Cruise Industry Under Scrutiny: Supreme Court May Pave Way for Lawsuits Over Cuban Ventures

Next week, the future of some of the world's leading cruise lines will be determined by the United States Supreme Court. At stake is not merely a Cold War-era legal dispute, but also millions of dollars, the reach of the embargo, and the message Washington sends to any company doing business with confiscated properties in Cuba.

On Monday, February 23, justices will hear arguments in the case of Havana Docks Corp. v. Royal Caribbean Cruises Ltd., a lawsuit that could reshape the financial implications of operating on the island. At the heart of this conflict is the Havana Port's Cruise Terminal, a facility that was originally leased to an American company before being seized by the Cuban government in 1960.

Decades later, during the thaw initiated by the Obama administration, thousands of American tourists began arriving in Cuba via cruise ships. Companies like Royal Caribbean, Norwegian, Carnival, and MSC utilized this port between 2016 and 2019. They now face accusations of "trafficking" in confiscated property, violating Title III of the Helms-Burton Act.

This title grants U.S. citizens and companies the right to sue entities benefiting from properties expropriated by the Cuban regime after 1959. Although enacted in 1996, the provision was suspended by successive administrations until 2019, when the then Secretary of State fully activated the measure, enabling lawsuits like that of Havana Docks.

In 2022, a federal judge in Miami ruled against the cruise lines, awarding judgments exceeding $100 million. However, the 11th Circuit Court of Appeals overturned this decision, reasoning that the original lease for the port had expired in 2004, negating any ongoing rights during the cruise operations in Havana.

The Supreme Court must now decide if the right to sue is tied to the certified claim of confiscation or to the formal duration of the original lease. The distinction is pivotal. A ruling in favor of Havana Docks could not only revive massive claims against the cruise lines but might also lead to thousands of similar lawsuits.

According to the State Department, there are at least 200,000 potential claims concerning confiscated properties in Cuba. For businesses, the implication is clear: engaging in the island's economy might pose a significant financial risk, even years later.

The Trump administration has taken a decisive stance in the case. Solicitor General D. John Sauer has requested to personally participate in the oral arguments before the Court, a request that was granted. The federal government’s direct involvement highlights the political and strategic significance of the litigation, extending beyond the companies involved.

Lawmakers from both parties, including several from Florida, argue that the right to sue is a cornerstone of U.S. policy towards Cuba and a tool to economically pressure the regime. They assert that allowing foreign or American companies to profit from confiscated properties undermines this policy.

Conversely, travel industry associations warn that an adverse ruling would create legal uncertainty and question the validity of executive guidelines on lawful travel to Cuba. They claim the sector acted under existing federal regulations at the time, and altering the rules retroactively would severely impact the U.S. tourism industry.

This case is not alone. On the same day, the justices will also hear a separate Helms-Burton related lawsuit involving Exxon Mobil and state-run Cuban company CUPET. Though different in nature, this case reinforces the notion that the high court is poised to reassess the actual scope of one of the embargo's most contentious legal instruments.

For Cuba, the economic impact might extend beyond the courtroom. Should the Court broaden the scope of lawsuits under Title III, any international company contemplating investing, operating, or partnering with entities tied to confiscated properties would need to reassess their risks. At a time when the island faces a severe economic crisis, the outcome could further isolate it financially.

The Supreme Court's decision will not only affect maritime tourism giants but also set a precedent on the extent of liability for those who conducted business in Cuba during the brief period when cruises returned to Havana. For many Cubans, both on the island and abroad, the ruling could become another defining chapter in the long-standing economic tensions between the two nations.