Court of Appeals Affirms that Helms-Burton Claim Must be Acquired Prior to March 12, 1996

What Happened: A federal appellate court affirmed the dismissal of a plaintiff’s Helms-Burton claim because he acquired ownership of the property at issue after March 12, 1996, in contravention of the statute.

The Bottom Line: The plaintiff in this case cannot recover under the Helms-Burton Act because he failed to allege that he acquired ownership of a claim to confiscated property by March 12, 1996. This opinion benefits entities with potential risk under Helms-Burton as a result of their business interests related to Cuba, limiting those who could potentially claim under Helms-Burton.

The Full Story:

In Gonzalez v. Amazon.com, Inc., et al., the plaintiff sued Amazon.com, Inc. and Susshi International Inc. d/b/a FOGO Charcoal under Title III of the Helms-Burton Act. The Act provides to US nationals with claims to property confiscated by Cuba’s Castro regime a cause of action against those who traffic in such property. The plaintiff, Daniel Gonzalez, alleged that he is the rightful owner of real property located in the province of Oriente, Cuba. The defendants, Amazon.com and FOGO Charcoal, allegedly conducted and promoted the sale of marabu charcoal produced on the subject property without Gonzalez’s authorization.

According to Gonzalez, the property at issue originally belonged to his grandfather, who purchased the land from 1941 through 1952. Upon his grandfather’s passing in 1988, the property passed to his father, who maintained his claim to the property until he passed away in November 2016. When his mother inherited the property, she chose to pass her ownership claim on to the plaintiff, Daniel Gonzalez. Therefore, the plaintiff’s amended complaint states that he did not acquire a claim to the confiscated property until November 2016.

In May 2020, a Florida federal judge dismissed Gonzalez’s amended complaint for failure to state a claim upon which relief may be granted. Gonzalez appealed the dismissal, arguing that he alleged facts sufficient to show that he had acquired ownership of a claim to confiscated property in Cuba. The United States Court of Appeals for the Eleventh Circuit examined the language of the Helms-Burton Act to determine whether the district court erred in dismissing Gonzalez’s complaint. Under 22 U.S.C. § 6082(a)(4)(B) of the Helms-Burton Act, “[i]n the case of property confiscated before March 12, 1996, 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 March 12, 1996.” Thus, Gonzalez needed to plausibly allege that he acquired his claim to the property by March 12, 1996, which he did not. For this reason, the court of appeals affirmed the district court’s judgment, concluding that Gonzalez cannot recover under the Helms-Burton Act. This ruling is significant because it makes it more difficult for a potential claimant to acquire a valid Helms-Burton claim. For property confiscated before March 12, 1996, there can essentially be no new claimants because, according to this opinion, claims to such property cannot be inherited.

Companies doing business in or with Cuba, especially involving property known to have been confiscated, should be careful to avoid liability under the Helms-Burton Act. Note that the risk under Title IV of being subject to visa restrictions or exclusion from the United States is not affected by this ruling.

The Latin America practice group and the Commercial Litigation practice group at Hunton Andrews Kurth LLP will continue to closely monitor related developments on this issue and the broader issue of the US government’s enforcement of the Helms-Burton Act. Please contact us if you have any questions or would like further information regarding the Act.