had its headquarters in Karlsruhe, just across the Rhine from Schueller’s native Alsace. The company had opened its first German agency in Berlin, in 1922, but it did not do as well as expected, and its manager, Frau Kuhm, refused to produce her account books. In 1930 L’Oréal sacked her (to her fury—she sued, but lost) and opened another office under the management of a Frenchman, André Tondu.68
The Berlin premises were destroyed during the war, and after it Tondu, who remained in charge, moved the business to Karlsruhe. There, under the name Haarfarben und Parfümerien (Hair Dyes and Perfumery) he rented the ground floor and cellar of a house in the center of town, at number 18, Kaiserallee. The business at that point was “Lilliputian,” Dalle remembered: its “factory” consisted of the cellar room, an area of about 300 square meters.69
When the business needed more space, in February 1949, Tondu signed purchase papers on its behalf for a property situated just round the corner, at 17, Wendtstrasse. This house and the one at 18, Kaiserallee, shared a common neighbor, number 19, Wendtstrasse, a once-luxurious mansion that had been bombed during the war, and which occupied the corner lot where Wendtstrasse met Kaiserallee. If Tondu could consolidate, and buy this property also, his business would then occupy an important and valuable site in the center of town.
In November 1951, he seemed to have received some assurance that he would indeed, sooner or later, be able to buy number 19. That month, Haarfarben bought the house at 18, Kaiserallee, whose ground floor and basement it had hitherto been renting—a move that only made sense if they now knew they would also be able to buy the ruined lot situated between the two properties they owned already. And in 1954 they duly did so.
The seller was a large insurance company, the Badischer Gemeinde Versicherung Verband (BGV), which had acquired number 19 in 1938 from a Frau Luise Dürr. The property, however, was not owned by Frau Dürr. Rather, it belonged to the family of a wealthy lawyer named Dr. Fritz Rosenfelder in whose name she was acting. Until 1936, Dr. Rosenfelder had lived there with his mother-in-law, his wife, Kaethe, and their young daughter, Edith. But the family was Jewish, and by the end of 1936 they knew they would have to leave Germany. Dr. Rosenfelder spoke French and had studied in Paris, and he therefore decided to move his family to that city, traveling on ahead to look for accommodations. They would join him there as soon as he had found somewhere suitable for them all to live.
By the time he was ready to receive them, however, the situation in Germany had deteriorated further. For Jews to leave was no longer a straightforward matter. There was now invariably a price to pay: in the Rosenfelders’ case, this included their house. They would need exit visas, and to obtain them, Dr. Rosenfelder was told he must designate an agreed Aryan to handle all his business in Germany—which meant transferring “all the rights” to this person, including the right to dispose of property.70 The holder of this power of attorney would be Frau Dürr. Dr. Rosenfelder had never met her and knew nothing about her. No one, least of all an experienced lawyer, would willingly sign over his property to such a person in this way. But as it was the only way to get his family out of danger, he signed.
The family duly came to Paris and in September of 1938 moved into an apartment in the rue des Saussaies, near the Champs-Élysées (as it happened, just across the road from where the Gestapo would establish its headquarters). Meanwhile, on January 20, 1938, Frau Dürr transferred rights in number 19, Wendtstrasse on behalf of Dr. Rosenfelder “once of Karlsruhe, now of New York,”71 to BGV.
For the Rosenfelders, as for so many Jewish families, the wa
r was a time of unspeakable torment. In 1939, Dr. Rosenfelder was sent by the French to the first of a series of internment camps, where food was scarce and living conditions atrocious.6 During intervals of freedom he managed to get visas for his family to emigrate to America, but his mother-in-law refused to go: America, she declared, had no culture. By 1941, however, it was clear that Paris, though doubtless cultured, was no longer safe for Jews. Fritz Rosenfelder was interned once again, this time at Les Milles, near Aix-en-Provence, and Kaethe, Edith, and Kaethe’s mother, Emma, decamped to Allauch, a small town not far away, where they lodged with a family and Edith went to school.
So things went on for some months. Then one day, when Edith chanced to be at the beach with her teacher, her mother and grandmother were picked up by the milice. They were sent to the infamous internment camp at Drancy, a staging post for Auschwitz, where they died. Edith was saved by a young village girl who arrived before the gendarmes could find her, and who helped her hide.
Fritz, meanwhile, had escaped from Les Milles. When he heard what had happened, he realized there was no way of retrieving his wife and mother-in-law. He and his daughter made their perilous way to Switzerland, where, weakened by his successive ordeals, he died in 1945. Edith, then seventeen, ended up in a camp for Jewish displaced persons, where she stayed until an uncle who had made it to Brazil agreed to take her in. She traveled to Brazil, married there, and had two children. But she could never bear to talk about the war, or her dead mother and grandmother. She told her children she didn’t remember.72
In 1951, the year Edith Rosenfelder married, BGV took full legal possession of 19, Wendtstrasse. Until 1949, regulations imposed by the victorious Allies had prevented any dealing in property stolen from the Jews by the Nazis. But on January 1st of that year these restrictions were lifted, and in August 1950, BGV began the process of establishing their legal right to number 19. In the absence of living claimants, all such matters were decided via the Jewish Restitution Successor Organization (JRSO), based in New York.
There were, of course, living claimants: not just Edith Rosenfelder, but an uncle, Fritz’s brother, Karl Rosenfelder, who was then still alive. And it seems that Karl Rosenfelder was trying to lay claim to his family’s property. But BGV made no effort to contact him—on the contrary: an internal memorandum dated June 4, 1951, records that a lawyer had phoned to say that Karl Rosenfelder had been in touch with a view to establishing his right to restitution of the property, but that if the matter could not be settled by negotiation via the JRSO, he (the lawyer) would not pursue the matter, as he had no wish to act against his friends in BGV.73 As it turned out, this man had been chairman of the Association of National Socialist Lawyers for Karlsruhe during the 1930s and was personally responsible for the banning of Fritz Rosenfelder from practicing. He was unlikely, to say the least, to have been an enthusiastic advocate for Fritz’s brother Karl.
The matter was settled, without reference to either Karl or Edith Rosenfelder, on November 5, 1951. On that day, BGV agreed to pay JRSO 5,000 deutschmarks as compensation, in return for ownership of the lot at 19, Wendtstrasse.74 Later they claimed that Karl Rosenfelder had signed the document, but neither they nor anyone else have ever produced his signature.
Meanwhile, André Tondu’s property purchases on behalf of Haarfarben progressed in close step with BGV’s. In January 1949, as we have seen, the restriction on dealing in stolen Jewish properties was lifted, allowing BGV to begin the formalization of its ownership of 19, Wendtstrasse. In February, Tondu made the first of his purchases—number 17, Wendtstrasse. And he bought the property at 18, Kaiserallee on the very day—November, 5, 1951—that the BGV/JRSO matter was settled, that same day reconfirming his purchase of 17, Wendtstrasse.
Two and a half years later, on June 29, 1954, the Wendtstrasse saga was completed—at least as far as Tondu and Haarfarben/L’Oréal were concerned. That day Tondu, on behalf of Haarfarben, bought number 19 from BGV for DM 27,000. The transfer document noted that a restitution procedure had been initiated concerning ownership of this property, but that the file had been closed, entitling the present owner [BGV] to dispose of the property.75 Haarfarben/L’Oréal now owned the entire corner site at the junction of Kaiserallee and Wendtstrasse. They would remain there for the next thirty-seven years, selling the property in 1991 (the same year, as it happened, that the Corrèze scandal broke).
Edith Rosenfelder, now Edith Waitzfelder, living in Rio de Janeiro, knew nothing of these maneuverings. But her daughter, Monica, noticed that the other Jewish families they knew in Rio, many of whom had arrived there in circumstances very similar to Edith’s, had all received restitution payments from Germany. Edith had received nothing; and although she hated talking about her family’s life in Germany, and what had happened to them, she said enough to indicate that they had been well-off and had owned a substantial property in Karlsruhe. Why, then, had she been neglected? What had happened to her rightful compensation?
Monica Waitzfelder determined to find out. She moved to Paris, found a job there, and set about unraveling her family’s German affairs.
The task, which she carried out in the intervals of her busy life as an opera director, turned out to be difficult and complex. Papers that should have been available somehow could not be found. Bureaucrats were unhelpful. A clause in the November 5, 1951, agreement by which BGV acquired 19, Wendtstrasse, for example, stated that “The JRSO undertakes, inasmuch as the defendant (the BGV) acts in conformity with instructions from the JRSO, to compensate the defendant to a maximum of 5,000 DM if a situation arises where those with a priority right make themselves known and validly undermine the defendant’s position.”76 But when Waitzfelder made inquiries regarding this clause, she was informed that the compensation had already been paid, and the matter was closed. Yet how was this possible? No one but Edith, her uncle Karl having now died, had a priority right, and she had never made herself known to JRSO, since by the time she found out what was going on in Karlsruhe, the JRSO no longer existed.
“L’Oréal is still very powerful [in Karlsruhe],” was the explanation offered by one nervous and unhelpful woman at the Karlsruhe town hall when asked why she could not supply copies of the relevant documents. Bit by bit, however, Monica Waitzfelder accumulated the documents and pieced together the story. The 1954 papers recording BGV’s sale of 19, Wendtstrasse to Haarfarben stated that “The compensation rights owed to victims of the war remain entirely within the possession of the vendor.” That was to say, BGV—the people who had illegally acquired the property in the first place.
On June 18, 2001, Maître Charles Korman, acting for Monica Waitzfelder, wrote to Lindsay Owen-Jones, managing director of L’Oréal, detailing what his client had uncovered. Valuations of sales and rental income for comparable properties indicated that the Waitzfelders had been cheated, over the years, of a substantial sum. The amount named by Korman was DM 60,556,726, (roughly, €30,000,000, or $40,500,000). He made it clear that both he and Ms. Waitzfelder would prefer an out-of-court settlement, but failing that they would go to court.
However, in letters to the lawyer and, later, to Edith and Monica Waitzfelder, Owen-Jones rejected all notion of a settlement. He declined to acknowledge that L’Oréal had any responsibility in the affair, asserting that Haarfarben was quite distinct from L’Oréal and that L’Oréal had not bought a majority holding in it until 1961. If strictly true in a legal sense, in practice the company always regarded the German subsidiary as part of
the parent organization. There is particular mention of Haarfarben as part of the L’Oréal family in staff magazines from 1948 and 1949, while a paragraph in L’Oréal Deutschland’s website describes how André Tondu restarted the business in Karlsruhe after it was bombed out of Berlin.
Owen-Jones insisted that the JRSO transaction of 1951, in which due compensation had been awarded, had been signed by Karl Rosenfelder (though he, too, failed to produce any signature). He declared his “deepest conviction . . . that L’Oréal has done no wrong to Mrs. Edith Rosenfelder,” and announced that L’Oréal had appointed its own lawyers to deal with the case. They were Michel Zaoui and Jean Veil, two well-respected Jewish advocates, one of whom (Zaoui) had been a leading prosecutor in the Klaus Barbie trial—a choice whose insulting implications were not lost on the Waitzfelders.77 Owen-Jones had clearly been advised that the law was on his side, and, that being so, he was not inclined to give in.
L’Oréal did indeed win the case, both at the first hearing, when the Waitzfelders’ complaint was declared out of time, and later, to Korman’s great surprise, on appeal. But it is still hard to understand why Owen-Jones decided to fight rather than settle. From a publicity point of view, it would surely have been better for L’Oréal to portray themselves as prepared to right old wrongs rather than as legalistic skinflints upholding shameful Nazi theft. The Waitzfelders would doubtless have settled for less than the stated sum—not that €30 million would bankrupt a company of L’Oréal’s size and wealth. In 1988, Capital magazine calculated that the Bettencourts, its main shareholders, were getting richer at the rate of €14.2 million a day, or €590,000 an hour, while in 2001 their share of the company’s dividends amounted to more than €81 million.78 As Owen-Jones presided over year after year of double-digit growth, the share price rose from $8 in 1990 to $76 in 2000. When he took charge, Liliane Bettencourt, the company’s largest shareholder, was already the wealthiest woman in France; he made her the wealthiest woman in the world.
