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Bacardi’s “Forever Cuban” Campaign Reignites Havana Club Battle

January 4, 2018

Bacardi has opened a new front in its battle with Pernod Ricard over the Havana Club rum brand, provocatively asserting the Cuban credentials of its version of the brand in a new ad campaign that launched late last year. Titled “Forever Cuban,” the multimillion-dollar initiative promotes Bacardi’s Puerto Rico-produced Havana Club rum in a bid to appeal to Cuban exiles in the U.S. on the eve of the 59th anniversary of the Cuban Revolution. The 60-second ad—which was written, produced and directed entirely by Cuban exiles in Miami—stars actor Raul Esparza, who reads “Island Body,” a poem by Cuban poet Richard Blanco.

The campaign highlights the historical connection between Bacardi’s Havana Club and the Arechabala family, who created the brand and recipe before being driven into exile during the Cuban Revolution.

So far, Bacardi says response to the push has been positive, and that the brand’s sales have been exceeding expectations since it went national over the past year and a half. “The ‘Forever Cuban’ campaign has been sparking conversations about the origins of Havana Club rum,” says Ned Duggan, vice president of rums at Bacardi. “Havana Club rum sends a powerful message to all exiles: regardless of where they live, they remain a part of their homeland.” In the year-to-date through last November, Bacardi’s Havana Club depleted about 10,000 cases in Nielsen channels and 5,000 cases in control states.

While Bacardi is currently able to sell its Havana Club brand in the U.S., the trademark dispute between the company and Pernod Ricard—which is partnered with the Cuban government on its own version of the brand—has not been fully settled. The dispute stretches back to 1973, when the Arechabala family’s trademark lapsed. Three years later, the Cuban government registered Havana Club in the U.S. through Cuban state company Cubaexport. Pernod Ricard partnered with Cuba’s state-run rum company Cuba Ron in 1993 to share control of the brand, which sells about 4 million cases globally despite being barred from the U.S. market.

In 1994, Bacardi registered its trademark for Havana Club in the U.S. and kicked off the current protracted legal battle with its claims that Pernod and Cubaexport cannot trademark Havana Club in the U.S. because the brand was seized without compensation by the Cuban government. The U.S. Department of State recommended that the Cuba-produced Havana Club be denied the ability to re-register the trademark in 2006. Bacardi’s victory stood until 2016, when the State Department reversed itself and the Treasury Department renewed the Cuban brand’s trademark through 2026. Bacardi fought that decision, and in 2016, the case was referred to the U.S. District Court in Washington, where it remains.

Beyond the legal battle, the dispute between Bacardi and Pernod is highly emotional. Both brands claim to be the authentic Havana Club. Bacardi’s claim rests on the recipe it acquired from the Arechabala family in 1994 for $1.25 million (plus a portion of the brand’s sales going forward). Pernod Ricard’s brand rests its claims on terroir, asserting that Havana Club rum must be made in Cuba to be authentic.

“We’re still waiting for the court to rule on the motions filed by the Cuban government seeking to dismiss all or part of our case,” says Amy Federman, director of corporate communications at Bacardi. “We’re confident in our position, and after defeating the Cuban government’s motions we look forward to proving our case at trial. We have confidence in our court system to once again follow well-respected U.S. and international policy and law to not legitimize illegal confiscations.”

“A rum referencing Havana should be made in Cuba,” reads a statement from Pernod Ricard. “We expect to prevail in the trademark dispute and when the embargo is eventually lifted we’ll be the first company to sell genuine Cuban rum in the US.”

Pernod Ricard North America chairman and CEO Paul Duffy told SND last year, “We have to be clear that for U.S. companies to import Cuban rum, the trade embargo has to move. That’s up to Congress. Do we think that Cuban rum has great potential in the United States? Absolutely. Are we confident that Pernod Ricard’s brand, Havana Club, can attack that market if it does open up? Yes is the answer to that. We’ve seen excellent growth of the brand around the world.” While Pernod still aims to market its own Havana Club in the U.S. if the embargo is lifted, it has also registered another rum trademark, “Havanista,” in the event Bacardi prevails in the long-running dispute over the Havana Club brand.—Shane English

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