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The basic elements of the story, of Major Gangl having gone to meet the advancing US forces and surrender Castle Itter to them, and of the small number of US personnel under Captain Lee who proceeded with Gangl and his men to take control of the castle and secure the french VIP prisoners being hgeld there, are no doubt quite true. However, there seems to be a degree of exaggeration in the depiction of the "battle" on 5 May 1945.
In the first place, the Waffen-SS force which opened fire on the castle in the early morning of that day was quite small, only 100-150 men, led by a Georg Bochmann, who in the last weeks of the war had been appointed commander of the 17th SS Panzergrenadierdivision Goetz von Berlichingen. It is claimed that it was Bochmann who made the decision to launch an armed assult on the castle, but there seems to be no explanation as to why he did so. Bochmann does not seem to be a diehard fanatic; he had been retreating with his unit through Bavaria and had recently refused orders from Generalfeldmarschall Ferdinand Schoerner to attack Allied troops, for which he had been dismissed from his post and was slated to face a court-martial. so there seems to be no reason why he would initiate a pointless fire-fight.
The accepted story states that after a "battle", more realistically a skirmish, lasting through the day of 5 May, larger US forces arrived and Bochmann's forces retreated and about 100 of them (possibly the whole unit) were subsequently taken prisoner. Photographic evidence shows substantial damage to the castle walls, indicating that it had come under artillery fire. One likely possibility is that Bochmann's small unit was retreating through the forest surrounding the castle and had gained the impression that it had been captured by allied forces, and they, the SS unit, would have to fight their way past it.
Given Bochmann's recent disobedience, which had led to his dismissal from his command, it seems unlikely that he was carrying out an order to take possession of the castle and kill the the prisoners held there. As of 5 May, Hitler had been dead for almost a week, Himmler was a fugitive, and the German armed forces were now taking orders from the Government of Admiral Doenitz, which had given them the commend to surrender to the Western Allies. Given the circumstances, it seems extremely unlikely that anyone in a position of command in the German armed forces would have given an order to kill the prisoners held at Castle Itter, and just as unlikely that Bochmann would have decided on his own intitiative to kill them, assuming that he even knew that important prisoners were being held there.
It seems to me that the one-day "battle" around Castle Itter on 5 May 1945 was most likely a case of two forces stumbling on each other almost by chance, and that the "defenders" of the castle, the small number of US personnel, the small number of German personnel, and those of the prisoners who took up arms and participated in the fire-fight, later grossly exaggerated the action, partly out of pride, partly for political reasons. As I stated, almost immediately after the end of the war the legend of "Austrian resistance" began to be invented, with Allied acquiescence, and the story of a group of outnumbered Austrians heroically resisting a large force of diehard Nazi SS-men was just the sort of thing needed to bolster that legend.
As it happened, the leader of the Wehrmacht men who allegedly changed sides and joined an alleged unit of the Austrian "resistance", Major Gangl, was killed during the fighting, so he was not arround to be interviewed about what had actually happened. As for the role played by the French VIP prisoners held in the castle, which included two former premiers, Daladier and Reynaud, who were political rivals, if ever French politicians are given the opportunity to portray themselves as heroic fighters, they are unlikely to turn it down.
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