Carnival Cruise Hit With Lawsuits Involving Expropriated Cuban Assets
When the Cuban revolution occurred, the state, under Fidel Castro expropriated millions in privately owned assets. Some of the assets belonged to American citizens and others were the assets of the descendants of former Cubans. A federal judge recently ruled that American citizens can sue Carnival Cruise to seek damages under a special provision of the Helms-Burton Act.
One such claimant, Javier Garcia-Bengochea, alleges that Carnival Cruise is turning a profit on ports and piers that were expropriated from his father, a Cuban businessman. Essentially, the U.S. government recognizes Garcia-Bengochea’s claim on the property while the Cuban government does not. But how does that translate to actionable damages?
Enter Geopolitical Politics
President Obama had eased restrictions on Cuba during his presidency, but once President Trump took over, he announced that he intended to enforce the entirety of the Helms-Burton Act. A second lawsuit has been brought by Havana Docks Corporation against Carnival Cruise for use of another dock. The U.S. government recognizes Havana Dock’s claim. Both cases are moving forward toward a jury trial.
Unfortunately, this will not have much of an impact on Carnival, because it has discontinued its port calls in Cuba, but may have a significant impact on Cuba’s ability to obtain hard currency.
How do geopolitical politics play in? The U.S. government is using enforcement of Helms-Burton and other laws, in an attempt to dissuade Cuba from backing current president Nicolas Maduro.
Other U.S. Companies May be Hit
Of course, Carnival Corporation is not the only company in the U.S. who began doing business when the easing of Helms Burton.
In response, Carnival has maintained that it had permission from the U.S. Treasury to do business with Cuba, which should insulate it from liability.
Although this change in policy creates uncertainty, one thing that is for sure, Carnival will not go down without a fight.
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