Supreme Court Revives Cruise Lawsuits Over Cuba Seizures

In an 8-1 ruling on Thursday, the U.S. Supreme Court cleared the way for lawsuits against four major cruise lines to proceed over their use of port facilities in Havana that were confiscated from an American company by the Cuban government in 1960. The decision in Havana Docks Corporation v. Royal Caribbean Cruises, Ltd. revives up to $440 million in combined judgments against Carnival Corporation, Royal Caribbean Cruises, Norwegian Cruise Line Holdings, and MSC Cruises.

Background: A 60-Year-Old Dispute

The case traces back to the aftermath of the Cuban Revolution. In 1960, the Cuban government under Fidel Castro seized a 99-year concession held by Havana Docks Corporation — a Delaware company — to operate piers and terminal facilities at the Port of Havana. The concession, originally granted in 1905 and extended in 1920, had given Havana Docks exclusive possession of and the right to receive economic benefits from the docks, terminal building, and associated land.

Havana Docks filed a claim with the U.S. Foreign Claims Settlement Commission, which certified a loss of over $9 million. But the company was unable to pursue direct legal recourse for decades due to the suspension of key provisions of the Helms-Burton Act.

The Helms-Burton Act and Title III

Enacted in 1996, the Cuban Liberty and Democratic Solidarity (LIBERTAD) Act — commonly known as the Helms-Burton Act — codified the U.S. embargo against Cuba. Its Title III created a private right of action allowing U.S. citizens whose property was confiscated to sue anyone who “traffics” in that property. However, every president from Bill Clinton through Barack Obama suspended Title III at six-month intervals, citing foreign policy concerns.

That changed in May 2019, when the Trump administration fully activated Title III for the first time, opening the door for a wave of litigation. Havana Docks promptly sued four cruise lines that had docked at the Havana Cruise Port Terminal between 2016 and 2019 — during the brief thaw in U.S.-Cuba relations under the Obama administration. According to court filings, the cruise lines disembarked nearly one million tourists on those docks, paying the Cuban government at least $130 million in hard currency without compensating Havana Docks.

The Legal Dispute and Lower Court Rulings

The central legal question was whether a plaintiff suing under Title III must prove that the defendant “trafficked” in property that the plaintiff would have continued to own in a counterfactual world without expropriation — or whether it is sufficient that the defendant used property that was originally confiscated by the Cuban government.

The U.S. District Court for the Southern District of Florida initially entered summary judgments totaling over $100 million against each of the four cruise lines. But the Eleventh Circuit reversed those judgments, reasoning that Havana Docks’ 99-year concession would have expired in 2004 — meaning the cruise lines could not have “trafficked” in property that Havana Docks no longer had a right to possess.

The Supreme Court’s 8-1 Ruling

Writing for the majority, Justice Clarence Thomas held that the cruise lines’ use of the docks is sufficient to establish that they used “property which was confiscated by the Cuban Government” under the plain language of the Helms-Burton Act. The Court ruled that Havana Docks is not required to establish that the cruise lines “trafficked” in its specific property interest — the leasehold. Instead, the statute’s focus is on whether the property in question was originally confiscated by the Cuban government, not on what the plaintiff’s property rights would have been in a hypothetical non-expropriation scenario.

Justice Sonia Sotomayor filed a concurring opinion joined by Justice Brett Kavanaugh, providing additional reasoning on congressional intent. Justice Elena Kagan was the sole dissenter, arguing that the majority’s interpretation could lead to “absurd results” by expanding liability beyond what Congress intended, according to the Supreme Court’s official docket.

The majority included Chief Justice John Roberts and Justices Samuel Alito, Neil Gorsuch, Ketanji Brown Jackson, and the two justices who wrote separately.

Implications and Analysis

The ruling has significant legal, economic, and political ramifications. By rejecting the “counterfactual” approach that would have required courts to imagine what property rights would look like without expropriation, the Court substantially lowered the bar for plaintiffs under the Helms-Burton Act.

This decision likely strengthens the position of Exxon Mobil in a companion case, Exxon Mobil Corp. v. Corporación Cimex (Docket No. 24-1058), which was argued on the same day but has not yet been decided. Exxon Mobil seeks compensation for oil and gas assets in Cuba confiscated in 1960, valued at approximately $70 million at the time and now claimed at $280 million with interest.

More broadly, the ruling could open the door for hundreds of other U.S. claimants whose property was seized after the Cuban Revolution. The Foreign Claims Settlement Commission has certified numerous claims that could now be pursued in court.

What’s Next

The case has been remanded to the Eleventh Circuit for further proceedings consistent with the Supreme Court’s opinion. The cruise lines now face the prospect of substantial damages for their operations in Havana during the 2016-2019 period.

The decision also raises questions about the future of U.S.-Cuba relations and the extraterritorial application of American law, which has long been controversial among U.S. allies and trading partners. The cruise industry may also be deterred from doing business in Cuba even if diplomatic relations thaw in the future, given the legal risks now clearly established by the nation’s highest court.