First Arguments In Carnival Corporation Libertad Lawsuit Don't Bode Well For Dismissal; Judge Has Long History With Cuba Cases

Helms-Burton Suit Against Carnival May Float Despite Holes

By Nathan Hale  

Law360, Miami (July 31, 2019, 6:40 PM EDT) -- A Florida federal judge indicated Wednesday that he will deny Carnival's bid to dismiss a lawsuit seeking damages under the Helms-Burton Act over its use of Cuban port facilities that were confiscated by the Castro regime, but counsel for the cruise line said they still see several deficiencies in the claims.  

At a hearing in Miami, senior U.S. District Judge James Lawrence King said he was prepared to make a tentative ruling that, viewing the pleaded facts as true, plaintiff Javier Garcia-Bengochea has made a sufficient claim to an ownership interest in the La Maritima and Terminal Naviera docks in Santiago de Cuba.

The judge reserved the right to change his mind in his final order; however, he also suggested several times that Carnival's arguments for dismissal ask him to make findings that he is not prepared to make at this stage of the case.

"It seems to me that it's taking the court beyond perhaps where it should be at this point," the judge said, adding that he has always viewed the "guiding star" when deciding a motion to dismiss is "facts well pled."

After the hearing, George J. Fowler III of Jones Walker LLP, who is representing Carnival Corp. and was involved in the drafting of Helms-Burton, said he thinks Judge King is inclined to rule against the company at this stage but said that gaps in Garcia-Bengochea's pleadings about the basis for his ownership claim could portend problems for his case down the road.

"It may not be reflected in this first decision," said Fowler, who characterized the judge's comments as, "He said, 'I'm not going to dot all the I's and cross all the T's at this point.'"

Counsel for both sides noted the first impression issues presented by the case, which was filed May 2, the first day a policy shift by the Trump administration allowed Title III of the 1996 Helms-Burton Act to take effect, allowing U.S. nationals to bring litigation over property seized by Fidel Castro's communist government. Carnival also faces a similar suit over its use of docks in Havana.

In his eight-page complaint, Garcia-Bengochea, who is currently a resident of Jacksonville, Florida, claims that Doral, Florida-based Carnival is liable for money damages under Helms-Burton for trafficking in confiscated Cuban property through its use of the La Maritima docks to disembark passengers after it started offering cruises to the Caribbean island in May 2016.

Garcia-Bengochea asserts that he is the rightful owner of an 82.5% interest in the La Maritima property, and attached a form from the Foreign Claims Settlement Commission certifying a portion of his claim representing a 32.5% interest in the property.

But Carnival says Garcia-Bengochea's ownership claims are conclusory. The cruise line pointed out that the commission's certification lists an Albert Parreno as the owner of the claim and the complaint offers no explanation for Garcia-Bengochea's assertion that he possesses a right to the claim now.

The company also has argued that dismissal is warranted because Garcia-Bengochea's claim relates to ownership of stock in the La Maritima corporation that owned the docks, not the docks themselves, so he cannot allege that Carnival trafficked in the property he allegedly owned. Furthermore, he cannot bring a derivative claim on behalf of La Maritima because it was incorporated in Cuba and does not qualify as a U.S. national eligible to bring a claim under Helms-Burton.

During the hearing, Garcia-Bengochea's counsel, Roberto Martinez of Colson Hicks Eidson PA, told the court that Garcia-Bengochea inherited the claims through two cousins, which he said is certainly allowed under Helms-Burton.

"It was not the intent of Helms-Burton to allow the Cuban government to run out the clock on old Cubans," Martinez said.  Martinez also argued that the law features a "very expansive definition of property" that extends to patents, copyrights and any interest in property.

He also argued that the complaint is sufficient, having alleged that Garcia-Bengochea has an ownership interest in the waterfront property and that Carnival has used it.  

"A claim is really nothing more than an assertion to a right to a payment," Martinez said.  Judge King said he was swayed that Garcia-Bengochea's claims were sufficient for this stage of the litigation.

"He says he owns it. It may be totally wrong. It may be proven totally wrong. But it's a claim," the judge said.

Carnival also contends that its use of the property does not meet the definition of "trafficking" under Helms-Burton because the law carved out an exception for "uses of property incident to lawful travel to Cuba" and "necessary to the conduct of travel." It said it is undisputed that it was acting lawfully under a license to provide cruises to Cuba granted by the U.S. Treasury Department's Office of Foreign Assets Control, and it says Garcia-Bengochea's pleadings were insufficient because they did not mention lawful travel.

"You cannot plead trafficking without addressing whether the use of the property was lawful," Carnival counsel Stuart H. Singer of Boies Schiller & Flexner LLP argued, suggesting the court can dismiss the case based on judicial notice of Carnival's OFAC license.  

In response, Martinez argued that Carnival's lawful travel argument is an affirmative defense, calling the suggestion it had to be included in the complaint nonsense. Carnival's assertions that its use of the docks was incidental and necessary to travel and that it complied with its license are issues of fact that Garcia-Bengochea disputes. Martinez declined further comment after the hearing.  

Garcia-Bengochea alleges that he is entitled to money damages equal to three times the greater of the amount certified by the Foreign Claims Settlement Commission, plus interest; an amount determined by a special master; or fair market value of the property.  

Garcia-Bengochea is represented by Roberto Martinez, Francisco Raul Maderal Jr. and Stephanie A. Casey of Colson Hicks Eidson PA and Rodney S. Margol of Margol & Margol PA.  

Carnival is represented by Stuart H. Singer and Evan Ezray of Boies Schiller & Flexner LLP and George J. Fowler III and Luis E. Llamas of Jones Walker LLP.  

The case is Garcia-Bengochea v. Carnival Corp., case number 1:19-cv-21725, in the U.S. District Court for the Southern District of Florida.  

The Honorable James King, Senior Judge of the United States District Court for the Southern District of Florida  

Garcia-Bengochea v. Carnival Corporation (1:19-cv-21725-JLK)

https://www.fjc.gov/history/judges/king-james-lawrence  

https://www.flsd.uscourts.gov/content/senior-judge-james-lawrence-king 

https://en.wikipedia.org/wiki/James_Lawrence_King

U.S. Department Of State Imposes Visa Restrictions Upon Cuban Officials & Their Families

https://www.state.gov/visa-actions-against-cuban-officials/

Visa Actions Against Cuban Officials

Press Statement

Michael R. Pompeo, Secretary of State

July 26, 2019

The Cuban government engages in exploitative and coercive labor practices while it earns money on the backs of its citizens through its overseas medical missions program.  To address this labor abuse, the Department has imposed visa restrictions on certain Cuban officials and other individuals responsible for these coercive labor practices under the Immigration and Nationality Act Section 212(a)(3)(C).  These practices include working long hours, housing in unsafe areas, and compelling Cuban medical professionals to advance the regime’s political agenda.  Such visa restrictions could include immediate family members of these individuals.

No USDA Taxpayer Support Required: U.S. Soybean Exports To Cuba For First Five Months Of 2019 Exceed Entire Exports For Calendar Year 2018

Soybean product (soybeans, soybean oil cake) exports from the United States to the Republic of Cuba have thus far in 2019 exceeded the entire calendar year 2018, representing an increase of 14.59%. 

Soybean product exports to the Republic of Cuba for the period January 2019 through May 2019 were US$46,627,034.00 compared to calendar year 2018 of US$40,687,867.00. 

The Trade Sanctions Reform and Export Enhancement Act (TSREEA) of 2000 re-authorized the direct export of agricultural commodities and food products from the United States to the Republic of Cuba albeit on a payment-of-cash-in-advance basis.  

Since the first exports using provisions of the TSREEA in December 2001, the Republic of Cuba has purchased more than US$6,011,335,411.00 in agricultural commodities and food products exclusive of transportation charges, bank charges, or other costs associated with exports. 

On 25 July 2019, the United States Department of Agriculture (USDA) announced a “Support Package for Farmers” valued at US$16 billion “aimed at supporting American agricultural producers while the Administration continues to work on free, fair, and reciprocal trade deals.”  Soybean products are a significant component of the Support Package as soybean product exports from the United States to the People’s Republic of China have decreased substantially: 

https://www.usda.gov/media/press-releases/2019/07/25/usda-announces-details-support-package-farmers 

LINK To Economic Eye On Cuba Report

U.S. Department Of State Fourth Update To Cuba Restricted List Includes Second Kempinski Property & Aerogaviota

Munich, Germany-based Kempinski Hotels S.A. (seventy-five properties in thirty countries) has their second property (the first was Gran Hotel Manzana Kempinski La Habana) in the Republic of Cuba included on the Cuba Restricted List: https://www.kempinski.com/en/cayo-guillermo/cayo-guillermo-resort/ 

From The United States Department Of State: 

The Department of State is publishing an update to its List of Restricted Entities and Subentities Associated with Cuba (Cuba Restricted List) with which direct financial transactions are generally prohibited under the Cuban Assets Control Regulations (CACR). This Cuba Restricted List is also considered during review of license applications submitted to the Department of Commerce's Bureau of Industry and Security (BIS) pursuant to the Export Administration Regulations (EAR). 

DATES: The Cuba Restricted List is updated as of July 26, 2019. 

LINK To PDF Of List 

Background 

On June 16, 2017, the President signed National Security Presidential Memorandum-5 on Strengthening the Policy of the United States Toward Cuba (NSPM-5). As directed by NSPM-5, on November 9, 2017, the Department of the Treasury's Office of Foreign Assets Control (OFAC) published a final rule in the Federal Register amending the CACR, 31 CFR part 515, and the Department of Commerce's Bureau of Industry and Security (BIS) published a final rule in the Federal Register amending, among other sections, the section of the Export Administration Regulations (EAR) regarding Cuba, 15 CFR 746.2. The regulatory amendment to the CACR added § 515.209, which generally prohibits direct financial transactions with certain entities and subentities identified on the State Department's Cuba Restricted List. The regulatory amendment to 15 CFR 746.2, notes BIS will generally deny applications to export or re-export items for use by entities or subentities identified on the Cuba Restricted List. The State Department is now updating the Cuba Restricted list, as published below and available on the State Department's website (https://www.state.gov/​cuba-sanctions/​cuba-restricted-list/​). 

This update includes four additional subentities. This is the fourth update to the Cuba Restricted List since it was published November 9, 2017 (82 FR 52089). Previous updates were published November 15, 2018 (see 83 FR 57523), March 9, 2019 (see 84 FR 8939), and April 24, 2019 (see 84 FR 17228). The State Department will continue to update the Cuba Restricted List periodically. 

The publication of the updated Cuba Restricted List further implements the directive in paragraph 3(a)(i) of NSPM-5 for the Secretary of State to identify the entities or subentities, as appropriate, that are under the control of, or act for or on behalf of, the Cuban military, intelligence, or security services or personnel, and publish a list of those identified entities and subentities with which direct financial transactions would disproportionately benefit such services or personnel at the expense of the Cuban people or private enterprise in Cuba. 

This document and additional information concerning the Cuba Restricted List are available from the Department of State's website (https://www.state.gov/​cuba-sanctions/​cuba-restricted-list/​). 

List of Restricted Entities and Subentities Associated With Cuba as of July 26, 2019 

Below is the U.S. Department of State's list of entities and subentities under the control of, or acting for or on behalf of, the Cuban military, intelligence, or security services or personnel with which direct financial transactions would disproportionately benefit such services or personnel at the expense of the Cuban people or private enterprise in Cuba. For information regarding the prohibition on direct financial transactions with these entities, please see 31 CFR 515.209. All entities and subentities were listed effective November 9, 2017, unless otherwise indicated. 

* * * Entities or subentities owned or controlled by another entity or subentity on this list are not treated as restricted unless also specified by name on the list. * * *

State Department Updates the Cuba Restricted List

07/26/2019 10:32 AM EDT  

The State Department has updated the Cuba Restricted List to add four sub-entities owned by the Cuban military.  The changes take effect today, July 26, as Cuba celebrates more than 60 years since the start of the Cuban Revolution.  Sixty years after Castro promised to improve the lives of the Cuban people, the revolution continues to fail its people by squandering Cuba’s economic potential through mismanagement and oppressing brave Cubans that continue the fight for freedom.  The Department remains committed to ensuring U.S. funds do not directly support Cuba’s state security apparatus, which not only violates the human rights of the Cuban people, but also exports this repression to Venezuela to support the corrupt Maduro regime. 

In accordance with the June 2017 National Security Presidential Memorandum-5, “Strengthening the Policy of the United States Toward Cuba,” the U.S. government generally prohibits direct financial transactions with listed entities and sub-entities because they would disproportionately benefit the Cuban military, intelligence, and security services or personnel at the expense of the Cuban people or private enterprise in Cuba. 

For more information on the regulations prohibiting direct financial transactions with entities and sub-entities on the Cuba Restricted List, please refer to the November 2017 regulatory amendments by the Departments of the Treasury (31 CFR part 515) and Commerce (15 CFR parts 730-774). 

For further information, please contact WHA Press at WHAPress@state.gov and EB Press at EEB-A-PD-DL@state.gov. 

The post State Department Updates the Cuba Restricted List appeared first on United States Department of State.

U.S. Cash-In-Advance Food/Ag Exports To Cuba Exceed US$6 Billion

In December 2001, the first agricultural commodity exports were delivered directly from the United States to the Republic of Cuba using provisions of the Trade Sanctions Reform and Export Enhancement Act (TSREEA) of 2000. 

The TSREEA re-authorized the direct commercial (on a cash basis) export of food products (including branded food products) and agricultural commodities from the United States to the Republic of Cuba, irrespective of purpose. The TSREEA does not include healthcare products, which remain authorized and regulated by the Cuban Democracy Act (CDA) of 1992. 

The data represents the U.S. Dollar value of product exported from the United States to the Republic of Cuba under the TSREEA. The data does not include transportation charges, bank charges, or other costs associated with exports; the government of the Republic of Cuba reports unverifiable data that includes transportation charges, bank charges, and other costs.

LINK To Economic Eye On Cuba Report

U.S. Exports To Cuba Decrease 5.1% In May 2019; Remain Up 8.5% Year-To-Year; Cuba Hits US$6 Billion In Purchases

ECONOMIC EYE ON CUBA©

July 2019

US$6 Billion Exported To Cuba Since 2001- 1

May 2019 Food/Ag Exports To Cuba Decrease 5.1%- 1

Cuba Ranked of 50th of 229 U.S. Food/Ag Export Markets- 2

Cuba Year-To-Year Exports Increase 10.1%- 2

May 2019 Healthcare Product Exports US$144,860.00- 2

May 2019 Humanitarian Donations US$1,412,237.00- 3

Obama Administration Initiatives Exports Continue To Increase- 3

U.S. Port Export Data- 16 

MAY 2019 FOOD/AG EXPORTS TO CUBA DECREASED 5.1%- Exports of food products and agricultural commodities from the United States to the Republic of Cuba in May 2019 were US$27,657,057.00 compared to US$29,169,203.00 in May 2018 and US$31,720,403.00 in May 2017.   

United States exports from January 2019 through May 2019 were US$136,122,190.00 compared to US$123,585,994.00 from January 2018 through May 2018, representing an increase of 10.1%. 

Total exports of agricultural commodities and food products from the United States to the Republic of Cuba since December 2001 is US$6,011,335,411.00 through May 2019.   

The information on exports from the United States to the Republic of Cuba includes- products within the Trade Sanctions Reform and Export Enhancement Act (TSREEA) of 2000, Cuban Democracy Act (CDA) of 1992, and regulations implemented (1992 to present) for other products by the Office of Foreign Assets Control (OFAC) of the United States Department of the Treasury and Bureau of Industry and Security (BIS) of the United States Department of Commerce. 

The TSREEA re-authorized the direct commercial (on a cash basis) export of food products (including branded food products) and agricultural commodities from the United States to the Republic of Cuba, irrespective of purpose. The TSREEA does not include healthcare products, which remain authorized and regulated by the CDA 

LINK To Complete Report

Recent Court Filings In Spain (Not United States) Lawsuit Against Melia Hotels International

The two most recent filings for the lawsuit filed on 29 May 2019 in Spain against Palma de Mallorca, Spain-based Melia Hotels International S.A. relating to the use by the company of expropriated property in the Republic of Cuba.   

The lawsuit is not using provisions of the 1996 Cuba Liberty and Democratic Solidarity Act (known as “Libertad Act”) although Melia Hotels International S.A. does reference the Libertad Act in its response. 

8 July 2019 on behalf of Melia Hotels International S.A. [LINK]

17 July 2019 on behalf of Central Santa Lucia L.C. [LINK]

29 May 2019 on behalf of Central Santa Lucia L.C. (original lawsuit filing) [LINK]

Libertad Act 

The Trump Administration has made operational Title III and further implemented Title IV of the Cuban Liberty and Democratic Solidarity Act of 1996 (known as “Libertad Act”).   

Title III authorizes lawsuits in United States District Courts against companies and individuals who are using a certified claim or non-certified claim where the owner of the certified claim or non-certified claim has not received compensation from the Republic of Cuba or from a third-party who is using (“trafficking”) the asset.   

Title IV restricts entry into the United States by individuals who have connectivity to unresolved certified claims or non-certified claims.  One Canada-based company is currently subject to this provision based upon a certified claim. 

Certified Claims Background 

There are 8,821 claims of which 5,913 awards valued at US$1,902,202,284.95 were certified by the USFCSC and have not been resolved for nearing sixty years (some assets were officially confiscated in the 1960’s, some in the 1970’s and some in the 1990’s.  The USFCSC permitted simple interest (not compound interest) of 6% per annum (approximately US$114,132,137.10); with the approximate current value of the 5,913 certified claims US$8,521,866,236.75.  

The first asset to be expropriated by the Republic of Cuba was an oil refinery in 1960 owned by White Plains, New York-based Texaco, Inc., now a subsidiary of San Ramon, California-based Chevron Corporation (USFCSC: CU-1331/CU-1332/CU-1333 valued at US$56,196,422.73).  

The largest certified claim (Cuban Electric Company) valued at US$267,568,413.62 is controlled by Boca Raton, Florida-based Office Depot, Inc.  The second-largest certified claim (International Telephone and Telegraph Co, ITT as Trustee, Starwood Hotels & Resorts Worldwide, Inc.) valued at US$181,808,794.14 is controlled by Bethesda, Maryland-based Marriott International; the certified claim also includes land adjacent to the Jose Marti International Airport in Havana, Republic of Cuba.  The smallest certified claim is by Sara W. Fishman in the amount of US$1.00 with reference to the Cuban-Venezuelan Oil Voting Trust. 

The two (2) largest certified claims total US$449,377,207.76, representing 24% of the total value of the certified claims.  Thirty (30) certified claimants hold 56% of the total value of the certified claims.  This concentration of value creates an efficient pathway towards a settlement.   

Title III of the Cuban Liberty and Democratic Solidarity (Libertad) Act of 1996 requires that an asset had a value of US$50,000.00 when expropriated by the Republic of Cuba without compensation to the original owner.  Of the 5,913 certified claims, 913, or 15%, are valued at US$50,000.00 or more.  Adjusted for inflation, US$50,000.00 (3.70% per annum) in 1960 has a 2019 value of approximately US$427,267.01.  The USFCSC authorized 6% per annum, meaning the 2019 value of US$50,000.00 is approximately US$1,649,384.54.  

The ITT Corporation Agreement 

In July 1997, then-New York City, New York-based ITT Corporation and then-Amsterdam, the Netherlands-based STET International Netherlands N.V. signed an agreement whereby STET International Netherlands N.V. would pay approximately US$25 million to ITT Corporation for a ten-year right (after which the agreement could be renewed and was renewed) to use assets (telephone facilities and telephone equipment) within the Republic of Cuba upon which ITT Corporation has a certified claim valued at approximately US$130.8 million.  ETECSA, which is now wholly-owned by the government of the Republic of Cuba, was a joint venture controlled by the Ministry of Information and Communications of the Republic of Cuba within which Amsterdam, the Netherlands-based Telecom Italia International N.V. (formerly Stet International Netherlands N.V.), a subsidiary of Rome, Italy-based Telecom Italia S.p.A. was a shareholder.  Telecom Italia S.p.A., was at one time a subsidiary of Ivrea, Italy-based Olivetti S.p.A.  The second-largest certified claim (International Telephone and Telegraph Co, ITT as Trustee, Starwood Hotels & Resorts Worldwide, Inc.) valued at US$181,808,794.14 is controlled by Bethesda, Maryland-based Marriott International.  

TITLE III--SEC. 302. LIABILITY FOR TRAFFICKING IN CONFISCATED PROPERTY CLAIMED BY UNITED STATES NATIONALS. 

(a) Civil Remedy.-- (1) Liability for trafficking.--(A) Except as otherwise provided in this section, any person that, after the end of the 3-month period beginning on the effective date of this title, traffics in property which was confiscated by the Cuban Government on or after January 1, 1959, shall be liable to any United States national who owns the claim to such property for money damages in an amount equal to the sum of-- (i) the amount which is the greater of-- (I) the amount, if any, certified to the claimant by the Foreign Claims Settlement Commission under the International Claims Settlement Act of 1949, plus interest; (II) the amount determined under section 303(a)(2), plus interest; or (III) the fair market value of that property, calculated as being either the current value of the property, or the value of the property when confiscated plus interest, whichever is greater; and (ii) court costs and reasonable attorneys' fees.  (B) Interest under subparagraph (A)(i) shall be at the rate set forth in section 1961 of title 28, United States Code, computed by the court from the date of confiscation of the property involved to the date on which the action is brought under this subsection.   

(2) Presumption in favor of the certified claims.--There shall be a presumption that the amount for which a person is liable under clause (i) of paragraph (1)(A) is the amount that is certified as described in subclause (I) of that clause. The presumption shall be rebuttable by clear and convincing evidence that the amount described in subclause (II) or (III) of that clause is the appropriate amount of liability under that clause. 

(3) Increased liability.-- (A) Any person that traffics in confiscated property for which liability is incurred under paragraph (1) shall, if a United States national owns a claim with respect to that property which was certified by the Foreign Claims Settlement Commission under title V of the International Claims Settlement Act of 1949, be liable for damages computed in accordance with subparagraph (C).   

(B) If the claimant in an action under this subsection (other than a United States national to whom subparagraph (A) applies) provides, after the end of the 3-month period described in paragraph (1) notice to-- (i) a person against whom the action is to be initiated, or (ii) a person who is to be joined as a defendant in the action, at least 30 days before initiating the action or joining such person as a defendant, as the case may be, and that person, after the end of the 30- day period beginning on the date the notice is provided, traffics in the confiscated property that is the subject of the action, then that person shall be liable to that claimant for damages computed in accordance with subparagraph (C).   

(C) Damages for which a person is liable under subparagraph (A) or subparagraph (B) are money damages in an amount equal to the sum of-- (i) the amount determined under paragraph (1)(A)(ii), and (ii) 3 times the amount determined applicable under paragraph (1)(A)(i).  (D) Notice to a person under subparagraph (B)-- (i) shall be in writing; (ii) shall be posted by certified mail or personally delivered to the person; and (iii) shall contain-- (I) a statement of intention to commence the action under this section or to join the person as a defendant (as the case may be), together with the reasons therefor; (II) a demand that the unlawful trafficking in the claimant's property cease immediately; and (III) a copy of the summary statement published under paragraph (8).  (4) Applicability.--(A) Except as otherwise provided in this paragraph, actions may be brought under paragraph (1) with respect to property confiscated before, on, or after the date of the enactment of this Act. 

(B) In the case of property confiscated before the date of the enactment of this Act, a United States national may not bring an action under this section on a claim to the confiscated property unless such national acquires ownership of the claim before such date of enactment.  (C) In the case of property confiscated on or after the date of the enactment of this Act, a United States national who, after the property is confiscated, acquires ownership of a claim to the property by assignment for value, may not bring an action on the claim under this section.   

(5) Treatment of certain actions.--(A) In the case of a United States national who was eligible to file a claim with the Foreign Claims Settlement Commission under title V of the International Claims Settlement Act of 1949 but did not so file the claim, that United States national may not bring an action on that claim under this section.  (B) In the case of any action brought under this section by a United States national whose underlying claim in the action was timely filed with the Foreign Claims Settlement Commission under title V of the International Claims Settlement Act of 1949 but was denied by the Commission, the court shall accept the findings of the Commission on the claim as conclusive in the action under this section. 

(C) A United States national, other than a United States national bringing an action under this section on a claim certified under title V of the International Claims Settlement Act of 1949, may not bring an action on a claim under this section before the end of the 2-year period beginning on the date of the enactment of this Act. 

(D) An interest in property for which a United States national has a claim certified under title V of the International Claims Settlement Act of 1949 may not be the subject of a claim in an action under this section by any other person. Any person bringing an action under this section whose claim has not been so certified shall have the burden of establishing for the court that the interest in property that is the subject of the claim is not the subject of a claim so certified.  (6) Inapplicability of act of state doctrine.--No court of the United States shall decline, based upon the act of state doctrine, to make a determination on the merits in an action brought under paragraph (1). 

(7) Licenses not required.--(A) Notwithstanding any other provision of law, an action under this section may be brought and may be settled, and a judgment rendered in such action may be enforced, without obtaining any license or other permission from any agency of the United States, except that this paragraph shall not apply to the execution of a judgment against, or the settlement of actions involving, property blocked under the authorities of section 5(b) of the Trading with the Enemy Act that were being exercised on July 1, 1977, as a result of a national emergency declared by the President before such date, and are being exercised on the date of the enactment of this Act.

Societe Generale Of France Is Target Of 9th Lawsuit Using Libertad Act

1:19-cv-22842-DPG Sucesores de Don Carlos Nunez y Dona Pura Galvez, Inc. v. Societe Generale, S.A.
Darrin P. Gayles, presiding

Date filed: 07/10/2019 

LINK To Filing 

Societe Generale sued for $792 million by heirs of Cuban bank seized by Castro 

Reuters

By Jonathan Stempel

10 July 2019 

(Reuters) - The family of the former owners of a Cuban bank seized by Fidel Castro’s government nearly six decades ago sued Societe Generale (SOGN.PA) for approximately $792 million, saying the French bank owes damages for circumventing U.S. sanctions against Cuba. 

In a complaint filed on Wednesday with the U.S. District Court in Miami, 14 grandchildren of Carlos and Pura Nuñez, who once owned Banco Nuñez, want to hold Societe Generale liable under U.S. law for doing business with Cuba’s central bank, which nationalized Banco Nuñez and other lenders in 1960. 

A lawyer for the plaintiffs said he believed the case was the first against a bank that allegedly “trafficked” in property expropriated by the Castro regime, since the Trump administration said in April it would begin letting U.S. nationals sue companies for such conduct. 

“Victims of the Cuban regime who had their property confiscated now have a vehicle to get justice,” Javier Lopez, the lawyer, said in an interview. “We have multiple financial institutions that we’re looking to target.”  Societe Generale did not immediately respond to requests for comment after market hours. 

The lawsuit was filed eight months after Societe Generale agreed to pay $1.34 billion and enter a deferred prosecution agreement to settle U.S. and New York regulatory charges that it handled billions of dollars of transactions related to Cuba and other countries under U.S. sanctions. 

According to the plaintiffs, Societe Generale generated hundreds of millions of dollars of fees by lending money to and processing transactions for Banco Nacional de Cuba from 2000 to 2010. 

The plaintiffs said they own a claim to 10.5% of the equity in Banco Nacional de Cuba, roughly the percentage that Banco Nuñez represented when it was seized.  Lawyers for the plaintiffs at Kozyak Tropin & Throckmorton based the $792 million damages estimate on Banco Nuñez’s $7.8 million worth at the time, plus 6% annual interest and triple damages under the Helms-Burton Act, a 1996 federal law. 

The right to sue under that law had been suspended for 23 years because of opposition from the international community and concern that U.S. courts could be overrun by lawsuits. 

Secretary of State Mike Pompeo announced the lifting of that suspension in April, to boost pressure on Havana to end Cuban support for Venezuela’s socialist president, Nicolas Maduro. 

The case is Sucesors de Don Carlos Nuñez y Doña Pura Galvez Inc v Societe Generale SA, U.S. District Court, Southern District of Florida, No. 19-22842.

President Trump To Visit Turkey: (Bonus) A Trump Tower In Istanbul & (Challenge) A Well-Known Company May Be Sued

The Honorable Donald J. Trump, President of the United States, continues to plan for a visit to the Republic of Turkey.  Will he visit Trump Towers in Istanbul?  Cuba will be a topic.   

A goal for a two-night visit to Turkey remains for July 2019 or August 2019 (prior or subsequent to the 45th G7 Summit in Biarritz, Nouvelle-Aquitaine, France) or September 2019 prior to the United Nations General Assembly in New York City. 

During the United Nations General Assembly, President Trump anticipates high-profile bilateral meetings (formal and sideline) with leadership of Cuba, Iran, North Korea, Syria, and Venezuela (unified or bifurcated) among others. 

H.E. Recep Tayyip Erdogan, President of the Republic of Turkey since 2014, was Prime Minister from 2003 to 2014, and Mayor of Istanbul from 1994 to 1998.  President Erdogan leads the Justice and Development Party (AKP).  Primary opposition party is Republican People’s Party (CHP). 

Despite current commercial, economic and political challenges for President Erdogan, he and the 82.9 million population of Turkey remain indispensable to the multilateral interests of the United States.  

The Trump Administration remains concerned by a re-alignment of Turkey with China, Russia, India, Iran, Iraq and Syria (where Ankara will have a substantive role in the management and rebuilding of the country).   

The delay by the Brussels, Belgium-based European Union (EU) in its efforts to include Turkey as its 29th member is no longer considered by Turkey to be of immediate importance; membership has ceased to be an enticement to influence behavior.   

Turkey withdrawing from the 29-member Brussels, Belgium-based North Atlantic Treaty Organization (NATO) should not be discounted as a genuine option; Turkey could affiliate with the 125-member and 25 observer countries of the New York, New York-based Non-Aligned Movement (NAM)- Turkey would immediately have a leadership role and revitalize its global influence.    

A goal of the visit to Turkey is to project President Trump as not anti-Muslim in a country where an existing narrative is that he is anti-Muslim; with a perception by some that he separates Muslims into two groups- those who are “civilized” defined as wealthy, purchase products (particularly defense-related) from the United States, and support United States policies and those who are “uncivilized” defined as poor, do not purchase products (particularly defense-related) from the United States, and do not support United States policies. 

Venues in Turkey of interest to staff at The White House- National Security Council (NSC) and Office of Scheduling and Advance, United States Department of State, and United States Secret Service (USSS) include the capital Ankara (population approximately 5 million), the largest city Istanbul (population approximately 15 million), and Izmir (population approximately 4 million), located on the Aegean Sea coast and location of substantive photogenic archaeological sites. 

In Istanbul, the preferred primary location, President and Mrs. Trump with President and Mrs. Erdogan would visit the Blue Mosque, Hagia Sophia Museum and Basilica Cistern.  President Trump and President Erdogan might visit the Suleymaniye Hamam.  Mrs. Trump and Mrs. Erdogan may visit Topkapi Palace Museum, Suleymaniye Mosque and Grand Bazaar.  There may also be a cruise on the Bosphorus and photo opportunity at the Maiden’s Tower; and potentially a visit to one of the Prince’s Islands located in the Sea of Marmara to the southeast of Istanbul.  

The government of Turkey advocates for Air Force One to arrive at US$8 billion Istanbul Airport (IST) which commenced full operation in 2019 and is located approximately expressway 22 miles from Istanbul.  Once completed, expected to be one of the largest airports in the world with eight runways and annual capacity approaching 200 million travelers.  Turkish Airlines is reported as the largest airline in the world by number of destinations, currently 304.  Turkish Airlines is an “Airborne Embassy” and Turkish Cargo is an “Airborne Chamber of Commerce.”   

If bilateral and multilateral defense-related issues are resolved or near resolution, President Trump would have an interest in visiting a military base to reinforce the relationship of Turkey with the United States and NATO (F-35 aircraft manufactured by Fort Worth, Texas-based Lockheed Martin with components manufactured in Turkey).  If there are Patriot surface-to-air (SAM) systems manufactured by Waltham, Massachusetts-based Raytheon Company available for viewing, they would be included in any tour. 

If Turkey accepts delivery of the S-400 SAM from Moscow, Russia-based VKO Almaz-Antey, a visit by President Trump to an installation site should not be discounted as it would provide an opportunity for the President to present reasons the Patriot is superior to the S-400.   

Venue concerns are primarily focused upon (though unlikely) demonstrations- in support of the AKP and against the AKP and in support of the CHP and against the CHP.  The recently-elected mayors of Ankara (the capital) and Istanbul (the largest city in the country) are members of the CHP and each will welcome President Trump when he arrives to their respective cities.  Expect Turkey to consider temporarily closing its overland borders with Syria, Iraq, Iran, Armenia and Georgia as security precautions.  President Erdogan will desire to be perceived as a muscular democrat- tolerant to opposition yet unquestioned as to his leadership of the country.    

A most significant optical challenge for the Trump Administration is how to manage the desire of President Trump to visit the two-building Trump Towers located in the Sisli District of Istanbul.  

According to the required 2018 filing to the U.S. Office of Government Ethics, President Trump certified: “TRUMP MARKS ISTANBUL II LLC NIA 342.  Value: None (or less than $1,001).  Income Type: royalties.  Income Amount: $100,001-$1,000,000.  Value reported reflects bank account holding only.  Additional Underlying Asset: license deal with ORTADOGU OTOMOTIV TICARET AS - value not readily ascertainable. License holder, New York, NY.  Trump Marks Istanbul II LLC shareholders: 1% Trump Marks Istanbul II Corp (role- managing shareholder) and 99%- DTTM Operations LLC (role- member).”   

The property is near previously-outlined secure motorcade routes from Ataturk International Airport to the listed hotels (United States government preferred brands include Hilton, Hyatt, Marriott).  The Trump Towers are viewable from most rooms in the United States-branded properties in Istanbul.  

President Trump has been criticized for visiting properties in the United States and other countries owned/managed/licensed by The Trump Organization as the visits are perceived as a United States-taxpayer funded opportunity to provide marketing value for the personal interests of the President and his family.  Thus far, the President has not indicated that he considers such criticism to be justified; and has continued to visit properties even when there is substantial cost to United States taxpayers- golf course in Scotland, for example and no identifiable official purpose.   

Opened in 2010, Trump Towers Istanbul (http://www.trumpistanbul.com.tr/en/default.aspx) was reported as the first to be constructed on the European Continent. 

Trump Towers (Wikipedia): 

“Trump Towers, Istanbul, Sisli is a landmark in the historic city of Istanbul.  With two towers rising in Mecidiyekoy, one of the city's most vibrant areas, the property captures the utmost in luxury.  The residential tower, just under 40 stories, consists of over 200 residences, and will feature the expansive layouts, meticulous eye for design and lavish finishes synonymous with the Trump name.  Forest, city and Bosporus views will be extraordinary through the vista of floor-to-ceiling windows.   

In addition, residents will enjoy a full-service spa and fitness center, an indoor pool, a 24-hour doorman, a business center, and a vast range of additional amenities. The office tower, also 40 stories, will offer commercial luxury at its finest, with a private entrance, a beauty center, fitness area and pool for those working in the building. A luxury retail component of over 400,000-square-feet rests at the base of both towers, offering residents and visitors the best in retail and dining with personalized service incomparable to anything in Istanbul. 

A prominent tenant in the building has been: Reza Zarrab (Persian: رضا ضراب‎, Turkish: Rıza Sarraf; born 12 September 1983 in Tabriz, Iran) is a Turkey-based businessman. He has quadruple Iranian, Azerbaijani, Turkish and Macedonian citizenship.  

On 19 March 2016 he was arrested in the United States, and is accused of being a member of international criminal organization. He was charged with evading the US economic sanctions on Iran and money laundering in an alleged racket scheme to help Iran bypass the sanctions, involving ministers of the Turkish government of then prime minister and now president of Turkey, Recep Tayyip Erdoğan.   

His father, Hossein Zarrab, had a close relationship with Mahmoud Ahmadinejad, who served as the President of Iran between 2005 and 2013. The U.S. Department of Treasury accused Hossein Zarrab of violating U.S. sanctions on Iran and slapped a $9.1 million fine against him. His fine reduced to $2.3 million following his collaboration with the U.S. officials. 

Zarrab was arrested by the FBI in Miami in the US on March 19, 2016 and was accused of bank fraud, money laundering and helping the Iranian government in evading the US economic sanctions on Iran to hinder its nuclear-weapons program. His charges; conspiracy to defraud, violating the International Emergency Economic Powers Act, money laundering, and bank fraud; could bring up to 70 years in prison if found guilty in the U.S. Federal Court.” 

Issues for discussion by President Trump and President Erdogan include:  

Accepting from Iraq the children of Turkish-nationals

Accepting from Syria the children of Turkish-nationals

China (commercial relationship, Uighurs)

Continuing NATO membership

Cuba (potential lawsuit against company using Libertad Act; relationship with Venezuela)

EU Membership

F-35 Aircraft

Fethullah Gulen

Iran

Iraq

Israel

Libya

NATO membership

Natural Gas Purchases

North Korea

Oil Purchases

Prisoner Exchanges

Production Cooperation Agreement for S-500 defense system with Russia

Purchase of S-400 defense system from Russia

Removal of Turkey as a Beneficiary Developing Country (BDC) for GSP

Removed higher level United States tariffs on steel exports to the United States

Russia

Syria

Venezuela

Complete Analysis In PDF Format

OFAC Sanctions Another Company Owned By Government Of Cuba That Engages With Venezuela

United States Department of State

Washington DC

3 July 2019

The United States Curtails Cuban Support for Illegitimate Former Maduro Regime

Today, the United States removed sanctions on oil shipping company PB Tankers in response to actions it has taken to ensure that its vessels no longer were complicit in supporting the former Maduro regime. Additionally, the United States designated Cubametales, the Cuban state-run company and primary facilitator of oil imports from Venezuela, for circumventing U.S. sanctions.

The services and goods Cuba provides Venezuela continue to fuel the corruption of Maduro and his cronies and help maintain their influence over the Venezuelan people. These actions serve to squeeze the lifeline provided by Cuba that preserves Nicolas Maduro’s influence. Every drop of Venezuelan oil shipped to Cuba is traded for additional security and intelligence officers and other personnel, which further robs and impoverishes a once rich nation, denies Venezuelan sovereignty, and prolongs the suffering of the Venezuelan people.

We commend PB Tankers, which was sanctioned on April 12, 2019, for taking actions since then to ensure that its vessels are not used to prop up Maduro and his Cuban sponsors. This is a reminder that those who take concrete and meaningful actions to restore democracy in Venezuela can expect the removal of sanctions.

At the same time, the United States will continue to take action against those that seek to thwart Venezuela’s peaceful transition back to freedom and prosperity.

We call on the international community to step up pressure on Nicolas Maduro and his criminal associates. We must stand together in support of the Venezuelan people’s struggle for democracy and desire to live in dignity.

United States Department of the Treasury

Washington DC

3 July 2019 

Treasury further removes sanctions on company that has ended its involvement in Venezuelan oil shipments to Cuba 

Washington (3 July 2019) – Today, the Department of the Treasury’s Office of Foreign Assets Control (OFAC) designated Cubametales, the Cuban state-run oil import and export company, for its continued importation of oil from Venezuela.  Cuba, in exchange for this oil, continues to provide support, including defense, intelligence, and security assistance, to the illegitimate regime of former President Nicolas Maduro.  Today’s action, taken pursuant to Executive Order (E.O.) 13850, as amended, targets the company for operating in the oil sector of the Venezuelan economy.   

“Maduro is clinging to Cuba to stay in power, buying military and intelligence operatives in exchange for oil.  Treasury’s sanctions on Cubametales will disrupt Maduro’s attempts to use Venezuela’s oil as a bargaining tool to help his supporters purchase protection from Cuba and other malign foreign actors,” said Treasury Secretary Steven T. Mnuchin.  “Treasury’s decision to remove restrictions on PB Tankers and unblock previously sanctioned vessels is a reminder that positive changes in behavior can result in the lifting of sanctions.” 

On October 31, 2000, the Government of Cuba solidified its investment in the oil sector of Venezuela through the Cuba-Venezuela Integral Cooperation Agreement (CIC).  Through this agreement, Venezuela exports oil to Cuba, and in return, Cuba provides assistance to several sectors of the Venezuelan economy, to include the provision of medical services, technology, and military assistance.  The goods and services Cuba provides Venezuela continue to fuel the corruption of Maduro and his associates and help maintain their control over the increasingly impoverished Venezuelan people whose oil has been shipped to Cuba in support of dictatorship.   

Since the January 28, 2019 designation of Petroleos de Venezuela, S.A. (PDVSA), the Venezuelan state-owned oil company, Cubametales and other Cuba-based entities have continued to support Maduro through oil shipments from Venezuela.   

Cubametales is based in Havana, Cuba and is responsible for guaranteeing 100 percent of imports and exports of fuels and imports of additives and basic oils for lubricants to and from Cuba.  Additionally, Cubametales has been the recipient, and charterer, of shipments of oil from Venezuela to Cuba and has expanded its operations to include non-traditionally traded oil products such as sulfur fuel and diluted crude oil.  As a part of the original CIC agreement, the agreement states that Cubametales (and its administrative manager) and PDVSA are responsible for setting the terms and conditions for PDVSA oil exports up to 53,000 barrels per day on a quarterly basis.   

As a result of today’s action, all property and interests in property of this entity, and of any entities that are owned, directly or indirectly, 50 percent or more by the designated entity, that are in the United States or in the possession or control of U.S. persons are blocked and must be reported to OFAC.  OFAC’s regulations generally prohibit all dealings by U.S. persons or within (or transiting) the United States that involve any property or interests in property of blocked or designated persons.

Delisting of PB Tanker S.p.A 

In addition to today’s designation of Cubametales, OFAC is delisting PB Tankers S.p.A. (PB Tankers).  OFAC designated PB Tankers on April 12, 2019, for operating in the oil sector of the Venezuelan economy.  As a part of this designation, six vessels were identified as blocked property in the interest of PB Tankers; one vessel, named the Silver Point, was used to deliver oil products from Venezuela to Cuba.  Following the company’s designation, PB Tankers terminated its charter agreement with Cubametales, which had chartered the Silver Point to transport oil between Venezuela and Cuba.  Likewise, PB Tankers took additional steps to increase scrutiny of its business operations to prevent future sanctionable activity.   

Treasury recognizes the actions that PB Tankers has taken to ensure that its vessels are not complicit in propping up the illegitimate former Maduro regime in Venezuela.  As a result of today’s action, all property and interests in property, which had been blocked as a result of PB Tankers’ designation, are unblocked, and all otherwise lawful transactions involving U.S. persons and PB Tankers are no longer prohibited. 

Delistings Promote Positive Changes in Behavior 

U.S. sanctions need not be permanent; sanctions are intended to bring about a positive change of behavior.  The United States has made clear that the removal of sanctions is available for persons designated under E.O. 13692 or E.O. 13850, both as amended, who take concrete and meaningful actions to restore the democratic order, including through refusing to operate in Venezuela’s oil sector, which continues to provide a lifeline to the illegitimate regime of former President Nicolas Maduro.  

Additional Resources 

For information about the methods that Venezuelan senior political figures, their associates, and front persons use to move and hide corrupt proceeds, including how they try to exploit the U.S. financial system and real estate market, please refer to Treasury’s Financial Crimes Enforcement Network (FinCEN) advisories FIN-2019-A002, “Updated Advisory on Widespread Public Corruption in Venezuela,” FIN-2017-A006, “Advisory to Financial Institutions and Real Estate Firms and Professionals” and FIN-2018-A003, “Advisory on Human Rights Abuses Enabled by Corrupt Senior Foreign Political Figures and their Financial Facilitators.”