Cohiba vs. Cohiba
Cohiba is arguably the most valuable trademark in the world of premium cigars. It’s also the most contested. A legal battle for Cuba’s flagship luxury cigar brand has been going on for nearly 30 years—and untold dollars have been spent on litigation—but the raging fight for the soul of Cohiba just took another turn. After two years of stagnation, the case came back to life when a recent decision by a Virginia court ruled in favor of Cuba. As for what it means for U.S. consumers, the answer is still unclear.
The imbroglio all started in 1997 when Cuban company Cubatabaco, which owns Cohiba and the rights to market the brand internationally, sued General Cigar Co. for its use of the Cohiba name in the United States. General was rolling and selling non-Cuban Cohibas of its own (casually referred to as “Red Dot” Cohibas, named after the original non-Cuban packaging) for the U.S. market. Cubatabaco cried foul and has been seeking to cancel General’s trademark, which would effectively abolish the production, marketing and sale of all non-Cuban Cohiba cigars.
The issue has been in litigation since the Clinton administration with back-and-forth losses and victories for both sides. So far, the Supreme Court has refused to hear the case, but the scales of justice in the lower courts have tipped in Cuba’s favor (see the timeline). It all comes down to one question: Do international trademark laws still apply when the aggrieved company is under a trade embargo? According to one justice, the answer is yes.
This most recent ruling is a result of a suit filed in February 2023: General Cigar Company v. Empresa Cubana del Tabaco d.b.a. Cubatabaco. General sought to reverse a previous decision made by the Trademark Trial and Appeal Board (TTAB) in 2022, which ruled to cancel General’s Cohiba trademark registration in the United States. In May, General lost that case.
Judge Leonie M. Brinkema of the United States District Court for the Eastern District of Virginia upheld the TTAB’s 2022 decision to cancel General’s use of the Cohiba trademark. By her legal interpretation, Cubatabaco’s trademark is shielded under the Inter-American Convention (IAC), a 1929 law that protects international trademarks—even during the time of an embargo.
The legend of Cohiba and its creation as Castro’s private cigar is certainly fascinating, but the story of the trademark is its own separate history. According to the legal document, Cubatabaco applied for the Cohiba trademark in September 1969 and was granted registration on May 31, 1972. Nearly six years later, on March 13, 1978, General Cigar applied to register Cohiba with the United States Patent and Trademark Office (USPTO). Registration was issued on February 17, 1981. One of General Cigar’s primary arguments in the suit was the claim that Cuba allowed the Cohiba trademark to lapse from non-usage in the 1970s, but the court rejected this notion. An article published in Forbes magazine in 1977—presented as evidence by the Cubans—states the existence and use of a Cohiba brand. The fact that Cohiba cigars were disseminated noncommercially at the time (as diplomatic gifts, as Fidel Castro’s personal brand, etc.) was deemed irrelevant—the trademark was still protected. Cohiba was finally released commercially by the Cubans in 1982.
“Because . . . General Cigar had knowledge of Cubatabaco’s use of ‘Cohiba’ for cigars in Cuba, the Court finds that the TTAB validly cancelled General Cigar’s registration under Article 8 of the IAC,” the ruling states.
Good news for Cuba, bad for General, but what does it all mean in practical terms? Does the company have to now cease production and sale of its Cohiba cigars? That doesn’t seem likely. In addition to this suit, General has a pending appeal with the TTAB that has yet to be resolved. The appeal was filed in 2023 as well. And General immediately issued a statement saying that it’s seriously considering an appeal to judge Brinkema’s recent decision.
“We are of course disappointed by this decision,” says Régis Broersma, chief commercial officer of Scandinavian Tobacco Group, the owner of General Cigar Co., “but we and our advisors will now study the ruling closely and of course consider the opportunity to appeal to the U.S. Court of Appeals for the Fourth Circuit. Our federal trademark registrations, which are the subject of the dispute, would remain valid and enforceable during a pending appeal. We expect the long dispute to continue before the courts.”
Furthermore, General added that the recent ruling “deals with the federal trademark registrations and does not impact General Cigar Co.’s common law trademark rights based on its long use of the Cohiba mark on its cigars marketed and sold in the U.S. These trademark rights remain valid and enforceable irrespective of the current dispute.”
It’s no surprise that Cubatabaco is defending the trademark so aggressively. Cohiba is the Cuban cigar industry’s most valuable brand, bringing in more money per year than any other cigar line in the portfolio. Many sell for more than $100 (or the equivalent) for a single cigar, and one sells for more than $800. In 2022, prices for Cohiba nearly tripled, a move made to not only bump revenue but to also reinforce Cohiba’s global position as a high-luxury item in its own league of distinction.
Habanos S.A., the marketing and distribution arm of Cubatabaco, continues to affirm rightful ownership of the brand, but fans of non-Cuban Cohibas shouldn’t lose too much sleep over the recent legal decision. It seems that these cigars won’t be disappearing from America’s retail shelves any time soon. And unless there’s a ruling by the Supreme Court, this litigation is probably destined for another 30 years of appeals. Whatever the outcome, it’s sure to be a landmark case that will be cited in trademark law for years to come.
