## Tuesday, January 15, 2013

### Czech Budweiser defends the trademark in the U.K.

A major loss for the world's #1 brewer

Pilsner Urquell is clearly the most valuable Czech beer trademark – not only because it's produced in my hometown. The brewery belongs to SABMiller these days, the world's second largest brewing empire after Belgium's AB Inbev which is known as the owner of Anheuser-Busch ("Budweiser").

On the contrary, Budweiser is arguably the second most well-known Czech beer after all the Pilsner brands. Yes, I said Budweiser. The Czech brewery (founded in 1895 in its current form but the city has produced OK beer since the 13th century and pils since the 1840s; the brewery is state-owned these days) has been active in legal disputes against its American namesake (founded in 1852 in St. Louis) since 1906. It's been quite some time.

Now, you should understand that it's a genuine David vs Goliath battle: Anheuser-Busch produces a whopping 270 times more beer than the equally named Czech brewery. But just like in the Holy Scripture, David may sometimes win. And it actually often wins. Among the 125 legal disputes about the trademark since 2000, the Czech brewer has won 89 of them, a vast majority.

The newest victory today is among the sweetest ones. The battlefield was the United Kingdom, an important market and a natural transition point between Europe and the U.S.

In the latest verdict that can no longer be appealed, the judge declared that the Southern Bohemian brewery is allowed to share the trademarks such as Budweiser with Anheuser-Busch. The British consumers are intelligent and experienced enough to distinguish the two products, the judge explained.

You may see that the further a court is from Budweis, the actual city – and be sure that its 100,000 inhabitants live in Czechia, not the U.S. – the more likely it is that he or she is ignorant about the basic geography and etymology. Budweis is the German name for a Czech city and Budweiser is really a kind of an adjective derived from this name of the city. So how could it denote an American beer? ;-)

Just to be sure, this is a suggestive map of the Czech lands with the Sudetenland – the areas in which the German minority became a majority at one point – and with the German names. Of course, there are German names for all major Czech towns. Prag, Pilsen, Brünn, Karlsbad, Marienbad, Budweis are sort of self-explanatory. But many Czech readers may want to be assured that Eger, Aussig, Reichenberg, Iglau, Zwittau, Troppau, Teschen are German names for Cheb, Ústí nad Labem, Liberec, Jihlava, Svitavy, Opava, and Český Těšín (a city that split to the Polish and Czech parts after the de iure tied but de facto victorious 1919 Seven Day War between Poland and Czechoslovakia).

If you realize that this whole map was administratively "Czech lands" for 1,000 years, it's kind of incredible that the Germans could have become a majority in such a big chunk of the map, a curiosity that was skillfully abused by Adolf Hitler in 1938. And even in cities where Czechs have never lost its majority and that were at least meters outside the Sudetenland, such as Pilsen, there has always been a culturally important enough German-speaking minority.

But let us return to the legal disputes. George Schneider opened the "Bavarian Brewery" in 1852. Note that Pilsner Urquell was established as an "instant success" in 1842 also because a Bavarian brewer was hired by the distinguished citizens of Pilsen. So the Bavarian and Bohemian beer histories are culturally unified.

When did Anheuser-Busch begin to produce Budweiser? Well, in the 1870s, Adolphus Busch toured Europe and he was trying to steal the ideas and tastes wherever he could. Finally, he was intrigued by one of the "imitations" of the Pilsner beer brewed in Budweis – it was two decades before the town of Budweis established the company we know today – and not-quite-accurately emulated the beer as the American Budweiser.

Anheuser-Busch should really be grateful to the Budweiser, Pilsner, and even Bavarian breweries that this big company isn't sued for stealing the whole concept and recipes of the products that it has benefited from for well over 160 years. Maybe, trillions of dollars should be paid to the city of Budweis as damages. ;-) But the idea that Anheuser-Busch could prevent the Budweiser beer from the original city of Budweis from being sold in places that are rather close to Budweis – for example Britain – sounds utterly ludicrous. From an impartial viewpoint, it's as ludicrous as if the New Yorker couldn't send the magazine in Canada because everyone knows that this title must describe a Czech journal – because a Czech guy toured North America sometime in the 19th century. Or, using a real-world example, it's exactly as if Harvard weren't allowed to call its branches "Harvard" because the trademark "Harvard" belongs to Viktor Kožený, the Pirate of Prague who managed to get an MBA from the "other" Harvard. ;-)

Now, many Americans think that Europe is a country that speaks French, especially in Budapest, so it's not shocking they have no clue where is Budweis and whether it exists at all. So they have no problem with a beer from St Louis that is called Budweiser (in Northern America, the real Budweiser has to be sold as Czechvar). But judges from more geographically educated countries should know better. ;-)

The emotions remain bitter. In some countries, such as Germany, the Czech brewer has a monopoly over the Budweiser trademark. In North America, it's the other way around. And in many other countries including the U.K., the brand is shared. The Czech brewery's representatives already noticed that Anheuser-Busch doesn't want to leave any breathing room for anyone else so it's even bad when the Budweiser trademark is shared. Anheuser-Busch has to be destroyed, they have realized. :-)

When we are already talking about international trade, it's fun to mention that Iran's economy minister said that his country plans to phase out dollars and euros in foreign trade. That's quite an ambitious proclamation and you may be asking what currency they will be using.

Fortunately, the Iranian agency also offers us the picture above. Right behind the one-dollar bill, you see a Czech 50-crown bill. So that must be the replacement! The only problem is that the 50-crown banknote has been out of circulation since 2011. These days, we exclusively use the 50-crown (bimetal) coin, aside from coins and banknotes of other denominations. But if Iran wants to use discontinued foreign banknotes for international trade, it's their right. ;-)

1. Busch toured Europe in the 1870s, not in the 1970s.

2. Typo fixed, thanks. In the 1970s, it would be pretty hard to steal from our national corporations. ;-)

3. " Among the 125 legal disputes about the trademark since 2000, the Czech brewer has won 89 of them, a vast majority."
Well their teams of lawyers must be on a first name basis now. After a day in court they probably meet over a pint of Heineken or Carlsberg to talk about football.

4. State owned brewery uses naming pretext and strong arm government to exclude foreign competitor = how is this something to cheer about?

There is a disturbing undercurrent of chauvinism in your commentary, Boss.

By your own admission, Anheuser-Busch has the precidence by two decades using the Budweiser label. Besides which Budweiser's true success wasn't due to a label, it was due to their pioneering use of pasteurization and refrigerated train cars for distribution.

Shall they pay royalties to the Pasteur Institute also?

5. Apologies, papertiger, I simply find it ludicrous to name a product after a foreign city - and it was not for no good reason: the product is actually emulating a product from that foreign city - and then claim that this name of the product is your trademark and you have a monopoly over it globally.

The "trademark" primarily belongs to the city itself and it's been called in this way - Budweis - approximately since its birth in 1265. Budweiser is just the adjective derived from this name, just like The New Yorker in the case of New York. You can't "reserve" the adjective for some completely general thing that has nothing to do with yourself.

Note that in the semi-legitimate cases of Xerox etc., it's the other way around. The company actually started with it, and then the name of the company started to be used in a more general sense. But Budweiser isn't the case. It's been primarily the general name of the city so as far as I am concerned, whatever the location of the city is, it should be allowed to say whether it wants someone to have a "monopoly" over its name. And be sure they would say No.

Of course that the kosher thing would be for them to agree with the inventors of all other biotechnologies they have been using. Whether this was enforceable is a different issue, depending on whether Pasteur etc. had patents over various things. It actually seems like Pasteur *did* have a patent for pasteurization, at least in the case of wine, see

http://science.howstuffworks.com/life/cellular-microscopic/pasteurization1.htm

so I am afraid that if Anheuser-Busch hasn't paid anything to him, they were acting illegally.

6. I was under the impression that the Czech name was České Budějovice, with the Budweis being a contrived German derivative of the name. So Adolphus Busch didn't steal the name of your town, he adapted the German nickname for your town.

Playing around with the google translator I find every of the other Euro nation states preserve the Czech language flavor in their interpretation of České Budějovice.

The Poles say Czech Budejovice.
The French say tchèque Budejovice.
The Danes say Tjekkisk Budejovice.

And so on.

This leads me to the conclusion that the Germans meant their interpretation as sort of a perjorative. They wanted to rub it in your nose, show you who's boss and the like.

Why would your countrymen embrace a term meant to make small of you?

All roads lead to greed and filthy luqre, and sniffing up an easy way to get more of the same.

Speaking of primacy, why is a Czech surname attached to Budějovice? Is there another Budějovice out there? Do they get confused on the traffic signs and what not?

You say you find Budweiser's success based on it's superior distribution a contrivance? I assure you it's not. Look at a railroad map of the United States. It's not for some vague reason that Anheiser was founded in St. Louis Missouri. It's the major hub of rail activity situated in the geographic middle of the country.

So it boils down to your secret beer recipe. AND since it boils down to that, I say we settle our differences like men, with a beer drinking contest.

My team verses your team, and may the best drunk win.

7. Apologies, papertiger, I am just understanding none of your claims. It makes no sense. What's exactly pejorative about the word Budweis? It was a town where Germans had a majority at some point so be sure that they were very careful not to call it Scheise, for example.

Why does it matter whether Anheuser-Busch "borrowed" the Czech or German name of the city? It's still the same city - one that was bilingual.

Czech Budweis has "Czech" because there also exists the Moravian Budweis in Moravia, the Eastern part of the Czech Republic.

8. Always a struggle making myself understood - Perhaps not the case of the Germans naming a Czech city something vulgar as much as their naming a Czech city in the first place.

The perjoritive is the effrontery of an immigrant minority coming into your land and putting new names to townships, many of which are so dissimilar as to not naturally follow from a straight conversion of the Czech into the Germanic idiom, to places which have been administratively "Czech lands" for 1,000 years.

It's like they move in and think they own the place.

It's not like I mean Budweis, Prag, or Brünn, are pejoratives in and of themselves. All good names for certain, but it reminds me of the North Vietnamese changing the name of Saigon to Ho Chi Minh.

I can see your point in that after awhile it would be like the city is named San Fransico, San Jose, Vallejo. Doesn't mean anything that we kept the Spanish names.
Just means we saved money on street signs.

Speaking of which, what name is printed on the street sign as you drive into Budweis? Is it the České Budějovice?

I find this story facinating, Adolphus lurking about Pilsen in search of the secret Barvarian beer recipe. I imagine him enlisting the assistance of a comely beer wench to pry the secret free.

Which brings us to the next point, a state owned enterprise by definition belongs to nobody. They can't have secret recipes or proprietary rights, at least none that people are abliged to respect. There is a freedom of information act. Ordering up the formula would be akin to ordering the maintenance manual for a Willies Jeep, or the recommended daily allowance guidelines from the FDA. The Beer belongs to the public, a subset of which includes Adolphus Busch.

9. Dear papertiger,

most of the translations between Czech and German are literally straightforward. This is often seen even in units that are as short as 1/4 of a word. Take "ausverkauft" - "vyprodáno" (sold out). "Aus" is "vy", "pro" is "ver", and so on.

It's not clear to me what you want to achieve by the constant repetition of the meme that all German names for Czech things are insults. Yes, no, what of it? Even if it were the case, it has absolutely no impact on these trademark lawsuits, as most of the judges confirm.

Of course that German Nazis of a certain kind - the kind that hasn't realized that the Czech DNA is more Aryan than e.g. the Austrian one - view everything linked to Czechia as pejorative. I have never heard about Prag or Brünn being pejorative - it makes no sense to me whatsoever. But the word "Tschechei" has surely been viewed as a pejorative one in German which is one reason why Germans who don't want to insult you prefer Tschechien.

Needless to say, I don't give a damn. The word "Tschechei" is viewed as pejorative because this was the desired result of years of Nazi propaganda. It's pejorative purely because of the Nazis. You may find the history at some German pages. Fine. Tschechei and Tschechien still mean the same thing which has some objective properties. So of course that if a pejorative word is being used for the same thing and the actual real-world thing is less embarassing than the word is pejorative, the word will just lose its pejorative character over time. Like Škoda (Auto) has lost its pejorative meaning 20 years after it was owned by Volkswagen.

I would have lots of problems with the Nazi propaganda - which seems to underlie most of your comment, too. I have no problem with its impact - some Germans' hardwired feeling that some words are pejorative. One could go on and on and on. But it's still obvious that none of these things has any impact on who is right in the Budweiser trademark issues. As far as I can say, you only wanted to scream some irrelevant anti-Czech racist slurs and humiliate my nation. I have no problem with that. I am used to such things and moreover, I know that some of the criticism is sometimes right. We're just not trying to paint ourselves better than we are - perhaps our national character involves just the opposite.

All these things are fine and your repetition that names for Czech things are all pejorative would normally indicate that you're a simple man with IQ 50 brainwashed by the cheapest Nazi propaganda. All these things are OK but they still don't change an iota about the fact that Budweis is a city in Bohemia and Budweiser is an adjective derived from it. The American founders used the German version of the word because it was easier for them to pronnounce and they were just not good at languages from other language groups. What a shock.

Cheers
LM

10. Ahem, if I may intrude for a moment. Can we have a moment's silence for August Haffenreffer, of whose passing I learned only just today. A Harvard-educated biochemist and descendant of one of the earliest arrivals in America aboard the Mayflower (like my ex girlfriend in Boston), his family brewery produced the legendary Haffenreffer Private Stock Malt Liquor.

A Harvard fellow like Dr. Motl likely never touched the Green Death, preferring John Adams or Anchor Steam Beer instead, but Harvard fellows are rich :)

To an impoverished college student, Haffenreffer produced the biggest bang for the buck and was therefore the beverage of choice.

End of anti-temperance diversion.

11. Hi Eugene, a nice lecture on Hus and the Czech history which was, according to our top 19th century nationalist historian, the history of conflicts with the Germans.

Of course that I am proud about Hus and even hussites despite their being terrorists, robbers, and communists at the same moment. ;-) But the most glorious times of the Czech kingdom would probably be even earlier, early 14th century, the era of Charles IV.

I am not aware of loanwords imported from Czech to German, either. Of course that most loanwords of German origin sound a bit "pejorative", in some sense, they're used primarily by the "most typical working class" to sound cool and provocative, but they're not really problematic.

The co-existence on this territory over the millennium had both positive and negative sides, of course. I would say that the beer industry is a clear example of the positive outcomes of the co-existence.

12. I'll remind you I am not the guy defending the socialist beer for the sake of "national pride".

The more I read this last comment of your, the more I appreciate the genius of Anheiser Busch selling the product to the Belgians.

13. Could you please stop with these obnoxious, insulting lies?

As everyone with a glimpse of honesty who has read this thread knows, I am defending the brewery's right to use the name not because of any "national pride" but because geography and history makes the right self-evident and I am convinced that everyone is equal in front of the law, whether or not he is currently owned by a socialist state, great entrepreneur, or the Devil.

Companies are sometimes sold to others - Budweiser Budvar may be privatized on a sunny day as well, it's a complete coincidence and exception that it's still state-owned - and there is absolutely nothing "ingenious" about selling a company to Belgians, South Africans, or anyone else. When someone pays a pleasing amount of money, it's always equally ingenious. It's a problem of the buyer who must decide whether it's a good investment to buy.

Emotions make you unable to understand basic laws of economics, too.

14. In my country a beer company has to deal with hostile local, city, county, state, and federal governments, just to operate.
Even it's online ads are treated like a pornography.
Throw in a hostile foreign government nursing a perpetual 100 plus year old grudge, that's too much for any company to handle.

So yeah, it makes no sense at all to sell the company to Belgians, who specialize in dealing with Kafkaesque bureaucracies.

If you are having troubles making your patience last try socializing it. Works for grudges.

15. By Nazi propaganda poisoning my mind do you mean Budweiser commercials?

No worries on that score. The Belgians don't hold as high a premium on marketing. For instance over this weekend during the NFL Championship games there were only two commericals from Anheiser Busch, both of them of the generic "Bud" type.

The word "Budweiser" has been stricken from our American airwaves.

Can't say when that happened exactly, because I don't pay attention to such things, but it appears to be policy now.

So congratulations.

16. I prefer Miller anyway.