This court case has been going on for years. Russia does not accept the authority of a US court, arguing that it is a sovereign nation and US courts have no jurisdiction over it. Chabad wants Russia fined in the hopes that somehow that will get Russia to release the books and manuscripts. The US Government opposes the fines.
The books are, as the AP notes, from two different collections. The second one is familiar to anyone who closely read Bryan Mark Rigg's Rescued From The Reich (Yale University Press). These are the books – many of them secular, like Sherlock Holmes in Yiddish – that the sixth Rebbe of Chabad-Lubavitch, Rabbi Yosef Yitzchok Schneersohn (the Rayyatz), wanted the US to rescue. As he crossed from German-held territory to freedom in Latvia and was handed over to the Americans by the German military intelligence team that had tracked him down in war-ravaged Poland and brought him to the Americans in Latvia, the Rayyatz asked the Americans to go into Poland to rescue his silver, his household goods and his books.
The holy sixth rebbe of Chabad-Lubavitch didn't ask the Americans to save any Jews, even though America – which was still neutral when this took place in 1940 – could have done so.
The second half of the books and manuscripts Chabad is fighting for are the books that were more important to the Rayyatz than the lives of Jews. But you won't hear Nathan Lewin talking about this in court.
The AP reports:
…Chabad-Lubavitch…wants the judge to impose civil fines on Russia. The [Justice D]epartment says fines won't help resolve the dispute and in fact would be counterproductive.
Chief Judge Royce Lamberth…had a quick rejoinder: "How can you be counterproductive from zero?"
Justice Department lawyer Joel McElvain said things could go into negative territory, adding that the U.S. government has made progress, albeit "slow and halting," on the matter. He said that fines would amount to a substantial step backward.
"Am I supposed to accept that as intuitive?" the judge asked.
Chabad lawyer Seth Gerber said he was unaware of any negotiations under way to get the materials back.…
Another lawyer for the group, Nathan Lewin, who was in the courtroom, said the fine could be $25,000 or $50,000 a day, although he added he didn't know what the right amount is.
Lewin said that Russia has deprived the members of Chabad access to the materials for a long time.
"I agree with you," said Lamberth, who has frequently issued largely unenforceable multimillion-dollar judgments against foreign governments he believes are hostile to this country and have harmed U.S. citizens,
In addition to arguing that fines would hurt efforts to get the collections returned, Justice Department lawyer McElvain said that fines would be "contrary to our foreign policy interests .... and contrary to international norms." He said they could lead to reciprocal measures against the U.S. in other countries.
There are two collections at issue: 12,000 religious books and manuscripts seized during the Bolshevik revolution and the Russian Civil War nearly a century ago; and 25,000 pages of handwritten teachings and other writings of religious leaders stolen by Nazi Germany during World War II, then transferred by the Soviet Red Army as war booty to the Russian State Military Archive.…