YESTERDAY MARKED the latest battle in a long-running legal war between an American brewing giant and a lesser-known Czech brand over the rights to the use of the names ‘Budweiser’ and ‘Bud’.
The EU’s General Court was hearing a dispute on whether beers produced by the Czech brewery Budějovický Budvar were identified as ‘Bud’ widely enough to stop the makers of the American ‘Budweiser’ beer, Anheuser-Busch, from registering the trademark on an EU-wide basis.
Budějovický Budvar is based in the Czech town of Budejovice, which in German is known as ‘Budweis’ – hence the origin of the name ‘Budweiser’, and the use of the shortened version ‘Bud’ as a common prefix for the name in either language.
Here’s our bullet-point guide to yesterday’s ruling, and the origin behind it.
- In July 1996, Anheuser-Busch applied to register the word ‘Bud’ as a trademark for various kinds of goods, including beer, on an EU-wide basis.
- This was opposed by Budějovický Budvar, which said its use the name ‘Bud’ was protected in France, Italy and Portugal under treaties on the recognition of geographically-oriented names designating a product’s place of origin, as well as in bilateral treaties between Austria and the former Czechoslovakia.
- The EU’s trademark body OHIM had rejected Budějovický Budvar’s opposition, citing insufficient evidence that the brand was actually used in those countries.
- Budějovický Budvar brought this decision to the EU’s General Court (that’s the court one step below the European Court of Justice), which annulled these decisions by the trademarks agency.
- Anheuser-Busch appealed the General Court’s decision to the European Court of Justice, which set aside parts of the earlier ruling and ruled that the protection offered by a geographical name can only prevent the registration of a similar trademark if it is sufficiently used in a substantial part of a country.
- The ECJ, however, said the circumstances before it did not allow it to make a full ruling – sending the case back to the General Court to figure out whether the phrase ‘Bud’ had been used widely enough to refer to Budějovický Budvar’s products.
- The General Court then had to decide whether Budějovický Budvar’s use of ‘Bud’ was sufficient and prevalent enough to stop Anheuser-Busch from registering it as a trademark.
- Yesterday the General Court ruled that the evidence provided by Budějovický Budvar about the use of ‘Bud’ in the original case was not sufficient to illustrate any significant use of ‘Bud’ in any way other than local significance. Any evidence that had been submitted related to use after July 1996, when Anheuser-Busch had applied to register the word ‘Bud’ in the first place.
- The General Court also found that while Budějovický Budvar had submitted invoices from before July 1996, regarding the sale of its beer with the name ‘Bud’ in France, these related only to a limit volume of products sold in only three towns. This was not sufficient to establish sufficient use of the name ‘Bud’ within France, it said.
- Similarly, though it submitted documents to show the use of the appelation ‘bud’ in Austria, the volume of sales was quite low – and that sales outside Vienna were totally negligible.
- Therefore the General Court dismissed all the actions brought by Budějovický Budvar, effectively clearing the way for Anheuser-Busch to register ‘Bud’ as a trademark – 17 years after it first applied to do so.
It is likely that the case may still be appealed to the European Court of Justice, which could hold up the show for another few years.
It should be noted that this only relates to the registration of ‘Bud’ and not of ‘Budweiser’ itself – which is the subject of separate marathon legal proceedings in dozens of jurisdictions around the world.
The whole process is made slightly more complex by the fact that Budějovický Budvar isn’t the only brewer whose products are often referred to as ‘Budweiser’ when sold in the Czech Republic. Budějovický Mestansky Pivovar also does likewise.
However, in an effort to ensure its control over the ‘Budweiser’ name, Anheuser-Busch bought Budějovický Mestansky Pivovar last year – leaving only Budějovický Budvar in its way.
The case is made even more obtuse by the fact that Budějovický Budvar is owned by the Czech government, and was one of the prized assets of the former Czechoslovakian government as it sought to soften its image around western Europe.
It has previously been speculated that the Czech administration could opt to sell off the brewery, or at least float it on the stock market – with Anheuser-Busch then certain to take a major stake, if only to end their marathon legal battles.