Pernod Ricard USA, LLC v. Bacardi U.S.A., Inc.

Havana Club rum was a popular type of Cuban rum sold by the Arechabala family. In 1976, the Cuban government registered a United States trademark for “Havana Club” rum. In 1994, the Cuban government transferred the Havana Club trademark to a joint venture, which included Pernod Richard, S.A. (Pernod) (plaintiff). Bacardi U.S.A., Inc. (Bacardi) (defendant) purchased all remaining rights to the “Havana Club” mark from the Arechabala family. The United States later voided the transfer to Pernod, and the Cuban government owned the Havana Club mark until the mark expired in 2006. After the mark expired, Bacardi began selling Havana Club rum in Florida. Bacardi’s Havana Club rum was almost identical to the Arechabala family’s original product. Bacardi’s bottle was labeled “Havana Club Brand Puerto Rican Rum.” Another portion of the label explained that the rum was based on the Arechabala’s family recipe and manufactured in Puerto Rico. Pernod filed a false-advertising suit against Bacardi. Pernod claimed that Bacardi’s packaging misleadingly indicated that the rum was made in Cuba. Pernod offered in evidence survey results showing that 18 percent of consumers who viewed the label thought that Bacardi’s rum was made in Cuba or with ingredients of Cuban origin. The district court rejected Pernod’s survey evidence, finding that Bacardi’s packaging was not misleading as to the geographic origin of Bacardi’s product. Pernod appealed.