CUBA
Cuba's frozen assets depleted by lawsuits

A handful of large payouts have virtually wiped out $268 million in Cuban assets held in the United States since they were frozen in 1963.

BY JANE BUSSEY
jbussey@MiamiHerald.com



Thousands of U.S. companies -- hoping for compensation from the Cuban government for property seized after the 1959 revolution -- may as well forget the Cuban money once held at JP Morgan Chase bank in New York.

Cuban funds, as much as $268 million at one point, sat in U.S. bank accounts since 1963, when the Kennedy administration froze all Cuban assets in the United States. But now almost all of that money is gone, paid out to a handful of citizens who sued the Cuban government in Miami courts in wrongful-death cases.

Awards from the frozen accounts have gone to the families of Brothers to the Rescue pilots shot down by Cuban MiGs, to the spurned wife of a Cuban spy and to relatives of Americans executed shortly after the revolution.

This means there is virtually no money at banks such as JP Morgan Chase for the long list of other parties who seek compensation from Cuba, including nearly 6,000 American companies and individuals who have certified claims for seized property and Cuban-Americans who also seek payments for former homes, farms and businesses.

If and when Cuba and the United States get closer to normalizing relations, the issue could be a major stumbling block.

Havana has denounced the payouts as theft, and at least one U.S. corporation has fought the payouts in court.

In January, after $400 million was awarded to the survivors of Robert Fuller, an American executed by a Cuban firing squad in 1960, the Cuban government accused the United States of stealing more than $170 million of its money kept in the frozen accounts.

The families and individuals who have collected on judgments against Cuba insist they were seeking justice for their suffering and the painful deaths of their relatives.

''The money wasn't that important,'' said Janet Ray Weininger, who won a wrongful-death suit in 2004 in Miami-Dade Circuit Court for her father Thomas ''Pete'' Ray.

''Fidel Castro chose to hold my life hostage.'' said Weininger, who was 6 years old when her father, a CIA pilot, was shot down during the Bay of Pigs invasion. ``I wanted Castro exposed.''

But critics of the massive payouts -- $23.9 million to Weininger, for example -- say they create potential problems in restoring diplomatic and economic relations with Cuba in the future.

''It's fundamentally unfair that individuals and companies that filed claims and played by the rules in the 1970s and waited 40 years would have had their claims trumped by lawsuits that were filed decades later,'' said Stuart Eizenstat, who served as undersecretary of state in the Clinton administration.

THOUSANDS OF CLAIMS

During the 1960s, the Foreign Claims Settlement Commission certified 5,911 claims of American citizens and companies worth $1.85 billion. Now those claims are valued at more than $7 billion after 47 years at 6 percent interest.

Eizenstat, now with a Washington law firm, said the frozen assests have traditionally been viewed as a bargaining chip in bringing countries like Cuba to the table to discuss property disputes and other issues.

Also looking to receive compensation or recover property are Cuban-Americans whose property was seized. Miami lawyer Nicolás Gutiérrez said he has an informal registry of 350 claims totaling $100 billion. They aren't certified because the claimants weren't U.S. citizens at the time their property was taken.

Gutiérrez said he has been studying whether the group can try to obtain the frozen funds or even seize commodities being shipped to Cuba from a U.S. port. Under an exception to the embargo, food shipments to Cuba must be paid for before they leave the United States so they're Cuban property.

''This mess will have to be cleaned up down the road,'' said Robert Muse, a Washington attorney who represents some of the certified claimants.

'96 LAW PIVOTAL

What started the run on the frozen accounts was the 1996 Anti-Terrorism and Effective Death Penalty Act, passed after the Oklahoma City bombing. It cleared the way for private citizens to sue foreign governments for terrorist acts and triggered a flurry of lawsuits from those by families of Brothers to the Rescue fliers to the family of Howard Anderson, an American businessman linked to the CIA, who was shot by a Cuban firing squad in 1961.

The Cuban government has never defended itself in the wrongful-death suits but has insisted it is the rightful owner of the money in the frozen accounts and wants Washington to ``take full responsibility for the theft.''

What lawyers on all sides agree is that there is hardly any money in the accounts that can be claimed. Most of what is left, $60 million to $70 million, is exempt from garnishment under U.S. law.

Weininger has collected her full judgment from Cuban funds held at JP Morgan Chase, but first she and the Anderson family had to face a challenge from OfficeMax, the corporation that wound up with the claims for the Cuban Electric Co., a seized American property.

In an unsuccessful brief filed for OfficeMax, Muse argued that Cuba was not designated as a terrorist state until 1982, more than 20 years after Ray and Anderson were killed.

But Weininger questions why anyone would think corporate interests or international relations should take precedence over people seeking redress for emotional suffering.

''Why would an American company seek to deny justice to an American who had died for his country?'' she said.

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