Tropical Tobacco, Inc.—a company best known by its AGANORSA Leaf and Casa Fernández names—has won a ruling over who its trademark for the word Mombacho in the U.S. cigar market.

On Friday, a three-judge panel from the U.S. Patent and Trademark Office ruled in favor of Tropical over a dispute filed by Mombacho Cigars S.A., a Canadian company. The dispute is over the Mombacho name, which Tropical trademarked in 2003, and Mombacho Cigars S.A.

For a while, Mombacho Cigars S.A. sold its cigars under the Tierra Volcán name in the U.S., but it eventually began marketing Mombacho-branded cigars in the U.S., which began a legal dispute. The Canadian company has the rights to use the name internationally, which it does, but notably does not have a U.S. trademark for the word. In June 2016, Mombacho Cigars S.A. filed a lawsuit in Texas, which was shortly withdrawn, and simultaneously filed a complaint to the trademark board, asking the board to cancel Tropical’s trademark due to inactivity.

Mombacho Cigars S.A. claimed that Tropical was not selling, or at best barely selling, its Mombacho brand. It also was not marketing the brand and didn’t include it on its website. Tropical countered, claiming that it was selling small quantities of the brand throughout the years.

The questions were over sales, including specifically over sales between 2012-2015. Mombacho Cigars S.A. claimed Tropical didn’t sell any cigars for three consecutive years. Tropical countered, saying it sold six boxes in 2012, five in 2013 and just two in 2014.

In the end, the panel ruled that Mombacho Cigars S.A. could not prove the claims that Tropical failed to sell boxes during any year-long period and as such, they declined to grant the petition to cancel the trademark on the grounds of inactivity.

The real question is now what’s next.

Paul Palmer of Tropical/AGANORSA Leaf declined to comment on whether the company would pursue legal action against Mombacho Cigars S.A., but Tropical has stated in the past that it does not believe Mombacho Cigars S.A. should be selling Mombacho-branded cigars in the U.S. market.

For its part, Mombacho Cigars S.A. says it will continue to sell Mombacho-branded cigars in the U.S.

“Importantly, the ruling has no bearing on who can use the MOMBACHO trademark in commerce in the United States,” said Mombacho Cigars S.A. in a statement. “This ruling has no impact on day-to-day operations and Mombacho Cigars continues to operate in the United States under its “Mombacho’ flagship banner, as it does in 15 other countries around the world.”

Update (July 10, 2018) — Added statement from Mombacho Cigars S.A. Also, the word “further” has been removed from a sentence regarding whether Tropical would pursue legal action.

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Charlie Minato

I am an editor and co-founder of Media, LLC. I previously co-founded and published TheCigarFeed, one of the two predecessors of halfwheel. I have written about the cigar industry for more than a decade, covering everything from product launches to regulation to M&A. In addition, I handle a lot of the behind-the-scenes stuff here at halfwheel. I enjoy playing tennis, watching boxing, falling asleep to the Le Mans 24, wearing sweatshirts year-round and eating gyros. echte liebe.