The Trump administration is moving to allow lawsuits in U.S. courts against any company or entity doing business in Cuba using property seized in the 1959 revolution, Secretary of State Mike Pompeo announced Wednesday.
The move is meant to choke off foreign investment in Cuba as the administration seeks to tighten economic pressure on the government there in a repeal of President Barack Obama’s opening to Cuba and an effort to punish Cuba for its support of President Nicolas Maduro in Venezuela.
“Sadly, Cuba’s most prominent export these days is not cigars or rum, it’s oppression. Detente with the regime has failed. Cozying up to Cuban dictators will always be a black mark on this great nation’s long record of defending human rights,” Pompeo said in a clear swipe at the Obama administration.
Lawsuits can begin starting May 2. The lawsuits were originally authorized under a 1996 law known as Cuban Liberty and Democratic Solidarity Act, but Presidents Bill Clinton, George W. Bush, and Obama had extended six-month waivers for 23 years because the lawsuits were seen as disruptive, likely ineffective, and particularly damaging to U.S. allies in Europe.
But Pompeo signaled this move was coming by shortening those waivers in recent months and then in March allowing lawsuits against businesses and entities with ties to Cuba’s security and intelligence services. Now, lawsuits against any business or entity will be allowed, with no exemptions — including for American companies. The European Union issued a statement last week to urge the administration not to move forward with the move, threatening lawsuits against the U.S. at the World Trade Organization and to allow counter suits in European courts if it did.
“European companies that are operating in Cuba will have nothing to worry about if they are not operating on property that was stolen from Americans post-revolution,” Assistant Secretary for Western Hemisphere Kimberly Breier told reporters.
The U.S. has certified 6,000 claims by Americans for confiscated property seized by the Castro regime that were worth $2 billion in total at the time they were confiscated, according to the Department of Justice’s Foreign Claims Settlement Commission. Those properties could be worth $8 billion with interest now, although a 1996 estimate found that there could be up to 200,000 more claims that have not been certified, potentially worth tens of billions of dollars.
“Implementing Title III in full means a chance at justice for Cuban Americans who have long sought relief for Fidel Castro and his lackeys seizing property without compensation,” Pompeo said, referring to the section of the 1996 law that allowed for lawsuits.
But the lawsuits could also backfire, according to some critics, because it means those European or even American companies would have to now pay compensation, instead of the Cuban government.
“This doesn’t punish the Cuban government; it lets them off the hook,” said James Williams, president of Engage Cuba, a coalition of private companies and organizations that lobbies for the end of the U.S. embargo of Cuba. “This decision punishes the Cuban people and American companies — companies who were given permission by the U.S. government to do business and are now having the rug pulled from underneath them.”
National Security Adviser John Bolton is expected to announce further penalties against Cuba during an address to the Bay of Pigs Veterans Association in Miami to mark the 58th anniversary of the failed effort to topple Fidel Castro’s government. Those could include new sanctions against senior Cuban officials or restrictions on U.S. trade with or remittances to Cuba, with Breier saying, “You’re going to see quite a bit more from us, and this is the beginning of a new process on this.”