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Cruises sentenced to pay high sums for use of goods confiscated in Cuba

A US cruise ship in the port of Old Havana, Cuba, in November 2018.

A US cruise ship in the port of Old Havana, Cuba, in November 2018.

miami herald

A federal judge ordered four Florida-based cruise lines that sailed to Cuba to pay more than $400 million in damages to the American company that owned the concession for some of Havana’s port wharves that had been illegally expropriated by Fidel Castro in the 1960s. , the unprecedented decision on a law that punishes “trafficking in stolen goods” in Cuba.

US District Judge Beth Bloom’s long-awaited decision on Friday follows another consequential decision in March, in which she concluded that the four companies – Carnival, MSC SA, Royal Caribbean and Norwegian – committed “acts of trafficking” and engaged in under “forbidden tourism”. taking American travelers to Cuba and using Havana’s port facilities that Castro had confiscated.

The Cuban government never compensated Havana Docks, the US company with legal rights to the facility and whose ownership claim was certified by the US Department of Justice’s Foreign Claims Settlement Commission.

The four cruise lines, registered outside the United States but headquartered in Florida, would have to pay $439 million to Havana Docks in total, plus attorneys’ fees and costs, according to the ruling. Each company was ordered to pay the value of the original property claim plus decades of simple interest.

But the number is even higher because the law that punishes the use of confiscated assets in Cuba, the Helms-Burton Act of 1996 or the Libertad Act, allows the court to triple the amount of damages awarded.

“The crimes of the defendants in these cases have been established, and the Court has concluded that the defendants derived significant amounts of revenue – in the hundreds of millions of dollars each – from their illicit trafficking activities and to the detriment of the plaintiff,” the judge wrote. “A lower award, as the defendants suggest, would not effectively serve a deterrent purpose, as a lower award could be considered just a cost of doing business.”

The main provision of the Helms-Burton Act that allows lawsuits against those who use illegally seized property in Cuba, called Title III, has been suspended by every president since Bill Clinton signed it until Donald Trump took office. Breaking with tradition, Trump enacted it in 2019, opening the door to a flurry of lawsuits.

Still, skepticism persisted about whether the claimants, mostly the Cuban and American heirs of the companies expropriated in the 1960s, would be able to overcome all the legal hurdles involved in these complicated cases and find sympathetic ears in court.

While Friday’s decision can be appealed, it proves that at least some Helms-Burton cases can be won and end up with millions of dollars in judgments, offering hope to Americans, and especially to Cuban-American families who have been waiting for many years obtain reparations for Castro’s actions. At the same time, the multimillion-dollar fine sends another chilling message to potential investors and those looking to do business with the Cuban government on disputed properties.

“This is a very important decision by Judge Bloom,” said Bob Martinez, head of the Havana Docks legal defense team and a partner at Colson Hicks Eidson law firm in Coral Gables. “Commercial use of property seized in Cuba in violation of US law carries clearly detailed, well-known and publicized legal consequences. After decades of seeking its legal rights, Havana Docks is one step closer to justice. Havana Docks appreciates Judge Bloom’s thorough and careful analysis of the facts and the law.”

The case has also been closely watched because it sets a precedent for lawsuits involving travel providers such as cruise lines and airlines. These companies tried to argue in court that they were authorized by the Obama administration to do business with Cuba and that their business was covered by a “legal travel” exception in the embargo regulations.

But the judge rejected the defense after lawyers for Havana Docks presented evidence of tourist activities offered by cruise lines to their passengers, usually through tourism agencies contracted by the Cuban government.

Despite the relaxation of some sanctions during the brief détente with Cuba under Obama, tourism to Cuba was banned at the time, and still is. Cruise voyages to Cuba started in 2015 and ended in June 2019.

“The fact that the Treasury Department issued travel permits and executive branch officials, including the President, encouraged Defendants to do so does not automatically immunize them from liability if they engage in tourism prohibited by law,” the statement wrote. judge in March.

Hundreds of court documents examined by the Herald showed that cruise lines offered excursions to the beach, to the Tropicana cabaret in Havana and cocktail-making classes to learn how to make mojitos, among other activities that don’t quite fit the description of “educational trips”. to encourage “person-to-person” contacts, which was the legal travel category invoked by cruise lines to bring Americans to Cuba.

According to records, the companies earned at least $1.1 billion and paid $138 million to Cuban government entities.

A spokesman for Carnival told the Herald that the company does not believe its actions were wrong.

“Carnival Corporation has engaged in legal travel explicitly licensed, authorized and encouraged by the US government,” said Jody Venturoni. “We strongly disagree with the decision and judgment and plan to appeal these decisions.”

For more than two years, the parties have been embroiled in a bitter dispute over the question of whether, when docking in the port of Havana, the cruise companies “trafficked” confiscated goods. Havana Docks holds a US government-certified claim for loss of assets and a concession dating back to 1934 to operate three piers in the port of Havana that decades later were used as a cruise ship terminal to receive American travelers.

Norwegian, MSC SA and Royal Caribbean did not immediately respond to emails seeking comment.

This story was originally published December 30, 2022 8:53 pm.

Profile picture of Nora Gámez Torres

Nora Gámez Torres is a Cuba/United States-Latin America political reporter for El Nuevo Herald and the Miami Herald. She studied journalism and media and communication in Havana and London. She has a Ph.D. in sociology from the City, University of London. Her work has won awards from the Florida Society of News Editors and the Society for Professional Journalists.//Nora Gámez Torres studied journalism and communication in Havana and London. She has a doctorate in sociology and since 2014 has covered Cuban topics for the Nuevo Herald and the Miami Herald. She also reports on US policy towards Latin America. Her work has been recognized with awards from the Florida Society of News Editors and the Society for Professional Journalists.