The botom video was made by a Starbucks representative and the top video is from Arnold and Porter, which represents the Ethiopian government.
A article discussing the dispute is here.
The trademark issue (as opposed to the overall business issue) is that Ethiopia filed for standard trademark, as opposed to certification mark, protection for the names of several coffee-growing regions in Ethiopia. Here’s the most recent office action in Ethiopia’s HARRAR application.
If a region’s name has commercial value, as is the case here, then it is to the benefit of the merchants in that region that a single entity is motivated to protect that name – so some sort of protection is needed.
However, as the article states, the general consensus is that GIs are preferable to standard trademarks. I agree with both parts of that statement – GIs are preferable and it is the general consensus that they are preferable.
Ethiopia’s U.S. lawyer states that the Ethiopian government does not prefer GIs because it would have less control over the marketing and sale of the coffee, and that would result in lower prices for the producers. It’s true that Ethiopia would have less control and the speculation that that would result in lower prices for growers is plausible. But that might not be the only consideration.
In the U.S., a merchant that complies with the articulated standards for a certification mark, can use the mark. Thus, in theory, different growers from a region can use the name to indicate origin, and act independently of each other and cut its own deals.
As for a standard trademark, the trademark owner can prohibit any third party from using the mark. Thus the growers can be cartilized by the trademark owner, which can be a good or bad thing (probably both). In this case, growers in a particular region could lose the right to accurately indicate where their product comes from, if they do not have authorization from the trademark owner. This is scenario contravenes the policy behind the prohibition of the registration of geographical names as trademarks.
Again, this post deliberately does not address the ‘fairness’ issue of Starbucks’ economic relationship with Ethiopian coffee growers.
Background (with link to PTO materials on geographical indicators) here.