NYT: Pact on U.S.-Cuba Flights Reopens Battle for Seized Property

Tuesday, February 16, 2016
From The New York Times:

Pact on U.S.-Cuba Flights Reopens Battle for Seized Property

The Obama administration’s top transportation officials will join Cuban dignitaries at the Hotel Nacional in Havana on Tuesday to sign an agreement that will restore commercial airline service between the two countries for the first time in more than 50 years.

José Ramón López, 62, the exiled heir to the Havana airport and to Cuba’s national airline, was not invited.

This being Cuba, even a significant diplomatic announcement has a back story involving old wounds, confiscated properties and uphill legal battles.

Mr. López is the son of the former owner of the airport, whose property was seized by the Communists after the triumph of the Cuban revolution. He says he deserves compensation if the United States is going to agree to a commercial deal involving the airport with the government that stole his inheritance.

“The airport in Havana is private property — mine,” Mr. López said. “How are American corporations going to go there and benefit from it?”

Mr. López says his is a cautionary tale that highlights the perils of doing business in Cuba, where unresolved, decades-old disputes complicate efforts by Cuba and the United States to resume not only diplomatic relations but also economic ones.

Mr. López is a former Cuban merchant mariner who left Cuba in 1989 and moved to Miami seven years ago. He has paperwork showing that he is the only child of José López Vilaboy, an associate of Fulgencio Batista, the Cuban dictator who was overthrown early in 1959.

Mr. López Vilaboy ran to safety on Dec. 31, 1958, when it became clear that a young bearded rebel named Fidel Castro had defeated the Batista forces and that the dictator would step down. Mr. López Vilaboy hid in the Guatemalan Embassy for nine months before fleeing the country; his properties were immediately seized.

Among his many holdings were a bank, a couple of hotels, factories, a newspaper, two airlines and Rancho Boyeros, the airport serving Havana now known as José Martí International Airport.

As far as the new Cuban government was concerned, Mr. López Vilaboy’s many properties were the fruits of his close relationship to a corrupt regime.

Mr. López Vilaboy eventually arrived in South Florida, and he lived quietly in a two-bedroom apartment in Miami Beach until his death in 1989.

He never saw his son after he left Cuba.

In 2010, a probate court in Miami declared Mr. López to be one of Mr. López Vilaboy’s heirs.

Over the years, he met with various lawyers, but he said they shrugged him off, viewing him as just one of the thousands of Cuban-Americans who lost property in the revolution — which they had little chance of ever getting back.

Then it was announced late last week that the American secretary of transportation, Anthony Foxx, and the assistant secretary of state for economic and business affairs, Charles H. Rivkin, would lead a delegation to Cuba for a signing ceremony at the Hotel Nacional.

By the fall, United States airlines will operate 20 flights a day from the airport Mr. López still considers his.

“I just don’t understand how American corporations can do business with my property,” he said. “If they are not giving it to me, then pay me for using it.”

Mr. López enlisted the help of Andy S. Gómez, a retired scholar of the Institute for Cuban and Cuban-American Studies at the University of Miami, who helped him arrange meetings to explore possible legal recourse. “Americans need to understand the risks of doing business in Cuba,” Mr. Gómez said.

He said the moment was particularly crucial now, as President Obama seeks to ease restrictions on doing business with Cuba and as more American companies flock there hoping to sign deals. Last week, the Obama administration approved the first American factory to operate in Cuba in more than 50 years, a small tractor company from Alabama.

The Helms-Burton Act, signed by President Bill Clinton in 1996, says that anyone who profits from properties that were confiscated from American citizens is liable for damages, even if the owner was not an American citizen at the time. Yet the law has provisos that allow the president to decide whether, for the sake of American interests, the law should be enforced.

It has pretty much never been enforced.

“It would be a slug fest,” said Pedro A. Freyre, a Miami lawyer who specializes in Cuban business deals. “It would be a brawl, a free-for-all, everyone suing every Canadian company, airline, hotel, you name it — and it would be detrimental to U.S. foreign relations.”

Martha Pantin, a spokeswoman for American Airlines, which is expected to bid for the Cuba routes, said Mr. López’s problem is one best answered by government agencies. “This is not an airline issue,” she said.

A spokesman for the State Department, who spoke on the condition of anonymity in keeping with department policy, said officials in the United States and their Cuban counterparts had touched on the topic during aviation talks. The State Department is negotiating with the Cubans over compensation for confiscated properties, but the cases of people who were not American citizens at the time of the confiscations were not included in those talks.

And unlike the situation after the fall of the Berlin Wall, when heirs of property owners in the former East Germany received compensation for seized assets, the confiscators in Cuba are still in power.

“Claims issues have been one of our highest priorities since we re-established diplomatic relations with Cuba,” the State Department spokesman said.

The United State Department of Transportation said the administration could not stop people with legal judgments against the Cuban government from going to court to seize Cuban assets. But Mr. López does not have a judgment against the Cuban government or Cubana de Aviación, the national airline that his father owned.

Even if he did, because of the many judgments by American courts against the Cuban government, planes belonging to Cubana de Aviación are not expected to start flying to the United States.

“We do not anticipate Cuban-owned aircraft serving the United States in the near future,” Thomas S. Engle, deputy assistant secretary for transportation affairs at the State Department, told reporters on a conference call last week.

He said negotiators were clear with Havana that the Obama administration would not be able to stop their planes from being seized by people who have successfully sued the Cuban government in American courts.

Andrew C. Hall, a Miami lawyer whose client won a $2.8 billion verdict against the Cuban government, considers himself first in line to seize Cuban planes should they try to land here.

“If it comes here, I’m going to go get it,” Mr. Hall said. “And if American Airlines at some point owes Cuba money, I will try to intercept that money.”

Mr. Hall said the United States government would be unlikely to get involved in cases like Mr. López’s, because governments generally have a right to confiscate property. But the dispute could be among the kind that help push for a resolution, he said.

“Hopefully, as the political process begins to develop, Cuba will compensate its citizens for property it confiscated,” Mr. Hall said.

The Cuban government did not respond to a request for comment.