Product type Rum Introduced 1934 | Owner Corporación Cuba Ron Related brands | |
 | ||
Country Santa Cruz del Norte, Cuba Markets Global, except United States | ||
Havana Club is a brand of rum created in Cuba in 1934, and now one of the best-selling rum brands in the world. Originally produced in Cardenas, Cuba by family-owned Jose Arechabala S.A., the brand was nationalized after the Cuban Revolution of 1959. Since 1994 it has been produced in Cuba and sold globally (except the United States) by Havana Club International, a 50:50 joint venture between Pernod Ricard and the Cuban government. Bacardi also produces a competing product with the same name in Puerto Rico, sold only in the United States. The two companies have engaged in ongoing litigation about ownership of the brand.
Contents
History and production
The Arechabala family founded a distillery in Cardenas, Cuba in 1878. Later renamed Jose Arechabala S.A., the company created the Havana Club brand in 1934, and sold rum under that name in both Cuba and the United States. The company was nationalized by the Castro government in 1960. Subsequently, the Arechabala family left Cuba for Spain and the United States.
The Cuban government sold rum abroad under the Havana Club name beginning in 1972, focusing primarily on the Soviet Union and Eastern Europe. The government focused on Havana Club because (unlike the Barcardi family) the Arechabala family had not established plants outside of Cuba and so could not produce a competing brand. The company was considered a "national jewel" by the Cuban government, and in 1977 manufacturing was moved to a new plant in Santa Cruz del Norte.
Since 1994, Cuban production and non-US global marketing of Havana Club has continued under a joint partnership between Pernod Ricard and Corporación Cuba Ron.
In 1994, Bacardi began producing rum under the Havana Club name in Cataño, Puerto Rico using a recipe given to them by Arechabala family members. While originally sold in only a few states (primarily Florida), production was expanded in 2006, and in 2012, after winning a critical court battle, Bacardi announced plans to sell the rum more broadly.
Pernod Ricard/Bacardi trademark conflict
The Havana Club trademark has been the subject of extensive trademark litigation in the US, Spain, and World Trade Organization.
After Jose Arechabala S.A. was nationalized, the Arechabala family left Cuba and stopped producing rum. They therefore allowed the US trademark registration for "Havana Club" to lapse in 1973. Taking advantage of the lapse, the Cuban government registered the mark in the US in 1976. The brand was then assigned by the Cuban government to Pernod Ricard in 1993.
In 1994, Bacardi obtained the Arechabala family's remaining rights in the brand, and began producing limited amounts of rum bearing the name. 922 cases were sold in the US in 1995 and 1996. This drew litigation from Pernod Ricard. Pernod Ricard was successful in two of the first three court holdings issued in this litigation.
However, in 1998, after heavy lobbying from Bacardi, the US Congress passed the "Bacardi Act", which protected trademarks related to expropriated Cuban companies, and effectively ended the first phase of the litigation by eliminating Pernod Ricard's standing. This act (also known as Section 211) has been applied only to the Havana Club trademark. The act was ruled illegal by the World Trade Organization in 2001 and 2002, on grounds that it singled out one country (Cuba). The United States has not yet acted to address the WTO ruling, despite a 2005 deadline and requests from the European Union.
Following the initial round of litigation, a second round of litigation occurred, through both the US Federal court system and the Trademark Trial and Appeal Board, focused in part on the allegedly deceptive nature of the use of "Havana" in the name of a rum produced outside of Cuba. This round of litigation lasted from 2009 to 2012, and again resulted in a victory for Bacardi. After this defeat, Pernod Ricard announced plans to market the product in the US under the "Havanista" mark, while Bacardi announced plans to extend distribution of Bacardi's version of Havana Club throughout the US.
In Spain, Pernod Ricard's ownership of the mark has been upheld in three court rulings, most recently in 2011.
In January 2016, the U.S. government awarded a trademark for Havana Club to the Cuban government. The Wall Street Journal said, "The move is expected to reignite longstanding tension between Bacardi Ltd. and the Cuban government", and Bacardi announced plans to appeal the decision.
Current sales and marketing
Pernod Ricard's Havana Club is the fifth-largest rum brand in the world, with almost 4 million cases sold in 2012–2013. It is sold in over 120 countries. Its strongest markets include France, and Germany, where marketing plays off the brand's distribution in East Germany during the Cold War. Since 2008, it is also bottled in India, the world's second-largest rum market.
Pernod Ricard plays heavily on Cuban themes in its marketing, including labeling Havana Club as "El Ron de Cuba" ("The Rum of Cuba"). It is one of the most common items brought into the US by tourists returning from Cuba. To avoid charges of customer deception, Bacardi's Havana Club labeling prominently mentions that it is made in Puerto Rico and is often referred to as "Havana Club Puerto Rican rum".
Pernod Ricard's labeling, originated by Cubaexport in the 1970s, is gold and red, and features the Giraldilla, a weathervane from the old fort of Havana. Pernod Ricard has announced plans to use similar gold and red labels on their "Havanista" product in the United States.
Pernod Ricard
Bacardi
Bacardi makes only one grade of Havana Club Puerto Rican rum, at 40% ABV (80 proof).