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Rum Punched: DeLay Provision Gone

House Armed Services Chairman Duncan Hunter (R-Calif.), under pressure from the Senate, has ended an attempt by rum maker Bacardi-Martini Inc. and Majority Leader Tom DeLay (R-Texas) to alter U.S. trademark law in Bacardi’s favor.

But opponents of the DeLay provision, including Pernod-Ricard of France, are still concerned that the Texas Republican or another Bacardi ally on Capitol Hill may try to slip the measure into an upcoming omnibus spending package that GOP Congressional leaders are assembling for the unfinished fiscal 2004 appropriations bills.

DeLay had pushed for inclusion of language in the 2004 Defense authorization bill that would help Bacardi in its long-running battle with Pernod-Ricard over who owns the rights to the legendary “Havana Club” rum label.

Senate Armed Services Chairman John Warner (R-Va.), however, objected to DeLay’s provision — along with several other unrelated items — arguing that they did not belong in the underlying Defense authorization bill. Hunter announced on Thursday that he was withdrawing the measure.

“It’s unfortunate when there isn’t sufficient support to step up to the plate and defend American companies from evil dictators” like Cuban President Fidel Castro, said Jonathan Grella, a DeLay spokesman.

Grella was unable to comment on whether DeLay would attempt to include the provision in the omnibus or other legislation before Congress adjourns for the year.

DeLay’s provision sought to alter Section 211 of U.S trademark law to ensure that U.S. and foreign companies are prevented from registering or defending in court trademarks associated with property expropriated by foreign governments.

This change would have benefited Bacardi at the expense of Pernod-Ricard and the Cuban government, which set up a joint venture in 1993 to market Havana Club.

The European Union, on behalf of the French government, filed a complaint with the World Trade Organization over Section 211, a 1999 law pushed through Congress by then-Sen. Connie Mack (R-Fla.) on behalf of Bacardi.

In a ruling last year, the WTO sided with the European Union, saying Section 211 was discriminatory as it currently stands because it only applies to foreign companies. The United States has until Dec. 31 to change its law to comply with the WTO ruling.

“We’re very pleased,” said William Reinsch, president of the National Foreign Trade Council, which represents hundreds of companies that own trademarks in Cuba and which fear retaliation by the Castro regime if the Havana Club dispute is resolved in Bacardi’s favor.

Reinsch and the NFTC, which support an alternative proposal designed to repeal Section 211 entirely in order to bring the United States into compliance with the WTO ruling, said he feared there would be another attempt by Bacardi to get its proposal approved.

“We’re expecting another effort somewhere else, I don’t know where,” said Reinsch.

Bacardi has given more than $800,000 to lawmakers on both sides of the aisle since 1997. Of that total, $43,000 went to DeLay or organizations under his control.

But the Texas Republican vehemently denied the allegation that there was any link between the Bacardi donations and his actions on behalf of the company, which has been involved in the Havana Club dispute for more than a decade.

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