La Ley Helms-Burton, Título III: otro ejemplo de hipocresía estadounidense

• Author: Kathleen Marcel Paolo
• Position: U.S. District Court for the Eastern and Southern Districts of New York
• Pages: 309-323

SECCIÓN ESPECIAL

REVISTA CUBANA DE DERECHO 309

VOL. 4, NO. 02, NÚMER O CENTENA RIO, PP. 309323, 2024

THE HELMSBURTON ACT, TITLE III: ANOTHER EXAMPLE OF

U.S. HYPOCRISY

La Ley Helms-Burton, Título III: otro ejemplo de hipocresía es-

tadounidense

Dra. Kathleen Marcel Paolo

Licensed to practice law in the State of New York (USA)

U.S. District Court for the Eastern and Southern Districts of New York

and the U.S. Court of Appeals (4th Circuit)

https://orcid.org/0009-0007-3156-7527

kathleenpaolo@yahoo.com

Abstract

While it has been condemned by most U.N. member states, the U.S. continues

to expand its illegal blockade against Cuba. Title III of the Helms-Burton Act of

1996 authorizes U.S. nationals to sue in U.S. courts “any person” who “ tracs” in

property nationalized by Cuba on or after January 1, 1959. Past U.S. Presidents

suspended Title III due to international opposition, but in 2019 President Trump

lifted the suspension (continued by President Biden) to allow Title III lawsuits

to proceed. Forty-four lawsuits have been led in U.S. courts. Most suits have

targeted U.S. corporations. In 2022, a U.S. court in Florida awarded $439 million

to Havana Docks Corporation against four cruise lines for using the Havana port

2016-2019. Expropriation and nationalization are permitted by international law

with compensation. Cuba negotiated compensation settlements with all but the

U.S., which refused Cuba’s attempts to negotiate. In the U.S., expropriation is a

regular occurrence called “eminent domain”. The U.S. Constitution’s allows the

government to take private property, with just compensation, for “public use,”

now expanded by U.S. courts to include taking of private property for private use.

U.S. examples abound where persons are forced from homes, land and small

business, without just compensation, to allow corporate development. Rather

than continue a policy of hypocrisy, the U.S. government should honor the U.N.

Charter and cease ignoring the General Assembly’s three-decade demand for an

end to the illegal blockade against Cuba.

Keywords: blockade; eminent domain; Havana Docks decision; Helms-Burton

Act Title III; nationalization.

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Dra. Kathleen Marcel Paolo

Resumen

Si bien ha sido condenado por la mayoría de la ONU, Estados Unidos continúa

expandiendo su bloqueo ilegal contra Cuba. El Título III de la Ley Helms-Burton

de 1996 autoriza a los nacionales estadounidenses a demandar en los tribunales

estadounidenses a “cualquier persona” que “traque” con bienes nacionalizados

por Cuba a partir del 1 de enero de 1959. Los anteriores presidentes de Estados

Unidos suspendieron el Título III debido a la oposición internacional, pero en

2019 el presidente TRUMP levantó la suspensión (continuada por el presidente

BIDEN) para permitir que procedieran las demandas del Título III. Se han

presentado cuarenta y cuatro demandas en los tribunales estadounidenses.

La mayoría de las demandas se han dirigido a corporaciones estadounidenses.

En 2022, un tribunal estadounidense en Florida otorgó 439 millones de dólares

a Havana Docks Corporation contra cuatro líneas de cruceros por utilizar el

puerto de La Habana entre 2016 y 2019. La expropiación y la nacionalización

están permitidas por el Derecho internacional con compensación. Cuba negoció

acuerdos de compensación con todos menos con Estados Unidos, que rechazó

los intentos de negociación de Cuba. En Estados Unidos, la expropiación es un

hecho habitual llamado “dominio eminente”. La Constitución de Estados Unidos

permite al gobierno apropiarse de propiedad privada, con una compensación

justa, para “uso público”, ahora ampliada por los tribunales estadounidenses

para incluir la apropiación de propiedad privada para uso privado. En Estados

Unidos abundan los ejemplos de personas que se ven obligadas a abandonar

sus hogares, sus tierras y sus pequeños negocios, sin una compensación justa,

para permitir el desarrollo corporativo privado. En lugar de continuar con una

política de hipocresía, el gobierno de Estados Unidos debería honrar la Carta de

la ONU y dejar de ignorar la exigencia de tres décadas de la Asamblea General

de poner n al bloqueo ilegal contra Cuba.

Palabras claves: bloqueo; dominio eminente; decisión de Havana Docks;

nationalización; Título III de la Ley Helms-Burton.

Summary

1. Background of U.S. Laws Establishing the U.S. Blockade of Cuba. 2. Title III of the Helms-

Burton Act. 3. Havana Docks Decision. 4. International Resistance. 5. Nationalization

Sanctioned by International Law. 6. Conclusion. Bibliography.

While the Cuban government, with direct popular participation, constructed a

new and innovative Constitution, overwhelmingly approved by Cuban voters

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The Helms-Burton Act, Title III: another example of U.S. hypocrisy

in 2019 to reect societal changes over the past decade, the United States has

implemented draconian measures under Title III of the Helms-Burton Act to

tighten the illegal U.S. blockade in an attempt to strangle the Cuban economy

and provoke a change in government.

1. BACKGROUND OF U.S. LAWS ESTABLISHING THE U.S.

BLOCKADE OF CUBA

Signed into law in 1996, the Cuban Liberty and Democratic Solidarity (Libertad)

Act, also knownas the Helms-Burton Act,1 codied and expanded the now

more than 60-year nancial, commercial and economic blockade against

Cuba, which is illegal under international law. The block ade has been opposed

by a minimum of 96% of UN member nations for the past 30 years when the

vote to abolish it has come up annually in the General Assembly. In 2023, for

example, 187 nations voted overwhelmingly in favor of the draft resolution

entitled “Necessity of ending the economic, commercial and nancial embargo

imposed by the United States of America against Cuba”.2 Nonetheless, during

the rst 14 months of the BIDEN administration, the U.S. government not only

continued, but escalated sanctions against Cuba, resulting in estimated

damages to the island nation of $6.36 billion or more than $15 million per

day. According to the Report of the UN Secretary General,3 between August

2021 and February 2022, Cuban losses from U.S. sanctions amounted to more

than $3.8 billion, a record gure for seven months. At current prices, the repor t

continues, accumulated losses to Cuba over the 60 years of the blockade are

estimated at $154.22 billion.4

The far-reaching Helms-Burton Act is only one part of a vast, complex network of

U.S. laws and administrative provisions designed to hold the blockade in place,

1Helms-Burton Act, 22 U.S.C. Chapter 69a, §§6021–6091, Pub. L 104-114, 110 Stat. 785,

March 12, 1996.

2“General Assembly votes overwhelmingly against US Cuba embargo”, UN News,

Global Perspective Human stories, 2 November 2023, https://news.un.org/en/

story/2023/11/1143112#:~:text=The%20UN%20General%20Assembly%20on,voting%20

against%20and%20Ukraine%20abstaining

3“Necessity of ending the economic, commercial and nancial embargo imposed by the

United States of America against Cuba”, A/77/358, Seventy-seventh session, Report of the

Secretary-General, Agenda item 36, 21 September 2022.

4Adopting Annual Resolution, Delegates in General Assembly Urge Immediate Repeal of

Embargo on Cuba, Especially amid Mounting Food, Fuel Crisis, GA/12465, Seventy-seventh

Session, 28th Meeting (AM), 3 November 2022.

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Dra. Kathleen Marcel Paolo

including the Trading with the Enemy Ac t of 1917;5 the Foreign Assistance Act

of 1961;6 Presidential Proclamation 3447 of 19627 (signed by President KENNEDY

to ban all trade with Cuba after he obtained 1200 Cuban cigars for his personal

humidor); the Cuban Democracy (Torricelli) Act of 1992;8 the Antiterrorism

and Eective Death Penalty Act of 1996;9 the Export Control Act of 2018;10 the

Trade Sanctions Reform and Export Enhancement Act of 200011 and the Cuban

Assets Control Regulations.12

The Helms-Burton Act seeks “international sanctions” and requires that Cuba

“transition to a democratically elected government,” specically without

“a Castro government”, before the blockade can be lifted. The Act imposed

extraterritorial sanctions on foreign companies doing business in Cuba and

denied entry into the United States of executives of foreign investors in Cuba.

2. TITLE III OF THE HELMS-BURTON ACT

Title III of the Act authorizes U.S. nationals to le private lawsuits in U.S. courts

against “any person” who “tracs” in property subject to Cuban nationalization

between January 1, 1959, and March 12, 1996. The action must be brought

against persons who have tracked or are tracking in the nationalized

property, and the suit must be led no later than two years after the tracking

giving rise to the action has ended. “Trac” is broadly dened to include

not only owners of the property, but any person or company that derives a

benet from it. Title III also allows U.S. citizens to sue for three times the current

value of any nationalized property worth more than $50,000. The law even

5Trading with the Enemy Act, 50 U.S.C. Chapter 53, §§95a-95b, 40 Stat. 411, 6 October 1917.

6Foreign Assistance Act of 1961, 22 U.S.C. §§2151 et seq., Pub. L 87-195, Approved 4 September

1961, As Amended Through Pub. L 117-263, Enacted 23 December 2022.

7John F. Kennedy, Presidential Proclamation 3447, Embargo on All Trade with Cuba, 27 FR

1085, 3 CFR 1959-1863, Comp., p. 157, 3 February 1962.

8Cuban Democracy ( Torricelli) Act of 1992, Chapter 69, 22 U.S.C. §§6001 et seq., 3 October 1992.

9Anti-terrorism and Eective Death Penalty Act, Pub. L 104-132, 110 Stat. 1214, (codied as

amended at 8 U.S.C. § 1189 (Supp. II 1996)), 4 April 1996.

10Export Control Act of 2018, 50 U.S.C. Chapter 58, §§ 4801 et seq., Pub. L 115-132, 17 April 2018.

11Trade Sanctions Reform and Export Enhancement Act, Title IX of Pub. L 106-387,

28October 2000.

12Cuban Assets Control Regulations 31 C.F.R. Part 515, 8 July 1963.

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The Helms-Burton Act, Title III: another example of U.S. hypocrisy

permits lawsuits by former owners who were not U.S. citizens at the time their

properties were nationalized or abandoned.

Presidents William CLINTON, George W. BUSH and Barack OBAMA exercised the

authority provided in the Act to suspend application of Title III throughout

their administrations, in part due to international opposition to its provisions.

In 1996 the European Union challenged Title III at the World Trade Organization,

of which the U.S. is a member, and withdrew the case only after the U.S. agreed

to continue Title III suspension. On May 2, 2019, however, President Trump

lifted the suspension to allow Title III lawsuits to proceed; a policy continued

by President Biden.

Title III was originally designed to target and deter foreign, not U.S., companies

from investing in Cuba, since, at the time the law was passed, U.S. companies

were prohibited from doing business on the island. Starting in 1990, to boost

its economy, the Cuban government instituted regulated market reforms,

including steps to encourage foreign investment, by easing restrictions on

foreign ownership, permitting joint ventures and allowing 100% repatriation

of prots. Companies from Canada, Mexico and the European Union began

to invest in Cuba. By 1994, the Cuban government had negotiated 185 joint

ventures in a multiplicity of areas, including energy, technology, tourism and

agriculture. By 1998, the number of joint ventures increased to 322. By 1998,

15 foreign banks were also operating in Cuba. These successes did not go

unnoticed by the U.S. government.

At the same time, with the loosening of some restrictions under President

CLINTON and the temporary resumption of diplomatic relations in 2015

under President OBAMA, many U.S. companies eagerly sought opportunities

to do business with or in Cuba. Some of those same U.S. companies now nd

themselves targets of Title III lawsuits. Indeed, most Title III lawsuits thus far have

targeted U.S. companies which, ironically, were engaged in business ac tivities

licensed and even encouraged by the U.S. government. In 2016, for example,

after President OBAMA relaxed travel restrictions to Cuba, more than 140,000

people traveled from the U.S. to Cuba on cruise ships. In 2017 alone, more than

300 cruises docked at Havana Harbor, with 145 docking at the Cuban city of

Cienfuegos. It is estimated that cruise lines made at least $1.1 billion from the

short-lived period of travel to Cuban ports from 2016-2019, which also added

more than $130 million to the Cuban tourist industry.

On June 4, 2019, however, the TRUMP administration announced new travel

restrictions which included a ban on cruise ships from the U.S. docking at

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Dra. Kathleen Marcel Paolo

Cuban ports, which reportedly impacted 800,000 bookings, since no grace

period was allowed. In at least two cases in the Southern District of Florida,

“García-Bengocheavs.Carnival Corporation”13 and “Havana Docks Corporation

vs. Carnival Corporation”,14 the court found that previous reliance on a license

from the U.S. Oce of Foreign Assets Control (OFAC) was insucient to support

a motion to dismiss, although, at the same time, U.S. District Judge Beth Bloom

determined that Carnival cruises were promoting “tourism”, which, incredibly,

remains against the law for U.S. visitors to Cuba, even travelers on cruise ships,

which the U.S. government well knew are designed for vacationers. Judge

Bloom stated, “The fact that OFAC promulgated licenses for traveling to Cuba,

and executive branch ocials, including the president, encouraged defendants

to do so, does not automatically immunize defendants from liability if they

engaged in statutorily prohibited tourism”.15

In a 1972 report, the Foreign Claims Settlement Commission (FCSC), a

U.S. government agency that adjudicates claims of U.S. nationals against

foreign governments, certified 5913 claims by U.S. nationals against the

Cuban government totaling almost $2 billion.16 According to the U.S.-Cuba

Trade and Economic Council, the FCSC permitted simple interest of 6%

per annum (approximately $114,132,137.10 USD); with the approximate

current value of the 5,913 certified claims being $8,750,130,510.77

(USD).17 However, in a press briefing on April 17, 2019, a U.S. Department

of State official stated that Title III provisions were not focused solely on

the FCSC-certified claims and estimated that there could be as many as

200,000potential claims under Title III, worth tens of billions of dollars.18

While some expected a rush of lawsuits after the lifting of the Title III suspension,

the U.S.-Cuba Trade and Economic Council reports that only 44 suits have been

13 “García-Bengochea vs. Carnival Cruise Line”, No. 19-cv-21725-JLK (U.S.D.C., S.D. Fla. August

26, 2019).

14“Havana Docks Corp vs. Carnival Cruise Line, et al.”, No. 19-cv-23591 Bloom/McAliley (U.S.D.C.,

S.D. Fla. Dec. 30, 2022).

15Ibidem.

16U.S. Department of Justice, Foreign Claims Settlement Commission, Completed Programs-

Cuba, updated April 21, 2022 https://www.justice.gov/fcsc/claims-against-cuba

17Ibidem.

18U.S. Embassy in Cuba, Telephonic Press Brieng with Senior State Department Ocial on the

U.S. Policy toward Cuba, April 17, 2023, https://cu.usembassy.gov/telephonic-press-brieng-

with-senior-state-department-ocial-on-the-u-s-policy-towards-cuba/

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The Helms-Burton Act, Title III: another example of U.S. hypocrisy

led against 82 companies and their subsidiaries since 2019 (15 FCSC-certied

claimants and 29 non-certied claimants): one case was settled in 2021, sixhave

been dismissed by the U.S. Court of Appeals and ten are being appealed to the

Court of Appeals, with the remainder at other stages of litigation. The same

report appears to indicate that while the number of lawsuits is small, the eect

is massive. More than 16 countries have been impacted, including Canada,

Chile, China, Denmark, France, Germany, Netherlands, Panama, Republic of

Cuba, Singapore, Spain, Switzerland, Thailand, United K ingdom and the United

States. More than 90 law rms have been retained, with tens of millions of

dollars in attorneys’ fees and the involvement of numerous U.S.federal courts.

Defendants run the gamut from Amazon.com, Expedia, Booking.com, Kayak,

Melia Hotels, Orbitz, Trivago, Tripadvisor, American Airlines and Iberia Airlines,

to Mastercard, Visa, Young & Rubicam, the advertising agency, and Société

Générale S.A, the French bank, to name a few. 19

Title III’s impact on the Cuban economy is devastating. Foreign corporations

have cancelled contracts rather than face the potential risk of Title III litigation.

National Society of French Railways canceled its contract with the Cuban

Railway for a modernization project worth $46.7 million. The French company

Bouygues Batiment International, which managed Havana’s José Mar tí Airport

and constructed 50% of the hotel rooms oered in Cuba, also cancelled

construction contracts. These are two examples among many. The stunning

verdict in the “Havana Docks” cases will certainly contribute substantially to

disincentivizing any foreign company considering investment in Cuba.

3. HAVANA DOCKS DECISION

On December 30, 2022, in “Havana Docks Corp. vs. Carnival Corp., et al”

(19-cv-23591[ S.D. Fla.]),20 Judge Beth Bloom granted the rst windfall verdict

under Title III to plainti Havana Docks Corporation, ordering Entry of Final

Judgment against four defendants: $109,671,180.90 against Carnival Cruise

Line; $109,848,747.87 against MSC Cruises; $109,848,747.87 against Royal

Caribbean Cruises and $109,848,747.87 against Norwegian Cruise Line,

for a staggering total of $439,217,424.51 to compensate Havana Docks for

19U.S.-Cuba Trade Economic Council, “After 43 Months, Florida District Court Judge Hands

First Cuba Libertad Act Verdict-Four Cruise Lines Must Pay US $439,217,424.51 plus US

$11,707,484.31 in Legal Fees”. Appeals Probable, December 30, 2022, https://static1.

squarespace.com/static/563a4585e4b00d0211e8dd7e/t/63b013f09cd8f9321bb299

ea/1672483824437/Libertad+Act+Filing+Statistics.pdf

20“Havana Docks Corp vs. Carnival Cruise Line, et al.”, 19-cv-23591, supra at n. 13.

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defendants’ use of the Havana Port for three short years, 2016-2019, and to

punish the cruise lines for carrying tourists. All four cruise lines have led

appeals with the 11th Circuit Court of Appeals, with Judge Bloom denying

defendants’ motion for a stay of execution of judgment without bond or with a

reduced bond; instead, she required the companies to purchase supersedeas

bonds of 110% of the judgment to obtain stays pending appeal.21

Havana Docks Corporation is a 1917 U.S. company that currently exists solely

to pursue Title III claims. Havana Docks’ main actors are board members

Mickael BEHN and his mother Aphra Behn, descendants of Sosthenes Behn, who

purchased the land and built the Havana Dock in 1920. Sosthenes BEHN was an

American businessman and founder of International Telephone and Telegraph

(ITT), which supported Cuban dictator Fulgencio BATISTA and exploited the

Cuban people, supported Dictator Francisco FRANCO’S military takeover in Spain

and funded the 1973 U.S.-backed coup in Chile, resulting in the murder of duly

elected President Salvador ALLENDE and installation of Dictator Augusto PINOCHET.

An ITT subsidiary supported the German Nazi war machine by producing

airplanes for the Luftwae and radar equipment for the Wehr macht (while also

supplying the Allies), starting in 1933 when Sosthenes Behn personally met

with Adolf HITLER. Incredibly, after World War II, ITT, as a “victim”, was awarded

$27 million in compensation from the U.S. government for damage from Allied

bombing to its factory in Germany. The Cuban government nationalized the

Havana Dock as an asset of the Cuban people in 1960.

4. INTERNATIONAL RESISTANCE

The extraterritorial applications of U.S. sanctions, such as Helms-Burton and its

Title III, do not enjoy universal approval, even among close U.S. allies, including

Canada and the European Union. Countries that do not impose economic

sanctions on Cuba viewed the enactment of Helms-Burton, particularly TitleIII,

as forcing a “secondary boycott” (which are notably illegal on U.S. soil under

the Taft-Hartley Amendments to the National Labor Relations Act22) of Cuba

by third countries who merely wish to engage in lawful commercial activity.

Title III permits suits against foreign companies whose investments in Cuba are

legal in their home countries and under international law.

21“Havana Docks Corp vs. Carnival Cruise Line, et al.”, 19-cv-21724 Bloom/McAliley (U.S.D.C.,

S.D. Fla. Mar. 13, 2023).

22Labor Management Relations Act, also known as Taft-Hartley, 29 U.S.C. §141 et seq., Pub.

L 104-320, June 23, 1947.

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The Helms-Burton Act, Title III: another example of U.S. hypocrisy

The European Union has stated through a spokesperson that “the

European Union reiterates its strong opposition to the extraterritorial

application of unilateral Cuba-related measures that are contrary to

international law”.23 The EU has said it may again challenge Title III in the

World Trade Organization or impose retaliatory sanctions to protect its

Cuban investments. On December 21, 2021, for the first time, the Court of

Justice of the European Union (CJEU), issued the first-ever judgment on

the European Union Blocking Regulation,24 which it interpreted broadly to

prohibit EU operators from compliance with foreign sanctions; any such

compliance can be considered a breach of the EU Blocking Regulation

and could be challenged in civil proceedings. The particular case involved

an Iranian state-owned bank, but the principles are applicable to the U.S.

sanctions against Cuba. EU operators, therefore, are forced to choose

between compliance with U.S. sanctions and compliance with the EU

Blocking Regulation.

5. NATIONALIZ ATION SANCTIONED BY INTERNATIONAL LAW

Nationalization, however, is a principle sanctioned by international law,

authorized by the United Nations Charter and armed in multiple UN

Resolutions and Declarations. It must be “based on grounds of public utility,

security or the national interest, which are recognized as overriding purely

individual or private interests, both domestic and foreign”.25 Cuba incorporated

these principles into its legislation and on January 1, 1959, nationalized

property in Cuba that had belonged to U.S. owners, as well as owners from

other countries, including electric and phone utility companies, like ITT, which

were considered after 1959 to be assets of the Cuban people.

The U.S. Supreme Court recognized Cuba’s right to nationalize in the famous

case of “Banco Nacional de Cuba vs. Sabbatino”,26 in which a U.S. commodity

23 European Commission, Joint Statement by High Representative/Vice President Federica

Mogherini and Commissioner for Trade Cecila Malmström on the decision of the United

States further activate Title III of Helms-Burton (Libertad) Act, 17 April 2019, Brussels, https://

ec.europa.eu/commission/presscorner/detail/en/STATEMENT_19_2171

24Council Regulation (EC) No 2271/96, 22 November 1996, otherwise known as the “Blocking

Regulation”.

25General Assembly Resolution 1803 (XVII) of 14 December 1962, “Permanent sovereignty

over natural resources”, https://www.ohchr.org/sites/default/les/Documents/

ProfessionalInterest/resources.pdf

26376 U.S. 398 (1964).

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Dra. Kathleen Marcel Paolo

broker contracted to purchase Cuban sugar destined for the U.S. After the

sugar was loaded on a ship, but still in Cuban waters, the Cuban government

issued a decree under Executive Power Resolution 1 pursuant to Law 851 of

July 6, 1960,27 which authorized nationalization of U.S. properties, and took

possession of the sugar. The Cuban government refused to release the sugar

until the U.S. broker entered a new contract with Banco Nacional de Cuba.

Cuba’s Executive Power Resolution 1 cited the injustice of the U.S. reduction

of the Cuban sugar quota after 1959 and emphasized the importance of Cuba

serving as an example to other countries to follow “in their struggle to free

themselves from the brutal claws of imperialism”.28 The U.S. broker received

payment for the sugar, but refused to deliver the payment to the Cuban bank ’s

agent in the U.S., which led to the dispute in court. The U.S. Supreme Cour t, in

a nearly unanimous decision, found for Cuba, citing the Act of State doctrine,

a U.S. common law principle that a nation is sovereign within its own borders

and that a U.S. court will not sit in judgment on an act of a foreign government

that takes place in that foreign government’s ter ritory.

The outraged U.S. Congress responded by passing 22 U.S.C. §2370, the

Second Hickenlooper Amendment to the Foreign Assistance Act, in 1964.

Section (e) (2) expressly prohibited U.S. Courts from invoking the Act of State

doctrine to refuse to hear claims against foreign nationalizations that “violate

international law”, the U.S. being the arbiter of what violates international

law. This amendment was a legislative reversal of Sabbatino and specically

applied to takings after January 1, 1959, so its target was clear.

The United States, however, itself has a long history of nationalizations, the

process of taking privately controlled property and placing it under public

authority. In 1917, as the U.S. entered World War I, the U.S. government

temporarily nationalized all railroads under the Army Expropriations Act

of 1916, as well as the telegraph and telephone networks and the radio

industry and arms manufacturer Smith and Wesson. The U.S. government also

nationalized U.S. subsidiaries of several German companies under the Trading

with the Enemy Act, most notably the pharmaceutical company Merck and the

U.S. subsidiary of Bayer, which was later sold by the government at auction.

27“Cuba, Nationalization Law, 1960”, The American Journal of International Law, Vol. 55, No 3,

July 1961, https://www.jstor.org/stable/2195928?seq=1, accessed 26 November 2023.

28Idem at fn 7.

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The Helms-Burton Act, Title III: another example of U.S. hypocrisy

The U.S. nationalized industries and companies during World War II, including

railroads, trucking companies and briey, the retailer Montgomery Ward, on

the grounds of a national emergency. It also nationalized coal mines, largely to

stop 500,000 low-paid coal miners from striking for higher wages.

Although almost all U.S. nationalizations have occurred during wartime,

nancial crises have generated nationalizations, generally at an exorbitant

cost to the U.S. taxpayer.

For example, in 1989, the U.S. government created the Resolution Trust

Corporation to nationalize more than 1,000 failing Savings and Loan banks

to address the collapse of the privately held Savings and Loan industry due to

speculation, deregulation and fraud. The Savings and Loan industry had once

been the most secure source of home mortgages for working people. During

the banks’ heyday, many private speculators became extremely wealthy, but

government nationalization to wind down these failing banks cost the U.S.

taxpayers $132 billion.29

In another form of nationalization that transmitted public funds to the

private sector, the U.S. government’s bailout to purchase toxic assets from

the nation’s largest pr ivately held banks and other institutions in 2008 cost the

U.S. taxpayers $700 billion. This nationalization, however, did not prevent

the recession that followed or the loss of 8.6 million U.S. jobs.30

U.S. law also has a mechanism for the expropriation, or taking, of individual

private property for public use. In the United States, we call this expropriation

“eminent domain”, and it is a nationwide, regular occurrence. Eminent domain

“appertains to every independent government”. The U.S. Supreme Court held

in 1879 that eminent domain requires no constitutional recognition; it is an

attribute of sovereignty. “Boom Co. vs. Patterson”.31

Indeed, the “takings” clause of the Fifth Amendment of the United States

Constitution allows the government to take private property for “public use”,

29HANNAH, Thomas M., “A History of Nationalization in the United States, 1917-2009”, The Next

System Project, p. 36, https://thenextsystem.org/sites/default/les/2019-09/A_History_of_

Nationalization_in_the_US-Hanna-NSP.pdf

30CUNNINGHAM, Evan, “Great Recession, great recovery? Trends from the Current Population

Survey”, Monthly Labor Review, April 2018.

3198 U.S. 403, 406 (1879).

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Dra. Kathleen Marcel Paolo

expanded by the U.S. Supreme Court in the controversial case of “Kelo vs. City

of New London”32 to mean “public purpose”, which can include the taking of

private property for private use under the guise of economic development. In

“Kelo”, the beneciary was a private developer, who then never built anything

on the land, while taxpayers were out $80 million and the homeowners lost

their family homes to the government for a fraction of what they were worth.

Since the “Kelo” decision, instances of eminent domain abuse, where private

property is taken for private real estate developers, abound throughout the U.S.

Moreover, the U.S. government and state governments routinely seize and

sell private real estate for tax deciencies. Until the U.S. Supreme Court

nally ruled “home equity theft” unconstitutional on May 25, 2023 (“Tyler vs.

HennepinCounty, Minnesota”),33 thirteen states, including New York, allowed

their governments to seize and liquidate private real estate to satisfy tax bills

(sometimes very small ones) and then retain the surplus money (representing

a portion of a homeowner’s equity), rather than returning it to the property

owners. The Pacic Legal Foundation estimates that more than $780 million has

been lost to homeowners by the government’s practice of home equity theft.34

Nationalization and expropriation require compensation, “in accordance with

the rules in force in the State taking such measures in the exercise of its sovereignty

and in accordance with international law”.35 Accordingly, Cuba decades ago

negotiated settlements of compensation claims with Switzerland, Spain,

France, Great Britain and Canada. Cuba has repeatedly announced its

willingness to negotiate a lump-sum settlement with the United States. The

United States government, however, has never been willing to negotiate, nor

has it allowed aected companies to negotiate, creating the situation where

the U.S. can claim that the takings were uncompensated.

6. CONCLUSION

The Helms-Burton Act in specic and the U.S. blockade in general contravene

international law, harm both the Cuban people and those in the U.S., and tarnish

further the already tarnished reputation of the U.S. around the world. Rather

32545 U.S. 469 (2005).

33No. 22-166 (U.S. Supreme Court, May 25, 2023).

34When Taxation Really is Theft, Pacic Legal Foundation, https://homeequitytheft.org/

35U.N Resolution 1803, supra, at note 22.

REVISTA CUBANA DE DERECHO 321

The Helms-Burton Act, Title III: another example of U.S. hypocrisy

than continue a policy of hypocrisy, the U.S. government should honor the UN

Charter and cease ignoring the General Assembly’s three-decade demand for

an end to the illegal blockade against Cuba. Lifting the blockade is not only

essential to achieving the progress the Cuban people need and deserve, but it

would also benet the people of the U.S. and the rest of the world.

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REVISTA CUBANA DE DERECHO 323

The Helms-Burton Act, Title III: another example of U.S. hypocrisy

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Recibido: 19/1/2024

Aprobado: 24/2/2024