On March 4, 2019, the U.S. State Department announced a limited exception to the suspension of Title III of the Cuban Liberty and Democratic Solidarity Act (also known as the Libertad Act or the Helms-Burton Act).Title III of the Libertad Act allows certain U.S. nationals to bring a lawsuit in federal court against any person who knowingly “traffics” in property confiscated by the Cuban government. This power has been suspended by every Presidential administration since the Libertad Act was enacted in 1996 and it was recently again suspended by the Trump administration.
The State Department’s announcement, however, provides a limited exception to this suspension. Beginning March 19, 2019, the suspension shall not apply to “The right to bring an action against a Cuban entity or sub-entity identified by name on the State Department’s List of Restricted Entities and Sub-entities Associated with Cuba (known as the Cuba Restricted List), as may be updated from time to time.” In other words, this exception means that Cuban entities or sub-entities on the Cuba Restricted List that traffic in confiscated property can, as of March 19, be sued by U.S. nationals who own the claim to the property.
Importantly, “trafficking” is defined broadly in the Libertad Act and includes transferring, purchasing, improving, investing in, and benefiting from confiscated property. Because this definition is so broad, companies that profit from the use of confiscated property may be liable, even if they do not own the property themselves.
Additionally, while the March 4 announcement provided only a limited exception to the suspension of Title III, in a special briefing, a senior State Department official suggested that the Trump administration is open to removing the suspension altogether. The current suspension will expire on April 17, 2019. If this suspension is not extended again by April 17, individuals and entities across a wide range of sectors could face civil liability under this Act. Title III liability is not statutorily limited to Cuban entities but extends to others who traffic in confiscated property.3 As noted by the senior official, the administration “encourage[s] any person who is doing business in Cuba to reconsider whether they are trafficking in confiscated property.”