Logo lawsuit continues to tie up farm funds

MAT-SU — A lawsuit filed by the state’s Division of Agriculture against the Mat-Su Chapter of the Alaska Farm Bureau over rights to the “Alaska Grown” marketing logo has frozen a $1,000 grant needed by the Anchorage Farmer’s Market to buy advertising and fulfill the terms of a federal grant. It also has frozen the rest of the chapter’s charitable budget.

A court-ordered funding freeze has created a chain reaction of events that add up to the Anchorage Farmer’s Market canceling its advertising at a time when it needs to get word out that it’s open until Oct. 20, said market president River Bean of Palmer.

There are no new talks aimed at settling a lawsuit in which a preliminary court ruling favors the state, although a hearing for a summary judgment that could end the case may be heard next month. Barring a quick ruling, Bean and others hoping for grant funding from the Mat-Su chapter’s sale of merchandise this year are out of luck, at least until December, when a week of trial time is blocked out in Superior Court.

The local farm bureau’s executive director said the grant is one of several frozen by the injunction.

“We’re trying to continue to operate,” Karen Olson said. “Of course, we’re allowed to pay expenses, but we’re not allowed to pay any of the things we’re in business to do.”

Without those funds, the Mat-Su Chapter of the AFB cannot promote agriculture for the area, she said, adding the state hasn’t “been doing much of it lately.”

As much as $10,000 in grants for farmer’s markets and Agriculture in the Classroom programs are also on ice, Olson said.

The bureau filed for a federal trademark on the Alaska Grown logo to protect it from bootleg uses because the state refused to properly protect the logo, she said, adding the Mat-Su chapter did so on behalf of all of the state’s farmers.

The Mat-Su chapter invested decades turning the clothing business into a fundraising enterprise, she said.

“The [state agriculture] division refused to do anything about any of the encroaching uses that were being done in Anchorage,” she said. In late November 2004 the state told the local bureau it would not act, and in January 2005 Mat-Su’s bureau filed for a trademark, setting up the unusual scenario of the state’s farm administrators suing farmers.

“We figured it would go into the public domain if we didn’t do something about it,” Olson said.

State has strong case

The Alaska Farm Bureau’s Mat-Su chapter maintains it filed a copyright application on the logo because it was being hijacked by businesses using it to sell merchandise for profit. The logo was used for decades by the chapter solely to raise cash for agricultural grants, scholarships and other ag-related nonprofit programs.

The state contends it has owned the logo since 1986 and that the Mat-Su chapter has always acknowledged the state’s ownership of the logo — a claim denied by Olson.

The cash in that Mat-Su account is “recoverable damages” should the state prevail in December, the state attorney on the case said.

“They don’t have a good case,” said Assistant Attorney General Steve Ross of the Alaska Department of Law.

The court has frozen the Mat-Su Farm Bureau chapter’s assets from sales of Alaska Grown apparel until the case is decided.

Superior Court Judge Jack W. Smith ordered all assets from Alaska Grown items sold since Nov. 18, 2005, placed in a blocked account. The judge, the second on the case since its filing, found that the state had a likelihood of winning the case on its merits and that the state faced “irreparable harm” if the Mat-Su chapter were allowed to get a federal trademark on the logo.

The state is still pressing for a summary judgment and has revoked the chapter’s permission to use the logo for fund- raising, Ross said. He compares the situation to someone borrowing a car, then going to the state Department of Motor Vehicles to register it in his name just because he had been using it with permission. Ross also said the state does lack a federal trademark; rather, it does not legally need one to defend its existing claims to the logo.

The local bureau has stalled its efforts to get a trademark until this case is decided.

The state and the local farm bureau disagree on the quality of evidence provided by the farm bureau to back up its case for a trademark. Olson said no Farm Bureau witnesses were called during the first proceeding.

“So basically we have not had our day in court yet and we’re made to stop,” she said. “It’s what happens when the legal minds get to work.”

Olson also disputes her chapter’s permission to use the logo has been revoked. The state never had a license agreement with the Farm Bureau chapter, but a user agreement. “You’d think if they really had a license they’d have taken us to court on the basis of that license,” she said.

Bad timing

Getting the word out about fresh produce is crucial to those who sell in weekly markets like the Anchorage Farmer’s Market. The market draws thousands to 1420 Cordova St. at the corner of 15th Avenue in Anchorage on Saturdays, but those attending now seem to think each week is the last due to winter’s approach, Bean said.

New people find the market each week through newspaper ads and a lot “can’t believe we’re still going to market until Oct. 20,” he said.

Fewer people mean fewer purchases of organic vegetables like rutabagas, turnips, carrots and other fresh produce and seasonal root vegetables produced in Alaska and sold and advertised under the Alaska Grown logo.

With cash raised through T-shirt and related sales at the Alaska State Fair frozen, would-be beneficiaries who budgeted for Mat-Su Chapter grants are left as frozen out as those funds sitting unused in the bank.

Bean, who lives in Palmer and is president of the Anchorage Farmer’s Market, feels the situation is a crisis. It’s his job to summarize his progress marketing with the Alaska Grown logo to continue a federal Cooperative Marketing Program grant. His summary won’t contain good news, as the Mat-Su chapter’s cash is what the market relied on to pay for end-of-year ads.

“Since the Mat-Su chapter's funds are locked and unavailable (due to the lawsuit by the Division of Agriculture) I have had to cancel all remaining ads in local media to advertise our hours of operation and location,” Bean says in a written response. “This in turn will cause us to fall short on the spending commitment of our CMP grant, which will imperil our receiving the last installment.”

The funding freeze also hit a nonprofit group dedicated to preserving farmland from development. The Alaska Farmland Trust Corp. was to receive as much as $4,000 from the Mat-Su chapter, which pledged $1 from the sale of each logo item to the group. The corporation exists to purchase development rights from interested farmers, protecting the land from development while allowing for its productive use.

Contact John R. Moses at 352-2270 or john.moses@frontiersman.com.