In the early 1930s, Martin Schulz, who owns a San Francisco art gallery with fellow German Max Eisenstein, leaves San Francisco with his wife Elsa and their sons for a buying trip in Germany. Remaining behind to run the business is Max and Martin's son Heinrich, who is engaged to Max's daughter Griselle. Griselle, an aspiring young actress, decides to postpone the marriage for one year while she pursues a stage career in Europe. In Germany, meanwhile, Martin meets Baron von Friesche, a cultivated nobleman and advocate of the recently spawned Nazi doctrine. Swayed by the baron's charms, Martin begins to embrace his assertion that Hitler is Germany's destiny. Back in San Francisco, Max and Heinrich become concerned when Martin begins penning letters in praise of Hitler. One night, Griselle, who had gone to Vienna to study acting, visits Martin to tell him that she has won a role in a play to be performed in Berlin. When the baron learns that Griselle's last name is Eisenstein and that her father is Martin's partner, he warns Martin that he must choose between his loyalty to Germany and his friendship with the Jews. Accepting the baron's ultimatum, Martin writes his partner that they must cease all communication because of Max's "race." Certain that Martin's sentiments are motivated by fear of the German censors, Max asks a friend who is traveling to Germany to deliver a message to Martin. When Martin reads the missive, which asks him to signify his affirmation of democratic values with the word "yes," Martin responds "no." One day, during the rehearsal of Griselle's play, a representative from the office of censorship appears at the theater and demands the deletion of several lines extolling the virtues of the meek. Defiant, Griselle speaks the lines during her performance, and when the audience learns that she is a Jew, they hurl racial epithets at her and storm the stage. Narrowly escaping the angry mob, Griselle plods through the countryside to seek refuge with Martin. Learning of his daughter's danger, Max sends Martin a plea to help Griselle. As the police close in on her, Griselle reaches Martin's door and knocks. In response, Martin slams the door in her face, leaving her at the mercy of her pursuers, who shoot and kill her. Furious at her husband for allowing Griselle's death, Elsa decides to leave the country for Switzerland. When Martin sends Max a callous note informing him of Griselle's fate, Max cables back a cryptic message. Soon after, a messenger delivers a letter from Max to Martin, written in code. Martin notices that the censors have deleted part of the document and becomes worried. Martin's concern turns to panic when more coded letters arrive. After writing Heinrich a plea to stop Max's letters, Martin is visited by the baron, who informs him that it is illegal to send or receive coded documents. Desperate to stop the incriminating letters, Martin asks Elsa, who is leaving for Switzerland, to mail a final appeal to Max. Soon after Elsa' s departure, the baron visits Martin and informs him that Elsa was stopped at the border and destroyed a letter written in Martin's hand. Although Martin protests his innocence, the baron refuses to believe him and abandons him. That night, Martin is tormented by imaginary voices calling Griselle's name. As he runs downstairs into his study, he hears the footsteps of soldiers coming to arrest him. Back in San Francisco, the mailman returns Max's letter to Martin, stamped "address unknown." When Max insists that he ceased all correspondence with Martin long ago, Heinrich steps from the shadows, and Max realizes that the incriminating letters were penned by Martin's own son.