Brazil company challenges Florida ban on business dealings with Cuba, Syria

[JURIST] A lawsuit [complaint, PDF] filed against the state of Florida on Monday in the US District Court for the Southern District of Florida [official website] alleges that the state's ban on local authorities hiring companies that do business in Cuba or Syria is unconstitutional. Odebrecht Construction, Inc. [corporate website, in Portuguese], a Brazilian conglomerate in engineering, seeks declaratory and injunctive relief to declare the law [SB 1144, PDF] unconstitutional. The bill was signed [transmittal letter, PDF] by Governor Rick Scott [official website] and is expected to take effect on July 1. The company's US subsidiary, a Florida company with its principal place of business in Coral Gables, argued that the Cuba Amendment of the bill penalizes even companies that do not themselves conduct business in Cuba "if those companies have subsidiary corporations, parent corporations or sibling corporations that conduct business operations in Cuba." Although the bill only affects companies that are seeking to bid for state or local contracts for goods or services of $1 million or more, the company has engaged in state and local projects for the state amounting to $3.9 billion and thus claims the law would interfere with its operations in the state. The plaintiff argued that the law violates the Supremacy Clause of the US Constitution because it "frustrates federal statutory objectives regarding economic sanctions against Cuba." Additionally, the company claims that states do not have the authority to enact laws that would affect foreign affairs, the regulation of which is left to the federal government, and also that the state law discriminates against foreign commerce impairing federal uniformity in trade with Cuba. Lastly, the plaintiff pointed out that the savings clause of the bill which states that "th[e] section becomes inoperative on the date that federal law ceases to authorize the states to adopt and enforce the contracting prohibitions of the type provided for in this section" makes it inoperative due to the lack of federal authorization to the state to enact such law. There is no date set for a hearing in the case.

The Cuba-US relationship became a little bit relaxed when US President Barack Obama [official profile] ordered [JURIST report] in January of last year the Departments of State, Treasury and Homeland Security [official websites] to take steps to ease restrictions on travel and remittances to Cuba. The new regulations were expected to allow greater travel from the US to Cuba for religious and educational purposes, the transfer of up to $2000 per year to non-family members in Cuba so long as they are not senior government or Communist Party leaders and all US international airports to service charter flights between the two countries. The regulations were built off of those issued in 2009 [JURIST report] which allowed US telecommunications companies to work within Cuba to facilitate communication between families split between the two countries.

 

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