The Havana airport was privately owned and seized by the Castro government following the Cuban revolution. And the purported rightful owner of the airport whose property was taken is suing U.S. airlines for using it.
- Title III of the Helms-Burton Act (“the Cuban Liberty and Democratic Solidarity / LIBERTAD Act of 1996”) lets U.S. nationals sue people or companies that knowingly and intentionally “traffic” in property confiscated by the Cuban government after 1959.
- That includes using, benefiting from, managing, leasing, or profiting from confiscated property. The plaintiff must own the claim, and for pre-1996 confiscations must have acquired that claim before March 12, 1996.
A claim against American Airlines had been dismissed, but the Eleventh Circuit Court of Appeals revived it last summer ruling that the plaintiff did not have to be a U.S. citizen when he acquired the property. After that ruling, the plaintiff sued Delta. Here is their complaint. Delta argued its motion to dismiss on Thursday.
The Capitolio in downtown Havana
Why The Plaintiff Rightfully Owns The Airport
The current José Martí International Airport was owned and built by José López Vilaboy Compañía de Aeropuertos Internacionales, S.A. — CAISA.
Pan Am bought the airport in 1932. By the early 1950s they viewed the facilities as obsolete and offered the airport to the Cuban government, which turned them down. On November 14, 1952, the original owner bought back the airport for $1.5 million in cash and landing fee credits. He extended the runway, built a new terminal, and gave it its current name. The Castro government confiscated the airport around May 1959.
The private owner’s son is the sole heir. His father died intestate in Miami Beach on March 2, 1989. A Florida probate court confirmed that he was the man’s sole descendent on November 30, 2010.
Why U.S. Airlines Are Liable For Using The Airport
U.S. airlines use, benefit from and profit from commercial activity using property confiscated by the Cuban government after January 1, 1959, without authorization from the U.S. national who owns the claim to the asset. U.S. law imposes liability for ‘trafficking’ in confiscated property to the U.S. national.
The airport is confiscated property. U.S. airports can’t operate revenue flights to Havana wihtout using the airport. They didn’t get permission from the U.S. owner. Q.E.D.
An Airline’s Best Defenses
The Helms-Burton statute is broad and made more so by the Supreme Court last month. So the best defenses are to disqualify the plaintiff.
- He acquired the claim too late. Helms-Burton says that for property confiscated before March 12, 1996, a U.S. national may not sue unless “such national acquires ownership of the claim before March 12, 1996.” Florida law recognized the claim to ownership in a 2010 probate order.
- Even if Florida inheritance law would otherwise vest the claim at the father’s death in 1989, the plaintiff was a Cuban national who was blocked under OFAC Cuban Assets Control Regulations, so he could not receive the estate asset before the 1996 cutoff.
- Cuba confiscated Delta’s property after the revolution, too! They have a claim of $212,396.08 plus interest. And under Helms-Burton, an interest in property covered by a certified claim may not be the subject of another person’s claim. And since it had its own claim, it could authorize its own use of the airport.
- It’s not ‘trafficking’ under Helms-Burton when the property is being used where necessary for lawful Cuba travel. And the flights are specifically authorized and encouraged by the U.S. government.
American and Delta Aren’t Improperly Profiting From Serving Cuba
A decade ago I wrote that Cuba flights would be a new opportunity to lose money.
- Pretty much all traffic for these flights would originate in the US. There was almost no customer base to support these flights in Cuba.
- Planes would be filled predominantly with leisure travel. Cuba isn’t a strong business destination.
- Infrastructure in Cuba, from the airport to hotels, is wholly inadequate to match an aviation boom and influx of tourists.
- And Havana is an expensive airport to operate at.
Fishing on the Malecón in Havana
While not necessary under Helms-Burton, it seems still meaningful that U.S. airlines haven’t taken an equity interest in the airport, do not manage the airport, and are just using it. The fees they pay at the airport help support its upkeep – preserving the very asset that the plaintiffs claim to own. And their flights have been specifically authorized by the United States and use in no way complicates future return of the airport to its rightful owners.
They’re also not receiving unjust enrichment from their Cuba flights, as they’re likely losing money. At most they’re paying for the value they’re receiving, and likely overpaying.
So as a policy matter, holding American and Delta liable seems questionable. As a legal matter there may still be liability. Under last month’s Supreme Court Havana Docks decision mere use of confiscated physical property can be enough. That wasn’t previously clear. And there doesn’t have to be any actual profit. Damanges can be based on fair market value of use plus interest, fees, and then trebling.
Sign in support of the Cuban revolution
Will The Rightful Owners Get The Airport Back?
In Argentina at least there’s a saying, “Tengo una remera del Che y no sé por qué,” or “I have a Che T-shirt and I don’t know why.”
At one time Guevara was featured at the W South Beach. There has long been more excitement for the regime in the U.S. than among the Cuban people. The revolution never raised living standards there, and that’s not because of U.S. sanctions.
The more interesting question is, what’s happening now in Cuba – and could the rightful owner of the airport wind up getting it back?
- The regime in Cuba is weaker than it’s been at any time since 1959. There have been rolling blackouts most of the day, and public protests in Havana. There are shortages of food, fuel and medicine.
- In response, Cuba adtoped sweeping reforms this month that include private real estate development, partial privatization of state companies, private banks, and allowing sale of state property to foreign entities and to Cubans abroad.
- Markets are expressly recognized now, with the prime minister describin gthem as an instrument for efficient resource allocation.
The private sector in Cuba now accounts for more retail transactions than the government sector for the first time since the beginning of the socialism there. Cuba has partially dollarized parts of the economy, with dollar-only retail outlets and increased use of foreign payment cards. So it seems like the broader policy goals of Helms-Burton could be met in the future, regardless of the outcome of these suits.
You’d think Lil’ Marco would’ve convinced El Presidente to ‘annex’ that island 90-miles south of Florida by now… I guess getting humiliated in the Middle East came first.
There were dollar (and Euro/pound) outlets when I was there a decade ago. These had some interesting local products, while the stores only taking the local pesos had very few goods. (There also were 2 different pesos, one for tourists, the other for locals, somewhat similar to what I saw in Eastern Europe in the ’70s. I got some local “soft money” coins and currency that had things like Che and AK-47s on them, and these were far more interesting than the scenic views on the “hard value” tourist money.)
The revolution raised living standards for the poor and gave Cubans back pride in their country as not just being a party place for the Yankees. But it was at the cost of leveling down for those who had something under the old dictators–neither before or after was there much real freedom. And as Khrushchev himself said the U.S. sanctions only had the effect of drawing the island to the Soviet sphere, “like iron to a magnet”. It’s all a Cold War holdover that doesn’t end thanks to politics. After all, it was really about freedom and civil rights then the U.S. wouldn’t be trading with much of the world, starting with China. But realistically, by this late date how many 3rd or 4th generation Cubans in south Florida would actually move there? They would take whatever their claims gave them and that’s it.
I never got the US goverment’s desire to treat Cuba differently than other communist countries. I get the late-50s fervor, but what about the last 50 years? This lets them blame US sanctions for their woes not caused by US sanctions. Is it just a desire to placate the Cuban exiles and their decedants to ensure reelection?
With Donald John Trump the new face of appeasement, the descendants of Neville Chamberlain feel relief.
1990: it’s not over yet.
Based on the plaintiffs argument, tourists using the airport are also liable under Helms-Burton.
@Greggb57 — What’s the hold-up?
@This comes to mind — Likely, a combination of proximity (it is like 90 miles away from the Keys), and US politicians pandering to the Cuban-American voters in S. Florida (who seem to hate Cuba more than anyone else, and are willing to sacrifice the people who remain there, if only to spite their current regime.) Relatedly, it’s not as if the US has treated ‘Communist’ countries well… *laughs in Kissinger* Look no further than Loas (how much USAF unexploded ordinance is still left there?) and Vietnam (though, I guess we now allow them to make all our Nike sneakers… odd, because that feels fairly capitalist, no? Kinda like how mainland China, dominated by the CCP, sorta operates like a capitalist society, anyway. Perhaps, it was never about ideology, merely about stifling competition and hoarding resources and maintaining power…)
@1990: “I guess getting humiliated in the Middle East came first. ”
You refer to a big policy mistake. Trump could have gone down in history as the liberator of Cuba if he had made that the priority. The humanitarian value would be huge and it would be ordinary Cubans (the ones who live in or near poverty under the regime) who would benefit the most from unbridled capitalism. I doubt the Trump regime has the inititive to do this.
@Gary Leff — You may want to expand upon the broader geopolitical landscape, especially as it relates to foreign carriers, like Air Canada, Westjet, Air France, Iberia, etc., which are insulated from this litigation, but have been impacted by the fuel shortages in Cuba, caused by US blockade. Nearly all of our allies have enjoyed unrestricted tourism there for decades.
@1990
Don’t those old Cubans in Miami know they missed out on living in a communist socialist tropical paradise. Like all the eastern Europeans who left the USSR . Just like the Chinese or Vietnamese who hide in cargo ships for 3 weeks across the ocean. They were living your dream in those perfect communist countries only to try and not die coming to capitalist hell hole United States of America
@JOJO — Yeah, yeah… poverty cult… nice caricature! (But, like, why is CCP allowing all these Chinese billionaires to exist, and how is it that our companies, like Apple, basically gave them all our valuable IP, trained them how to make the world’s consumer goods, and our own economy is being hollowed out? Please, help, because I would like America to still be a land of opportunity with a thriving middle class, which we continue to lose, day by day, your god-king #45/47, having not improved this predicament, at all.)
Why are certain people in the USA so enamored with Cuba? During a meal at a Ybor City cafe I found no romantic notions of Cuba, only disdain and contempt for the “liders”.
Meanwhile, Delta and American are victims of an increasingly bizarre legal environment in the USA.
@ 1990. You are sounding MAGA sans Trump, which may be a winner. On Vietnam I think the Best and the Brightest actually believed in dominoes, whereas the realists (Morgenthau) knew the Vietnamese had resisted Chinese domination for over 1000 yrs. Our desire should have been a strong united Vietnam.
Too bad the United States court system doesn’t have a “looser pays” law. Stupid suits like this are what jam the courts with frivolous lawsuits. Should Delta win, hopefully they will sue to collect costs!
@jack the ladd — Maybe there is something to that ‘horseshoe’ theory. As far as Vietnam goes, yeah, the last ‘war’ China fought was against them (1979), and China lost, er, umm, “withdrew.” *cough*
Gary – I worked for an international carrier that served Havana as a Regional Airport Manager.
I can tell you many stories about the place – some whimsical, many sad, and others just unbelievable.
We had an aircraft overnight in Havana – and the crew was not familiar with how to manage the overnights. When the new crew boarded the next day – the aircraft had been stripped clean: packaged snacks gone, lavatory supplies gone, basically anything not locked up. Very sad because of the poverty in Cuba.
Hopefully things will change.
You know…I wonder if the airport makes money or costs money? Because if it’s a money-losing piece of necessary infrastructure, it would be kind-of funny if the Cuban government dumped it on the guy but forced him to keep it open…