Starbucks Litigation - What it’s all about?

During the fall of 1996, one of customers (a Boston, MA area retailer) told us that they had been brewing and serving our Country French blend. They told us that some of their customers were asking if we had anything that was darker roasted. Country French was our darkest roast at the time, and we were amazed that Boston area consumers would be asking for anything darker. New England coffee consumers traditionally don't prefer dark roasted coffee.

We had developed our reputation on roasting coffee only to the point necessary to bring out the full flavor profile that any particular variety or blend had to offer. Consequently, we were very resistant to roasting anything darker than our Country French, which we regarded as very dark.

After months of requests, we finally decided to give them what they wanted. After all, we are in business and we have a responsibility to be responsive to our customers. However, we were very nervous about producing a product that would be such a radical departure from the rest of our products, even our Country French blend.

We felt a strong, ethical obligation to label the product in a very distinctive manner that would alert any consumer to be fully aware of what was in the bag before purchasing it.

The term "Charbucks" had been in widespread usage for many years all over the United States, but during the early 90s, it was being used intensively in the Boston, MA area. George Howell, former owner of the, now non-existent Coffee Connection, had brought it into prominence in the Boston area.

The Coffee Connection was the most popular coffee roastery in Boston, and was known, and highly revered, for roasting coffee in a manner identical to the way we do, that is, not "over roasting" coffee. George Howell, founder and owner of the Coffee Connection, regarded Starbucks as the antithesis to what he believed in. By 1994, the Coffee Connection had expanded to twenty-one retail outlets, and Starbucks was actively attempting to purchase the chain. Since George felt so strongly that Starbucks "over roasted" all of their coffee, he began to refer to Starbucks as "Charbucks" extensively.

At the time, the expansion of the Coffee Connection, George had been expressing concerns about maintaining the quality control that he believed in. Starbucks finally offered enough money (about twenty-three million) to George, persuade him to sell the Coffee Connection to Starbucks.

Many Boston area coffee consumers were horrified at the possibility that Starbucks roasting methods would ruin their cherished Coffee Connection products. Starbucks had developed a huge following by roasting coffee considerably darker than many Boston area coffee connoisseurs felt was reasonable.

In an effort to allay consumer fears, George Howell appeared side by side with Starbucks CEO, Howard Schultz, in a news conference shortly after the deal had been announced. The two assured local consumers that Starbucks would preserve the integrity of the Coffee Connection products.

Starbucks proceeded to wipe out any trace of the Coffee Connection in a matter of a few years, leaving the Coffee Connection devotees with nothing but a memory. The former customers of the Coffee Connection were left with a profound sense of betrayal and outrage. Usage of the term "Charbucks" became an emotional mantra in the Boston area. We have to assume that George Howell was quite sincere in his assurances during that news conference, and that he was as betrayed, as were his former customers. We also cannot assume that there was any intent at the time, on the part of Starbucks, to do what they did. Whether one supports their actions or not, any business has the perfect right to alter its business strategy at any time it wants.

During the spring of 1997, it seemed to us that naming our new dark roasted coffee "Charbucks Blend" could not have been a more perfect way for us to grab the attention of consumers. Most of our business was concentrated in New England. It was the "char" part of the name that we felt was particularly direct and blunt. We reasoned that no one could possibly purchase the coffee by mistake. We even added the tag line below the name, which read, "You wanted dark ... you got it dark."

Since the name was going on our packaging, and since our graphics bore no similarity whatsoever to Starbuck's graphics, it seemed perfectly obvious that no one could possibly be confused into thinking we were in any way connected to Starbucks.

It was also quite obvious that the extensive use of the term "Charbucks" in the past, had absolutely no negative affect on the spectacular growth of Starbucks. How could our "microscopic" use of the term possibly have any effect on what has been viewed as one of the most spectacular name recognition success stories ever. The preposterous notion that we could possibly slowdown the Starbucks "freight train" simply didn't occur to us.

It comes down to a matter of the genetic makeup of an individual's sensory system. There are very distinct chemical compounds created when coffee is dark roasted. Individuals differ from one another when it comes to how these compounds are perceived. One is either genetically inclined to enjoy the flavor profile created by these compounds, or just the opposite. There is nothing we can do that will change the genetic taste preferences of the consuming public. Starbucks has built a most successful business based on a very sizable segment of the consuming public that has a taste predilection for darker roasted coffee. Is Starbucks seriously thinking that we are going to turn their customers against them? We simply can't imagine what actual damage they think we can do to them, and, to date, they haven't been forthcoming with what they're specifically afraid of. They just want us to do what we're told.

When we named our new blend "Charbucks Blend", we were running a large risk. We were associating our own product with the perception of charred beans. However, we felt we had to be as honest with customers as possible. It seemed to us that a clear sense of humor would be communicated, and would overcome the risk.

Feedback from customers during the past four years has overwhelmingly confirmed that the sense of humor strategy worked. Every customer who has commented to us about Charbucks Blend has appreciated the humorous aspect of the name. Of even more significance, not one single customer has ever called us and complained about buying a package of Charbucks Blend by mistake. We have to conclude that our "in your face labeling" has worked precisely as intended.

Starbucks does not share our views on this matter.