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Coffee trademark dispute brewing

Jeff Tyler Oct 26, 2006


KAI RYSSDAL:Coffee drinkers beware. The next time you step into a Starbucks and order a drink made with Ethiopian coffee beans, you’ll be stepping into the middle of a trademark dispute. Oxfam has launched a campaign to pressure the coffee giant into signing a licensing deal with Ethiopia that would recognize that country’s ownership rights for certain strains of coffee beans. But even some of Starbuck’s biggest critics have sided with the company in this dispute. Marketplace’s Jeff Tyler explains.

JEFF TYLER:Specialty Ethiopian coffee beans, like Sidamo, can retail for as much as $25 a pound in the U.S, but back in Ethiopia, impoverished farmers may earn less than $1 a pound for the same beans.

Hoping to take more control over marketing and boost prices, the government of Ethiopia tried to trademark the regional coffee names. Seth Petchers with Oxfam says that would boost profits.

SETH PETCHERS:It could bring in an additional 88 million dollars per year of additional revenue to the coffee sector, and that includes Ethiopia’s millions of small-scale coffee farmers.

That trademark application is floundering.

Oxfam and the Ethiopian government blame the National Coffee Association — and Starbucks in particular — for using its influence to block it. Now, Oxfam is targeting Starbucks with a media campaign to persuade the retailer to sign a licensing agreement.

DEAN CYCON:It’s not about Starbucks. It’s about whether or not Ethiopia should or could trademark the geographic names of their country.

That’s Dean Cycon, president of Dean’s Beans, a fair-trade coffee roaster. A self-described thorn in the side of Starbucks, Cycon is on the company’s side in this dispute. He believes governments shouldn’t own trademarks, and has said as much to the Ethiopians.

CYCON:I suggested that a clause be put in the trademark license that said, any and all funds that are raised pursuant to this trademark license shall be sequestered for the benefit of the farmers somehow. And the Ethiopian government didn’t want to do it.

As an alternative, Cycon suggests the appellation system. That’s what France uses to protect products like Champagne and Roquefort cheese.

I’m Jeff Tyler for Marketplace.

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