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Most Helpful TTB Website Pages

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TTB’s website at www.ttb.gov can be pretty helpful. Here are a few of the pages we check most often.

  1. TTB Newsletter. This comes out about once a week and can be very useful. For example, the August 19, 2016 edition provided background information about Tom Crone – with 53 years of federal service!
  2. Formula Tool. Don’t guess about whether you need a formula approval. If you guess, you are likely to be wrong because it’s not always intuitive. For example, why does all sake need a formula approval (and lab analysis) – when other fermented rice beverages (such as beer) don’t? If you make this mistake, it can be time-consuming and costly. With this tool, you can check most any class/type, and get a better view of what needs a TTB formula approval, and what does not.
  3. FAQs. TTB here answer dozens of common questions. One example is, what is “pear cider”?
  4. Public COLA Registry. This is a good place to look up all or almost all recent COLAs. At this point it goes back 20 years or more. We say almost because it does not cover wine coolers, kombucha – or other products that happen to be alcohol beverages, but don’t fall within TTB’s labeling jurisdiction. Last time we checked, this database had images back to around 1999, and text only results back to about the 1980s. With some creativity, you can find all COLAs for your competitor, or all whiskies made in Hawaii, etc. The same database can be a lifesaver when it comes to trademarks. Though this resource is good, for some things ShipCompliant’s LabelVision is even better.
  5. FOIA. This page is particularly helpful because it links to such crucial information as what are other people asking TTB to provide by way of Freedom of Information Act disclosure, most issued permits, and the Electronic Reading Room.
  6. APTs. TTB does a pretty good job, here, of showing how long the typical label, or permit, or formula takes (the “Average Processing Times”).

We could go on. But we are not sure you want us to. If you know of other great pages, within or without ttb.gov, let us know.

VABC Allows “Self-Distribution” for Virginia Distillers

The Virginia Department of Alcoholic Beverage Control Board (VABC) will now allow Virginia Distilleries to “self-distribute.” Previously, restaurants were required to purchase all spirits through their assigned VABC Store. Now, VABC has authorized distilleries to sell directly to restaurants.

Unfortunately, restaurants will be required to physically go to the distillery to purchase the spirits (delivery from the distillery is not allowed yet), but it is still a move in the right direction for Virginia to compete with Maryland and Washington D.C.’s more favorable distillery laws.

This change occurred within the past couple of weeks. We have not seen any explicit law change, but through discussions with the VABC and knowledgeable distillers, we understand that this is an important change in interpretation of existing laws.

Peter Ahlf, of Mt. Defiance Distillery, in Middleburg, Virginia was excited about the new allowance, because now it allows for greater distribution of some of their rarer, craft spirits. He said:

Not everything we produce is available in VABC stores, so this lets local restaurants come straight to us and purchase those seasonal and rare products. We would no longer have to drive small orders to Richmond, just to have it shipped back up to the VABC store down the street.

Virginia has been slowly broadening sales allowances for distilleries. We look forward to seeing whether this leads to more, and more successful craft distilleries nearby.

Johnny Love Vodka Wins “Sexy Lips” Trademark Appeal Against Jim Beam

Johnny Love Beverage Company LLC (“JL”) and Jim Beam Brands Co. (“Beam”) are fighting over the right to use “sexy lips” imagery on flavored vodkas. JL’s logo (the subject of U.S. trademark registration no. 4,044,182; shown below left) dates back to 2005, and is described by Johnny Love’s creator and namesake Johnny Metheny as “definitely sexy.” Metheny apparently felt the same way about Beam’s new logo, adopted in 2011, (shown below right), and sued Beam in federal district court for trademark infringement, false designation of origin, and unfair competition.

jllips After filing suit, JL promptly moved for preliminary injunctive relief, essentially requesting that the court order Beam to stop selling products with Beam’s new logo during the pendency of the trial. Beam cross moved for summary judgment. The district court denied JL’s motion, and, in a surprise move, sustained Beam’s motion, dismissing the case and holding, “For reasons articulated in the Order denying the Preliminary Injunction, the Court determines that no issues of material fact remain which could provide Plaintiff a basis for success on any of its claims.”

beamlipsJL appealed the district court’s decision to the 9th Circuit Court of Appeals and, on July 14, 2016, the 9th circuit court issued its ruling, reversing the district court. The circuit court held that the district court improperly applied the preliminary injunction standard to Beam’s motion for summary judgment. The circuit court pointed out that “both [logos] have puckered, human lips as the focal point of their design; the lips have a similar angle and shape; and the lips are color-coordinated with the flavor of the vodka.” Accordingly, the circuit court found that a reasonable fact-finder could determine that Beam’s logo was confusingly similar to JL’s logo and that summary judgment was, therefore, inappropriate.

Most observers know that a lot of the good words are taken, when it comes to that delicious intersection of beverages, brands and trademarks. This case is a useful reminder that a lot of the good images (some but not all sexy lips!) are taken, as well. It is also a prime example of a little guy scoring big points on a behemoth. Judge Wallace mentioned:  “Jim Beam instructed its legal counsel to perform a clearance search for lips designs. The legal department found 40 references to lips for alcohol-related products.”

Note: With JL having now ultimately survived Beam’s motion for summary judgment, experience tells us that it would not be surprising to see the case quietly settle in the near future, with Beam moving to a design less similar to JL’s (not less sexy, just different sexy).

Perfect Beach Reading

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For a good, edifying time, grab a bottle of craft spirits, a beach — and this book.

The book is Moonshiner to Craft Distillery: Leading Lawyers on the Business of Distilling. Aspatore Books, a division of Thomson Reuters, published the book a few weeks ago. In this book, I am pleased to be in the good company of Ryan Malkin, Gloria Materre, Alva Mather, and other notable lawyers in the alcohol beverage law field.

book

Here are a few excerpts from my chapter, entitled “Reflections on Thirty Years of Spirits Law Practice:  From a Few Score to a Few Thousand Distilleries.”

Almost thirty years ago I got lucky and happened upon the hitherto unknown field (unknown at least to me) now known as beverage law. The years have passed quickly, and this is a testament to how challenging and interesting this field can be. Things have moved a long way during that time, from shuffling paper forms, digging through millions of words in black binders, and a country with a few dozen large distilleries. The law has not changed a lot, but the related law practice has changed dramatically, and so has the business climate.

This area of the law is more heavily regulated than any other aspect of consumer products law — more than guns, tobacco, or even pharmaceuticals. What other consumer product is the focus of not just one, but two, Constitutional amendments? Tobacco and marijuana do not rate even one. Thus, in looking at what laws apply most directly to moonshining and proper distilling, we must start with the Constitution and its amendment banning most forms of commercial alcohol production and sale in 1919, as well as its amendment allowing such production, subject to many rules, fourteen years later.

Federal distillery law is made up of the twin pillars of the Federal Alcohol Administration Act (FAA) which regulates labeling and permits, and the Internal Revenue Code, which obviously regulates taxes. There are hundreds of pages of regulations under the FAA Act alone, approximately fifty of which are devoted to spirits. Most of them are common sense. Even though some politicians may rail against the profusion of federal rules and intrusions, it is hard to see how anyone can deny that we need rules addressing what to do if an alcohol claims to be 80 proof, but is truly at 81 or 79 proof.

This installment of “Inside the Minds” is also available at Amazon, where it could soon be burning up the charts. Last I heard it was #1 in Books > Professions > Law > Food > Beverages > Distilled Spirits > Craft Spirits > Books Less Than 130 Pages > Books More Than 128 Pages.

Main Tito’s Case Dismissed

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The main Tito’s Handmade Vodka case has been dismissed, after 19 months of heated litigation. Details are not available so far.

The main case was Hofmann v. Fifth Dimension, Inc. (first filed in state court in September of 2014 then removed to federal court in San Diego a month later). A second and similar case, Cabrera v. Fifth Generation, Inc., also got dismissed on the same day.

On April 22, 2016, both sides in both cases filed joint motions to dismiss. On May 3, Judge Miller of the U.S. District Court for the Southern District of California issued an order in each case, granting the parties’ joint motions.

At one point there were at least eight class action lawsuits against Tito’s Vodka, scattered around the U.S., challenging the very prominent references to “Handmade,” on the product’s labeling and advertising. There are no signs of any label changes, and Google says this has not been in the press to date.

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