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New York Judge Rules Against Diageo In Explorers Club Lawsuit

August 5, 2014 – Diageo is looking for a legal lifeline now that a New York state judge has ruled for the Explorers Club in its lawsuit over the Johnnie Walker Explorers’ Club line of Scotch whiskies. Law reports Manhattan Justice Charles Ramos has issued a permanent injunction banning Diageo from using the Explorers’ Club name under a state law banning the commercial use of established names for “benevolent, humane, or charitable” organizations without permission. The Club’s members have included legendary explorers from Sir Ernest Shackleton to astronaut Buzz Aldrin, and the organization funds scientific research and educational programs, making it eligible for relief under the state law.

Ramos has not ruled on the scope of his order yet, and Diageo executives have objected to a New York Post report that Ramos has ordered Diageo to remove the three whiskies in the range from travel retail outlets. The company has not received a written copy of the judge’s ruling yet. Following an April court hearing, Ramos ruled that Diageo adopted the Explorers’ Club name to lead consumers to believe the whiskies were “connected or affiliated” with the club, leading to an estimated $50 million in sales. Diageo and the Club had been in talks to license the name before the range was launched in late 2012, but the talks broke down and Diageo went ahead with the launch of the initial Trade Route series.

Read the ruling (PDF)

Diageo’s lawyers had fought the lawsuit on several grounds, including a pending federal lawsuit filed by the Club accusing the company of trademark infringement. Their arguments also highlighted the brand’s global heritage and the Walker family’s history of world travel. However, the Explorers Club lawyers countered with video of a duty-free store employee in London claiming that the Explorers’ Club whiskies were actually made at the Club’s New York headquarters. It was not made clear whether the worker was a Diageo employee or working for the retail outlet, and it should be noted that had the claim been true, the whiskies would not have been able to legally be referred to as “Scotch” whiskies.

Diageo spokeswoman Alix Dunn told WhiskyCast in an email that the company is “extremely disappointed and disagree(s) with the decision of Judge Ramos.”

“We are awaiting official receipt of the order and are planning to seek to stay the injunction while we immediately appeal this case.”

It is not clear whether the ruling extends outside of the US, since the Explorers’ Club range is sold in travel retail outlets worldwide. The 120-year-old Explorers Club is pursuing a separate trademark infringement case in federal court seeking monetary damages for the use of its name.

Editor’s note: This story was updated on August 6 to reflect that the judge’s initial ruling did not immediately order the removal of Explorers’ Club whiskies from retail outlets, but that a permanent injunction was issued barring Diageo from using the Explorers’ Club name. This story will be updated when the judge’s final ruling is issued. 

Links: Diageo | Johnnie Walker | The Explorers Club