Tuesday, October 24, 2006

RUSSIAN STANDARD SUES PERNOD FOR “FALSE ADVERTISING”

WSD reported on Friday, Russian Standard Vodka filed a lawsuit last week against Pernod Ricard and Allied Domecq in a New York district court. Russian Standard accuses both companies of falsely advertising that Stoli comes from Russia (Pernod gained Stoli with the Allied Domecq acquisition.) While Pernod claims Stolichnaya is distilled and produced in Russia, Russian Standard alleges it is distilled in Latvia instead. Let’s take a look at the court documents.

Russian Standard claims: “Defendants have falsely and misleadingly marketed, sold and advertised their Stolichnaya products as ‘genuine Russian,’ and have deliberately and intentionally caused public associations of their Stolichnaya products with Russia, with the quality of Russian vodka, and with the Stolichnaya vodka sold in Russia.”

As a result, defendants’ actions “have caused a likelihood of confusion and actual confusion, have caused damage and injury to Russian Standard and the consuming public, and have caused and continue to threaten irreparable harm for which there is no adequate remedy at law.”

“Defendants’ conduct as described hereinabove has been done knowingly, deliberately, intentionally, maliciously, fraudulently, willfully or recklessly.”

When Russian Standard began its accusations in April, Pernod reiterated “that Stolichnaya is truly Russian, being distilled and produced in Russia using Russian grain and water. It is then shipped in bulk and bottled in Latvia.”

Although share of Russian vodkas have dwindled in recent years, focusing on its Russian origin in ad campaigns is a big part of Russian Standard’s brand image. The company recently kicked off its “Vodka is Russian” ad campaign in the U.S. for the company’s flagship brand, Imperia vodka, which conveys a message that Imperia is the only truly authentic Russian vodka sold in the U.S. Therefore, pushing Pernod’s Stoli out of the picture certainly would help the brand, especially in backing up its claims of being the only “true Russian vodka.”

Now’s it’s up to the courts to decide. WSD will keep you posted.