Administration Slaps Bacardi for Castro

DS_Castro_bwMany Americans support an end to the United States embargo against Cuba. But the embargo exists for many reasons. Chief among them is Cuba’s confiscation of assets from large companies and family-owned businesses like Bacardi in 1960. [F/N 1]  In fact, following initial imposition of the United States embargo against Cuba in 1962, Congress passed a law known as the “Bacardi Act” in 1999 to protect trademarks related to companies that had their assets confiscated by the Cuban government. [F/N 2]

As implemented by the Treasury Department’s Office of Financial Assets Control (“OFAC”) at 31 C.F.R. Section 515.527, the Bacardi Act prohibits transactions or payments with respect to trademarks previously associated with businesses or assets confiscated by the Cuban government, unless the transactions or payments are made with the written consent of the original owner of the mark or the bona fide successor-in-interest. [F/N 3]

Today, the United States is reportedly the largest rum market in the world and Bacardi is thought of by some as a national treasure—the largest privately-held, family-owned distiller of rum in the world whose factory in Puerto Rico is a substantial employer and contributor to the United States economy. Its rums include the Bacardi Havana Club brand Puerto Rican rum line, which is presently sold throughout the United States.

There is a long and convoluted history of litigation over the Havana Club trademark. [F/N 4]  Last week, in an ironic turn of events, OFAC reportedly approved a license to allow Cubaexport, a Cuban government-owned company, to engage in transactions necessary to renew and maintain the Havana Club trademark registration with the U.S. Patent and Trademark Office.

The Administration’s move to award the Havana Club trademark to the Cuban government is a serious slap in the face to Bacardi, which issued a public statement noting how the “administration has reversed long-standing U.S. and international public policy and law that protects against the recognition or acceptance of confiscatory actions of foreign governments.” [F/N 5]  The Administration’s support of the Cuban government over U.S. domestic interests in this case is, however, consistent with the Administration’s go-for-broke policy approach to restoring diplomatic relations with Cuba.

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Front Page Photo Credit:  “Vintage car parked next to the Barcardi Rum building in Havana, Cuba.”  The Library of Congress, Carol M. Highsmith Archive.

[1] See generally, Tom Gjelten, Bacardi and the Long Fight for Cuba: The Biography of a Cause, Viking Penguin, 2008.

[2] See Section 211 to Omnibus Consolidated and Emergency Supplemental Appropriations Act, 1999, Pub. L. No. 105-277, § 211(a)(1), 112 Stat. 2681-88.

[3] See 31 C.F.R. § 515.527(a)(2) (“No transaction or payment is authorized or approved pursuant to paragraph (a)(1) of this section with respect to a mark, trade name, or commercial name that is the same as or substantially similar to a mark, trade name, or commercial name that was used in connection with a business or assets that were confiscated, as that term is defined in §515.336, unless the original owner of the mark, trade name, or commercial name, or the bona fide successor-in-interest has expressly consented.”). 

[4] See e.g., Pernod Ricard USA, LLC v. Bacardi U.S.A., Inc., No. 10-2354, Aug. 4, 2011 (3rd Cir.); Empresa Cubana Exp. De Alimentos v. U.S. Dept. of Treasury, 606 F. Supp. 2d 59 (D.D.C. 2009); Galleon S.A. et al. v. Havana Club Holding, S.A. et al., 2004 WL 199225, at *11 (Trademark Tr. And App. Bd. Jan. 29, 2004); Havana Club Holding, S.A. v. Galleon S.A., 203 F.3d 116 (2d Cir. 2000); Havana Club Holding, S.A. v. Galleon, S.A., 62 F. Supp. 2d 1085 (S.D.N.Y. 1999), aff ’d 203 F.3d 116 (2d Cir.), cert. denied, 531 U.S. 918 (2000); Havana Club Holding, S.A. v. Galleon, S.A., 1998 WL 150983 (S.D.N.Y. Mar. 31, 1998); Havana Club Holding, S.A. v. Galleon, S.A., 961 F. Supp. 498 (S.D.N.Y. 1997); Havana Club Holding, S.A. v. Galleon, S.A., 974 F. Supp. 302 (S.D.N.Y. 1997); In re Bacardi & Co. Ltd., 48 U.S.P.Q. 2d 1031, 1035 (T.T.A.B. 1997).

[5] See http://www.bacardilimited.com/news/356


The above is not intended as an exhaustive list of restrictions that may apply to a particular transaction nor advice for a specific transaction because the specifics of an individual case may implicate application of other U.S. laws as well as foreign laws that carry added or different requirements. In addition, U.S. export control and sanctions laws are frequently subject to change. Such changes can affect the continued validity of the information above, which is based on U.S. law existing as of January 16, 2016. For these reasons, assistance from a qualified attorney competent to advise on such matters is highly recommended. Matthew A. Goldstein is an International Trade Attorney in Washington D.C. licensed to practice in the District of Columbia. He can be reached at (202) 550-0040 and Matthew@GoldsteinPLLC.com

Categories: FACR, Industry Alerts, OFAC

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