Editor’s Note: The following is a book excerpt from Kim Fellner’s Wrestling With Starbucks (Rutgers University Press, 2008).
Tadesse Meskela, general manager of the Oromia Coffee Farmers Cooperative Union in Ethiopia, an organization of 115 cooperatives representing more than 102,000 coffee growers, apparently had mixed feelings about Starbucks. In an interview transcript from a June 2006 Starbucks meeting on African coffees, he spoke warmly about the company’s role in advancing the well-being of Ethiopian coffee farmers: “This year we sold more coffee to Starbucks and they paid us a very good price, which is better than Fair Trade price. So we want this type of pricing for our coffees to improve the lives of coffee growers.”
Yet there he was in Black Gold, a documentary released that year to wide acclaim. Filmed between 2003 and 2005, it followed Tadesse’s valiant struggle to increase the income that Ethiopian coffee farmers realize from their crops. It also featured Starbucks as villain, implying that the company made its millions off the backs of poor farmers.
For a while Dub Hay, Starbucks’ senior vice president for coffee purchasing, wondered if Tadesse had been unaware that the film was going to portray Starbucks as a bad guy. After all, the company had been involved with Ethiopia for more than thirty years, even before the arrival of Howard Schultz, and had been buying coffee from the Oromia Farmers Union since 2003. But Dub hoped in vain. Tadesse was in fact a man on a mission; and in the fall of 2006, he emerged as a key spokesperson for the Ethiopian government and for the international anti-poverty NGO Oxfam. Their prime demand was that Starbucks recognize Ethiopia’s right to trademark the names of its gourmet coffee regions. “Coffee shops can sell Sidamo and Harar coffees for up to $26 a pound because of the beans’ specialty status,” Tadesse said in an Oxfam press release. “But Ethiopian coffee farmers only earn between sixty cents to $1.10 for their crop, barely enough to cover the cost of production. I think most people would see that as an injustice.”
If Starbucks felt betrayed by the two faces of Tadesse, Tadesse felt betrayed by the two faces of Starbucks. Yes, it pays better than fair trade prices and is arguably the most ethical major coffee company in the world. But it also uses its reputation to avoid sharing real power.
The conflict over Ethiopia’s right to trademark its coffee lasted for roughly two years and involved three continents, a slew of public demonstrations, and a steady stream of media reports. The themes echoed those that had ignited the 1999 Battle of Seattle: economic relations between the global south and the global north and the role of corporations in translating capitalism for performance on the world stage. While flat-worlders like New York Times columnist and author Thomas Friedman enthused over the opportunities, not to mention the inevitabilities, of globalization, detractors saw it as a new version of imperialism, a way for the north to munch up both material and cultural assets. “Do we really need a Starbucks on every corner of every city in the world?” asked political theorist Benjamin Barber in the Philanthropy News Digest. “That’s not economic competition; that’s cultural monopoly, and it ends up destroying local cultures.” Even Friedman acknowledged that, without some pushback, the “electronic herd” of global finance will turn indigenous culture “into a global mush, and their environment into a global mash.”
By 2006 Starbucks was certainly a global player. Though Schultz originally conceived of the company as a vehicle to import coffeehouse culture to the United States, he soon discovered he could export his own version back to Europe and to anywhere else in the world that seemed ready for the Starbucks coffee experience. As he told his shareholders at the 2006 annual meeting, “In 1996, we began to dream we could be an international business”; and that same year the company opened its first overseas store, in Tokyo. By 1999 Starbucks was solidifying its presence in Britain and aiming to have five hundred European stores by the end of 2003. By early 2006 , Starbucks had more than 3,000 company-owned and licensed stores outside the United States in thirty-seven countries. Its feet were firmly planted in China, its toes testing the market in Brazil, its eyes turned toward India. To Starbucks, this behavior was in no way predatory. The company was merely sharing the delight of Starbucks at an international level and, of course, increasing the bottom line.
There were difficulties, of course. In China, state news anchor Rui Cheggang took aim at a Starbucks store lodged in a corner of the imperial palace of the Forbidden City, calling it “a symbol of low-end U.S. food culture” and “an insult to Chinese civilization” and generating a torrent of response that pitted cultural nationalism against imperialism in round after round of heated blogging. And sometimes the war of words concerned real wars. One set of bloggers castigated Schultz as a Zionist and accused Starbucks of anti-Arab bias, while others condemned Starbucks for closing its Israeli outlets. In fact, Starbucks had closed its stores in Israel because of poor management and performance, while maintaining numerous stores in Arab countries; and Schultz, in real life, appeared to favor a two-state solution. In 2006, when fighting in Lebanon temporarily shut down the Beirut Starbucks, the company continued to pay staff wages and benefits throughout the conflict.
Ethiopia is blisteringly poor country, ranked at 170 out of 177 countries in the 2005 United Nations Development Program Human Development Report. More than 25 percent of its people survive on less than a dollar a day; the average per-capita gross domestic product is less than 1,000 dollars. Although the country produces barely 6 percent of the world’s coffee, more than 1.5 million smallholders grow the crop, which sustains 15 million people and accounts for 40 to 60 percent of the country’s total exports. A significant percentage of the crop (estimates vary widely, depending on whom you ask, from a low of 15 percent to a high of 45 percent) is specialty coffee from the Harar, Sidamo, and Yirgacheffe regions, all prized for their quality and unique flavor.
In 2006 Starbucks purchased fewer than 10 million pounds of coffee from those regions, the equivalent of 2 to 3 percent of the company’s worldwide coffee purchases and a relatively small percentage of Ethiopia’s total coffee exports. Most of the nation’s coffee ends up on the arabica commodities market, where world overproduction has kept prices low. Moreover, because the country has no port, coffee must travel 1,000 miles to be shipped from Djibouti on the Gulf of Aden. In short, low prices and high marketing costs, combined with an outdated coffee auction system and a weak infrastructure, mean that most small coffee farmers stay poor.
To combat this destitution, the Ethiopian government decided in early 2005 to pursue an innovative strategy: it wanted to trademark, or brand, the names Harar/Harrar, Sidamo, and Yirgacheffe to command a greater share of the prices that its best coffees fetched at the retail end in the global north. With trademarks, the country could charge distributors a licensing fee for their use. The European Union, Japan, and Canada all approved this trademark scheme. But when the Ethiopian intellectual property office approached the U.S. Patent and Trademark Office to register Sidamo, they were surprised to discover that something called Shirkina Sun-Dried Sidamo was already in the pipeline. Starbucks had gotten there ahead of Ethiopia, and the patent office refused to consider another trademark that included Sidamo.
Trouble began when the Ethiopian government tried to contact Starbucks to resolve the matter. Yet the origins of the conflict were innocent enough. In 2002, Starbucks had approached the Fero Farmers Cooperative in Ethiopia and asked members to experiment with a different way of processing their coffee. Dub Hay explained, “We took the cherry, did not ferment or process it, just put it on drying beds and let it dry in the sun. There’s mucilage around the seeds, and when you don’t wash that off and allow it to sit, some of that flavor and the sugars are absorbed in the bean. It’s more bold, more up front, not as crisp, clean, or lemony, but you get all these wild flavors.”
It wasn’t an instant success. “We had to convince the farmer co-op it would be a good experiment, and the first year we did it, it was a complete disaster,” Hay recalled. “The coffee was undrinkable. We didn’t have all perfectly ripe berries, so some of the flavors were bad. We paid them for the 40,000 pounds of coffee and threw it away. But we convinced them to try again using only perfectly ripe beans, and we got this unique flavor; I’d never tasted anything like it. We asked the co-op to help us name it and called it Shirkina Sun-dried Sidamo, Shirkina meaning “partnership” in the local language. It became a Black Apron special and was a huge partner and customer favorite.” At this point Starbucks applied to the U.S. Patent Office for the right to trademark Shirkina Sun-Dried Sidamo.
Most of us are generally familiar with the notion of copyrighting original literary and artistic work, patenting inventions, and trademarking brand names and logos. According to the Patent Office, “A trademark includes any word, name, symbol, or device, or any combination, used, or intended to be used, in commerce to identify and distinguish the goods of one manufacturer or seller from goods manufactured or sold by others, and to indicate the source of the goods. In short, a trademark is a brand name.” But as a new era of global trade has developed under the jurisdiction of the World Trade Organization, a new raft of intellectual property laws has also emerged. Known as Trade Related Aspects of International Property (TRIPs), they were passed in 1995 to prevent entities (mostly in developing nations) from stealing or misusing corporations’ intellectual property. TRIPs place the burdens and costs of enforcement on the poorer countries. Yet its proponents argued that strict adherence would encourage affluent nations to lavish their poor cousins with new business ventures and inventions to address problems of hunger and health.
Nor surprisingly, however, the results are hardly salubrious. In addition to normal corporate battles to protect brand and lucre, there have also been breathtakingly venal moves to assert dominion over various kinds of property. Most notorious have been the efforts of big pharmaceutical companies to protect drug patents against the development of cheaper generics to treat HIV/AIDS and cancer. Although the TRIPs had originally included a few safeguards so that developing nations could produce generics, companies such as Novartis and Pfizer have lobbied to weaken even these modest protections. They argue that the monetary rewards promised by intellectual property are necessary to encourage scientific innovation. India, which rejected the patent for a cancer drug because a similar generic was available at one-tenth the cost, has been sued by Novartis to capitulate.
The story is similar in agriculture, where Monsanto has become a monster, harvesting seeds for subsistence crops such as maize, rice, and cotton from developing countries and then subjecting those seeds to genetic engineering. The new seeds, ostensibly engineered to withstand disease and produce higher yields, are then resold to the very same countries. The genetically engineered strains supplant heritage varieties and are often bred to germinate for one year only, forcing farmers to buy new seeds every year rather than save part of the crop for replanting. In other cases, farmers in the origin countries are prohibited by law from creating their own supply. Thus, Monsanto both wipes out native species and forces poorer nations into greater dependence and poverty.
Starbucks’ invocation of intellectual property laws has been less disastrous, but it’s often been silly. A number of conflicts have arisen over store names deemed too similar to Starbucks’ own. Targets have included tiny Sambucks in Astoria, Oregon; HaidaBucks on Queen Charlotte Island in Canada; and Starstrucks in India. This seems rather like the lord of the manor pursuing poachers: both predatory and petty. But Starbucks also protects particular blends or products. You would, for example, be unwise to market Gazebo blend coffee or a Frappuccino. Thus, the Ethiopian situation was a notable reversal in the pattern. When the company tried to brand its new method of processing Sidamo beans, it was accused not of overzealous trademark enforcement but of stealing Ethiopia’s birthright.
Ron Layton, an attorney from New Zealand, has developed and promoted intriguing ideas on the use of intellectual property as a tool for development in the global south and started a company called Light Years IP to advance the work. In a 2004 World Bank publication titled Poor People’s Knowledge, he argues that intellectual property provides more profit than manufacturing and agriculture do: “The IP laws, although somewhat disadvantageous to developing countries, are available for enforcement in the developed markets. Fair trade interventions offer the needed model for market access and delivery systems that ensure that revenues from IP exports do alleviate poverty.”
In The Coffee Paradox, authors Daviron and Ponte note that specialty coffee commands high retail prices not because of its tangible qualities but because of the symbolic qualities of the brand or experience. Ironically, they find, the higher the quality of the coffee, the lower the percentage of its retail price that goes to farmers. So long as farmers in producing countries sell commodities and distributors in consuming countries sell brands, the suppliers at the beginning of the chain will suffer increasing income disparity; they can only change the equation by capturing some of that intangible value for the countries of origin.
“It’s not really value-added,” Ron Layton corrected me when I used the term. “I call it ‘value inherent.’ We are shifting away from competing as a commodity to the inherent value of the coffee. If you have a shirt by a major designer and an identical one from an unknown, what makes you pay two hundred dollars for one and not the other? It’s the brand, the nonphysical enhancement . . . So we realized there’s a big intangible value to this coffee that they’re not getting a share of, and how do we get hold of that?”
Ethiopian coffee was a test of the intellectual property approach: the names of the indigenous coffees were already somewhat familiar in the developed world, and fair trade models were already in play. Layton and his firm assisted the newly formed Ethiopian Intellectual Property Office and its director Getachew Mengistie to formulate a plan that led them to the U.S. Patent Office, to Starbucks’ Shirkina Sun-Dried Sidamo, and to the company’s wall of silence.
No one at Starbucks is willing to say how this happened, but unfortunately for all concerned the original correspondence from the Ethiopian embassy was routed to an intellectual property attorney in the Starbucks legal department and was ignored by anyone whose viewpoint might have transcended legal considerations. Beginning in March 2005, K. E. Kassahum Ayele, a former Ethiopian ambassador to the United States, tried to meet with Howard Schultz to resolve the issue of the Shirkina application. He received only a curt response from a company attorney and an invitation to a dinner honoring Schultz. A press release from the Ethiopian embassy quoted Ayele as saying, “I asked to engage in substantive discussion with Mr. Schultz on the issues, not to have a debate with a lawyer and attend award ceremonies. I expected reasonable consideration and friendly dialogue, but was shocked at Starbucks’ refusal to meet and to discuss the situation.”
The Oxfam Intervention
Then Oxfam stepped onto the scene. The U.K.-based nonprofit describes itself as a “development, relief, and campaigning organization that works with others to find lasting solutions to poverty and suffering around the world.” With the millennium coffee crisis, Oxfam’s “Make Trade Fair” campaign focused on the plight of coffee growers.
In the past, Starbucks and Oxfam had been wary partners in several small projects. For instance, they had collaborated to help a small Mexican farmers’ cooperative improve the quality of its fair trade coffee; and in 2004 Starbucks U.K. had contributed 179,000 dollars to a jointly sponsored rural development effort that included irrigation and women’s literacy programs in Ethiopia’s East Hararge region. To avoid the appearance and prevent the reality of selling out, each party reserved the right to criticize the other. At the time of the East Hararge effort, Phil Bloomer of Oxfam U.K. told the Financial Times, “We want to maintain a constructive and critical relationship with Starbucks. We hope they’ll challenge us, and we know we’ll continue to challenge them.”
When the Ethiopian trademark became an issue, the moment of challenge arrived. Seth Petchers, head of Oxfam America’s coffee campaign, knew one of Ron Layton’s Light Years staff members and had been following the new strategy with interest. “In the spring of 2005,” he told me, “I got a call from Light Years and the Ethiopian government, expressing frustration about not being able to get in touch with Starbucks. Since we knew about coffee and had a relationship with the company, we got involved.”
Oxfam and Starbucks tell somewhat conflicting stories about communications during the eighteen months between Ethiopia’s first effort to talk with the company and Oxfam’s public campaign to change the company’s mind. It rapidly became apparent, however, that the issue involved more than miscommunication. Starbucks did not want to sign a licensing agreement. “It’s not a good solution, and the details are unacceptable,” Dub Hay protested to me early in the conflict. “We’d have to consult with them about how we package and market our coffee. It’s just not tenable. And there’s no guarantee that the fees would ever reach the farmers. It’s not good for them either.”
The company expressed agreement with the underlying goal of getting more money to the Ethiopian farmers but advocated instead a geographic certification, or appellationsomething comparable to the name protections granted to Wisconsin cheddar and French champagne. Certification would allow Ethiopia to protect the product’s good name and authenticity. Yet as its advocates pointed out, the appellation approach relies on market demand to set higher prices rather than paying direct fees for use of a name.
According to Oxfam, both the farmers’ welfare and Starbucks’ own reputation were indisputable arguments for signing the licensing agreement. By obstructing the trademark filing, the company was depriving Ethiopia of critical additional revenues, a figure that advocates estimated at 88 million dollars roughly eighty cents more per pound of coffee. There were also behind-the-scenes discussions at the Specialty Coffee Association of America (SCAA) and the National Coffee Association (NCA); and reports of those discussions slipped into advocates’ hands and into cyberspace, alleging that Starbucks was obstructing the trademark filings while publicly denying any such role.
Yet there’s ample evidence that many association members agreed that licensing was a bad idea. “Ethiopia got some very poor advice from both the marketing and legal standpoint” was the personal assessment of Ted Lingle, former director of SCAA. “No one wants to beat up on the Ethiopian farmer; there’s no PR value that comes out of that. But the specialty market doesn’t really need Ethiopian coffees.” He noted that, out of 3 or 4 million bags of coffee from Ethiopia, perhaps half a million are high-end coffees. “The world has otherwise thought of them as a Brazil substitute, a commercial supply. Their market reputation really isn’t much, and now they feel they can inflate what little they have. The market is not going to support it. The effort is misguided and doomed to fail.”
Nonetheless, in 2006 Oxfam and Light Years convened a cadre of progressive advocates, including Co-op America and Catholic Relief Services; they envisioned a “big noise” strategy waged with street demonstrations, letter-writing campaigns, and a heated Internet presence to pressure Starbucks into an agreement. These factors alone would have been enough to create a collision course. But Starbucks was about to be hit from another quarter as well. In 2003, two young British filmmakers, Marc and Nick Francis, decided to make a documentary on how the poverty crisis in Ethiopia was intersecting with the coffee industry. Nick Francis told me:
I first went to Ethiopia in 1997, and when I was there, I was thinking, “I’m in the birthplace of coffee, yet this is one of the poorest countries. How can that be?” Then in 2003, we learned that Ethiopia was facing another famine, like the one in ’84 that led to the Live Aid concert. But unlike ’84, even the richest coffee-growing areas were caught up in the crisis. At the same time, we were seeing more and more coffee shops everywhere, in Britain, in the U.S. There was this mushrooming coffee industry, but the people who grew it were in this absolute humanitarian emergency. We wanted to make the connection between the two, between the coffee-consuming public and the growers.
The result of their two-year odyssey was Black Gold, which premiered at the Sundance Film Festival on January 24, 2006, generating a buzz of its own. The documentary follows Tadesse Meskela from the Ethiopian coffee fields and the Oromia offices in Addis Ababa to the trade shows of Europe and the United States to seek a market for the beans. “We wanted to feature a protagonist from Africa who is out there doing something rather than waiting for charity and goodwill,” Nick explained. For the filmmakers, Tadesse’s work challenged our western notion that Africa survives solely on aid from the developed world.
By way of the farmers in the cooperative and Tadesse’s efforts on their behalf, the film exposes the web of trade regulations that keep farmers in developing countries poor, even while transnational corporations in the global north prosper. Women painstakingly sort millions of beans; and viewers observe the hunger and substandard housing that accompany poverty. Juxtaposed with these images are the cosmopolitan cafés of Europe and America, the comfort of conspicuous consumption, the places of commerce where deprivation in one part of the globe is turned into the wealth of another.
And like most recent efforts to hold the coffee industry accountable for the plight of the farmers, the film can’t resist featuring Starbucks as a predatory Goliath. In a scene praised by Washington Post film reviewer Ann Hornaday, the camera pays a call on the original Starbucks store at Seattle’s Pike Place Market, where two ever-so-bubbly baristas welcome the crew. Hornaday comments, “During the film’s most painful sequence, his [Tadesse’s] efforts and Ethiopia’s persistent, crushing famine are juxtaposed with the vapidly cheerful corp-speak of two Starbucks baristas.”
Yes, the baristas are excessively perky as they purvey coffee and the Starbucks experience; yet they are also model employees, supportive of each other, efficient, and proud of their company. At the time of the filming, the young women were entertaining a tour from the Specialty Coffee Association, to which the filmmakers had attached themselves to avoid asking Starbucks or its employees for permission to film. How could these young women know that they would be featured as unwitting symbols of the harm that transnational coffee giants inflict on poor Ethiopian farmers? At the progressive screening I attended, they were also the objects of disparaging audience laughter. Great, I thought. Because these Brit filmmakers couldn’t, or wouldn’t, interview Howard Schultz, they’re making two low-wage workers the target of their comparison.
Nick assured me this wasn’t his intention: “People are laughing at what they’re saying, like ‘Starbucks touches people’s lives all over the world,’ not at who’s saying it. The intention is not to mistreat them but to illuminate the issues, because they are the foot soldiers.” He said that the filmmakers had spent six months trying to interview someone from Starbucks for the film, to no avail. Former director of media relations Audrey Lincoff recalled meeting the filmmakers after a conference presentation and told me they had once asked to interview Schultz on very short notice, which he was unable to accommodate. The filmmakers claim that subsequent calls went unanswered. The final frames of the film say that the big-four coffee transnationals and Starbucks refused to comment.
When I noted that Starbucks, which buys just a small percentage of Ethiopian coffee, had been made the villain of the piece rather than Nestlé, Proctor & Gamble, Kraft, and Sara Lee, which buy exponentially more coffee, Nick suggested that my cultural bias was influencing my viewpoint. “The film isn’t about Starbucks,” he insisted. “They’re a very tiny part. It’s just that in the U.S. people look for Starbucks; it’s the cultural reference point that gets illuminated. It’s very much a lifestyle, and people may see it as a critique of their own lifestyle choice.” Nevertheless, the film sent a far sharper message about Starbucks than it did about the companies more accountable for Ethiopia’s plight. And with the conflict about trademarks mushrooming, Black Gold itself had struck gold: the filmmakers had received the perfect media hook for their film, and they lost no time in making it part of their publicity campaign.
Starbucks’ response to the film was curiously flat-footed. At the beginning of June 2006, the company held an African Coffee Celebration, touting the continent’s gourmet coffees and implicitly Starbucks’ good works. Although the producers of Black Gold suggest this was purely an effort to counter the bad publicity generated by their film, the event had actually been planned many months earlier, and Tadesse Meskela had been invited to participate. As it turns out, Tadesse did speak at the Starbucks event, praising the company’s prices and projects in Ethiopia. Then he attended the Seattle screening of Black Gold, where he condemned the company’s perfidy. Meanwhile, although the Starbucks staff had seen the film, no one seems to have approached Tadesse to acknowledge or discuss his concerns or explore ways to blunt the mounting crisis.
There were other missed opportunities. Not only had the coffee purchasing department been working with Tadesse and his cooperative for a number of years, but Seth Petchers of Oxfam and Starbucks vice president Sue Mecklenburg had developed a working relationship during prior collaborations. Both Petchers and Mecklenburg sidestepped questions on these matters, but sources suggest that Mecklenburg had advocated a course of engagement different from the one the company actually followed and that she met internal opposition from hardliners. As a result, chances to engage the parties went begging, apparently overcome by distrust and organizational tensions about how to respond.
Faced with growing criticism and the threat of a public confrontation, Starbucks decided to back off. When the trademark for Shirkina Sun-Dried Sidamo was approved on June 25, 2006, the company walked away from the application. “We dropped it,” Dub Hay told me. “All we had wanted was to protect this coffee, the shirkina sun-dried process that we had worked on.” He was aggrieved and angry. “Hurting farmers was the farthest thing from what we were trying to do. Our purchases in Ethiopia over the last four years are up 400 percent, our prices are up 40 percent. We’re buying more Ethiopian coffee than we’ve ever bought before and paying premiums no one else has paid. So here we are, thinking we’re doing absolutely the right thing helping the farmers and the co-ops, and someone’s thinking that we’re hurting them. It wasn’t worth it. We gave it up.”
But despite Starbucks’ withdrawal, criticism continued. To make matters worse, Ethiopia’s advocates again accused the company of pressuring the National Coffee Association to oppose the trademark filings in its stead. Starbucks and the NCA both vigorously denied this assertion, but none of the advocating groups believed them. “From my own experience of Starbucks in 2005 and nearly all of 2006,” wrote Ambassador Ayele, “ . . . this looks to me like a clear attempt of the company to hide behind an industry association, while Starbucks continued in its determination to prevent Ethiopia from carrying out its trademark program.”
When I saw Dub Hay in mid-October 2006, he was still convinced that trademarking was a poor strategy. “Oxfam wants us to sign, and they won’t listen to why we don’t think it’s a good idea,” he lamented. At the end of that month, the story broke in the foreign press, with Oxfam in particularly strident form. “Starbucks’ behavior is indefensible,” Petchers inveighed to a reporter. “Starbucks works to protect and promote its own name and brand vigorously throughout the world, so how can it justify denying Ethiopia the right to do the same?” Another Oxfam spokesperson told the BBC that the company’s behavior “stinks of corporate bullying.”
To stave off the escalating controversy, Starbucks again offered to help Ethiopia develop and implement a geographic coffee certification, but the offer did nothing to diffuse the conflict. Oxfam New Zealand staffer Linda Broom told a reporter, “We’ve been lobbying from behind the scenes, but Starbucks has turned a blind eye, so now we’re hoping for a public backlash.”
By November, the Ethiopian government, Oxfam, and Light Years effectively mounted a coordinated effort to compel Starbucks to sign the licensing agreement. Over a period of a few months, more than 90,000 activists and consumers contacted the company to demand a change in its position. On December 16, 2006, Oxfam coordinated a day of action in the United States and abroad. Activists leafleted stores, picketed with posters picturing Ethiopian farmers, and enlisted the support of local Ethiopian communities. On a YouTube video, newly educated customers urged Starbucks to pay Ethiopian farmers more for their coffee and recognize the trademarks.
Dub Hay responded for the company with a YouTube offering of his own, sincere and low-key but wrongly impugning the legality of the trademark strategy. And according to reports, former Starbucks CEO Jim Donald, meeting with Ethiopia’s prime minister, Meles Zenawi, didn’t seem to know the difference between a trademark and a certification. “I can’t talk about the details because I don’t understand them,” he told a London Times reporter. “I’m not a trademark lawyer.”
Its more aggressive opponents remain convinced that Starbucks, like all corporations, is incapable of making an honest mistake. All errors are attributed to bad faith; the company’s motives are berated, its missteps celebrated, and all its actions viewed through a prism of cynicism. The supercynical argue that the accuracy or inaccuracy of the particulars doesn’t really matter because the company is surely bad enough to deserve the negative blast. Hence, Reverend Billy of the Church of No Shopping had no problem with saying, “You’re stealing trademarks from Ethiopian coffee farmers. Starbucks is the devil.”
But some progressives take a more nuanced approach. The National Labor Committee, run by Barbara Briggs and Charlie Kernaghan, was established to help protect worker and human rights in the global economy. Since 1991, the committee has focused U.S. consumers’ attention on offshore clothing sweatshops, most notably exposing the Honduran sweatshops that sewed the Kathie Lee Gifford line for Wal-Mart. Briggs and Kernaghan are masters at holding corporations accountable, often through the canny use of publicity to magnify their organizing. Over the years, they’ve developed a sophisticated view of corporations and tactics.
Briggs acknowledges that, in choosing a public target, “the calculus includes how well-known the brand is, and how much the brand will want to protect its image. It’s not so much how good or bad the company is on a theoretical level, but what we actually see on the ground.” She suggests that the difference in how to proceed depends a lot on what happens once a human or workers’ rights issue has been flagged. “We’ve found that even the best companies have some pretty lousy places,” she told me. “The difference is, the good companies called us and told us what they were doing to correct the problem. We didn’t hear that from Wal-Mart.”
A key criterion for a confrontation and the way in which it is waged is whether it benefits the people in whose name the effort has been undertaken. Not all struggles for greater justice can be won, certainly not in the short term, but it helps to have a meaningful and achievable outcome in mind. For some radical campaigners, like the IWW, the publicity sometimes seems more important than the outcome. Ethiopia, on the other hand, needed real solutions and an agreement. “Starbucks is a valuable partner,” Getachew Megistie of Ethiopia’s Intellectual Property Office told me. “We just want to make the relationship more meaningful. Both they and we want to stop the loss of farmers and small traders. And we want to resolve our differences amicably.”
It looks like Getachew will get his wish. At the fourth African Fine Coffee Conference in Addis Ababa in February 2007, Dub Hay announced that Starbucks would not oppose Ethiopia’s trademarking initiative: “It is Ethiopia’s absolute right to take the course they think is best for Ethiopia and we will not oppose that.” He sweetened the Starbucks response with commitments to double the amount of coffee the company buys from Africa, jumping from 6 to 12 percent of its total by 2009. He also promised a 1-million-dollar revolving microloan fund for Ethiopia and 500,000 dollars to CARE International for a literacy program in the country. And the company committed to opening a farmer support center in East Africa.
“We made a mistake,” Jim Donald told me, echoing, or maybe leading, others in the company to the well. “We treated it as though it was a legal issue. But it wasn’t. It was a relationship issue.” Bingo. Starbucks took a bit too long to reach this conclusion, but it finally did. Although company experts still seemed to think the licensing idea was misguided, they had decided to suspend judgment and help Ethiopia’s experiment move forward.
When I did my last interviews at Starbucks on April 3, 2007, Howard Schultz and Jim Donald were meeting with representatives of the Ethiopian government. A month later Starbucks agreed to negotiate a licensing agreement, and the deal was inked in late June. As has so often been the case, the conflict drew massive attention. By comparison, the resolution received little notice.
Given the trademarking scheme’s experimental nature, there is no way to know if the strategy will be successful. The greatest boon to farmers might be Starbucks’ commitment to buy more coffee, make more loans, and offer greater technical expertise. But at least the campaign had moved Africa’s plight to the head of queue.
For a company that likes to portray itself as artfully balancing the demands of profit and principle, the Ethiopian crisis was a hard test. Starbucks didn’t do a very good job of handling it, but the company survived and learned something more about its role in the world, although what and how much would have to await the next crisis. “When you sign a copy of the book for me, I’ll tell you whether I think the resistance was worth all the aggravation,” one Starbucks player ruefully told me. I thought I knew the answer.
But Getachew was thrilled with the outcome, and hopeful. “Once we were actually able to talk with them, we were able to start resolving the problems,” he told me. “It’s like me sitting here with you. We haven’t met before, but we get to know each other. And next time we know each other a little better, and we grow to understand each other.”