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Federal Appeals Court Rules in Favor of SPI in STOLICHNAYA Trademark Litigation

August 5, 2013

WASHINGTON, DC, August 5, 2013 — SPI, owners of the famous STOLICHNAYA brand, secured a significant victory today, defeating the Russian Federation’s nine-year battle to take SPI’s rights in the U.S. STOLICHNAYA trademark. STOLICHNAYA is one of the bestselling vodkas in the world.

The U.S. Court of Appeals for the Second Circuit affirmed complete dismissal of all claims asserted against SPI by agents of the Russian Federation in the case of Federal Treasury Enterprise Sojuzplodoimport (“FTE”), et al. v. Spirits International N.V. (“SPI”), et al.

“This is a significant victory for our client, which has fought a long and hard battle to develop and protect its famous STOLICHNAYA brand,” said Hope Hamilton, vice chair of Covington’s Intellectual Property Rights group.

The case is one of many brought by Russian government entities following Russian President Vladimir Putin’s 2001 directive to renationalize intellectual property rights that were privatized during the period of “Perestroika” and the demise of the Soviet Union.

Although the Russian Federation asserted ownership interest in the U.S. STOLICHNAYA mark, it instead tasked agents of the government to appear on its behalf. The Second Circuit affirmed complete dismissal, confirming that only the Russian Federation as the purported “owner” had standing to assert those claims. The Second Circuit also refused to remand the case to permit the Russian Federation to be added as a party, observing that “it is simply too late.”

“The court carefully considered each of the many issues raised by FTE and gave comprehensive reasons for rejecting each of FTE’s arguments,” said Covington partner Eugene Gulland, who served as lead counsel and argued the appeal for SPI. “We expect that this almost decade-long lawsuit is finally at an end and that the courts will deny any further attempts of FTE and the Russian Federation to prolong litigation that should never have been brought.”

The principal Covington team also included Bingham Leverich, with assistance from Oscar Garibaldi, Emily Henn, and Marie Lavalleye.

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