A long legal dispute between the Czech producer of BUDWEISER beer, Budĕjovický Budvar, n.p., and the Austrian distributor of its U.S. competitor AMERICAN BUD beer, Anheuser-Busch, Inc., has finally been terminated. As a result, AMERICAN BUD beer may be freely distributed in Austria because Budĕjovický Budvar’s trademark BUD is not regarded as an appellation of origin in the sense of the European Union (EU) regulation on protection of geographical indications and appellations of origin (Council Regulation (EC) No. 510/2006, Mar. 20, 2006). (Case No. 17 Ob 20/11g (Supreme Court of Austria Aug. 9, 2011).)
Budĕjovický Budvar owns numerous domestic, European and international registrations for trademarks containing or consisting of the words BUDWEISER, BUDVAR, BUD, etc. All are senior to Anheuser-Busch’s trademark AMERICAN BUD, under which the company’s beer was sold in Austria until October 1999, when the dispute started.
In order to strengthen its position, Anheuser-Busch brought an invalidation action against Budĕjovický Budvar’s international trademark BUD, which was declared invalid in Austria for non-use. (Case No. Om 14/01 (Nm 38/90) (Supreme Patent and Trademark Board Dec. 12, 2001); see 94 TMR 303-04 (2004).) Therefore, Budĕjovický Budvar based its cease and desist request on a 1976 bilateral treaty between Austria and the former Czechoslovakia granting protection to the trademark BUD for beer.
Initially, the Supreme Court remanded the case to the court of first instance for amended proceedings in order to determine whether BUD was a simple and indirect geographical indication that would not be encompassed by the Regulation—that is, whether the mark could be protected by a bilateral treaty between a member state of the EU (Austria) and a country that was independent of the EU and not subject to the Regulation (the former Czechoslovakia). (Case No. 4 Ob 127/05p (Supreme Court of Austria Nov. 29, 2005); see 98 TMR 336-37 (2008).)
Meanwhile, on May 1, 2004, the Czech Republic joined the EU, which led to a change in the governing law, in that now the Regulation was primarily decisive. Although BUD had been granted protection in the Czech Republic as an appellation of origin, it was not registered as such according to the Regulation in the course of the country’s accession to the EU. As one designation could not be regarded in one member state as an appellation of origin and simultaneously in another member state as a mere simple and indirect geographical indication, the Supreme Court held that BUD was to be regarded as an appellation of origin, without, however, any monopolizing scope of protection in Austria owing to lack of registration under the regime of the Regulation.
Although every effort has been made to verify the accuracy of items in the INTA Bulletin, readers are urged to check independently on matters of specific concern or interest.
© 2012 International Trademark Association