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Not all Buds are equal (except in the UK)

Plucky local St Louis, Missouri, brewer Anheuser-Busch suffered a legal setback in the UK this week, when the House of Lords refused to remove the ownership of the "Bud" and "Budweiser" trademarks in Britain from the Czech state-owned conglomerate Budejovicky Budvar.

Without giving a reason for their decision, the three law lords have effectively put a stop, in the UK at least, to a 20-year long intellectual property row between the two companies. Anheuser-Busch will not be able to appeal this decision, or launch further legal actions under UK law.

The decision also means that the UK market is currently the only market where both companies are in active competition selling different products, both with the Budweiser name.

Suits between the two rivals have been played out, or are ongoing in around 60 countries and markets, with both sides claiming significant victories in various territories. To date, Anheuser-Busch holds the upper hand in Argentina, Australia, Brazil, Denmark, Finland, Italy, New Zealand and Spain, although the UK decision will no doubt be seen as a heavy blow. The UK is Anheuser-Busch's second largest market, behind domestic sales, for Budweiser beer. The Czech brewer, meanwhile, exports to over 50 countries, is allowed to use the Budweiser name in over 40 of them, and can also claim ownership of the Bud trademark in a number of markets.

Bud v Bud: King of Beers v Beer of Kings

In olden times, both Anheuser-Busch and Budejovicky Budvar contentedly brewed their beers, both using the Budweiser name, the name deriving from the town of Budweis in former Czechosolovakia. The Czechs chose the name because they lived there, and were brewing according to a centuries-old formula, while the American company used the name because its founders, Eberhard Anheuser and Adolphus Busch, were German emigrants who brewed dark Bavarian-style beers, before switching to versions of pale Czech Pilsner and Budweiser, according to the same methods. Somewhat cheekily, they even pilfered the Czech beer's nickname, Beer of Kings, albeit with a cunning first and last word switch.

The Anheuser-Busch case, at least their soundbite press statement case, rests largely on the 'we did it before you' argument, having brewed Budweiser beer since 1876. However, Budejovicky Budvar claims to have exported its Budweiser beer as early as 1872, and the brewing method is probably a few hundred years older than yet.

Despite agreements signed between the two companies, in 1911 and 1939, the dispute will most likely only be resolved when every global market and legal jurisdiction has made a ruling one way or the other. That is, assuming the Czech government can privatise its crown beer jewels but manage to keep Budejovicky Budvar out of the clutches of foreign buyers, or can keep enough capital in the company to expand further.

For the record

Anheuser-Busch is in fact the world's largest brewer. Net income last year was $269 million, up 13.7% on 2001. As well as brewing a wide range of beers, Anheuser-Busch owns theme parks, such as Grant's Farm (20 million visitors and counting), and recycles stuff. It's big.

Budejovicky Budvar is owned by the Czech government, and is much smaller. However, it does have access to a domestic market unrivaled by any other. Annual Czech beer consumption is the highest, per capita, in the world, at 160 litres.

True

Sources:
http://www.time.com/time/magazine/1998/int/980713/business.can_they_be_bud15.html
http://news.findlaw.com/business/s/20030217/foodbudweiserrulingdc.html
http://media.guardian.co.uk/marketingandpr/story/0,7494,897907,00.html