Federal Judge Overturns Cohiba Case — Again

The Cohiba trademark case that refuses to die has just taken another turn. Although the trademark dispute over the Cohiba brand name was dismissed in 2005, allowing General Cigar Co. to continue using the Cohiba mark in the United States, the case was reopened, and it was just overturned in light of a new legal precedent.

Cubatabaco, the arm of the Cuban government that owns Cuba's cigar trademarks, had appealed to the United States District Court, Southern District of New York, citing a prior Court of Appeals ruling (ITC v. Punchgini) as a basis for its claim against General Cigar, the producers of the Dominican Cohiba cigar sold in the United States. After reviewing Empresea Cubana Del Tabaco v. Culbro Corp. (Culbro being the former owner of General Cigar), Judge Robert W. Sweet determined on November 18 that General Cigar was guilty of unfair trade by misappropriation. Furthermore, Sweet ruled that Cubatabaco was entitled to relief.

General Cigar's spokesperson said company officials were not available to comment. General is a subsidiary of Swedish Match AB.

The litigation goes back 11 years since General Cigar began marketing products with the Cohiba name in 1997. Cubatabaco has attempted to block General's use of the brand name ever since, and won the first round of legal battles in 2004. But when General appealed in 2005, the Second U.S. Circuit Court of Appeals ruled that the U.S. embargo on Cuban goods precluded Cubatabaco from claiming any benefit of the Cohiba brand name. It was also determined that Cubatabaco had failed to established "bad faith," an element needed to make the claim of unfair trade by misappropriation.

Cubatabaco argued that a 2007 ruling in ITC v. Punchgini eliminated the "bad faith" requirement as being integral to the claim of misappropriation. Judge Sweet agreed.

Cubatabaco is requesting relief that includes General's profits on sales of Cohiba cigars.

For much more on this story, see next Tuesday's Cigar Insider.

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