Issued April 6, 2010, this opinion is the latest installment
of the HAVANA CLUB saga. Here, Pernod Ricard USA brought a false
advertising claim against Bacardi U.S.A., alleging that Bacardi's use of the
HAVANA CLUB trademark on its rum bottle deceives consumers into believing that
Bacardi's rum is made in Cuba, when in fact it is not. Pernod Ricard USA
LLC v. Bacardi U.S.A., Inc.,
2010 U.S. Dist. LEXIS 34424
2010). The court held a bench trial and granted judgment to defendant
Users can view Pernod Ricard USA
LLC v. Bacardi's full opinion and order. Lexis.com subscribers can view Pernod Ricard USA
LLC v. Bacardi's enhanced opinion.
Anyone shall be liable who "on or in connection with any goods or
services. . . uses in commerce any . . . false or misleading description of
fact, or false or misleading representation of fact, which . . . misrepresents
the nature, characteristics, qualities, or geographic origin of his or her. . .
goods . . . ." 15
U.S.C. § 1125(a)(1)(B). This opinion focuses on one element of the
plaintiff's false advertising claim: whether Bacardi's use of its
trademark misrepresented the geographic origin of its rum. The court
describes Bacardi's Cuban-themed marketing materials in detail but goes on to
discuss solely its product labeling.
The opinion in this case struggles with the meaning of "geographic
origin" under the statute. Citing the lack of case law interpreting
"geographic origin" in 15 U.S.C. § 1125(a)(1)(B), the court turns to
lengthy interpretations of the word "origin" in 15 U.S.C. §
1125(a)(1)(A). This unnecessary move muddies the waters and even the
court is forced to conclude that the authority interpreting subsection (A)
"is not particularly instructive" in interpreting subsection (B).
The court ultimately concludes that "geographical origin" could mean
either the product's physical place of manufacture or, oddly, the product's
"heritage" or "history." It finds that Bacardi's
labeling was accurate on both fronts. First, defendant's bottle includes
a prominent notice that the product is a "Puerto Rican rum,"
eliminating any possible deception from the mark HAVANA CLUB and clarifying
that the rum is not made in Cuba.
Second, the court found that HAVANA CLUB rum does have a Cuban heritage and the
defendant's use of that mark accurately represents that heritage. On that
point, the court noted that defendant Bacardi was originally a Cuban company
and HAVANA CLUB rum was originally made in Cuba,
though it fails to mention the fact that HAVANA CLUB rum is still made
by another party.
Finally, the court concludes tersely that the defendant "has a First
Amendment right to accurately portray where its product was historically
made." False advertising is a form of commercial speech that courts
can clearly prohibit under the Lanham Act without impinging on the First Amendment.
See, e.g., Central Hudson Gas & Electric Corp. v.
Public Service Comm'n of New York, 447 U.S. 557, 562-63 (1980).
Without the prominent disclaimer that the product is a "Puerto Rican
rum," it is quite doubtful that the defendant's use of the HAVANA CLUB
mark alone should have been protected by the First Amendment, as it would have
misrepresented the "geographic origin," or place of manufacture, of