31 May U.S. Court Upholds Cuban-Club Med Expropriation
The Eleventh Circuit applied the act of state doctrine today (Glen v. Club Med, 05-12648) to dismiss a lawsuit brought by Cubans whose land was expropriated during the 1960 Castro-led revolution. The Cuban government is now going to use that same land to open a Club Med (but of course) and the expropriated Cubans tried to block that deal by suing in federal court in Florida. (thanks to my colleague Eric Freedman for pointing out this case).
I’ll have to think a bit more about this case, but it seems basically right in its reading of the act of state doctrine and the Helms Burton Act (which creates a cause of action but allows the President to suspend those causes of action, which he has). I am not sure, however, why the Hickenlooper Amendment, which limits the application of the act of state doctrine in cases involving expropriation, doesn’t apply here. It might be because the claim is not being made by U.S. citizens (or at the time of the expropriation).
It doesn’t sound like this case has a serious future, but we’ll see whether the Supreme Court is willing to revisit the Act of State doctrine. More likely than not, Club Med can go forward with their plans to bring a little of the decadent Mediterranean to Cuba. Which is, on the whole, a very good thing.
I haven’t read the Club Med decision but I guess that the Hicklenlooper Amendment was not considered because a number of courts have held that the Amendment is inapplicable where the expropropriated property or it s proceeds are not in the US.