Bacardi Loses Bid to Block Cubaexport's Renewal of Havana Club Trademark

A just-published decision by the U.S. Fourth Circuit Court of Appeals rejects an attempt by Bacardi & Co. Ltd and Bacardi USA to prevent Cubaexport from renewing the trademark for Havana Club Rum.

The case traces itself back to the 1959 Cuban Revolution which resulted in the Communist government seizing private property in Cuba, including the Havana Club brand and its distilleries which were owned and operated by the Arechabala family without compensation, forcing the family into exile. In 1993, the Coban Government partnered with Pernod Ricard in a joint venture that makes and sells Cuban-made Havana Club globally.

In 1994, the Arechabala family entrusted their original receipe and and technique to Bacardi which now produces The Real Havana Club in Puerto Rico for the U.S. market.

Bacardi has sought to register the Havana Club trademark in the U.S. but Cubaexport has stood in the way. Cubaexport registered its trademark in the U.S. in 1976 and renewed it in 1986 and 1996, even though it couldn't sell its rum in the U.S. because Office of Foreing Asset Control (ofac)prohibit Cuban entities from engaging in most transactions.

Originially, OFAC regulations allowed registration and renewal of trademarks with the U.S. Patent & Trademark Office (PTO), including payment of the renewal fee. But in 1998, Congress prohibited those transactions, too.

So, soon after Cubaexport submitted its renewal and payment to PTO, OFAC notified PTO that Cubaexport needed a special license – which it had not obtained – to renew its trademark. Cubaexport applid for the special license and OFAC denied the application. PTO then rejected the renewal and refunded the fee.

After a decade of legal maneuvering, OFAC granted a special linse ahead of what would have been the expiration of the 2005 tradenark, authorizing Cubaexport "to engage in all transactions neceesary to renew and maintain the Havana Club trademark registration, including those related to Cubaexport's submission filed with" PTO in 2005.

Cubaexport resubmitted its application and fee to PTO and the director found the new license OFAC had granted validated the 2005 payment, so he granted the renewal and Bacardi sued.

After some more legal maneuvering, the appeals court upheld the district court's ruling that the trademark could be renewed.

Bacardi which has consistently sought to claim the Havana Club trademark for itself, then filed suit. More legal maneuvering ensued, and finally the appellate court.

We reached out to Bacardi and Pernod Ricard, but neither had time to respond before deadline.