Empresa Cubana Del Tabaco v. Culbro Corp.

399 F.3d 462, 2005 WL 427887
CourtCourt of Appeals for the Second Circuit
DecidedFebruary 24, 2005
DocketDocket Nos. 04-2527-CV(L), 04-3005-CV (XAP)
StatusPublished
Cited by49 cases

This text of 399 F.3d 462 (Empresa Cubana Del Tabaco v. Culbro Corp.) is published on Counsel Stack Legal Research, covering Court of Appeals for the Second Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Empresa Cubana Del Tabaco v. Culbro Corp., 399 F.3d 462, 2005 WL 427887 (2d Cir. 2005).

Opinion

STRAUB, Circuit Judge.

Defendants-Counterclaimants-Appel-lants-Cross-Appellees, General Cigar Co., Inc., and General Cigar Holdings, Inc. (“General Cigar”), appeal from a judgment and permanent injunction of the United States District Court for the Southern District of New York (Robert W. Sweet, Judge), entered on May 6, 2004, finding in favor of Plaintiff-Counter-Defendant-Ap-pellee-Cross-Appellant, Empresa Cubana del Tabaco, doing business as Cubatabaco (“Cubatabaco”), on its claim of trademark infringement under Section 43(a) of the Lanham Act, ordering cancellation of General Cigar’s United States trademark registration for COHIBA cigars, permanently enjoining General Cigar from further use of the COHIBA mark, and ordering General Cigar to deliver to Cubatabaco all merchandise, packaging and other materials bearing the COHIBA name, to recall from retail customers and distributors products bearing the mark, and to inform customers and distributors that they could not sell General Cigar’s COHIBA-labeled products in the United States. Cubataba-co has cross-appealed from the District Court’s dismissal of its treaty-based and state law claims.

This appeal arises from a dispute between Cubatabaco, a Cuban company, and General Cigar, an American company, over who has the right to use the COHIBA mark on cigars. After filing an application to register the COHIBA mark in Cuba in 1969, Cubatabaco began selling COHIBA cigars in Cuba. Cubatabaco has sold CO-HIBA cigars outside of Cuba since 1982, but, because of the United States embargo against Cuban goods, imposed in 1963, Cu-batabaco has never sold COHIBA cigars in the United States. General Cigar obtained a registration for the COHIBA mark in the United States in 1981 and sold COHIBA cigars in the United States from 1978 until late 1987. In 1992, General Cigar relaunched a COHIBA cigar in the United States and has sold cigars under that mark in the United States since that time.

Cubatabaco claims that it owns the U.S. COHIBA trademark because General Cigar abandoned its 1981 registration in 1987 and that, by the time General Cigar resumed use of the mark in 1992, the Cuban COHIBA mark was sufficiently well known in the United States that it deserved protection under the so-called “famous marks doctrine.” The District Court agreed and found that, although Cubatabaco had never used the mark in the United States and was prohibited from doing so under the embargo, it nonetheless owned the U.S. COHIBA mark. The District Court concluded that by failing to use the COHIBA mark from late 1987 to 1992, General Cigar abandoned its 1981 registration. It found further that because the Cuban CO-HIBA mark was sufficiently well known in the United States by November 1992, the date General Cigar resumed its use of the mark, Cubatabaco was entitled to priority in asserting ownership of the mark. After finding that there was a likelihood of confusion between the Cuban COHIBA mark and the General Cigar COHIBA mark, the court granted judgment to Cubatabaco on its claim for trademark infringement un[465]*465der Section 43(a) of the Lanham Act, 15 U.S.C. § 1125(a), cancelled General Cigar’s registration of the mark, and enjoined General Cigar from using the mark. The court dismissed all other claims brought by Cubatabaco, including claims under international trademark treaties and New York law.

We do not reach the question of whether an entity that has .not used a mark on products sold in the United States can nonetheless acquire a U.S. trademark through operation of the famous marks doctrine. We need not reach that question in this case because even were we to recognize and apply the famous marks doctrine, the Cuban embargo bars Cubataba-co’s acquisition of the COHIBA mark via the famous marks doctrine. Therefore, we reverse the District Court’s grant of judgment to Cubatabaco on its claim of trademark infringement under Section 43(a) of the Lanham Act. We affirm the District Court’s dismissal of all other claims brought by Cubatabaco.

BACKGROUND

In 1963 the United States imposed an embargo on Cuba. The Cuban Asset Control Regulations (“Embargo Regulations” or “Regulations”), 31 C.F.R. § 515.201 et seq., which were promulgated pursuant to Section 5(b) of the Trading with the Enemy Act of 1917, ch. 106, § 5(b), 40 Stat. 415 (codified as amended at 12 U.S.C. § 95a (2000)), contain the terms of the embargo. See Havana Club Holding, S.A. v. Galleon S.A., 203 F.3d 116, 120 (2d Cir.), cert. denied, 531 U.S. 918, 121 S.Ct. 277, 148 L.Ed.2d 201 (2000). In 1996 Congress codified the Regulations in the Cuban Liberty and Democratic Solidarity Act of 1996 (“LIBERTAD Act”), Pub.L. No. 104-114, Title I, § 102, Mar. 12, 1996, 110 Stat. 792 (1996) (codified at 22 U.S.C. § 6032(h)). “The Secretary of the Treasury has the authority to administer the Cuban embargo, which he has delegated to the Office of Foreign Assets Control (‘OFAC’).” Havana Club, 203 F.3d at 120 (citing 31 C.F.R. § 515.802). The Embargo Regulations prevent Cuban entities, such as Cu-batabaco, from selling cigars in the United States. Despite its inability to sell cigars here, Cubatabaco claims that it owns the COHIBA mark in the United States and that General Cigar’s sale of COHIBA cigars in the United States unlawfully infringes its mark.

The District Court, after a bench trial, issued a comprehensive opinion setting forth its factual findings. See Empresa Cubana del Tabaca v. Culbro Corp., No. 97 Civ. 8399, 2004 WL 602295, at *3-27 (S.D.N.Y. Mar.26, 2004) (“Empresa III”). Here we recount only those facts necessary to explain our holding.

In 1969 Cubatabaco filed an application to register the COHIBA mark in Cuba. Throughout the 1970s it sold COHIBA cigars in Cuba. By January 1978 Cubata-baco had applied to register the COHIBA mark in seventeen countries, including most Western European countries, but did not apply to register the mark in the United States. In 1982 Cubatabaco began selling COHIBA cigars outside of Cuba. In 1983 Cubatabaco considered registering its COHIBA mark in the United States but learned that General Cigar had already obtained the United States registration. On February 22, 1985, Cubatabaco filed an application with the United States Patent and Trademark Office (“PTO”) to register its BEHIQUE mark in the United States with the same trade dress that it used on its COHIBA cigars elsewhere. In 1987 Cubatabaco considered challenging General Cigar’s 1981 COHIBA registration, but chose not to take any action.

General Cigar first learned of the name “Cohíba” in the late 1970s after General [466]*466Cigar executives read a Forbes magazine article stating that Cubatabaco was planning to sell its COHIBA cigars outside of Cuba. General Cigar filed an application to register the COHIBA mark with the PTO on March 13, 1978, with a claimed first use date of February 13, 1978. The application was unopposed, and General Cigar obtained the registration on February 17, 1981.

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399 F.3d 462, 2005 WL 427887, Counsel Stack Legal Research, https://law.counselstack.com/opinion/empresa-cubana-del-tabaco-v-culbro-corp-ca2-2005.