A federal appeals court in the United States confirmed the dismissal of a lawsuit filed by seven American citizens, descendants and successors of businessman Ramón Rodríguez Gutiérrez, against two British companies accused of profiting from a tobacco factory confiscated by the Cuban regime in 1961.
The decision was issued last Thursday by the Eleventh Circuit Court of Appeals, which upheld the previous ruling of the Federal Court for the Southern District of Florida in favor of Imperial Brands and WPP.
The court clarified that U.S. courts lack personal jurisdiction over those foreign companies in this case.
The ruling is strictly jurisdictional: it does not determine whether the companies illegally used the property, whether they engaged in "trafficking" of confiscated goods under the Helms-Burton Act, or whether the heirs are entitled to receive compensation.
The plaintiffs own a 90% stake in Ramón Rodríguez e Hijos Sociedad en Comandita, a company that, prior to the rise of Castro's regime, owned and operated a cigarette factory in Havana and an adjacent mixed-use building.
Documents from the initial process identify the property as the Partagás factory. According to the lawsuit, the Cuban government confiscated the company and its properties in 1961 during the nationalization of the tobacco industry.
The heirs claimed that Habanos S.A., a company controlled by the Cuban state, used the facilities to manufacture, store, market, and distribute cigars. Tabacuba, the state monopoly in the sector, is also said to have set up offices in the adjacent building.
The lawsuit originally included Habanos S.A., Imperial Brands, WPP, and the advertising agencies Young & Rubicam and Burson Cohn & Wolfe.
Imperial Brands, headquartered in the United Kingdom, acquired the Spanish company Altadis in 2007, which had a non-controlling 50% stake in Habanos S.A. The British multinational divested its indirect stake in 2020.
The plaintiffs argued that, between 2010 and October 2020, WPP and its subsidiaries helped promote Habanos products related to the confiscated property through U.S. websites and platforms such as Twitter, YouTube, and Instagram.
The claim was filed under Title III of the Helms-Burton Act, which allows U.S. citizens to seek economic damages against those who allegedly use, manage, or benefit from properties confiscated by the Cuban government after January 1, 1959, without the authorization of their rightful owners.
However, the Eleventh Circuit concluded that forcing Imperial Brands and WPP to defend themselves in U.S. courts would impose an "unreasonable" burden.
The judges noted that neither of the two companies directly engaged in conduct significantly related to the allegations in the United States, nor did they maintain a relevant presence in the country that would justify subjecting them to federal jurisdiction.
In the case of WPP, the plaintiffs attempted to attribute the activities carried out by its U.S. subsidiaries to it.
The court deemed the argument insufficient because it was not demonstrated that Young & Rubicam and Burson Cohn & Wolfe were mere extensions or alter egos of the parent company.
The court also rejected that the indirect participation of Imperial Brands in Habanos S.A. would allow for holding it responsible for the actions of the Cuban company. The ruling emphasized that Habanos was controlled by the Cuban State and not by Imperial.
The court acknowledged that the heirs have a strong interest in defending the rights granted to them by the Helms-Burton Act and that U.S. courts are the only venues where they can bring such claims.
Nevertheless, he determined that those interests did not outweigh the constitutional difficulties in exercising jurisdiction over the two British companies.
He also recalled that UK legislation restricts the participation of its companies in lawsuits brought under Title III of the Helms-Burton Act without government approval.
"In the particular circumstances presented, we maintain that subjecting WPP and Imperial to the jurisdiction of the United States would impose an unreasonable burden on both companies," the court concluded.
The decision only confirms the dismissal of the claims against Imperial Brands and WPP due to lack of personal jurisdiction. The judges did not assess the companies' alternative argument that the lawsuit did not present a sufficient legal claim.
Habanos S.A., for its part, had previously been excluded from the litigation due to a different issue: the court determined that the Southern District of Florida was not the appropriate judicial venue to process the claim against that company.
Therefore, the ruling does not absolve the companies of the accusations nor does it establish that the property was not confiscated. Its scope is limited to concluding that, under the specific circumstances of the case, Imperial Brands and WPP cannot be subjected to this process in U.S. courts.
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