This question is about eligibility for German/US dual citizenship when a minor acquires US citizenship at the time that his parents naturalize.
Suppose a child is born outside of the United States to foreign parents and is at the time of his birth a German citizen by descent. The child's parents naturalize in the United States while the child is still a minor.
According to section 321 of the Immigration and Nationality Act of 1952 (INA 321), the child "automatically" receives US citizenship:
Child born outside of United States of alien parent; conditions under which citizenship automatically acquired. Sec. 321. (a) A child born outside of the United States of alien parents, ..., becomes a citizen of the United States upon fulfillment of the following conditions: (1) The naturalization of both parents; or [other criteria].
(This section of the Immigration and Nationality Act of 1952 was amended by the Child Citizenship Act of 2000; the major difference going forward is that now the child receives citizenship automatically when one of the parents naturalizes; previously, citizenship was not awarded until both of the parents naturalized.)
Now, this question concerns loss of German citizenship in the era of the mid-20th-century. German citizenship is generally lost when an individual naturalizes in another country. Section 25 of the German Nationality Act (as amended many times since its original passage in 1913) reads:
(1) A German shall lose his or her citizenship upon acquiring foreign citizenship where such acquisition results from an application filed by the German concerned or his or her legal representative,
For completeness, I looked up the English translation of the original version of the German Imperial and State Citizenship Law of July 22, 1913. Section 25 of that law reads:
A German who has neither his residence nor permanent abode in Germany loses his citizenship on acquiring foreign citizenship, provided the foreign citizenship is acquired as a result of his own application therefor or the application of the husband or legal representative, only when the conditions exist under which expatriation may be applied for according to §§ 18 and 19."
Of those, §19 is relevant:
The expatriation of a person who is under parental tutelage or guarianship may be applied for only by the legal representative and only with the consent of the German court having jurisdiction in guardianship matters. ... The consent of the court having jurisdiction in guardianship matters is not necessary if the father or mother apply for expatriation for themselves and by authority of parental tutelage simultaneously for the child, ... .
The question here is, for the purposes of German nationality law, did the child's US nationality arise "from an application filed by the German concerned or his or her legal representative" (in this case, his parents)? The quoted passage of the 1913 law specifically calls out the case of a father applying for foreign naturalization of himself and his child simultaneously as resulting in loss of German citizenship for the child.
Or did the child acquire US citizenship "automatically" (INA 321 does contain that magic word) as a sort of side-effect of his parents naturalization?
Is there any precedent on whether this child retains a claim to German nationality?