Friday, May 18, 2007

Fake Cuban Cigars (Part 7)

Despite the four letters to the PTO, sent by those who specifically received Bacardi contributions, Cubaexport's registered trademark was still not canceled. The PTO decided in 2004 that Bacardi's "petition fail[ed] to state a claim for cancellation." Bacardi was obviously upset. Since 1997, they had battled with Cubaexport in US courts to claim the Havana Club trademark.

I don't wanna bore anyone with the minute details of the court proceedings, but as Stephen Kimmerling summarized [PDF] in 1999 for the ASCE, the question still remained: "Does Cubaexport or Bacardi own the Havana Club trademark in the United States?"

In 1999, it seemed that Cubaexport had lost. That year, a New York federal judge decided that Cubaexport "ha[d] no rights to the Havana Club trademark" in the US. Bacardi felt vindicated. But, most of the Judge's decision relied on one controversial legislation called section 211 of the Omnibus Consolidated and Emergency Supplemental Appropriations Act. Legislation that had conveniently been introduced the year before by Florida's two Senators, Connie Mack and Bob Graham.

The New York court had made it clear that while Cubaexport had no rights to register the Havana Club trademark in the US (because of section 211 and the US embargo), or stop Bacardi-Martini USA from registering the trademark itself in the US, the court nevertheless would not order the cancellation of the Havana Club registration at the PTO.

As reported, this is the time when Bacardi began its aggressive petition, with the help of Jeb Bush and other politicians, to influence the director of the PTO, James E. Rogan, and the Secretary of Commerce, Donald Evans to cancel Cubaexports application. Lobbying money from Bacardi peaked around this time too. Donald Evans, in 2002, had replied to Bacardi that he did not have the authority to do so. I'm sure Rogan didn't either. And, in 2004 they had no choice but to dismiss Bacardi's petition.

In the meantime, Cubaexport and Pernod-Ricard appealed the 1999 New York decision, received help from the Organization for International Investment, but eventually lost in a 2000 Supreme Court decision. They also looked to the WTO. Bacardi called the WTO attempt "an unwarranted and reckless intrusion into a civil dispute." But, in 2002, the WTO's Dispute Settlement Body gave a final report calling section 211 of the 1998 Omnibus Consolidated and Emergency Supplemental Appropriations Act a violation of parts of international law.

The WTO, along with the European Community and other nations, is hoping that the US will change section 211, implement the recommendations of the final report, and even provide that Cubaexport defend again its trademark in US courts, denied initially by section 211.

It's been five years since that report, and the US has stalled so far on making any changes to section 211. And, most likely never will make changes until they see a "free Cuba." Last year, the US Patent and Trademark Office finally canceled Cubaexport's Havana Club trademark. The European Community was "extremely disappointed" at the decision, and Bacardi finally gave its thanks to the PTO.

Like Altadis cigars in the US, Bacardi plans to sell Havana Club rum with ingredients not made in Cuba. Both are imitations of Cuban products, which the rest of the world so happens to enjoy authentically.

[Part 8]