Two Canadian companies in Cuban lawsuit / National Post

June 29, 1999

Two Canadian companies in Cuban lawsuit

'Depriving workers'

Peter Morton, Financial Post
The National Post, Canada. June 29

WASHINGTON - Canadian companies are under attack again over projects in Cuba.

Sherritt International Corp. and Leisure Canada Inc. were named yesterday in a $1.35-billion (all figures in U.S. dollars) lawsuit. The two firms are among 40 targeted in the lawsuit.

Two Cuban exile groups filed the lawsuit in a Miami court, claiming Sherritt's and Leisure Canada's plans to invest in hotels in Cuba with Spanish and French partners are part of an illegal scheme by the Cuban government to deprive Cuban workers of $450 a month in wages each.

Toronto-based Sherritt is investing with the Spanish Sol Melia Group in a $212-million hotel complex just east of Havana, while Vancouver-based Leisure Canada is a 50-50 partner with the Cuban government in a $400-million hotel and golf resort north of the capital.

The lawsuit claims the 40 U.S. and multinational companies are working with the Cuban government to pay workers only $5 a month each while the government keeps the rest.

"Even though Sherritt does not have assets in the U.S., we plan to go after what they have elsewhere in world" said Eduardo Navarro, a Miami lawyer representing the Cuba Committee for Human Rights and and the Independent Federation of Electric, Gas and Water Plants of Cuba.

Ryan Mulhern, a spokesman for Leisure Canada, said the firm has no plans to back off from starting construction later this year. "This is just a nuisance suit," he said.

The lawsuit also named NationsBank and BancAmerica because it was thought they owned a piece of Leisure Canada.

But Mr. Mulhern said the Bank of Boston has an indirect 17% ownership in Leisure Canada.

Sherritt officials were not available to comment. But the nickel mining company has long been associated with Cuba and is the only firm that has been hit under the U.S. Helms-Burton law for mining on property expropriated from U.S. companies in 1959 by Fidel Castro, the Cuban president. Under Helms-Burton, Sherritt's directors and senior executives are barred from entering the United States.

Mr. Navarro said in an interview the claim is based on a belief that the Cuban government is violating its own constitution and labour code, as well as the United Nations Convention on Economic, Cultural and Social Rights signed by Mr. Castro.

John Kavulich, president of the U.S.-Cuba Trade and Economic Council in New York, said the key to the case will be whether the Miami judge believes there is jurisdiction to hear the case.

"Anyone can file a lawsuit in the U.S.," he said. "But the question will be whether it has standing and then whether the judge will dismiss it."

The U.S. court system is increasingly being used by exile groups to put pressure on the Castro regime, even though the government is largely immune from court judgments.

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