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Bevlog

Gluten

We wanted to check in and see what’s been happening with gluten claims, in connection with alcohol beverages. LabelVision data shows virtually no references to gluten until 2012. Then, TTB approved the first label with a nice, clear reference to “gluten free.” That label is below (potato vodka, brand name Spud). After rapid growth, from 212 to 2016, the gluten references seem to be leveling off, so far in 2017, at about 2016 levels. TTB’s policy is here (TTB Ruling 2014-2, Revised Interim Policy on Gluten Content Statements in the Labeling and Advertising of Wine, Distilled Spirits, and Malt Beverages).

Ginger Tonic from Gallo

If I recall right, TTB did not allow terms like “Tonic” or “Elixir” for many decades. This Thunderbird label, however, clearly shows that “Tonic” is okay these days. Way back, it apparently sounded far too close to a curative claim, as did “elixir.” TTB approved the above label on April 7th.

This label also seems noteworthy because it marks a return of Thunderbird, as an important brand, after almost 10 years without any approval within the TTB database. The new version of Thunderbird is a malt beverage with natural flavors. This is not easy to see. Can you spot the class/type statement off toward the upper right? Before the approval above, and two other versions, Thunderbird last appeared in the TTB database way back in 2008; then and since the 1950s, it was a flavored wine. This article has a lot of history about this important brand and suggests that U.S. law did not allow flavors in wine, until the dawn of this brand. This is yet another example of how brand names have jumped from one category to another, like Smirnoff jumping from spirits to malt beverages more than 16 years ago now.

Horses, Bourbon, Kentucky

I stumbled upon an interesting article in the Kentucky Journal of Equine, Agriculture, and Natural Resources Law of all places. Even though it’s based in Kentucky, I am startled to see that perhaps Mark Brown missed this, in the wee hours of the night, when he combs through the booze press near and far.

The article is entitled “‘Handmade’ or ‘Made By Hand’: Assessing Alcohol Labeling Practices and Evaluating a Popular Consumer Class Action.” It came out during the past year or so. I have followed the handmade litigations, a lot, in these pages. So I don’t want to rehash that stuff. I will mostly highlight a few points in this law review article, by then law student Hannah Simms. She says:

  • “In 2013 alone, the alcoholic beverage industry in the United States generated nearly $456 billion in total economic activity.” This seems mighty high to me.
  • “… courts have been entirely inconsistent on whether or not to apply safe harbor provisions contained in a majority of state deceptive and unfair practice laws.

Noting that the trends are not yet settled, the author wraps up by saying:

If the courts are unwilling or unable to address the situation, the responsibility to take action to protect the industry must shift to the TTB. The TTB could provide clarification of the COLA approval processes that seem to be a hang up for courts. The agency could also opt to issue definitive rulings that provide guidance to industry officials on the correct use or understood meaning of common terms used on labels. This would not only give TTB officers some direction when approving or denying COLAs, but it would also give manufacturers an opportunity to protect themselves and avoid these suits that involve costly litigation since they would have a better understanding of the acceptable use of the terms. If this problem continues unaddressed, liquor consumers and connoisseurs will come out the real losers, because whether manufacturers are forced to go through a costly re-labeling process or continue to litigate these issues in court, it is sure to affect the market price of our favorite beverages.

Since the publication of this article, the pace of the alcohol beverage labeling litigations seems to have eased up markedly, especially since very few courts seem willing to dole out harsh outcomes, beyond the heavy costs of litigation in general.

Shoutout to Fairfax

Our law firm has been in the heart of Fairfax County, Virginia, since 2001. Before that, I worked a couple blocks from the White House. For the most part, we’ve handled federal beverage law during that time. But increasingly, we are handling local law matters, and this story made the shift seem more real.

Jim Vance says the zoning laws got loosened, to make it easier for breweries, wineries and distilleries to open in our county. Even before this change, we were noticing Caboose Brewing down the street, Fair Winds Brewing in Lorton, and The Winery at Bull Run across town in Centreville. There is also the Paradise Springs Winery in Clifton. This Bowman plant closed down in 1988, after beginning distilling operations in Fairfax in 1934. Less than 1.5 miles from the office, there was a winery for a while after Prohibition, producing “Virginia Maid” wine at what is now Nottoway Park. Come to think of it, that’s startlingly little activity for a big, upscale, increasingly urban county with over 1.1 million residents and covering over 400 square miles.

As locals and as lawyers, we look forward to many more fine beverage producers setting up in our county.

How Old is that Old Charter?

The plaintiff in a would-be class action lawsuit against Sazerac voluntarily dismissed all his claims in late January, ending the litigation. The case (Parker v. Buffalo Trace Distillery, Inc. et al.) began in November of last year, and concerned a subtle change on the label of Sazerac’s “Old Charter” brand of bourbon whiskey. The older and newer labels are above, side by side.

Among the various changes, the old label says, “AGED 8 YEARS,” while the new label simply displays the number “8.”

Plaintiff Nicholas Parker alleged that the Old Charter bourbon sold under the new label was no longer aged for 8 years, and that Sazerac’s continued use of the number “8” on the label caused consumers to believe that the bourbon was aged for 8 years. Sazerac responded with a motion to dismiss the complaint, alleging that Alcohol and Tobacco Tax and Trade Bureau (TTB) approval of the label provided Sazerac with a “safe harbor” from Mr. Parker’s claims.

Just two weeks after Sazerac filed its motion to dismiss, Mr. Parker voluntarily dismissed the action. This voluntary dismissal meant that the court did not have to rule on the merits of Sazerac’s safe harbor defense, or Mr. Parker’s claims. If the Tito’s “Handmade” Vodka cases are any indication, it is likely that the safe harbor defense would not have insulated Sazerac in this case. It would seem that the parties reached a settlement, although the terms of any such settlement will likely remain private. Old Charter drinkers should keep an eye out for future label changes, which might indicate the terms of a settlement reached.

The voluntary dismissal notwithstanding, Mr. Parker’s claims raise an interesting issue: Shouldn’t TTB have a policy for this sort of thing? As it turns out, TTB does. TTB’s general stance has been that unexplained numbers on spirits labels are prohibited. That is, if you want to say “8,” you need to explain the significance of the number (e.g., “AGED 8 YEARS,” or “A BLEND FROM 8 BARRELS”). Take Jack Daniel’s, for instance:

While the number “7” appears prominently, the context (i.e., “Old No. 7 Brand”) makes it clear enough that “7” is part of the brand name, not the age of the spirit.

Re-examining the Old Charter labels, the new label does not seem to fall in line with TTB’s tenet. Although Sazerac’s incorporation of the unexplained “8” did not lead to a label rejection in this instance, it probably goes a long way toward explaining why Mr. Parker pounced on Mr. Brown.

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