Wednesday, June 20, 2012

Havana Club Trademark Dispute with US and Bacardi

Cuba and the US are at war…over Rum! Cuba’s state distillery sells the popular rum “Havana Club” in over 120 different countries (distributed through Pernod Ricard, a French company). But entry of Cuba’s delectable national drink is barred into the U.S. because of the embargo. The USPTO did however granted Havana Club International the U.S. trademark rights for “Havana Club.” However, the U.S. Treasury Department’s Office of Foreign Assets Control, which administers and enforces economic and trade sanctions, did not issue a license to the company to make a $200 renewal payment. Thus, a court recently refused the “Havana Club” trademark renewal.

Bacardi, which is the Havana Club brand’s global competitor, sold its own version of rum called “Havana Club” in Florida. Now that Havana Club International no longer owns the trademark “Havana Club” in the U.S., Bacardi may be free to apply for the trademark rights. The USPTO would surely not approve Bacardi’s application for “Havana Club” as long as Havana Club International held the rights to that trademark because there would be a likelihood of confusion between the two.

Bacardi plans on expanding sales of its “Havana Club” rum across the 50 states. Bacardi’s version reportedly uses the same recipe as Cuba’s “Havana Club. “ So for the first time, rum drinkers in the U.S. (40% of the world’s rum drinkers) may now get to enjoy a glass of the famous “Havana Club” rum.

For Bacardi, this decision represents more than an opportunity for economic profit. When the communist government took control of Cuba, it also seized Bacardi’s distilleries in the country. The VP of Corporate Communications at Bacardi has said:

“This is not a question of market share. Rather, this comes from our own experience as Bacardi’s assets in Cuba were illegally confiscated in 1960.”

The “Havana Club” makers have decided to create a new name for the rum to push back against what the brand feels is a trade bias against Cuba. Pernod Ricard has already registered “Havanista” as a trademark in the U.S. and plans on selling the rum under that name if the U.S. embargo is lifted.