- In early March, the Fourth Circuit Court of Appeals upheld a U.S. Patent and Trademark Office ruling that denied French and Swiss cheesemakers from the exclusive use of the term ‘gruyere,’ a designation requested for only cheese made in the region of Gruyere.
- Geographical indications have long been a contention point between the United States and the European Union due to their differing philosophies, which caused strain in the negotiations for the Transatlantic Trade and Investment Partnership.
- Geographical indicators are frequently used as non-tariff barriers in international trade as a means to insulate domestic industry, in this instance the dairy producers within Western Europe.
“Like a fine cheese, this case has matured and is ripe for our review,” stated the judges of the Fourth Circuit Court of Appeals in their decision of an extensive legal battle between European cheese producers and the U.S. Patent and Trademark Office (USPTO). The court ruled this month against the Swiss and French producers’ claims that the name gruyere cheese should be reserved only to cheese produced in the Gruyere region.
In 2015, two foreign business associations – Switzerland’s Interprofession du Gruyère and France’s Syndicat Interprofessionnel du Gruyère – filed with the USPTO to bar the use of gruyere by foreign producers, particularly the large dairy producers in the United States. The request was denied and the groups appealed the decision to the Fourth Circuit. The court concluded “that the term gruyere is generic as a matter of law,” thus denying the geographical indication. As a result of this ruling, American dairy producers can continue to sell gruyere cheese despite its production in states such as Wisconsin, Idaho, or California.
The ruling is a major blow to the European producers. In 2022, France exported over $2 billion worth of gruyere and Switzerland followed with over $700 million. Because gruyere is an internationally recognized term, the exclusion of non-French and Swiss producers would have provided a non-tariff barrier, and a great windfall for these industries.
Sour Grapes Across the Atlantic
Geographical indications have long been a contention point between the United States and their trading partners in Europe due to their different attitudes and methods of designation. In the European Union and other European countries, geographical indications are designated by the region a product is produced in. Regulated by the European Commission, any individual producer is able to use the geographical indication if that product originated in that region.
For example, all sparkling wine produced in the Champagne region of France is legally designated as champagne, while the same wine produced in the Veneto region of Italy is deemed prosecco. If a sparkling wine is produced outside of these regions, they are called mousseux or crémant, designating to consumers that it is a “generic” sparkling wine. Besides sentimentality, geographic indications are a cash cow in the European market. Products that include geographical indications represent a sales value of €74.76 billion in the European Union and see double the sales of products without an indication.
In the United States, geographical indications are not designations of regionality but rather the application of a trademark. Entities such as corporations or government bodies can apply and be granted trademarks for their products despite a geographical indication. For example, products like the Vidalia onion and Florida oranges are simply trademarked monikers. Due to this trademark method, the USPTO has the ability to deny a trademark due to its genericness or irrelevance. In this case, the USPTO found that gruyere had become standard lexicon in American cheese production and lost its association to the aforementioned European region.
Don’t Leave Me Provolone – The Downfall of the TTIP
In 2013, the United States and the European Union reopened negotiations for a potential free trade agreement called the Transatlantic Trade and Investment Partnership (TTIP). Because the United States and European Union already cooperate closely through the Transatlantic Economic Council and other avenues, the endmost goal of the TTIP was to eliminate non-tariff barriers in trade that were yet to be tackled. Estimates claimed that the elimination of non-tariff barriers, such as geographical indication disputes, would have resulted in an increase in GDP of 1.3% for the EU and 0.79% for the US.
Despite having signed on to basic agreements in the WTO’s Trade-Related Aspects of Intellectual Property Rights (TRIPS) Agreement, the two parties continuously clashed on how to manage geographical indications. Due to this, specific working groups and heads of discussions were designated for the fifteen rounds of negotiations that took place in Washington and Brussels.
The TTIP ultimately failed and never came to fruition. Then-German economic minister Sigmar Gabriel claimed the agreement was doomed to fail because the United States was demanding that the European Union compromise its “environmental, consumer protection, and public health standards,” the same European complaints when criticizing American geographical indication policy.
Not Such a Gruyere-Area
To those familiar with the American procession of geographical indications, the ruling of the Fourth Circuit Court of Appeals was expected. As explained in the gruyere ruling, many of these European product names are too commonplace to retroactively change. European leaders are aware of this dynamic, but still pursue international protections to boost their own industries through a veneer of prestige and exclusivity. The European argument for geographical indications is poorly justified through domestic sentimentality rather than intrinsic qualities of the product.
Two products that contain the same inputs and same model of production are the same products, whether they were made in the rolling hills of the French countryside or Plymouth, Wisconsin.