Starbucks, Ethiopia settle licensing dispute

By Dana Ford

LOS ANGELES (Reuters) - Starbucks Corp. (SBUX.O: Quote, Profile, Research, Stock Buzz) and the Ethiopian government reached an agreement that settles a dispute over the country's bid to trademark its coffee beans, according a joint statement released on Wednesday.

The U.S. coffee chain had been accused by Ethiopia and aid agency Oxfam of attempting to block Ethiopia from obtaining trademarks for its best-known beans -- Sidamo and Harrar.

The agreement allows Starbucks to use and promote the Harrar, Sidamo and Yirgacheffe designations in markets where trademarks exist, as well as where they don't, the statement said.

The U.S. Patent and Trademark Office awarded Ethiopia's Yirgacheffe coffee a trademark in 2006.

Starbucks had previously stated that it would not oppose Ethiopia's efforts to obtain trademarks, but the agreement goes further.

"This is a broad agreement that addresses distribution, marketing and licensing," Sandra Taylor, senior vice president of Corporate Social Responsibility at Starbucks, told Reuters.

It includes the license of certain trademarks and language that recognizes the importance and integrity of Ethiopia's specialty coffee designations.

Currently, about 2 percent of Starbucks' coffee purchases are from Ethiopia, but the amount could increase as the company plans to raise its coffee supply from East Africa.