The Sparkling Wine War: Pitting Trademark Rights Against Geographic Indications

The May/June 2009 issue of Business Law Today is all about food. The article, The Sparkling Wine War: Pitting Trademark Rights Against Geographic Indications

By Carol Robertson, provides an nice overview of the US-EU debate on geographic indicators for wine.

"Masquerading as Champagne might be legal, but it isn't fair," reads a recent ad sponsored by the Office of Champagne, USA, a trade group dedicated to the promotion of the interests of French champagne producers. What is their complaint?—that certain U.S. winemakers are legally entitled to produce sparkling wine in this country and label it "champagne."

The Historic Mystique of Champagne

Champagne (in French "le champagne") is a beverage produced in La Champagne. This region of Northeastern France is known for its chalky soil, which contributes to the unique flavor of a sparkling wine that has long been a favorite celebration beverage—at marriages, births, and, of course, the New Year. Since the early nineteenth century, American vintners have attempted to produce a sparkling wine that would rival champagne. In 1842, Louis Longworth of Cincinnati (known as the father of the American wine industry) produced a bubbly wine from the native Catawba grape that was compared favorably to the French product. In 1876, a New York Times correspondent encountered a sparkling wine called "Eclipse" at Buena Vista Winery in California. By the end of the nineteenth century, a number of U.S. producers were making sparkling wine and were not hesitant to call their products "champagne." Among these were the Korbel brothers, who began producing a sparkling wine called "champagne" in California in 1882. . . .

Place Name Versus Trademark

There is a conflict between European wine producers and American wine producers over whether greater importance should be placed on the name of a place where a wine is produced or the brand under which it is sold. In America, historically, the trademark has been the most important feature, not the provenance of the wine. But European producers have long recognized the importance of "terroir"—that wine made from grapes grown in a particular location will have a unique taste. The word "terroir" has no English translation. It means place, certainly, but also it implies soil characteristics, climate, and altitude, for example. It represents also the learnings about wine production passed on from an earlier generation of winemakers to their followers, that is, the craft of the winemaker. France's first laws designed to protect geographic areas were enacted in the nineteenth century, as a means to deter fraudulent indication of origin. In 1919, the French created the Appellation D'Origine Contrôl&ée (AOC), which required that the true geographic origin of a wine be accurately represented and which remains in effect to this day. Starting in 1989, the European Union (EU) passed a number of regulations governing wine products with a goal of preventing descriptions that were incorrect or were likely to cause confusion or to mislead consumers. These regulations were intended to apply not only to wines produced in Europe but also to wines originating in other countries. They specifically prohibit the use of the name of a given region in the EU to describe an imported wine. . . .

Europe's Stance: Geography Controls

For comparable reasons, Europeans wish to protect their place names. The French have long railed against the common practice of U.S. winemakers to indiscriminately borrow French place names—such as Champagne, Burgundy, or Chablis—to label wines that do not come from these specific regions and that do not even closely resemble them. . . .

Robertson’s whole article is available here.