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Controversial New Fund May Further Normalization Efforts with Cuba

New Miami Blog

New Miami Blog
October 03, 2016

Cuba Image for BlogPrivate judgments worth millions of dollars against the Cuban government have been a hindrance to normalizing U.S.-Cuba relations. Meanwhile, many of the victims who won those judgments have long given up on ever recovering a dime.

But there is new hope for those victims of state-sponsored terrorism, according to Bilzin Sumberg attorneys José M. Ferrer and Yasmin Fernandez-Acuña. The two members of Bilzin Sumberg’s Litigation Group co-wrote a piece in the Fall 2016 edition of the International Law Quarterly detailing how these victims may yet see compensation.

Until recently, the only hope of satisfying any of these private judgments was for the U.S. to seize Cuban assets that touched U.S. soil. One such example was the confiscation of a Cuban airplane that was hijacked and flown to Key West in 2003. Despite Cuba’s protestations, the plane was sold at auction to satisfy a private litigant’s claims. So as long as private judgments went unpaid, no Cuban boats could dock in the U.S. and no Cuban goods could enter the U.S. without the fear of being seized.

A piece of legislation buried in a massive tax-and-spending bill signed by President Obama on December 18, 2015, promises compensation for victims of international terrorism. The new law creates the Victims of State Sponsors of Terrorism Fund, which was kick-started with $1 billion from penalties BNP Paribas paid for violating sanctions against Iran, Sudan, and Cuba. With another $1.025 billion contributed from the U.S. Treasury and more fines for sanction violations earmarked, the fund promises up to $20 million for those who have received final court judgments against Iran, Cuba, and other state sponsors of terrorism.

While the fund cannot possibly satisfy all the judgments, it is presently the only option for resolving claims that are a roadblock for normalizing U.S.-Cuba relations, Ferrer and Fernandez-Acuña conclude in their article.

Click here to read Ferrer’s and Fernandez-Acuña’s article.

Publication Fall 2016
While journalists and pundits tend to fixate on theCastro dynasty’s and the Obama administration’sdiplomatic overtures, there is another critical but oftenignored component in this political narrative: privatejudgments against Cuba. Despite the recent change inpolitical climate, the exis...