HAVANA CLUB held to be geographically deceptively misdescriptive

In Corporacion Habanos SA v Anncas Inc (Opposition 91165519, September 26 2008), in a precedential opinion, the Trademark Trial and Appeal Board (TTAB) has upheld an opposition against the registration of the trademark HAVANA CLUB on the grounds that the mark was primarily geographically deceptively misdescriptive under Section 2(e)(3) of the Lanham Act
In an apparent effort to give the impression that its cigars would be the equivalent of Cuban cigars, Anncas Inc filed an intent-to-use application to register the mark HAVANA CLUB in respect of “cigars made from Cuban seed tobacco”. The application was opposed by a Cuban cigar company, Corporacion Habanos SA, which is authorized to export Cuban cigars manufactured in Cuba from tobacco that is 100% of Cuban origin. Habanos is the owner of a federal registration for the mark HABANOS UNICOS DESDE 1492 (which may be translated as 'Unique Havana cigars since 1492') covering cigars. Habanos argued, among other things, that the mark HAVANA CLUB is primarily geographically deceptively misdescriptive under Section 2(e)(3) of the act and deceptive under Section 2(a).
The TTAB did not consider Habanos’s deceptiveness assertion under Section 2(a) based on the Federal Circuit’s decision in In re California Innovation Inc (329 F 3d 1334 (2003)), in which the court stated that it anticipated that the US Patent and Trademark Office (USPTO) would usually address geographically descriptive marks under Section 2(e)(3), not Section 2(a).
The first issue was whether the primary significance of the mark at issue was a "generally known location". Anncas did not contest that HAVANA CLUB is primarily significant as a generally known location. The TTAB noted that Havana is the largest city in the West Indies, as well as “the political, economic and cultural centre of Cuba [...] known to the relevant public”. Thus, the primary significance of HAVANA CLUB was found to be geographical. Even if Anncas had contested this issue, it is evident that it would have lost. In this regard, where a geographic term is part of a composite (as here), and notwithstanding that the USPTO is permitted to consider the significance of each element in that composite, the significance of the geographic element will be hard to counter if that element identifies a major geographic location (see California Innovation). Thus, the presence of the word 'club' was found not to undo the primary geographic significance of the mark.
The second issue was whether the consuming public was likely to believe that the place identified by the mark indicated the origin of the goods, when in fact the goods did not come from that place. Two questions were thus raised: 
  • whether there was a goods/place association; and
  • whether the goods came from that place. 
As to the first question, there was little doubt that there was a goods/place association between Havana and cigars. Anncas did not argue the contrary in its briefing. Had it done so, it is apparent that Habanos's proofs (eg, gazetteers, encyclopaedia, dictionaries and cigar publications) would have established a goods/place association. 
The issue which Anncas emphasized was whether the goods would in fact be expected to come from that place. It is revealing that Anncas initially sought registration of its mark in respect of “cigars”. It amended that description to “cigars made from Cuban seed tobacco” only after the examiner initially refused registration under Section 2(e)(3). In its analysis, the TTAB observed that even though a product is manufactured elsewhere, it can nevertheless be found to originate from the geographic location identified in the mark so long as there is a sufficient connection between the product and the place, citing its decisions involving the marks NANTUCKET NECTARS and BAIKALSKYA.
The central issue with the mark HAVANA CLUB was whether cigars made from Cuban seed tobacco should be deemed to originate or come from Havana. Habanos argued that Cuban seed tobacco is a term used in the United States to describe tobacco grown outside Cuba, allegedly from multi-generational descendants of seeds taken from Cuba four to five decades ago. Habanos built a record establishing that there was no connection between Cuban seed tobacco and Havana or Cuba. In short, Habanos argued that the claim of the 'descent' of the Cuban seed tobacco was so distant as to be insufficient to warrant a finding that cigars made from such tobacco come from or originate in Havana.
Habanos's record on this point consisted of testimony from its own technical personnel and an expert, the editor of an encyclopaedia on the subject of cigars. For its part, Anncas offered no testimony to rebut Habanos's. Instead, it relied on its claim that Cuban seed tobacco is a term “widely used in the industry” and the fact that the USPTO considers cigars made from Cuban seed tobacco an acceptable identification of goods. Copies of a number of third-party registrations and applications utilizing this description of goods were submitted by Anncas. However, Anncas’s president also testified that he did not know:
  • whether the intended tobacco came from seeds that were descendants of seeds taken from Cuba; or
  • whether cigars made from such descendant seeds would share any characteristics or qualities such as taste, flavour or aroma with cigars actually made in Cuba.
The TTAB found an “insufficient connection” between Cuban seed tobacco and Havana to support a finding that goods made from Cuban seed tobacco originate or come from Havana. Thus, the connection between Anncas’s intended goods and Havana was found to be “far too tenuous" and unlike the situations where such connections were found to exist (see In re Nantucket Allserve Inc (28 USPQ 2D 1144 (1993) and In re Joint-Stock Company Baik (80 USPQ 2d 1305 (2006)). The TTAB found that consumers were likely to believe that 'Havana' indicated origin when, in fact, the goods did not come from that location.
The TTAB also found that the misrepresentation as to geographic source is material given that cigars are a principal product of Havana and that cigars from Havana are desirable. Thus, the goods/place association “undoubtedly would be material in a customer’s decision to purchase applicant’s cigars”.
Russell Falconer, Baker Botts LLP, New York

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