Budvar fails in Bud marketing ban bid

- Last updated on GMT

Related tags: Budejovicky budvar, Trademark, European union, Brand

Budejovicky Budvar, the Czech brewer, has taken a different tack in
its attempt to stop arch rival Anheuser-Busch from using the
contested brand name Budweiser. But the bid to stop the US group
from using the name for entertainment and related services - not
simply for the beer itself - has once again ended in failure.

The two companies have been pursuing their David vs. Goliath battle for years, with the Czech brewer arguing that it has the sole right to the Budweiser name because only its beer is made in the town after which the beer is named. A-B, on the other hand, has long held the registered trademark for Budweiser in most countries, and argues that this gives it the sole right to the name.

The situation in the EU, as elsewhere, is complicated. The EU's Office of Harmonisation in the Internal Market (OHIM) has already ruled several times on which company has the right to what name. As a result, Budejovicky Budvar has been able to register its company name (but, crucially, not the Budweiser or Bud names) throughout the EU, despite A-B's protestations, while the US group's attempt to register Budweiser as its trademark in all 25 EU nations was blocked by the prior registration of the name by Budvar in a handful of Member States.

All the previous European lawsuits have focused on the brand name in the beer market, but brewing is big business these days, and far more than simply a matter of selling bottles, cans or glasses. Beer marketing, in all its diverse forms, is now as important to the brewers as making the beer itself, and this was the latest front chosen by Budvar for its battle with A-B.

The Czech group sought to stop its rival from using the Bud or Budweiser name for entertainment and a variety of related services - in other words, effectively trying to curb A-B's ability to use its brand name to sponsor and promote sporting or cultural events, or to advertise its products alongside others which are not related to beer.

This has become a major tool of the brewers in recent years, with sports in particular seen as key marketing tool for beer brands, as beer's portability, its relative weakness and its refreshment capacity makes it the alcoholic beverage of choice for spectators at many sporting events. Indeed, many events are named after the beer brands which sponsor them - the Heineken Cup in rugby, the Stella Artois championship in tennis, and the Budweiser UK Open Darts Championship.

But Budweiser also has a number of other rather more high-profile sponsorships, such as the Williams Formula One team and the Winter Olympic Games in Italy, which would have been seriously affected by Budvar's attempt to block the use of the name, and which would have cost it billions of dollars in lost revenues.

The US group welcomed the OHIM's decision, adding that it was hopeful of winning its appeal against the earlier decision stopping it from registering Bud and Budweiser in all 25 EU nations, a move which would give it EU-wide registration "for services that are important in the marketing of beer,"​ the company said in a statement.

"The EU trademark office has resoundingly rejected Budejovicky Budvar's attempts to block our registration for our Bud trademark,"​ said Steve Burrows, president and chief executive officer, Anheuser-Busch International. "This sets an important precedent as we fight to protect our Budweiser and Bud trademarks in Europe."

This legal dispute between the two companies began in 2001 when Budejovicky Budvar opposed Anheuser-Busch's registration for Bud, and has spread to more than 50 countries worldwide. A-B has won most of the battles, but almost all of these have focused on the beer name - opening up the tantalising possibility that Budvar could attempt similar blocking moves at the marketing level in other countries.

Related topics: R&D

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