The United States Court of Appeals for the 11th Circuit has overturned a previous ruling that had found four major cruise lines—Carnival Corporation, Royal Caribbean Group, MSC Cruises, and Norwegian Cruise Line Holdings—guilty of engaging in illegal tourism to Cuba between 2016 and 2019. The latest review nullified the decision that required these companies to pay $439 million in damages to Havana Docks Corporation for using Havana's docks, which were seized by Cuba's communist regime in 1960.
According to Telemundo 51, the court found that Havana Docks' property rights had expired in 2004, meaning the cruise lines' activities did not qualify as illegal "trafficking" under U.S. law. This verdict changes the earlier decision by Judge Beth Bloom in March 2022, which had ordered the companies to compensate the descendants of an American businessman whose docks were expropriated after the Cuban Revolution, arguing that these trips did not comply with legally permitted categories.
Judge's Original Ruling
Judge Bloom emphasized that even though the Office of Foreign Assets Control (OFAC) had granted licenses for travel to Cuba and government officials had encouraged these activities, it did not absolve the companies of liability if they engaged in prohibited tourism. "By using the terminal and its docks in various ways, Carnival, MSC SA, Royal Caribbean, and Norwegian committed acts of trafficking under Section 6023 [of the Helms-Burton Act]," she noted.
In her 168-page ruling, Bloom highlighted that the cruise lines transported passengers for activities outside the legally allowed categories and had signed multimillion-dollar contracts with several Cuban government agencies for the use of the terminal and for conducting excursions. During their operations, these cruise lines generated over $1.1 billion in revenue by offering excursions to nightclubs, tourist sites, rivers, and beaches. However, following the announcement of sanctions in June 2019, they were forced to quickly drop Cuban stops and reroute their ships.
Impact of U.S.-Cuba Relations
A month before these restrictions, the administration of former president and current Republican presidential candidate Donald Trump activated a provision of the embargo that allowed Americans to sue any company involved in commercial activities related to confiscated properties in Cuba. Havana Docks Corporation sought approximately $9.2 million in compensation, and while the appeals court dismissed the case, the legal journey isn't over as proceedings on other claims against Carnival Corporation may continue.
In a joint statement quoted by Telemundo 51, MSC Cruises, NCLH, and Royal Caribbean expressed their satisfaction with the court's decision, appreciating the meticulous review of the case. Meanwhile, a spokesperson for Carnival Corporation commented, "We are pleased with the outcome and will not comment further on pending litigation."
This case underscores the enduring impact of U.S.-Cuba relations and the potential for future legal battles as companies try to navigate a shifting and complex legal landscape.