Sucesores De Don Carlos Nuñez Y Doña Pura Galvez, Inc. v. Société Générale, S.A.

• Decision Date: 22 December 2021
• Docket Number: 20-CV-851 (KMW)
• Citation: 577 F.Supp.3d 295
• Parties: SUCESORES DE DON CARLOS NUÑEZ Y DOÑA PURA GALVEZ, INC.; Myriam E. Nuñez, as Personal Representative and Executor of the Estate of Nestor Francisco Nuñez Galvez; Eileen Dominguez, as Personal Representative and Executor of the Estate of Blanca Nuñez; Gloria Torralbas Nuñez; Gloria Pilar Molina, as Personal Representative and Administrator of the Estate of Thomas Torralbas Nuñez; Pura America Ochoa Nuñez; Norka Cabanas Nuñez; Carlos Cabanas Nuñez; Silvia Nuñez Tarafa; Carlos Nuñez Tarafa; Lourdes Nuñez, as Personal Representative and Administrator of the Estate of Alejandro Nuñez Tarafa; Carlos Arsenio Nuñez Rivero, as Personal Representative and Executor of the Estate of Caridad Maria Rivero Caballero; and Carlos Arsenio Nuñez Rivero, Plaintiffs, v. SOCIÉTÉ GÉNÉRALE, S.A., and BNP Paribas, S.A., Defendants.
• Court: U.S. District Court — Southern District of New York

577 F.Supp.3d 295

SUCESORES DE DON CARLOS NUÑEZ Y DOÑA PURA GALVEZ, INC.; Myriam E. Nuñez, as Personal Representative and Executor of the Estate of Nestor Francisco Nuñez Galvez; Eileen Dominguez, as Personal Representative and Executor of the Estate of Blanca Nuñez; Gloria Torralbas Nuñez; Gloria Pilar Molina, as Personal Representative and Administrator of the Estate of Thomas Torralbas Nuñez; Pura America Ochoa Nuñez; Norka Cabanas Nuñez; Carlos Cabanas Nuñez; Silvia Nuñez Tarafa; Carlos Nuñez Tarafa; Lourdes Nuñez, as Personal Representative and Administrator of the Estate of Alejandro Nuñez Tarafa; Carlos Arsenio Nuñez Rivero, as Personal Representative and Executor of the Estate of Caridad Maria Rivero Caballero; and Carlos Arsenio Nuñez Rivero, Plaintiffs,

v.SOCIÉTÉ GÉNÉRALE, S.A., and BNP Paribas, S.A., Defendants.

20-CV-851 (KMW)

United States District Court, S.D. New York.

Signed December 22, 2021

Benjamin Widlanski, Evan Stroman, Dwayne Antonio Robinson, Stephanie Moncada, Kozyak Tropin & Throckmorton LLP, Miami, FL, James A. Barta, MoloLamken LLP, Washington, DC, Javier A. Lopez, Javier Asis Lopez, Kozyak Tropin & Throckmorton PA, Coral Gables, FL, Jennifer Elizabeth Fischell, Sara Ellen Margolis, Steven Francis Molo, MoloLamken LLP, New York, NY, Paul A. Sack, I, Paul A. Sack, P.A., Miami Beach, FL, for Plaintiff Sucesores de Don Carlos Nunez y Dona Pura.

Benjamin Widlanski, Evan Stroman, Dwayne Antonio Robinson, Kozyak Tropin & Throckmorton LLP, Miami, FL, James A. Barta, MoloLamken LLP, Washington, DC, Javier A. Lopez, Kozyak Tropin & Throckmorton, Coral Gables, FL, Jennifer Elizabeth Fischell, Sara Ellen Margolis, Steven Francis Molo, MoloLamken LLP, New York, NY, for Plaintiffs Gloria Pilar Molina, as Personal Representative and Administrator of the Estate of Thomas Torralbas Nunez, Carlos Nunez Tarafa, Pura America Ochoa Nunez, Gloria Torralbas Nunez, Norka Cabanas Nunez, Lourdes Nunez, as Personal Representative and Administrator of the Estate of Alejandro Nunez Tarafa, Myriam E. Nunez, as Personal Representative and Executor of the Estate of Nestor Francisco Nunez Galvez, Silvia Nunez Tarafa, Eileen Dominguez, as Personal Representative and Executor of the Estate of Blanca Nunez, Carlos Cabanas Nunez.

Steven Francis Molo, MoloLamken, LLP, New York, NY, for Plaintiffs Carlos Arsenio Nunez Rivero, as Personal Representative and Executor of the Estate of Caridad Maria Rivero Caballero, Sucesores de Don Carlos Nunez y Dona Pura Galvez, Inc., Carlos Arsenio Nunez Rivero.

Edward Maurice Mullins, Astigarraga Davis Mullins & Grossman, P.A., Jose I. Astigarraga, Reed Smith LLP, Miami, FL, Alex C. Lakatos, Pro Hac Vice, Gretel Echarte Morales, Stephen M. Cohen, Mayer Brown LLP, Washington, DC, Lydia Ho, Michelle J. Annunziata, Steven Wolowitz, Mayer Brown LLP, New York, NY, for Defendant Societe Generale S.A.

Carmine D. Boccuzzi, Jr., Cleary Gottlieb, New York, NY, for Defendant BNP Paribas, S.A.

OPINION & ORDER

KIMBA M. WOOD, United States District Judge:

Plaintiffs, a corporation created to assert claims to the confiscated assets and banking infrastructure of former Cuban bank Banco Nuñez and twelve heirs or descendants of the founders of the bank, bring this suit against Defendants Société Générale, S.A. ("SocGen") and BNP Paribas, S.A. ("Paribas"). They allege that by extending credit facilities to the Cuban bank that now holds the assets expropriated from the Banco Nuñez founders, Defendants trafficked in that confiscated property within the meaning of the Helms-Burton Act. Under the civil remedy provision of that Act, Plaintiffs assert a claim against Defendants for money damages of three times the value of Banco Nuñez at the time it was seized, plus interest for the ensuing sixty-one years.

Defendants move jointly to dismiss Plaintiffs’ claims under Rules 12(b)(1) and 12(b)(6) of the Federal Rules of Civil Procedure. Defendants raise a range of arguments in support of their motion, including contentions that Plaintiffs fail to allege continued ownership of claims to confiscated property that are not time-barred, that international law forecloses Plaintiffs’ claims, that the alleged injury in this case cannot support Article III standing, and that Plaintiffs have not adequately alleged that Defendants acted knowingly and intentionally.¹ For the reasons set forth below, Defendants’ motion to dismiss is GRANTED.

BACKGROUND²

Plaintiff Sucesores de Don Carlos Nuñez y Doña Pura Galvez, Inc. ("Sucesores") is a Florida corporation formed by heirs of the founders of Banco Nuñez, Carlos and Pura Nuñez, "[f]or the sole purpose of consolidating and asserting interests in Banco Nuñez." (Second Am. Compl. ("SAC") ¶ 3, ECF No. 82.) The twelve individual plaintiffs include ten children and grandchildren of Carlos and Pura Nuñez, Carlos's second wife, and his son from that second marriage, all of whom inherited interests in Banco Nuñez. (Id. ¶¶ 7–18.) Defendants are two large French financial institutions, SocGen and Paribas, that have extended credit facilities to numerous Cuban enterprises. (Id. ¶¶ 20–21, 41, 48.)

Carlos and Pura Nuñez founded Banco Nunez in 1921. By 1958, it had become the second largest bank in Cuba, and it grew to $105.1 million in assets and $7.8 million in equity by 1960. (Id. ¶ 27.)³ After Fidel Castro came to power, the Cuban government seized Banco Nuñez and its assets on October 14, 1960, as part of a final step of nationalizing all banking entities in Cuba. (Id. ¶ 28.) After the seizure, the bank's assets were incorporated into Banco Nacional de Cuba ("BNC") and accounted for approximately ten percent of BNC's equity. (Id. ¶ 30.) BNC operated initially as the sole financial institution in Cuba. (Id. ¶ 23.) Alarmed by the rise of a nearby Communist country, the United States imposed a punishing embargo of a wide range of economic entities in Cuba, including those in its financial sector. (See id. ¶ 36.) Nevertheless, BNC continues on as a commercial bank today. (Id. ¶ 23.)

Upon the deaths of Pura Nuñez in 1969 and Carlos Nuñez in 1979, their interests in the confiscated Banco Nuñez assets passed to their heirs and descendants. (Id. ¶¶ 3, 32.) These interests became potentially much more valuable in 1996, with the passage of the Cuban Liberty and Democratic Solidarity (LIBERTAD) Act of 1996, also known as the Helms-Burton Act (the "Act"). Pub. L. No. 104-114, 110 Stat. 815 (1996). Around this time, many in Congress had grown concerned that "the Cuban Government [wa]s offering foreign investors the opportunity to purchase an equity interest in, manage, or enter into joint ventures using property and assets ... confiscated from United States nationals" and that these foreign investments "provide[d] badly needed financial benefit, including hard currency, oil, and productive investment and expertise" that helped the Cuban government remain in power. See 22 U.S.C. § 6081(5) – (6). After Cuban military jets downed unarmed American civilian aircraft in what Congress labeled an "act of terrorism"—leaving four American members of a humanitarian organization dead—Congress and the President responded and enacted the Helms-Burton Act just seventeen days later. See id. § 6046. The Act was intended to compel the Cuban government to adopt democratic elections by toughening existing sanctions and establishing a civil remedy for U.S. nationals who own a claim to property wrongfully confiscated by the Cuban government. See id. § 6022(2), (4), (6). This remedy allowed these U.S. nationals to recover up to three times the fair market value of confiscated property from any party that "traffics" in that property, creating a potent deterrent to foreign investment. Id. § 6082(a)(1), (3). An international uproar followed, due to anger at the United States for imposing enormous potential liability on nationals of other countries. The United States’ reaction was to suspend operation of the Act's civil remedy provision every six months; this series of suspensions lasted until May 2, 2019. (SAC ¶ 61.)

Following passage of the Helms-Burton Act, SocGen and Paribas engaged in significant financial dealings with BNC and other Cuban entities. From 2000 to 2010, Paribas provided Cuban entities access to U.S. dollars via eight credit facilities and through accounts with BNC and other Cuban banks, all in violation of the U.S. embargo. (Id. ¶ 48.) Paribas also "extended multiple credit facilities to BNC." (Id. ¶ 53.) On June 28, 2014, Paribas entered a guilty plea in which it admitted to much of that conduct and under which it forfeited more than $8.8 billion. (SAC, Ex. 2 ("Paribas Guilty Plea") at 2.) Between 2000 and 2010, SocGen also operated at least twenty-one U.S.-dollar credit facilities involving Cuban entities, six of which directly or indirectly extended credit to BNC. (SAC ¶ 41; SAC, Ex. 3 ("SocGen DPA") at 42–44 ¶¶ 21–23, 25.) In 2018, SocGen entered into a deferred prosecution agreement with the U.S. Attorney for the Southern District of New York admitting to this conduct and forfeiting $880 million. (SAC ¶ 43; SocGen DPA at 2.)

Heirs of Carlos and Pura Nuñez formed Sucesores in 1996 to assert claims under the Helms-Burton Act. Through a May 24, 1997 Stockholders Agreement ("Agreement") and a September 20, 2019 Assignment of Interest, those heirs transferred to Sucesores all interests in Banco Nuñez that had been inherited via Carlos Nuñez's will. (SAC ¶ 34.) In return, those heirs received shares in Sucesores. (Id. ) Shortly before initiating this litigation, Sucesores sent a letter to SocGen demanding that it stop trafficking in property seized from Banco Nuñez, which SocGen received on June 10, 2019. (Id. ¶¶ 57–58.) Paribas received a similar demand letter on February 19, 2020. (Id. ) Neither firm responded.

LEGAL STANDARDS

A district court must dismiss an action under Rule 12(b)(1) for lack of subject matter jurisdiction if it determines that the plaintiff lacks constitutional standing to bring the action....