Exxon uses revived Helms-Burton law to sue Cuban companies for holdings confiscated in the 1960s

By John Severance | May 7, 2019

WASHINGTON (Legal Newsline) –The Helms-Burton Act was passed in 1996 under President Bill Clinton and ever since then, it  has been suspended and not put into effect by the United States in its dealings with Cuba.

But not anymore. President Donald Trump has allowed the provisions of the law to go forward. So what does that mean?

Americans can now sue foreign companies using property that was seized and confiscated by the Cuban government back in the 1960s when Fidel Castro was in charge of the island nation.

The first prominent company to take legal action under the act is Exxon Mobil Corp., which filed a suit May 2 in the U.S. District Court for the District of Columbia seeking damages in the amount of approximately $71.6 million plus interest of 6 percent since July 1, 1960. Defendants in the case are listed as Corporacion CIMEX and Union Cuba Petroleo Oficios of Havana. 

Representing Exxon in the case are attorneys Steven K. Davidson, Michael J. Baratz and Jared R. Butcher of Steptoe and Johnson LLP of Washington.

‘’CIMEX uses and continues to profit from the confiscated property by, among other things, operating service stations in cooperation with CUPET, the state-owned oil company of Cuba," the complaint said. 

"CUPET additionally uses and continues to profit from the confiscated property through its use of the Nico Lopez Refinery (formerly known as the Belot Refinery) and certain terminals and plants used in conjunction with the refinery operations. Title III of the act  permits plaintiff to bring private actions against any person who, like CIMEX and CUPET, knowingly and intentionally traffics in confiscated property without authorization from the rightful owner.’’

In regard to the act, U.S. Secretary of State Mike Pompeo said May 2, ‘’The right to bring an action under Title III of the Libertad Act (Helms-Burton) will be implemented in full.”  

The complaint stipulated that the Cuban government took the assets from Essosa, a subsidiary of a Standard Oil which later became Exxon Mobil.

Among the assets was the Belot Refinery, which produces 35,000 barrels per day. At the refinery was a marine terminal, an 8,800 pounds-per-day grease plant, a 205 barrel-per-day lube blending and packaging plant and 109 storage tanks with a total capacity of 2.4 million barrels. In addition, there were bulk product terminals including three ocean terminals and seven at inland sites. 

"Plaintiff has never settled the outstanding certified claims or received any payment from any entity with respect to the principal or interest due on its certified claim from the Cuban Liberty and Democratic Solidarity (LIBERTAD) Act of 1996,’’ the complaint said.

The complaint said CIMEX is Cuba’s largest commercial corporation that rakes in $1.3 billion in revenue and ‘’engages in a variety of foreign commerce across a variety of industries. For example, CIMEX reportedly maintains a financial division that manages all remittance wire transfers from the United States and a tourism company that is the exclusive provider of travel from the United States.’’

In conclusion, the attorneys for Exxon said, ‘’Plaintiff has not authorized CIMEX or CUPET to refine crude oil using plaintiff’s confiscated property, nor has plaintiff authorized them to produce, transport, make available for sale, or otherwise engage in any commercial activity involving any petroleum products that are or have been produced using plaintiff’s confiscated property.’’

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