## Facts

- Felicia Grunfeder, a Holocaust survivor, suffered severe psychological harm from Nazi persecution in occupied Europe; members of her family were killed.
- Beginning in 1968, she received monthly reparation payments from the Federal Republic of Germany under the German Restitution Act.
- Grunfeder later applied for Supplemental Security Income (SSI) under the Social Security Act, a needs-based program for aged, blind, and disabled persons.
- The Social Security Administration treated the German reparation payments as countable unearned income, reducing or eliminating her SSI benefits.
- Grunfeder sought review, contending the reparations should not be treated as “income” for SSI calculations.

## Issues

1. Whether German restitution payments to Holocaust survivors are countable “income” for purposes of determining SSI eligibility and benefit amounts.

## Decision

- The Ninth Circuit, sitting en banc, reversed the district court’s judgment upholding the Secretary’s inclusion of the payments as income.
- The court held that German Holocaust reparations paid under the German Restitution Act are not countable income for SSI purposes.
- The case was remanded for recalculation of SSI eligibility and benefits excluding the reparations payments.

## Legal Principles

- SSI is a needs-based program designed to assure a minimum income level for eligible individuals; “income” must be construed in a manner consistent with that purpose.
- Payments that function as restitution and indemnification for Nazi persecution are not treated as ordinary unearned income in the SSI computation.
- Agency interpretations of broadly defined statutory terms are not controlling where they conflict with the program’s remedial purpose and established federal policy favoring non-penalization of Holocaust restitution recipients.
- Treating Holocaust reparations as countable income would improperly reduce public assistance based on compensation intended to redress persecution-related injuries and losses.

## Conclusion

The Ninth Circuit required exclusion of German Holocaust restitution payments from SSI income calculations, reasoning that counting such reparations as income would be inconsistent with the character of restitution and the objectives of SSI’s minimum-support scheme.


Grunfeder v. Heckler, 748 F.2d 503 (9th Cir. 1984) (en banc)