Exxon Mobil sues Cuba’s oil companies for their use of properties seized under Castro

[El Presidente]

The first of many to come 

 

https://www.miamiherald.com/news/nation-world/world/americas/cuba/article230009709.html

 

In an expanding legal battle, Exxon Mobil has filed suit in U.S. federal court against Cuba’s CIMEX and CUPET companies for their use of an oil refinery and other properties seized by the Fidel Castro government six decades ago.

Exxon Mobil is the first U.S. company to file suit against Cuban companies after President Donald Trump allowed Title III of the Helms-Burton Act to take effect, opening the way for demands against Cuban and foreign companies that benefit from properties seized by the communist government.

Title III had been suspended every six months by every U.S. president since the law was approved in 1996.

The Exxon Mobil lawsuit, filed in federal court in Washington Thursday, followed two other complaints filed in U.S. court in Miami against Carnival Corp. for the use of port facilities in Havana and Santiago de Cuba, by descendants of the families that owned the docks and warehouses.

“This filing is immensely significant. The largest energy company in the United States, the fifth-largest energy company in the world (is) using Title III … to sue a company owned by the government of Cuba,” said John Kavulich, president of the U.S-Cuba Trade and Economic Council.
 

“This provides comfort for other large claimants to sue, will increase fear by companies in other countries from engagement with Cuba due to the reach of Exxon Mobil and is consistent with Exxon Mobil efforts to recover assets in Venezuela and defend themselves in other countries,” he added.

Exxon has filed suit against the Venezuelan government’s PDVSA oil company for the nationalization of properties during the government of the late President Hugo Chavez.

Exxon Mobil, a successor company to Standard Oil, argued in its lawsuit that CIMEX and CUPET (Cuba Petroleo) have long exploited a refinery in Havana, formerly called the Belot and now the Nico López refinery, as well as gasoline stations and other installations that were worth $72 million when they were seized by the Castro regime without compensation in 1960.

The Helms-Burton law allows companies to demand three times the original value of the seized properties, plus six percent per year and court costs.

The U.S. Department of Justice has certified nearly 6,000 claims by U.S. citizens and companies for properties expropriated after Castro seized power in 1959. Now Cubans who became U.S. citizens after their properties were seized will also be able to file lawsuits under Title III.

Cuban Foreign Minister Bruno Rodríguez said Thursday his government will protect the companies facing lawsuits under Title III, but offered no details.

“The Helms-Burton law is illegal, violates international law, cannot be applied and has no legal weight or impact,” he declared on Twitter. “Cuba will protect the Cuban and foreign entities operating in the country, and considers all demands based on that judicial monstrosity to be null.”

Kavulich warned of rough waters ahead for Havana.

“Regardless of the position of the government of Cuba, if enough certified claimants use Title III, there will be immense pressure upon Cuba by members of the EU, Canada, Japan, Russia and China to negotiate a settlement with the 5,913 certified claimants,” he said.

Founded by the Cuban Ministry of the Interior, CIMEX is on the list of restricted Cuban entities maintained by the U.S. Department of State. It is now part of GAESA, a conglomerate controlled by the Cuban military, and administers shops, restaurants and real estate agencies. With CUPET, it operates hundreds of gas stations on the island.

One CIMEX branch, Fincimex, has a contract with Western Union to deliver remittances to island residents, one of the principal sources of hard currencies for the country.

CUPET also co-managed a gasoline refinery in Cienfuegos with Venezuela’s PDVSA until 2017, when CUPET took over sole management of the facility.

In the past, a number of people have won lawsuits in U.S. courts against Cuba, but have been largely unable to collect on the damages awarded because the Cuban government no longer has properties or accounts in the United States that can be seized.

But that apparently did not dissuade Exxon Mobil, which has a powerful legal team, from filing its lawsuit.

Kavulich said the oil giant could try to seize some part of the fees that Western Union or other clients pay to CIMEX for the remittances. Western Union itself has a certified claim against Cuba for more than $1 million.

Exxon Mobil has “the commercial, economic and political reach to locate assets and litigate for assets,” Kavulich said. “And, the Trump Administration will certainly assist in whatever way is viable.”

[Habana Mike]

All in the plan. Going hard.

Shame to see as the most impact will be to the Cuban people who are already suffering more than enough.

[cigcars]

    *I thought that once the Castro's were no longer alive or running things all the hostilities from the west was supposed to suddenly dissolve away. And now Western companies are still in Cuba's stuff about what was done by their original "Bad Boy" 60 years ago - as if he were still around? 

[Ken Gargett]

love that exxon might sue western union. i reckon the cuban leadership would have spat their breakfast across the table laughing at that. 

i assume exxon will applaud the cuban govt for treating this action with the same sort of contempt that they themselves treated decisions like the litigation in the exxon valdez disaster? 

they must know that they will get nothing but a big legal bill from this. or do they really think that a decision in an american court, the country that has bullied this small island for decades, will have the cuban govt falling over itself to pay. even if it had the money. but at least they will have subjected the cuban people to more misery. 

[DaBoot]

They are thinking decades ahead, maybe if they become a democratic state one day, the companies and individuals would have claim to past stolen land as they open up to the world markets 

[Born Habano]

My family (my mother's side) lost their farm.  That's never coming back.  The Cuban government will have counter suits (maybe?) as they claim billions in economic damages from decades of embargo policy.

Whether or Cuba, Venezuela, wherever....  Political risk is part of the picture when foreign nationals/companies do business on soil other than their own.  Cuba will never see a penny of damages and Exxon will never get a penny of recompense for their nationalized property.  Meanwhile, new business opportunity remains unexploited (with all the same risk as before).

Anyway, that's how I see it.

[Ken Gargett]

42 minutes ago, Born Habano said:

My family (my mother's side) lost their farm.  That's never coming back.  The Cuban government will have counter suits (maybe?) as they claim billions in economic damages from decades of embargo policy.

Whether or Cuba, Venezuela, wherever....  Political risk is part of the picture when foreign nationals/companies do business on soil other than their own.  Cuba will never see a penny of damages and Exxon will never get a penny of recompense for their nationalized property.  Meanwhile, new business opportunity remains unexploited (with all the same risk as before).

Anyway, that's how I see it.

it is all very sad for the "little people" who are inevitably the losers.

even if cuba becomes a paragon of democracy, agree - exxon getting zip. 

[nKostyan]

If the US government had reasonable policies, they could make a deal: lift the embargo in exchange for phased compensation for the market value of the expropriated property

[Ken Gargett]

2 minutes ago, nKostyan said:

If the US government had reasonable policies, they could make a deal: lift the embargo in exchange for phased compensation for the market value of the expropriated property

don't see it, even if the states looked at lifting the embargo. near 60s years of oppression and the states wants money from cuba? there would presumably be an appropriate diplomatic term for go and take one flying leap...

they don't have it to start with and i think that govts in cuba actually gain from having the embargo in the sense it is something/someone to blame. other than themselves. 

even if the govt of cuba was 100% behind lifting the embargo, i still don't see them paying the states. it is one thing to say to the people, the position you find yourself in is beyond our control and all the fault of the states (leave aside for this argument the rights or wrongs as i know some have more draconian views than i do). it is entirely different to say well, you know that superpower who has oppressed us for near on 60 years. we are now paying money to it, even though we are still dirt poor. 

and even if they agreed (not that it is happening or likely under this administration), what is there to stop a future administration re-imposing the embargo? blind freddie could see that there would be a dispute somewhere along the line. i doubt either side trusts the other for a second. 

i wonder if exxon have been offered benefits by US admin of some kind entirely separate to anything to do with cuba in exchange for bringing this action. i don't believe that exxon thinks it will get a cent via a direct payment from the cuban govt as compensation. so why do it? i have no idea so that was pure speculation.

or possibly they think that when the embargo does fall, if they concede on any judgement made in their favour and do not insist on payment by the cubans, then they will get preferential treatment from the govt at that time. 

all speculation but i simply struggle to believe that this is as it appears on its face.  

[SirVantes]

Frank: Joe! What the hell is this? It says here in the court papers that we are the Plaintiffs.  Look, we can't have that sort of screwup in the legal department; we here in Corporate Public Relations have enough to do without this sort of mess.

Joe: But we are the Plaintiffs.

Frank: C'mon, that would mean we're the wronged party.

Joe: Er...yeah...?

Frank: When are we ever the wronged party?! You're telling me we didn't spill crude all over a pristine bay? We didn't leak toxins all over a water table?  We didn't despoil a bird sanctuary?

Joe: Nope.

Frank: No Native Americans, First Nations, aboriginals lodging civil rights claims? We have no campaigners for coral, elk or some banded tit against us?

Joe: Not this time.

Frank: So who's against us?  There has to be someone.

Joe: Communists. An oppressive regime bleeding the populace.

Frank: Communists?  We get to play victim against Communists? [A shaft of light pierces the boardroom plate glass, illuminating Frank in a beatific glow, as a single tear rolls down his cheek].   

[CaptainQuintero]

  Yeah, I'm guessing nest feathering for the future. 

  I mean what weight can any decision truly hold for the Cuban government? I'm guessing even if the Cubans bother turning up to courts, the issued court papers will go straight into the bin, or more likely fed into the propaganda machine for the regime to show how much the big US companies and government hate the downtrodden Cuban citizen. 

 Lawyers gaining the most as usual, the little people on both sides being sidelined in the name of real politik and international one upmanship

[Lotusguy]

 
i wonder if exxon have been offered benefits by US admin of some kind entirely separate to anything to do with cuba in exchange for bringing this action. i don't believe that exxon thinks it will get a cent via a direct payment from the cuban govt as compensation. so why do it? i have no idea so that was pure speculation.
or possibly they think that when the embargo does fall, if they concede on any judgement made in their favour and do not insist on payment by the cubans, then they will get preferential treatment from the govt at that time. 
all speculation but i simply struggle to believe that this is as it appears on its face.  

Bingo!! I would bet my bottom dollar that they have been “motivated” by the current US government. Quid pro quo. Drill rights in the arctic, whatever.

[BarryVT]

Sue all you want, you can't squeeze blood out of a turnip!