Cuban Brothers Stumble in $3B Verdict Collection

     (CN) — Frozen U.S. bank accounts owned by Cuban nationals cannot satisfy the multibillion-dollar judgment Cuba and Fidel Castro owe two refugees, the First Circuit ruled.
     Alfredo and Gustavo Villoldo brought their case to Florida in 2008, having fled Cuba for the United States 48 years earlier.
     The brothers alleged that Castro had just risen to power in 1959 when Cuban authorities arrested them and threatened to kill their entire family unless the brothers’ father committed suicide and turned his property over to the government.
     Within weeks, their father was found on Feb. 16, 1959, dead of an apparent suicide. The Cuban government in turn confiscated his land and bank accounts.
     A judge in Florida awarded the Villoldos $2.79 billion in 2011, but Cuba has not paid anything toward the judgment.
     The brothers then sought to recover the money by pursuing assets located in Massachusetts allegedly owned by the Cuban government.
     They filed a subpoena on Computershare, a transfer agent in Canton, Massachusetts, seeking information about any securities accounts that Cuba may own. Computershare identified 383 accounts that had been opened in the 1950s by Cuban nationals.
     A 1959 law passed in Cuba required Cuban nationals to repatriate any assets held abroad, or they would be confiscated by the government.
     Under this law, the Villoldos argue, the identified funds are the property of Cuba. The brothers sought to claim the funds in these accounts to satisfy their judgment against the island nation.
     But Computershare, joined by the U.S. government, argued that the Cuban law has no effect over the disputed accounts.
     A federal judge ruled against the brothers, and the First Circuit affirmed Thursday.
     “Normally, ‘our courts will not give extraterritorial effect to a confiscatory decree of a foreign state, even where directed against its own nationals,'” Judge David Barron wrote for a three-judge panel, quoting Fifth Circuit precedent. “After all, United States law and policy – as evidenced by the Fifth Amendment of the United States Constitution – does not support the taking of private property without just compensation.”
     Barron said there was no cause to deviate from the normal rule, especially when U.S. foreign policy has sought to halt the flow of cash to Cuba.
     “If we were to decline to adhere to the extraterritorial exception to the act of state doctrine, Cuba would gain the benefit,” through the reduction of the judgment against it, the 22-page opinion states.
     The Boston-based panel also affirmed the dismissal of Computershare’s request for attorneys fees, given that its untimely petition is due to the “misunderstanding of its counsel,” which does not qualify as excusable neglect.
     In 2014, the Second Circuit similarly ruled against the Villoldos in their attempt to recover Cuban money from Spanish banks.

%d bloggers like this: