CU rum
August 25, 2001

ASSOCIATED PRESS - HAVANA - Next to the fragrant old oak barrels in Havana's Rum Museum, a poster brags: "There's no rum as good as ours." The slogan doesn't come from Cuba's premium brand, Havana Club. Rather, it is attributed only to "a brand produced in Cuba at the beginning of the century." That's a roundabout way of saying - or rather not saying - Bacardi. Since 1994, Bermuda-based Bacardi has been locked in a legal battle with French spirits giant Pernod Ricard, which runs a joint venture with the Cuban government, over the rights to sell rum with the Havana Club label in the United States. The issue also pits the United States against the European Union in a fight before the World Trade Organization that could undermine Washington's status as a worldwide defender of intellectual property rights. At the core of the dispute before the WTO is a U.S. law barring U.S. courts from enforcing Cuban brand names for products made by firms nationalized after Fidel Castro took power in 1959. The 1998 law stripped Pernod Ricard of any right to legally challenge Bacardi in the United States. Last week, the WTO ruled against the EU on 13 of its 14 claims in the trademark law dispute. Bacardi, whose owners fled revolutionary Cuba, started making its version of Havana Club in 1994, three years before claiming to have bought the U.S. rights to the brand from the Arechebala family, the brand's original owners. But the Arechebalas let those rights expire in 1973, only to see them snapped up in 1976 by a Cuban company and transferred in 1993 to Havana Club Holding, the Cuban government's joint venture with Pernod Ricard. Last year, the Pernod-Cuba venture sold 1.4 million cases of Havana Club in more than 80 countries, and the brand is registered in 100 more. Bacardi's market for its Havana Club is limited to the United States. Though foes in nearly all arenas, Washington and Havana, had agreed to recognize each other's intellectual property rights under the Inter-American Trademark Convention. There are nearly 4,000 trademarks registered in Cuba by U.S. companies, ranging from Aunt Jemima to Jell-O and Starbucks coffee.  Those trademarks could now be questioned by Cuba. Castro has threatened to retaliate by making a Cuban Bacardi. Wayne Smith, former chief of the U.S. Interests Section in Havana and now a senior fellow at the Center for International Policy in Washington, said: "If the United States does not respect the Inter-American Trademark Convention . . . it could cause utter chaos in trademark protection worldwide."  Pernod Ricard and the EU both said the WTO panel sided with them in recommending that the United States make changes to conform to the WTO's Trade-related Aspects of Intellectual Property Rights Agreement. Smith said the WTO ruling was particularly worrisome because it appeared to remove trademarks from the agreement, which U.S. officials invoked most recently to protect its pharmaceuticals industry against cheaper generic medicines produced in developing nations. "It's totally counterproductive to U.S. interests in getting better protection for intellectual property globally," said Smith, adding he is "baffled" by the U.S. Commerce Department's willingness to push the issue. "This law only benefits Bacardi, which isn't even a U.S. company," he said. "But then, this has to do with Cuba, which . . . seems to have the same effect on U.S. administrations as the full moon has on werewolves."