Buyers Know Bacardi Havana Club Rum Isn’t Made in Cuba

PHILADELPHIA (CN) - Bacardi's Havana Club rum does not imply that it is a product of Cuba, the 3rd Circuit ruled, affirming dismissal of a competitor's false-advertising lawsuit.

"Here, there is a factually accurate, unambiguous statement of the geographic origin of Havana Club rum," Judge Kent Jordan wrote for a three-judge panel. "The label clearly states on the front that the liquor is 'Puerto Rican rum' and, on the back, that it is 'distilled and crafted in Puerto Rico.' No reasonable consumer could be misled by those statements, and the rest of the label does not put those statements in doubt."

Pernod Ricard USA filed a lawsuit in 2006, shortly after Bacardi began selling Havana Club rum in Florida. Years earlier, Bacardi had bought the rights to the term "Havana Club" from the Arechabala family, which had been producing rum in Cuba before the communist revolution in which the Cuban government seized control of operations. The company makes Havana Club rum using the Arechabala family recipe and is said to be "almost identical" to the family's original product.

Cuba had registered the Havana Club trademark with the U.S. Patent and Trademark Office in 1976, despite the ongoing embargo, and tried to assign its interests in the Arechabala family's old business to a joint venture partly owned by Pernod Ricard's parent company. After the trademark expired, the Office of Foreign Assets Control, which controls the Cuban embargo, denied permission for renewal.

"It appears that this false advertising dispute is a proxy for the real fight the parties want to have, which is over the right to the exclusive use of the 'Havana Club' trademark," the federal appeals court explained.

But calling a rum Havana Club is "not the same as 'Made in Havana' or even 'Havana Rum,'" Jordan wrote, noting that U.S. District Judge Sue L. Robinson in Delaware had said Bacardi's product "has a Cuban heritage and, therefore depicting such heritage is not deceptive."

Pernod Ricard had claimed that "Havana Club" misrepresents the Bacardi product's geographic origin.

"If we were dealing with those words in isolation, we might agree," Jordan wrote. "But, as we have already emphasized, we are not dealing with those words in isolation," he added. "This is not a trademark case, and certainly not one addressing trademark registration, no matter how much Pernod may wish it were."

To date, the U.S. Patent and Trademark Office has refused to register several names involving Havana, whether for cigars not made in Cuba or for Bacardi's other products.

In a statement on its website, Pernod Ricard vowed to continue the fight.

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