Havana Club Explained

Havana Club
Type:Rum
Currentowner:Two competing Havana Club brands: 1) State-owned Corporación Cuba Ron; 2) Bacardi
Origin:Havana Club originated in Cardenas, Cuba by José Arechabala S.A.
Introduced:1934
Related:Havana Club (Bacardi)
Markets:State-run Corporación Cuba Ron version sold globally except within the United States. Bacardi version is sold in the United States.
Ambassadors:Bacardi-owned Havana Club U.S. brand Ambassador is named Gio Gutierrez, based in Miami, Florida
Tagline:Bacardi: Havana Club #ForeverCuban / Pernod Ricard:"El Ron de Cuba"

Havana Club is a brand of rum created in Cuba in 1934. Originally produced in Cárdenas, Cuba, by family-owned José Arechabala S.A., the brand was nationalized after the Cuban Revolution of 1959. In 1993, French-owned Pernod Ricard and the government of Cuba created a state-run 50:50 joint venture called Corporación Cuba Ron. They began exporting this version of Havana Club globally, except for the United States due to the embargo put in place by the U.S. government.

Bacardi, another Cuban family that had left Cuba after the Cuban revolution, after purchasing the original Arechabala family Havana Club recipe, also began producing Havana Club Rum in 1994, a competing product made in Puerto Rico and sold in the United States.

Bacardi and Pernod Ricard have engaged in ongoing litigation about ownership of the name "Havana Club".

Arechabala family history and production

The Arechabala family founded a distillery in Cardenas, Cuba in 1878. Later renamed José Arechabala S.A., the company created the Havana Club brand in 1934 and sold rum under that name in both Cuba and the United States.[1] [2] The company was nationalized without compensation by the Castro government in 1960.[3] The Arechabala family allege it was taken from them at gunpoint.[4] Subsequently, much of the Arechabala family was forced to leave Cuba for Spain and the United States, while other members of the family were imprisoned.[5]

The Cuban government sold rum abroad under the Havana Club name beginning in 1972, focusing primarily on the Soviet Union and Eastern Europe.[6] The government focused on Havana Club because (unlike the Bacardi family) the Arechabala family had not established plants outside of Cuba and so could not produce a competing brand.[7] The company was considered a "national jewel" by the Cuban government, and in 1977 manufacturing was moved to a new plant in Santa Cruz del Norte.

Since 1994, Cuban production and non-US global marketing of Havana Club has continued under a joint partnership between Pernod Ricard and Corporación Cuba Ron.

In 1994, Bacardi began producing rum under the Havana Club name in Cataño, Puerto Rico using a recipe given to them by Arechabala family members. While originally sold in only a few US states (primarily Florida), production was expanded in 2006, and in 2012, after winning a critical court battle, Bacardi announced plans to sell the rum more broadly.

Pernod Ricard/Bacardi trademark conflict

The Havana Club trademark has been the subject of extensive trademark litigation in the US, Spain, and World Trade Organization (WTO).[8]

After José Arechabala S.A. was nationalized, the Arechabala family fled Cuba and was forced to stop producing rum. The US trademark registration for "Havana Club" lapsed in 1973. The family alleges that this was due to the company's lawyer, Javier Arechabala, remaining imprisoned at the time.[9] Taking advantage of the lapse, the Cuban government registered the mark in the US in 1976.[10] The brand was then assigned by the Cuban government to Pernod Ricard in 1993.

In 1994, Bacardi obtained the Arechabala family's remaining rights in the brand and began producing limited amounts of rum bearing the name. 922 cases were sold in the US in 1995 and 1996.[11] This drew litigation from Pernod Ricard.[12] Pernod Ricard was successful in two of the first three court holdings issued in this litigation.[13]

However, in 1998, after heavy lobbying from Bacardi, the US Congress passed the "Bacardi Act" (Section 211 of the Omnibus Appropriations Act of 1998[14]), which protected trademarks related to expropriated Cuban companies, and effectively ended the first phase of the litigation by eliminating Pernod Ricard's standing.[15] The statute has been applied only to the Havana Club trademark, and was ruled illegal by the WTO in 2001 and 2002, on grounds that it singled out one country (Cuba).[16] The United States has not yet acted to address the WTO ruling,[17] despite a 2005 deadline and requests from the European Union.[18]

Following the initial round of litigation, the second round of litigation occurred, through both the US Federal court system and the Trademark Trial and Appeal Board, focused in part on the allegedly deceptive nature of the use of "Havana" in the name of a rum produced outside of Cuba. This round of litigation lasted from 2009 to 2012, and again resulted in a victory for Bacardi. After this defeat, Pernod Ricard announced plans to market the product in the US under the "Havanista" mark,[19] while Bacardi announced plans to extend distribution of Bacardi's version of Havana Club throughout the US.[20]

In Spain, Pernod Ricard's ownership of the mark has been upheld in three court rulings, most recently in 2011.

In January 2016, after a thaw in U.S.–Cuba relations, the U.S. government awarded a trademark for Havana Club to the Cuban government, which was "expected to reignite longstanding tension between Bacardi Ltd. and the Cuban government".[21] [22] Bacardi appealed the decision, and in 2017, a bipartisan delegation from the Florida House of Representatives asked new President Donald Trump to reverse the decision.[23] [24]

Current sales and marketing

Pernod Ricard's Havana Club is the fifth-largest rum brand in the world, with almost 4 million cases sold in 2012 - 2013.[25] It is sold in over 120 countries. Its strongest markets include France, and Germany, where marketing plays off the brand's distribution in East Germany during the Cold War.[26] Since 2008, it is also bottled in India, the world's second-largest rum market.[27]

Pernod Ricard plays heavily on Cuban themes in its marketing, including labeling Havana Club as "El Ron de Cuba" ("The Rum of Cuba"). It is one of the most common items brought into the US by tourists returning from Cuba. To avoid charges of customer deception, Bacardi's Havana Club labeling prominently mentions that it is made in Puerto Rico and is often referred to as "Havana Club Puerto Rican rum".[28]

Pernod Ricard's labeling, originated by Cubaexport in the 1970s, is gold and red and features the Giraldilla, a weathervane from the old fort of Havana. Pernod Ricard has announced plans to use similar gold and red labels on their "Havanista" product in the United States.

In 2016, Bacardi announced new branding and sells their version of Havana Club nationally, distilled in Puerto Rico and bottled in Florida.[29]

Grades and blends

Pernod Ricard

Bacardi

See also

References

23.1522°N -81.9175°W

Notes and References

  1. Web site: de la Fé . E.J. . Arechabala Industries .
  2. Web site: 30 March 2004 . Bacardi Files Appeal and Asks Court to Declare Company Exclusive Owner of Havana Club Brand . 11 January 2015 . Business Wire.
  3. News: Decker . Susan . 29 March 2011 . Pernod Ricard Loses Appeals Court Ruling in Bacardi 'Havana Club Fight . Bloomberg.com . 9 January 2015.
  4. News: Montgomery . David . Havana Club vs. Havana Club: Inside the rum war between Bacardi and Cuba . The Washington Post . 18 December 2018.
  5. Web site: Osorio . Sonia . War over Havana Club rum continues: 'Don't tell us we're not Cuban,' commercial says . 2 January 2018 . Miami Herald.
  6. O'Connell, Jr. . Robert M. . 2006 . A heady mix . World Trademark Review . November/December 2006 . 5–10 . 11 January 2015 . 4 March 2016 . https://web.archive.org/web/20160304025728/http://www.goodwinprocter.com/~/media/Files/Publications/Attorney%20Articles/2006/A_Heady_Mix.pdf . dead .
  7. Book: Gjelten, Tom . Bacardi and the Long Fight for Cuba: The Biography of a Cause . Penguin . 2008 . 9780670019786 . registration.
  8. Book: Joaquín Roy . Cuba, the United States, and the Helms-Burton Doctrine . University Press of Florida . 2000 . 55.
  9. Web site: Friedland . David K. . 2016 . Will the end of the embargo lead to clarity for US and Cuban brands? . 11 December 2018 . Current Issues in International Intellectual Property . 6 .
  10. News: Whitefield . Mimi . 20 July 2012 . Havana Club rum dispute isn't over yet . Miami Herald . 11 January 2015.
  11. Book: Stephan . Paul B. . International Business and Economics: Law and Policy . Roin . Julie A. . LexisNexis . 2010 . 9780327174677 . 5th.
  12. Web site: 30 March 2011 . Bacardi wins round in Havana Club fight . dead . https://web.archive.org/web/20150109025423/http://www.caribbeanbusinesspr.com/news03.php?nt_id=55761&ct_id=1 . 9 January 2015 . 8 January 2015 . Caribbean Business PR . dmy-all.
  13. Aste . Dylan M. . 2009 . Rumble of the Rums: The Battle Over 'Havana Club' . Journal of Contemporary Legal Issues . 19 . 271 . 2039818.
  14. Web site: Omnibus Consolidated and Emergency Supplemental Appropriations Act, 1999 .
  15. Web site: Mak . Tim . 19 December 2014 . Why Congress Hates Your Cuban Rum . 8 January 2015 . Daily Beast.
  16. Web site: 2 January 2002 . DISPUTE SETTLEMENT: DISPUTE DS176 United States — Section 211 Omnibus Appropriations Act of 1998 . World Trade Organization . 12 January 2015 . 11 March 2016 . https://web.archive.org/web/20160311003504/https://www.wto.int/english/tratop_e/dispu_e/cases_e/ds176_e.htm . dead .
  17. Farhadian . Sarah L. . 8 June 2012 . Stealing Bacardi's Thunder . Cardozo Arts and Entertainment Law Journal . 30 . 320.
  18. Web site: 28 March 2008 . John ("the Beast") Bruton savages the yanks ... diplomatically . IP Kat.
  19. Web site: Hopkins . Amy . 18 December 2014 . Pernod moves step closer to Havanista US launch . 11 January 2015 . The Spirits Business.
  20. Web site: Harrison . Carlos . 13 June 2012 . Bacardi To Start Selling Havana Club Rum Across The United States . HuffPost.
  21. News: Whitefield . Mimi . 15 January 2016 . Cuba prevails in Havana Club rum dispute with Bacardi . Miami Herald . 6 December 2016.
  22. Web site: Mickle . Tripp . 15 January 2016 . U.S. Grants Cuban Government a Trademark for Havana Club Rum . subscription . The Wall Street Journal.
  23. News: Whitefield . Mimi . 2 February 2016 . Bacardi says it's not over yet in Havana Club trademark battle . Miami Herald . 6 December 2016.
  24. News: Torres . Nora . 29 March 2017 . Florida lawmakers ask Trump administration to revoke Havana Club trademark license . Miami Herald . 8 July 2017.
  25. Web site: 30 August 2013 . Havana Club Sales Up 3 Percent . dead . https://web.archive.org/web/20150109041412/http://www.cubacontemporanea.com/en/havana-club-sales-3-percent . 9 January 2015 . Cuba Contemporanea . dmy-all.
  26. Book: Hosek, Jennifer Ruth . Sun, Sex, and Socialism: Cuba in the German Imaginary . University of Toronto Press . 2012 . 9781442641389 . 27–36.
  27. News: Kurian . Boby . Gupta . Swagata . 19 August 2008 . Pernod takes on Bacardi with Havana Club . The Economic Times .
  28. Web site: Tushnet . Rebecca . 15 April 2010 . Havana Club rum from Puerto Rico not false advertising . 15 January 2015 . Rebecca Tushnet's 43(B)log: False advertising and more.
  29. News: Whitefield . Mimi . 31 May 2016 . Bacardi evokes Cuba's 'golden age' in taking Havana Club rum national . Miami Herald . 8 July 2017.
  30. Web site: Havana Club . 25 May 2015 . Pernod Ricard.
  31. Web site: Havana Club añejo 3 años 3-year-old aged rum . 11 September 2019 . Havana Club.
  32. Web site: Añejo Especial Rum Gold rum Havana Club . dead . https://web.archive.org/web/20150523105622/http://havana-club.com/en/cuban-rum/anejo-especial-0 . 23 May 2015 . 25 May 2015 . Pernod Ricard.
  33. Web site: Añejo Reserva Rum Havana Club . dead . https://web.archive.org/web/20150519073323/http://havana-club.com/en/cuban-rum/anejo-reserva . 19 May 2015 . 25 May 2015 . Pernod Ricard.
  34. Web site: Dark rum 7 year old aged rum Havana Club . 11 September 2019 . Havana Club.
  35. Web site: Añejo 15 Años Rum Havana Club . dead . https://web.archive.org/web/20150523103729/http://havana-club.com/en/cuban-rum/anejo-15-anos-0 . 23 May 2015 . 25 May 2015 . Pernod Ricard.
  36. Web site: ISC trophies announced . 25 May 2015 . Drinks International.
  37. Web site: 19 July 2008 . Premium Cuban Rum – Havana Club's Maximo Extra Añejo . 25 May 2015 . Luxury Insider . 15 May 2015 . https://web.archive.org/web/20150515090952/http://www.luxury-insider.com/luxury-news/2008/07/premium-cuban-rum-e28093-havana-club-maximo-extra-anejo . dead .
  38. Web site: Máximo Extra Añejo Rum Havana Club . dead . https://web.archive.org/web/20150523101303/http://havana-club.com/en/cuban-rum/maximo-extra-anejo-0 . 23 May 2015 . 25 May 2015 . Pernod Ricard.
  39. Web site: Dykstra . Chip . 20 May 2012 . Havana Club Selección de Maestros . 15 January 2015 . The Rum Howler Blog.
  40. Web site: Havana Club Seleccion de Maestros . 15 January 2015 . Proof66.com . 18 January 2015 . https://web.archive.org/web/20150118010743/http://www.proof66.com/rum/havana-club-seleccion-de-maestros.html . dead .
  41. News: 5 February 2016 . Tasting Of Havana Club Union Rum With Master Blender . Havana Insider . 18 November 2017.
  42. News: Passy . Charles . Bacardi is touting a 'Cuban' rum that's actually made in Puerto Rico . MarketWatch . 18 November 2017.

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