One basic tenet of trademark law is that rights are territorial. One interesting example of this principal is the ongoing dispute between Bacardi and the government of Cuba pertaining to “HAVANA CLUB” rum. The Havana Club rum brand was nationalized by the Cuban government and has been produced and distributed throughout the world in partnership with Pernod Ricard, a French company. However, due to the embargo, Havana Club has never been sold by Pernod inside the United States. Instead, the family that previously owned the brand formed an alliance with Bacardi, who produces the rum in Puerto Rico and sells it in the United States. Yet due to some exceptional circumstances, the Cuban government owns the U.S. trademark registration for “HAVANA CLUB.”
In 2006, when the U.S. “HAVANA CLUB” trademark registration came due for renewal, the U.S. Treasury Department declined to provide the Cuban government with a license to pay the necessary fees. Instead of giving up the trademark registration, the Cuban government appealed the decision, a process which lasted over ten years. In 2016 the U.S. Treasury Department finally granted permission for the Cuban government to pay the necessary fees to renew its trademark registration and the U.S. Patent and Trademark Office, in an apparent aberration from its usual procedures, treated this payment as timely.
Bacardi has now asked a Federal District Court to deem the action taken by the U.S. Patent and Trademark Office as unlawful and beyond the scope of its authority. If Bacardi succeeds, it would likely mean that the registration owned by the Cuban government will be deemed expired and Bacardi’s pending applications will be free to move forward toward registration.