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Ethiopia’s Branding Battle
By Joel Starr & Timothy J. Castle

The struggle between Ethiopia and other organizations only seems to integrate deeper, thus complicating the chances of reconciliation or mutual agreements. What are both sides claiming and defending?

Intellectual property issues are becoming increasingly important to participants in the specialty coffee industry. Most prominently, the Ethiopian Intellectual Property Office (EIPO) has recently taken some bold steps, making the unprecedented move to trademark the coffee/origin names, Yirgacheffe, Harrar and Sidamo. The trademark application for Yirgacheffe has already been approved by the U.S. Patent and Trademark Office (USPTO), but the applications for Sidamo and Harrar were denied. The organization, however, plans to appeal those decisions. Typically, these coffees are blended at the mill or co-op with many other farmers’ lots from the same region. This was part of the reasoning behind the USPTO denial of the two marks. This denial seems to be consistent with U.S. trademark and patent law, which views regional geographic terms as descriptive of the product. However, if one can prove these items have an “acquired distinctiveness,” the patent can then be awarded. Therein lies the impetus of all the legal wrangling.

Light Years Intellectual Property, a non-profit organization that helps impoverished nations secure their intellectual property, and Oxfam, a U.K.-based non-profit, have joined forces with EIPO in an attempt to bring media attention to the issue and have succeeded greatly on that front. Meanwhile, Starbucks and the National Coffee Association (NCA) have been vilified by the former organizations as obstructing Ethiopia’s attempts at trademarks. Both organizations have denied these allegations, but Starbucks has recently stated that it will no longer oppose Ethiopia’s efforts, further illustrating the success of Oxfam’s campaign. The Specialty Coffee Association of America (SCAA) seems to support the position of the NCA.

The NCA and the SCAA are apparently in agreement that should the Ethiopian government wish to raise profits for farmers and protect their intellectual property (in the form of these regional names), that they should implement robust certification programs for their coffees, an option deemed too expensive and not powerful enough by EIPO.

Certified Controversial
Cultural differences complicate these intellectual property issues further. The specialty coffee industry prides itself on rewarding producers that produce the best coffee. Meanwhile, Ethiopia has rejected the certification option, arguing that this would require the establishment of yet more organizations. This is unattainable within their current rural infrastructure and abundance of backyard farms, not to mention that they would still have to trademark the names throughout Europe as the EU will not grant origin certification marks to any country outside the EU.

The NCA and the SCAA oppose Ethiopia’s efforts to trademark the regional coffee names. The NCA has filed a protest with the USPTO in opposition of any attempt by EIPO to appeal the previous decision denying the trademarks. Meanwhile, EIPO, Light Years IP and Oxfam are working together to influence U.S. and World consumers into understanding that it is Ethiopia’s right to claim their intellectual property in whatever way they see fit. The NCA, SCAA and Starbucks they argue, are obstructing their trademark initiative in order to protect their own financial interests.

There are points to all sides of the argument, and while the “one for all, all for one” position of the Ethiopians vis-à-vis their desire to build value in regional distinctiveness is one thing, their seeming commitment not to reward quality at it’s source is discouraging. However, others (notably the SCAA), argue that Ethiopians should not be awarded these trademarks for the same reason that the Javanese can not trademark “Java.” This is ironic, since Java has now come to be a generic term for any “cup o’ Joe.” The name, “Java” is a virtual “poster-trademark” for an origin’s farmers losing the equity in their birthright, namely the place and the land, from which their produce arises.

On the other hand, many roasters and two major trade organizations seem to be arguing that if too much equity is claimed too fast by the producers, consumers will be alienated by a sudden increase in prices and abandon Ethiopian coffees altogether. However, is it consumers or roasters that are raising this threat? The assertion that an initiative to protect the name of a coffee’s origin “will hurt growers,” sounds ominous and disingenuous. How, exactly, will the growers get hurt, and by whom? Ethiopian coffees, for some time, have been recognized by many in the trade as an excellent value — a cheap way to add acidity and a host of exotic flavors to a blend. Why would roasters want to pay more for this without a fight?

A Micro-Roaster’s view
We first spoke with Miguel Meza, green coffee buyer for Paradise Roasters and a cupper at the 2006 eCafé Gold competition in Ethiopia, who explained this further to us. “We talked to some best farmers in Yirgacheffe,” he said. “Those farmers said they got 60¢/lb. for cherry. The funds are supposedly distributed to the farmers by the central mill that the co-op has, not based on the quality of the cherries, but only the weight. If one farmer is picking only ripe cherries and another provides a mixed bag, how do we ensure a system for fairness to occur? What everyone would like to see is a better deal for the farmer and more transparency in the purchasing. Are there certain areas of the supply chain that are skimming more than their fair share? It seems to me that the fair trade floor price is about double what the best co-ops in Yirgacheffe are getting for their coffees. If we could see anywhere near fair trade prices sent to the farmer, then it would have an enormous impact.”

It should be known that the pre-export cost of coffee cherry is further inflated by coffee collectors. In Ethiopia, coffee is sold from each farmer to their preferred “Akrabie,” a coffee collector who physically transports the coffee and sells it to processing companies.

Coffee Importer and Broker
Stephen Bauer, coffee trader at Paragon Coffee Trading Co. in White Plains, New York, who also has some experience and knowledge of Ethiopia coffee stated, “I think Ethiopia produces the best coffees in the world. It’s amazing to me that Kona and Jamaican Coffees get the premiums that they do, when the quality of washed Ethiopian coffees clearly buries them. I’d like nothing more than to see the consumer demand for Ethiopia’s coffee increase, so much that the price doubles. The farmers deserve it. Coffee is everything to them. I can only think that more transparency in the specialty sector would increase the premiums they get for their coffees.”

Oxfam
Seth Petchers, of Oxfam International, is the Trade Campaign Coffee Lead, based in Boston, Massachusettes. He said, “We launched a campaign in 2001, seeking that small farmers who produce much of the world’s supply of coffee are able to make a sustainable living. When the ‘C’ price bottomed out in 2001, there was a humanitarian crisis in the world.” He went on to explain, “The ‘C’ price has recovered a bit from 2001, but to put that in perspective, one in four people in Ethiopia live on less than a dollar a day. The country still ranks in the bottom 10 of the U.N. Human Development index (which measures income, health and education among the world’s countries), that’s now even as the ‘C’ has recovered a bit. People may have seen the film, Black Gold recently. There may be different opinions about it, but the story that the film depicts shows the circumstances that Ethiopian coffee farmers are facing. Without pointing the finger, we as a development agency want to help ensure that farmers are able to earn a decent living from production of their coffee.”

It is ironic then that the coffee crisis itself was born out of an effort to provide certain impoverished farmers (specifically of Vietnamese origin) more income.

“The EIPO’s application process at the patent office is not over,” Petchers stated. “The NCA’s letter of protest is part of public record and will be reviewed by the USPTO as part of its process. Specifically, the EIPO is asking that Starbucks recognize Ethiopia’s ownership regardless of whether the trademarks have yet been registered successfully at the USPTO. The EIPO made its decision to pursue trademarks after careful consideration. There may be differences in opinion about that decision, but it would be far more productive to engage in a positive conversation about how to make the Ethiopian proposal work for both parties than to propose an alternative plan that the EIPO has chosen not to accept,” he concluded.

Robert Nelson, president and c.e.o. of the NCA, has filed a letter of protest against EIPO’s trademark applications. According to Nelson, “Registering terms that are geographically descriptive as a trademarks is generally contrary to U.S. law and custom. In May of 2005, the EIPO applied to register the geographic term ‘Harrar.’ In October, the USPTO denied the application because it is prohibited to register geographic descriptors as trademarks. The denial had nothing at all to do with the NCA. The NCA’s opposition was not entered into the deliberative process until mid-August, well after the USPTO denied the applications. Oxfam has manufactured the story that the NCA’s opposition stood in the way of the Ethiopian Government. They also said that Starbucks pressured us into doing this. This is also absolutely untrue. I never indicated, in the embassy, the comments that Oxfam attributed to me in their press release (Oct. 29, 2006), [and] that Starbucks brought to my attention.”

Nelson continued, adding, “One could register a certification mark legally in the U.S., however, that in and of itself will not increase value. To increase value, three additional things have to occur. One, Ethiopia would have to implement a robust system of transparency to ensure that any added value is making it back to the farmer, which is the stated goal of this campaign. Two, the mark has no value; you have to build a brand, you have to invest money into the market place to build a brand around it. Three, you have to enforce the mark.”

Nelson critiqued Light Years’ plan, stating, “They claim they can get the farmers 45% of the retail price of what Harrar and Sidamo are sold for in the U.S. Typically, they go for about $15 for a roasted pound. Therefore, by the time you add in the costs of transportation, manufacturing and so on, a pound of coffee would have to be sold for $50.00. Consumers are not going buy it at that price. Interestingly enough, Light Years points to the ‘Jamaican Blue Mountain’ brand as an example of what’s possible with their scheme. ‘Jamaican Blue Mountain’ is a certification mark, which is what has been recommended for Ethiopia. Trademarking the words Sidamo and Harrar will stifle the industry’s ability to promote the coffee as Sidamo and Harrar, and actually reduces the incentive to pay a premium for good quality coffee from these regions. Without the ability to freely sell and promote the coffee as Sidamo or Harrar, the opportunity to add to the value stream is lost. Once a name is trademarked, it can be licensed out for anything—t-shirts, coffees from other regions. If the name is certified, it can add value, and theoretically, with a transparent system, could be much more beneficial to the farmers.” Nelson concluded by saying, “I am aware of no trademarked geographic descriptor used for coffee in the U.S. that would set a precedent for this move.”

Starbucks
In addition to the assertions against Robert Nelson and the NCA in Oxfam’s press release, other claims were made about Starbucks, which ran in all corners of global media, such as the assertion that Starbucks was trying to trademark the names for itself, and was also selling Ethiopian coffee for $26/lb. that they had bought for “5-10% of the retail price” (Oxfam’s Oct. 29 press release). Starbucks representative, Audrey Lincoff, vice president for global brands communications, stated, “The Trademark applied for was ‘Shirkina Sundried Sidamo’ followed by a ‘tm’, but we disclaimed ‘Sundried’ and ‘Sidamo’ from the trademark. We withdrew the application after the coffee had sold out anyway. We do use the names Yirgacheffe and Sidamo to promote the coffees. Our ‘Black Apron Exclusives’ coffees come from individual farms, co-ops or estates. When we buy a coffee, we don’t know then that it is going to be a ‘Black Apron.’ That’s something that’s determined in the cupping room. Along with each ‘Black Apron’ coffee that we sell, we also award $15,000 to the originating farm to use for whatever they choose. ‘Black Apron’ coffees are sold only by the half pound in specially designed packaging, with significant marketing to support them.”

The Future of This Debate
If you walk into any specialty coffee shop today, you will see the creative efforts and toil of many, many people—from farmers, to processors, to the roaster, and the work of designers and copywriters who attempt to communicate with you about the products offered. As the stakes in this industry grow, the efforts of each group to carve out their slice of equity (and revenue) will increase. So, no one disputes that farmers should have their due, but the details - the how’s and how much’s, and to whom the check should be written - will bedevil us for some time.


Tea & Coffee - March, 2007
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