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Cuba's Cigar Company Wins Order Blocking U.S. Cohiba (Update2)
March 29 (Bloomberg) -- Cuba's state-run tobacco company won a U.S. court order blocking General Cigar Holdings Inc. from selling cigars in the U.S. under the Cohiba brand favored by Fidel Castro.

U.S. District Judge Robert Sweet in Manhattan ruled that New York-based General Cigar, a unit of Swedish Match AB, didn't own the rights to the brand and violated the trademark.

Havana-based Cubatabaco owns the mark and exports Cuban Cohibas worldwide except to the U.S., where an embargo blocks the imports. General Cigar, 36 percent owned by the Cullman family, has been making Cohibas in the Dominican Republic for more than a decade and selling them in the U.S since 1992 for as much as $20 each, according to its Web site.

``Obviously, the right to reclaim our mark is very important to us,'' said Kevin Walsh, the lawyer for Cubatabaco, which is also seeking undetermined damages from Swedish Match.

The ruling deals a blow to Swedish Match, which last month said fourth-quarter profit fell 13 percent as the dollar dropped against the krona, cutting into revenue from the U.S. On March 19, the company dismissed Chief Executive Officer Lennart Sunden, who focused on selling snuff and cigars. Sunden said he left in a dispute over his pension.

Sweet said in a 137-page ruling that General Cigar re- introduced its own Cohiba cigar in 1992 to ``capitalize on the success of the Cuban Cohiba brand.'' He also said he found ``strong evidence of intentional copying'' of the brand.

`Smaller Brand'

General Cigar said it would appeal. ``Based on our long- standing U.S. registration of the Cohiba brand and Cubatabaco's acquiescence for almost two decades, we marketed this brand with the confidence that we owned the mark,'' General Cigar Chief Executive Edgar Cullman said in a statement.

General Cigar spokeswoman Victoria McKee said the Cohiba is ``one of our smaller brands.'' She wouldn't comment on how much revenue it generates. The company grows its own Connecticut Shade wrapper tobacco and operates Club Macanudo, a cigar bar in New York City. Swedish Match sells Macanudo cigars and General brand snuff.

Fidel Castro told Cigar Aficionado magazine in an interview that cigars have boosted the prestige of his country and are ``one of the most important export items.''

Castro puffed on a Cohiba Esplendido during the interview.

To contact the reporter on this story:
David Glovin in Manhattan federal court dglovin@bloomberg.net.

To contact the editor of this story:
Patrick Oster, or poster@bloomberg.net.

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