While many individuals enjoy a cold margarita filled with Tequila on a warm summer day or enjoy the 1958 song “Tequila” by the Champs often played by marching bands, many people do not know that Tequila is now, at long last, a registered United States certification mark.
A certification mark is any name, word, symbol, or device, or any combination thereof, used by or intended to be used by someone other than the owner of the mark and which certifies regional or other origin, material, mode of manufacture, quality, accuracy, or other characteristics of the goods. See 15 U.S.C. §1127.
Tequila seems particularly well suited for this type of trademark registration. It is made from the blue agave plant, which grows primarily in the area surrounding the city of Tequila near Guadalajara, and in other parts of the Mexican state of Jalisco. Note that agave grows differently depending upon the region. While blue agave is specific to Tequila, other agaves are used to make mezcal. There is also a specific process for the distillation and production of Tequila.
Recognizing these unique attributes, a trade association of Mexican companies, Consejo Regulador del Tequila, A.C., based in Jalisco, Mexico filed an application in the United States Trademark Office for a certification mark in August 2003. Publication of the application and mark occurred five years later, in December 2008. Nearly ten years later, the mark finally registered in June 2017. According to the registration, which is U.S. Registration No. 5,225,126: “The certification mark “Tequila”, as used by persons authorized by the Consejo Regulador del Tequila, A.C., certifies that (1) the goods are manufactured in Mexico from a specific variety of the blue agave plant grown in certain regions of Mexico as defined by Mexican law and standards; (2) the goods are manufacturing in Mexico in compliance with Mexican law and standards including fermentation, distillation, aging, the percentage of blue agave sugars and physical – chemical specifications; and (3) the finished product is or contains within it the goods manufactured in accordance with (1) and (2) above.”
Due to the widespread use of the word “Tequila” it was not an easy application. During prosecution, the Trademark Office took the position that “Tequila” was a generic name for a type of alcoholic beverage rather than as a mark of certification; showing that various distilleries around the world claim to make “Tequila” – in fact there were over 50 registered United States trademarks including this term at that time. Because of this, the Trademark Office argued that competitors within the industry should be free to use the term to describe their goods. While the applicant was able to persuade the Trademark Office that the mark was not generic, the applicant had a more difficult time in supporting its position that it maintained adequate control over its goods due to the over 50 registered marks (although it eventually succeeded). Then, upon publication of the mark, it was opposed by Luxco, Inc., who argued and tried to prove that the term “Tequila” was generic. After a nearly 6 year battle, Consejo Regulador was awarded the registration. However, the jury is still out, as Luxco has appealed to the Eastern District of Virginia and the case is currently pending.
The owner of a certification mark must make the mark available without discrimination to anyone who meets the standards or criteria that the mark certifies. However, as you sip on your Anjeo Tequila this evening, consider this….given the high likelihood that the owner of the certification mark is made up of companies which control the production of blue agave or own the land in that region, is there a financial benefit to those involved, aside from the exclusivity awarded by the limited use of the certification mark?
DISCLAIMER: The information provided is for general informational purposes only. This post is not updated to account for changes in the law and should not be considered tax or legal advice. This article is not intended to create an attorney-client relationship. You should consult with legal and/or financial advisors for legal and tax advice tailored to your specific circumstances.