CZECHVAR BEER HITS UNITED STATES MARKET

BARBARA MURRAY

PRAGUE -- The Czech brewer Budejovicky Budvar, locked in dozens of trademark disputes worldwide with its American rival, the Anheuser-Busch Companies, St. Louis, recently introduced Czechvar beer to compete with Budweiser in the United States, according to a recent Reuters report.

At a news conference held here, the general director of the state-owned Budvar, Jiri Bocek, said the company had been forced to drop the name Budweiser and adopt Czechvar as it looked to gain a foothold in the lucrative American beer market.

"Our goal was to sell our beer in a non-confrontational manner," Bocek said. However, Budvar will keep its name in other export markets. Budvar has fought legal battles around the world for years over rights to the "Budweiser," "Bud" and "Budweis" trademarks.

Under agreements dating back to 1939, Budvar must not sell its lagers under those trademarks in North America. Under various agreements and court rulings, Anheuser-Busch has only limited access to some European markets.

Czechvar, a combination of the words "Czech" and "pivovar," which means brewery, is sold so far in seven states: California, Florida, Illinois, New York, Massachusetts, Georgia and North Carolina.

Budvar is using the distribution chains of World of Wine, Beveragelink Distributors and Czech Beer Importers, located in Darien, Conn., in the U.S.

Budejovicky Budvar is based in the southern Czech city of Ceske Budejovice, or Budweis in German.

Imports of beer from the Czech Republic jumped by 24.4% last year, to 2.6 million gallons, according to the Beer Institute, Washington, D.C.

Stephen J. Burrows, president and chief executive officer, Anheuser-Busch International, said in a statement directed to SN that "The Czech brewer does not have any rights to the Budweiser or Bud trademarks in the United States. The trademarks are some of the most valuable in the world and we will protect them against any attempts by the Czech brewer or anyone else who attempts to infringe upon them.

"We have no objections to the Czech brewer selling beer in the United States under other names they have a legal right to. What they cannot do is infringe on our trademarks Budweiser, Bud or other related terms.

"Faced with a similar situation on a limited basis in several European countries, we have marketed Budweiser under the names Bud, American Bud and Anheuser-Busch for many years."

Anheuser-Busch holds unchallenged rights to use Budweiser in most parts of the world, including virtually all of North and South America and Asia/Pacific territories, Anheuser-Busch's statement continued. "Even in Europe, we sell Budweiser under the 'Budweiser' name in at least 14 European countries and as 'Bud' in at least 15 others. We continue in legal proceedings against the Czech brewer over disputed rights to the Budweiser name in certain markets in Europe to expand our rights."

Further, the company stated, "the Czech brewer does not deserve the rights to the Budweiser name. Anheuser-Busch first started using Budweiser in 1876 -- 19 years before the Czech brewer made their first bottle of beer. We have invested millions of dollars in the Budweiser and Bud brand names over the past 122 years, making them among the most valuable in the world. In 1939, even the Czech brewer acknowledged that we used the Budweiser trademark first.

"It was not until the 1960s that the Czech brewer started using 'Budweiser' prominently on its label. This was long after we built and registered Budweiser into an internationally recognized brand for our beer.

"Recent developments in our ongoing dispute with the Czech brewer have been very positive. Courts in Italy and Spain recently ruled that the Czech brewer must cease use of the Budweiser and Bud trademarks for its beer on all labels, packaging and advertising. In addition, we were successful in canceling the Czech brewer's appellation of origin claims to Bud in Russia, Kazakhstan and Moldova ."