Winery, U.S. Olympic Committee resolve conflict over use of . . . er . . . the name of our Peninsula
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After nine months of legal struggle with the U.S. Olympic Committee, Kathy Charlton, owner of Olympic Cellars winery east of Port Angeles, is celebrating a qualified victory. Charlton will host a party today (Saturday) on the patio next to her small vineyard; she’ll wear a new T-shirt that reads, "Olympic Cellars vs. the USOC: The Name Is Still Ours!" -- Photo by Diane Urbani de la Paz/Peninsula Daily News

By Diane Urbani de la Paz Peninsula Daily News

PORT ANGELES — Nine months after her winery's 9/11, Kathy Charlton is celebrating with her trademark joie de vivre.

The principal owner of Olympic Cellars has emerged from a fight with what her attorney calls "the 900-pound gorilla" — the U.S. Olympic Committee.

Charlton is the victor in some ways, but she minces no words when describing the effect her dispute with the USOC will have on her and other businesses that bear the "Olympic" name.

"I can still operate as Olympic Cellars [and] sell wine via the Internet . . . as long as my sales and marketing of 'Olympic Cellars' branded wines beyond my local area are not deemed 'substantial,'" Charlton said this week in a written statement.

The settlement with the USOC means that although the word "Olympic" signifies this peninsula's beauty and identity — and thus is an ideal brand name — firms here cannot use it to promote themselves beyond the region.

"By forcing Olympic Peninsula businesses to be local in nature and restricting sales to the Olympic Peninsula, it unjustly limits our ability to grow, be competitive and survive," Charlton said.

"Sure, we could change our business names. It certainly would be easier, cheaper and less hassle.

"But that means shedding our heritage as well; basically giving in and giving up.

"And we just can't do that."

Told to give up name
The dispute began on Sept. 11, when USOC attorney Kelly Maser sent a letter to Charlton telling her she had to relinquish her winery's name.

The USOC owns the word "Olympic," when it comes to commerce, Maser wrote.

With the Ted Stevens Olympic and Amateur Sports Act of 1998, Congress gave the USOC exclusive control of the word, with one exception.

Businesses on the Olympic Peninsula can use it — but locally only.

Widespread Internet marketing of Olympic-named products violates the Stevens Act, and might unleash the wrath of the USOC.

Charlton has grown Olympic Cellars from the bankrupt operation she bought in 1999 to a brand that's won fans — and wine competition medals — across the West.

She and partners Molly Rivard and Libby Sweetser, along with youthful French vintner Benoit Murat, beckon the thirsty from on and off the Peninsula to the winery, a renovated dairy barn with a small vineyard and a big view of the Olympic Mountains.

The winery, one of the first 15 established in Washington, is located on U.S. Highway 101 near the Old Olympic Highway intersection.

But Olympic Cellars has no right to promote itself outside Western Washington, according to the USOC.

World Wide Web marketing of its products could mislead people into thinking the winery is an Olympic Games sponsor, the committee maintains.

This problem is pressing, with the 2008 Summer Games starting in Beijing this month and the 2010 Winter Games in Vancouver, British Columbia less than two years away.

The USOC's Maser sent a second warning to Charlton in October, instructing her to turn away customers who'd found Olympic Cellars online without actually visiting the building.

Sought help
That's when Charlton sought help from Sequim trademark attorney Jacques Dulin.

"I realized that I couldn't do this alone," she said.

Dulin tops a list of people Charlton thanked this week for encouraging her to stay the course and negotiate a settlement with the USOC.

The resolution saves her winery's name — but will choke future growth, Charlton believes.

And Dulin, the lawyer who calls the USOC a gorilla, doesn't think the committee has finished with the Peninsula.

A number of local businesses have heard from the USOC about the O-word, though he said they wanted to keep their communications private.

Charlton, for her part, communicated with the offices of Rep. Norm Dicks, the Belfair Democrat whose district includes the North Olympic Peninsula, and U.S. Sen. Maria Cantwell, D-Mountlake Terrace.

Aides briefed the members of Congress on the Olympic brand dispute, "but frankly, in an election year, they have much bigger fish to fry," Charlton said.

Still, she thanked Dicks' Port Angeles-based liaison, Judith Morris, and Cantwell staffer Michael Daum for at least listening to and conveying her concerns.

Amend Stevens Act
Now Charlton wants the federal government to amend the Stevens Act, and "to comprehend the dramatic changes in both electronic commerce (the Internet) and our flattened, global economy."

Charlton said she well understands the Olympic Committee's need to protect its brand and the corporations — leviathans such as Anheuser Busch and Visa — who pay millions to sponsor the Games.

But she doesn't understand why the committee sends attorneys after small businesses on the Olympic Peninsula.

"It makes far more sense for the USOC to simply limit its investigation to activities and companies outside the Olympic Peninsula using the mark "Olympic," and sue those who would try to create an association with, or trade upon the goodwill" of the Olympic Games, she said.

What's 'substantial'
For Olympic Cellars, there's another sensitive word: "substantial" — as in, wine sales off the Peninsula must not be.

In interviews this week, both Charlton and USOC spokesperson Lindsay DeWall agreed that their agreement contains no definition of the word.

"We expect that Olympic Cellars will act in good faith with a reasonable understanding," of what constitutes substantial sales and marketing, DeWall wrote in an e-mail to the Peninsula Daily News.

And what about the "local area" in the agreement?

Where is that line drawn?

"In working with Olympic Cellars and seeking to reach a reasonable accommodation for them, the U.S. Olympic Committee agreed that it will not object to their use of the word within the entire state of Washington," DeWall wrote.

So Olympic Cellars can continue competing in the Washington wine marketplace. And Charlton can keep promoting the Peninsula as a potential grape-growing region.

She and her four-member staff have planted a diminutive vineyard south of the tasting room.

And Charlton, cosponsor of a study that found the North Olympic Peninsula to be a promising place for viticulture, last April opened Olympic Cellars to a Washington State University class on grape-growing.

The winery will host a series of concerts on Saturdays through this month, the "No Labor Day" party for working women and friends on Aug. 23 and the annual grape stomp and harvest party on Sept. 13.

Charlton, Rivard and Sweetser, aka the "Olympic women in wine," have built a healthy business since releasing the first Working Girl-brand wines in 2003.

Growing business
Olympic Cellars grossed more than $1 million two years in a row, Charlton said.

"We had growth of 25, 30 and 40 percent from 2003 to 2005. In '06 and '07, it started flattening."

At the same time, Olympic Cellars beefed up contributions to local charities.

The winery gave about $15,000 last year to organizations including Family Planning of Clallam County and the North Olympic Land Trust, Charlton said.

The winery also hosts an International Women's Day celebration every March.

Supporting such causes "gives the winery its soul and purpose," Charlton said.

Yet this summer, the living is not easy.

Steep fuel and food prices have customers buying one bottle of wine instead of the two or 12 they've purchased on past visits; shipping costs "are getting outrageous," Charlton said, and the flow of travelers into the tasting room seems thinner.

"I've reduced my risk by reducing my distribution," said Charlton, and like many Peninsula businesses, Olympic Cellars is renewing its local marketing efforts — which, after all, aligns with the USOC's directive.

Charlton said she spent about $5,000 on legal help during her negotiations with the Olympic committee.

In addition, she had "pro bono support," in the form of legal counsel from a "major Washington corporation who chooses to remain nameless."

Without that help, Charlton said, she would have had to acquiesce to USOC demands much sooner.

"I didn't sign the first, second or even third drafts of the agreement," she added.

Now that the Olympic fight is finished, Charlton might be tired.

But she doesn't act it.

Today (Saturday), she and the other "working girls" will wear just-printed T-shirts that read, "Olympic Cellars vs. USOC: The Name Is Still Ours!"

"We're going to have cake to celebrate all day," Charlton promised.

And tonight, the local band Haywire will play a free, dance-friendly concert on the patio.

"Come enjoy the mountains," Charlton said, "and all that is Olympic."

________
Sequim-Dungeness Valley Editor Diane Urbani de la Paz can be reached at 360-681-2391 or diane.urbani@peninsuladailynews.com.

Last modified: August 01. 2008 9:00PM
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