Banco Nacional De Cuba v. Sabbatino

After the United States cut its Cuban sugar import quota, Cuba nationalized a sugar company, CAV, in which an American broker, Farr (defendant), had contracted to buy sugar. Farr agreed to buy the sugar from the Cuban government instead, but at CAV's urging and promise of indemnification, he diverted the sale proceeds to CAV rather than Cuba's shipping agent, Banco Nacional (plaintiff). Banco Nacional sued Farr for conversion of the bills of lading and sought to enjoin Sabbatino (defendant), CAV's receiver, from distributing the proceeds. Farr argued Cuba never validly acquired title because the nationalization violated international law; the district court and court of appeals agreed, and the Supreme Court granted certiorari.