09/05/13 - Miami Herald - Florida won't appeal ruling against law banning public hiring of firms tied
By Patricia Mazzei pmazzei@MiamiHerald.com
The state of Florida has conceded it will not enforce a law - ruled
unconstitutional by federal courts - that tried to prohibit the state and
local governments from hiring companies with business ties to Cuba. The
Florida Department of Transportation's decision not to contest the June
ruling by a federal appeals court marks the end of the short-lived
legislation. It also paves the way for Odebrecht USA, the Coral
Gables-based firm that challenged the law, to proceed with significant
projects in the works - unless politics get in the way.
FDOT and Odebrecht agreed late last month to allow the federal trial court
that struck down the legislation last year to enter an injunction
permanently blocking the law from taking effect. A preliminary injunction
had been in place since U.S. District Judge K. Michael Moore found in June
2012 that the legislation interfered with the federal government's
authority to set foreign policy.
"This means FDOT cannot enforce the law," FDOT Communications Director Dick
Kane said in an email Thursday.
Though the injunction is aimed only at FDOT, it effectively applies to
every state agency, said Jim Moye, an Odebrecht attorney.
"The federal government is going to continue to establish whatever it
believes is the proper relationship with Cuba," said Moye, of the
Orlando-based Moye O'Brien firm. "Our client will continue to comply with
the laws in that regard. It's not for the state or local governments to
attempt to set the parameters for the relationship with Cuba."
FDOT chose not to go to trial to try to show why the preliminary injunction
should be lifted. Instead, it agreed with the permanent prohibition and
will reimburse Odebrecht about $500,000 in attorneys' fees, Moye said.
The legislation would have forbidden government agencies from awarding
contracts worth at least $1 million to U.S. firms whose foreign-owned
parent companies or subsidiaries work in Cuba or Syria. Though Odebrecht
USA has no business in either country, an affiliate of its giant Brazilian
parent is performing a major expansion at the Cuban Port of Mariel.
Without any ties to Syria, Odebrecht did not challenge the law in regards
to that country, and the 11th U.S. Circuit Court of Appeals limited its
ruling to Cuba.
The law's demise is the latest in a string of legislation signed by
Republican Gov. Rick Scott that has ended up in the courts. Federal judges
have invalidated the scope of a state employee drug-testing program, a
requirement making it more difficult for groups to register new voters and
a ban on physicians asking patients about gun ownership.
The drug-testing program has been sent back to the trial court, and the
state has appealed the ruling in favor of physicians.
While hardly the only Florida company with indirect ties to Cuba, Odebrecht
became the target of Sen. René García and Rep. Michael Bileca, the Miami
Republican lawmakers who sponsored the legislation. It received
near-unanimous support in Tallahassee. The governor signed it into law, but
drew harsh criticism for suggesting the legislation might be
unconstitutional. His administration vowed to defend it.
García said he was disappointed in the state's decision but said he would
sit down with legislative attorneys to try to craft a narrower version of
the law in the future, to see if it passes muster. He also urged local
politicians to put pressure on their governments to reject companies tied
to Cuba or Syria, which for two years has been in a deadly civil war.
"We shouldn't send our hard-earned tax dollars to firms that turn around
and invest in these countries sponsors of terrorism," he said. "Look what's
happening in Syria now."
State law already imposes restrictions on hiring firms that work in Iran
and Sudan, which, along with Cuba and Syria, are considered state sponsors
of terrorism. But the federal government expressly authorizes hiring
limitations relating to Iran and Sudan, not the other two countries.
Florida's State Board of Administration found in a preliminary analysis
last year that 238 companies the state invests in could have connections to
Cuba, including airlines, banks and pharmaceuticals. Fourteen firms, mostly
in the oil and energy industry, could have ties to Syria.
The U.S. Chamber of Commerce and the United States Telecom Association both
filed briefs supporting Odebrecht in its case.
In Miami-Dade, where Cuba often seeps into local politics, elected
officials have had a fraught relationship with hiring companies linked to
the island. County attorneys advised commissioners in 2007 that
contractors' Cuba ties could not be considered in awarding the PortMiami
tunnel project, despite concerns that an affiliate of the French firm
Bouygues Travaux Publics built 11 resorts in partnership with the Cuban
After hiring Odebrecht to rebuild seaport wharves in 2011, several
commissioners said they did not want to award any more contracts to the
firm. They put a nonbinding question on the ballot last November asking if
the county should ban hiring companies that "actively" do business with
countries considered state sponsors of terrorism. Sixty-two percent of
That could spell trouble for Odebrecht, despite the company's court
victory. Its latest county project - the $512 million Airport City, in
which Odebrecht would develop 33 acres surrounding Miami International
Airport - has stalled for months, even after the county attorney opined
Miami-Dade could proceed with the project during the federal litigation.
Airport City appeared ready for a vote earlier this year. But with the
March retirement of one of its most prominent proponents, Aviation Director
José Abreu, it slowed again.
New Director Emilio González is in talks with Odebrecht to try to get a
more palatable deal than the one agreed to last year after two years of
negotiations, which has already received Federal Aviation Administration
"We are meeting and speaking with Odebrecht regularly to see how they can
better their financial agreements with the county," González told the Miami
Herald two weeks ago.
In 2011, all of Odebrecht's business came from public infrastructure and
transportation contracts. It has had a hand in some of South Florida's
biggest projects, including the Adrienne Arsht Center for the Performing
Arts and, more recently, expanding the southern runway at Fort
Lauderdale-Hollywood International Airport.
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