The U.S. Patent and Trademark Office (USPTO) faces a tightening legal landscape regarding trademarks linked to confiscated foreign property. Following the enactment of the No Stolen Trademarks Honored in America Act in December 2024, federal agencies are restricted from protecting brand names rooted in confiscated foreign property. This shift challenges long-standing agency practices that previously allowed foreign entities to maintain U.S. trademark registrations despite ongoing trade embargoes and historical property disputes.
The Legal Conflict Over Confiscated Trademarks
The core of the dispute involves the Havana Club brand, which was seized from the Arechabala family in Cuba in 1959. According to testimony provided by Ramón Arechabala to the Senate Judiciary Committee in 2004, the transition of ownership occurred under threat of force. While the family fled the country, the Cuban government assumed control of the distillery. For decades, the Arechabala family and the Cuban state company Cubaexport have contested the rights to the trademark in the United States.
A central point of contention has been the USPTO’s interpretation of “excusable nonuse.” Under the Trademark Manual of Examining Procedure (TMEP) 1613.11, the USPTO has historically permitted trademark owners to cite trade embargoes as a valid excuse for failing to use a mark in commerce. Bacardi, which acquired the rights to the Havana Club recipe and remaining interests from the Arechabala family in 1995, has argued that this practice improperly allows a foreign government to benefit from its own confiscation of property.
Did you know?
The U.S. embargo on Cuba has been in place since the early 1960s. Despite this, the USPTO has accepted sworn declarations of excusable nonuse from Cubaexport periodically since 1982, citing the embargo as the reason for the brand’s absence from U.S. shelves.
Shifting Standards: From Embargoes to Property Rights
Recent judicial and legislative actions suggest a move away from treating long-term embargoes as temporary administrative hurdles. In May, the Supreme Court ruled 8-1 that property Cuba confiscated remains permanently tainted, regardless of the time elapsed since the seizure. This decision aligns with the legal framework of the HEAR Act, which allows families to pursue Nazi-looted art decades after the theft, establishing a precedent that a wrongful taking doesn’t launder itself through the passage of time.
The USPTO’s reliance on TMEP 1613.11 has been criticized for creating a “deadwood” problem—maintaining registrations on the federal register that do not reflect actual, lawful use in U.S. commerce. Because the underlying product, Cuban rum bearing this trademark, remains barred from the U.S. market by federal law, critics argue these marks fail the Lanham Act’s requirement for “use in commerce.” By contrast, the Trademark Trial and Appeal Board has spent years refusing marijuana trademarks, citing the fact that federal law still prohibits their sale, regardless of their status under state law.
Future Implications for Global Brand Protection
The expiration of the current Havana Club registration, scheduled for January 27, 2026, followed by a six-month grace period ending July 27, 2026, will serve as a primary test for the new federal restrictions. Under the No Stolen Trademarks Honored in America Act, the USPTO is prohibited from granting renewals for trademarks tied to confiscated foreign property. Bacardi has stated that this legislation effectively bars the renewal of the Cubaexport registration.
The integration of property rights into trademark law marks a significant departure from the USPTO’s previous administrative focus on fee payments and technical compliance. If the agency removes the trade embargo entry from its manual, it would eliminate a loophole that has persisted for over three decades.
Pro Tip:
When researching the history of a trademark, look for “excusable nonuse” filings in the USPTO’s Trademark Status & Document Retrieval (TSDR) system. These documents reveal how long a company has claimed that external circumstances, such as embargoes or litigation, have prevented the use of a mark.
Frequently Asked Questions
- What is the “excusable nonuse” rule? It is an agency practice that allows trademark owners to maintain their registration even if they aren’t selling the product, provided they can prove a temporary, external disruption.
- Why is the Havana Club case significant? It highlights the tension between standard trademark renewal processes and the U.S. government’s policy toward assets confiscated by the Cuban regime.
- Does the new law apply to all trademarks? The No Stolen Trademarks Honored in America Act specifically targets federal protections for brand names built on confiscated foreign property.
- What happens if the USPTO denies a renewal? The trademark registration is cancelled, meaning the entity loses the federal protections and exclusive rights associated with that specific mark on the federal register.
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