Bacardi Confident of Its Re-Launch of Havana Club Rum in the U.S.; Bacardi Responds to Inaccurate Claims in Lawsuit against Havana Club Re-Launch.

MIAMI -- One week after its successful re-launch of HAVANA CLUB rum in the United States, Bacardi U.S.A. reaffirms its ownership of the brand and that its packaging does not mislead consumers. The company will vigorously defend its position in the wake of inaccurate allegations in a lawsuit filed by Pernod Ricard.

HAVANA CLUB rum was re-launched in the United States August 8 and is based on the original recipe created in Cuba. HAVANA CLUB rum is an ultra-smooth, clear, premium spirit, distilled and finely crafted in Puerto Rico.

The front of the bottle clearly states that HAVANA CLUB is Puerto Rican rum and no where on its packaging does it claim it is produced in Cuba. Rum requires no geographic designation, in contrast to Champagne, Scotch, Cognac or Bourbon, which by law must be produced in specific regions.

Historically, in addition to being produced in Cuba, HAVANA CLUB rum was made in Puerto Rico during World War II by the Arechabala company. Puerto Rico has a rich heritage of producing fine quality rums.

Bacardi purchased the rights to the HAVANA CLUB trademark from the creators and original owners, the Arechabala family. They made their famous rum in Cuba from the 1930s until 1960 and exported it to the United States and other countries until their rum-making facilities and personal assets were seized without compensation during the Cuban revolution.

The U.S. Patent and Trademark Office (PTO) determined on August 3 that Cuba's registration of the HAVANA CLUB trademark is "cancelled/expired." The decision means that the Cuban government can no longer claim any rights to the mark in the United States. Bacardi - which owns the rights to the brand based on use and as a successor to the original owners - has a pending application to register the mark in its own name.

The PTO's action came just six days after the U.S. Treasury's Office of Foreign Assets Control (OFAC) denied a Cuban government agency a specific license that was necessary to seek renewal of the trademark registration at the PTO.

The OFAC and PTO decisions are watershed events in the ten-year dispute between Bacardi and the Cuban government and its French partner over the rights to the HAVANA CLUB trademark in the United States. In a case that went all the way up to the Supreme Court, the U.S. courts ruled that the Cuban-French joint venture had no rights to the trademark. Bacardi continued to fight the Cuban government's claim to the U.S. registration in the PTO and the courts, even though by law that claim cannot be recognized or enforced in the U.S. Now Cuba's registration has finally been declared expired and cancelled.

The French liquor company Pernod Ricard, whose U.S. company today challenged Bacardi's legitimate ownership, has no trademark registration and no rights to the HAVANA CLUB brand in the United States.

Background

HAVANA CLUB rum was created in Cuba in 1935 by the Arechabala family company (Jose Arechabala, S.A.), which registered the trademark in the U.S. in 1935 and sold its rum in the U.S. over a twenty year period. The company's assets were seized without compensation by the Cuban government in 1960. In 1976, after the Arechabala family's HAVANA CLUB trademark registration expired, Cubaexport (a Cuban government agency) registered the HAVANA CLUB trademark in the U.S. through a loophole in the trade embargo. In 1993 the Cuban government established a partnership with the French liquor company Pernod Ricard to exploit the brand. Because the Arechabalas' business and personal assets were confiscated by the Cuban government, the Arechabala family was left without the means to produce rum. Nevertheless, the family always intended to resume producing and marketing HAVANA CLUB rum as soon as they were able to do so. The Arechabalas formed an alliance with Bacardi to achieve this end.

Congress closed the loophole in the Cuban embargo in 1998, when it passed a law to prevent recognition of trademarks confiscated without compensation by Cuba, except with the consent of the rightful owners.

This principle was upheld by the World Trade Organization as consistent with international agreements on intellectual property rights.

About Bacardi

Bacardi USA is the import, sales, and marketing arm of one of the world's leading wine and spirits producers. Bacardi USA boasts a brand portfolio of some the United States' most recognized and top selling spirits including: BACARDI rum, the favorite spirit in the U.S. and favorite rum in the world; GREY GOOSE vodka, the world leader in ultra premium vodka; MARTINI & ROSSI vermouth, the world leader in Vermouth; DEWAR'S scotch whisky, the favorite selling blended scotch whisky in the United States; BOMBAY SAPPHIRE gin, the best selling super premium gin in the US; and CAZADORES blue agave tequila, the top selling 100% blue agave tequila in the world and other fine brands.