Cubaexport’s attorneys don’t see it that way. “Bacardi shouldn’t be allowed to try to expropriate that mark by selling tiny quantities of Puerto Rican rum under a deceptive name,’’ said David H. Bernstein, a partner at the New York law firm Debevoise & Plimpton.
Paris-based Pernod, which formed a joint venture with a Cuban rum company in 1993 to market Havana Club, now distributes the brand in more than 120 countries and has survived international challenges from Bacardi over use of the name. This year it expects to sell 4 million 9-liter cases of Havana Club. The brand also is sold in Cuba.
Neal said she expects the USPTO will formally cancel Cubaexport’s trademark “in due course,’’ allowing Bacardi’s own application for the Havana Club mark to go forward.
But Bernstein said in a June letter to the USPTO that Cubaexport’s registration couldn’t be canceled or declared expired because it would be a transfer of property in which a Cuban national has an interest — and that would be a violation of the embargo.
“The Havana Club trademark is an asset just like any other,” Bernstein said in an interview.
The embargo prohibits most financial transactions with Cuba unless they are licensed by the U.S. Treasury’s Office of Foreign Assets Control.
“Cubaexport’s registration remains frozen in its previously existing state — neither renewed nor canceled nor expired — for the duration of the U.S. embargo of Cuba in the absence of an applicable general or specific license from OFAC,’’ Bernstein wrote.
That reasoning is similar to the rationale employed by OFAC when it declined to issue a license to Cubaexport in 2006 so it could pay $500 to renew the Havana Club trademark. Because the trademark office couldn’t accept the payment in the absence of a license, Cubaexport’s registration was declared “cancelled/expired.’’ That set the stage for Cubaexport’s last lawsuit.
After consulting with the State Department, OFAC said giving Cubaexport a license “would be inconsistent with U.S. policy.’’ Complicating matters was Section 211, which was attached to a 1998 federal spending bill and prohibits any trademark actions or payments in connection with a confiscated business or assets.
Cubaexport challenged OFAC’s determination in federal court in Washington, D.C., and lost. It also lost on appeal, setting up a potential Supreme Court showdown.
Now the dispute is back in the trademark office’s court.
If the trademark is canceled, Cuba has threatened to retaliate against U.S. trademarks that are registered on the island. For decades, representatives of U.S. companies have trekked to Cuba or hired Cuban law firms to make sure registrations for marks such as McDonald’s Golden Arches and Pepsi are current. Cuba says U.S. companies have some 6,000 registrations on file.
“The disrespectful attitude of the United States in depriving the legitimate holders of the Havana Club trademark may put in risk the trademark rights and patents of U.S. nationals in our country,’’ said Maria de los Ángeles Sánchez, director of Cuba’s Office of Patent Rights, in a statement.
“Cuba reserves the right, like any sovereign country, to act at the appropriate time,’’ she said.