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A poke at Castro, or corporate payback?

Published Apr. 29, 2005|Updated Aug. 25, 2005

For a handful of members of Florida's congressional delegation, it wasn't a tough call: A Florida company with deep pockets and deep roots in the state's political establishment needed help on legislation that enjoys the support of the House leadership.

And in the process, it gave them the chance to needle Cuban dictator Fidel Castro.

But critics say a new bill designed to tweak U.S. trademark law to help Bacardi USA Inc. sell rum under the name Havana Club _ a brand that happens to be owned by the Cuban government and that has become a top-selling rum in much of Europe _ is a wrong-headed giveaway to a major political donor.

They say it would undermine U.S. standing in international trademark fights.

Rep. Tom Feeney, R-Oviedo, introduced the bipartisan bill last week. His co-sponsors include at least eight other Florida representatives, as well as a Texas congressman close to Majority Leader Tom DeLay, who has pushed this bill in the past.

Bacardi has been indicted, accused of making an illegal contribution of $20,000 to a political action committee DeLay founded in Texas.

Known on Capitol Hill as the "Bacardi Bill," it marks the latest twist in a yearslong battle over trademark rights between Bacardi and Pernod Ricard, the French liquor conglomerate that distributes Havana Club rum in Europe and South America for Cuba's state-owned manufacturer.

"When property rights were confiscated by the Cuban government, then transferred or assigned to a third party, we want to make sure that the third party does not have those rights and privileges," Feeney said. "It's like knowingly buying stolen property."

Critics say the law could hurt American companies abroad, and some contend it's payback for Bacardi's hefty political contributions. Since 2000, Bacardi has donated more than $600,000 to political parties and their campaign committees.

Tom Schatz, president of Citizens Against Government Waste, which usually sides with Feeney, says the bill is bad policy and sets bad precedent.

"It's a special interest provision for one company that could jeopardize the international enforcement of trademarks," Schatz said.

Bacardi says it bought the rights to the name Havana Club in 1996 from the original owner, whose distillery was seized by the state after the Communist revolution. It contends the Cuban government and Pernod illegally claim the Havana Club trademark.

Current U.S. law, passed at the behest of Bacardi in 1998, bars U.S. courts from enforcing Cuban brand names confiscated during the revolution and manufactured by state-owned Cuban firms.

But the World Trade Organization ruled the law was too narrow, because it applies only to Cuban-owned firms. Feeney said the new bill would expand it slightly, bringing it into compliance with the WTO ruling.

The Citizens Against Government Waste and other groups have tried to remove the entire Bacardi provision from U.S. law, and will lobby against the change this year. "You have to wonder why, for just one company, they would try to do this," said Melanie Sloan, executive director of the Citizens for Responsibility and Ethics in Washington, a left-leaning watchdog group.

"They make it about being anti-Castro, but all it really is about is anti-competition. It's wanting to get ahold of the trademark to make more money."

Bacardi has given to Democrats and Republicans, though the Republicans have received more. The donations include $25,000 last year to the Florida Republican Party, and $107,000 to the state party in 2002, state records show.

In 2002, the Washington Post reported that Bacardi gave the Florida Republican Party $50,000 shortly before Gov. Jeb Bush wrote a U.S. Patent and Trade Office appointee of his brother, President Bush, to ask quick action on behalf of Bacardi in the trademark dispute over Havana Club.

Five days after the letter, Bacardi gave the party $25,000 more. Bush said the donations were not connected, and said he was simply trying to help a valuable Florida company.

Bacardi is one of eight corporations under indictment, accused of making illegal contributions to a political action committee DeLay founded. Texas law prohibits corporate donations.

The company has given $3,000 to DeLay's legal defense fund. Among the sponsors of the Bacardi bill is Rep. Lamar Smith, R-Texas, who gave $10,000 to DeLay's legal fund, while Feeney has donated $5,000, records show.

Smith sponsored the Bacardi bill last year, but it was derailed in the House Judiciary Committee.In 2003, DeLay tried to put it into a defense bill, but it was blocked.

Bacardi did not return calls for comment, but in published reports the company has maintained its innocence in the Texas investigation.

The bill's Florida co-sponsors include Republican Reps. Clay Shaw of Fort Lauderdale, Mark Foley of West Palm Beach, Ric Keller of Orlando, Ander Crenshaw of Jacksonville, Katherine Harris of Sarasota and Ileana Ros-Lehtinen of Miami. Democratic sponsors include Reps. Kendrick Meek of Miami, Debbie Wasserman-Schultz of Weston and Allen Boyd of Monticello.

Meek said many companies were unfairly stripped of their trademark rights during the Communist revolution. He said that he knows the Bacardi family and that Bacardi is a good corporate citizen.

"This legislation is very, very important to make sure a company _ which is a Florida company and headquartered in Miami, on Biscayne Boulevard _ has an opportunity to get full rights to its trademarks," Meek said.

Feeney said the bill is good policy. He serves on the House Judiciary Committee, which has jurisdiction over the matter.

"I make a habit out of helping Florida companies, I make a habit out of protecting intellectual property rights of all American companies, and I can tell you this was not part of any quid pro quo on our account," Feeney said.

"And any time I can take a shot at Fidel Castro and his minions, I do it. This is another well-deserved pummeling."

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