After a full day wrangling booze labels, I heard a good story about bacon labeling on the way home from work (bringing home the bacon, as it were). The radio story emanated from a Bloomberg web story, “Why Supermarket Bacon Hides Its Glorious Fat.” The story touches upon the intersection of our love-hate relationship with fat and with government, and also upon labeling issues and wily businesspeople. Explaining that bacon has “one of the most unusual and underappreciated packaging formats of any supermarket product” it says:
The standard one-pound package shows the bacon slices fanned out, with only their leading edges exposed. The industry term for this is a shingle pack—a reference to the way the slices overlap. Because those front edges tend to feature more lean muscle than the fattier back edges, and because the face of the top slice is invariably covered by a paperboard flap containing the manufacturer’s logo and other branding information, the consumer sees a relatively unbroken field of red protein, creating the illusion that the bacon is leaner than it is.
Lest the bacon packaging hide the fat too much, the U.S. government requires the packaging to show the real story, at least on the back window. The window allows the consumer:
to see how the bacon truly looks in all its fatty glory. … [T]he shingle pack doesn’t just present an idealized bacon fantasy—it also provides a built-in reality check. It’s hard to think of another package that engages in such a clever sleight of hand on the front and then gives away the game on the back.
The story also has a nifty video about the machinery used to slice the bacon slabs optimally. In a radio version of the story, Lukas says the shingle pack is “ingeniously deceptive.”
And if you don’t think bacon shingles have a lot to do with booze marketing, you should take a peek through this window.
TTB’s website at www.ttb.gov can be pretty helpful. Here are a few of the pages we check most often.
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.
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.
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.”
JL 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).
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.
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.
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.
I keep hearing about a Bud label that is so overflowing with patriotic hues and cries, that there is no room for the term Budweiser. For example, this Chicago Tribune article, from just a few hours ago, suggests that the label is under scrutiny somewhere deep within the belly of the bureaucracy.
Lo and behold, however, the label at issue got approved way back here, on March 1, 2016.
I have no idea whether this marketing plan (taking the Americana theme to the extreme and then quite a bit further) is a good idea. On the other hand, it’s difficult to find any basis for the government to have disallowed this label. At first I thought it might not mention the brand name at all, but it does, on the neck label. Then I thought maybe, somehow, it was so weighed down with homages to America, and so dressed up so as to resemble U.S. currency, that the term Beer did not fit on the label. But again, it is there, barely, this time at the upper right. If real patriotism were similar to the commercial kind, I would love to take a small measure of credit for this. We worked on this Ol’ Glory beer label about five years ago, and it is an open question, which one takes the cake.
Bud America label will look mighty nice, in a gigantic display at 7-11, on a hot July day this summer. It will look particularly nice next to this Bud Light label, submitted within the same week.
Yes that’s the whole label and it’s once again heavy on the Americana and light on the rest. At the risk of stating the obvious, a perusal of all recent Bud labels shows the advantages and disadvantages of being enormous. They can throw almost literally everything at any would be competitor: Americana, fish, soccer, kicking, shooting, baseball, festivals, concerts, hockey, basketball, football, etc.
Just when it seemed like TTB labels and formulas would be slow, and get slower every year — all of a sudden things look pretty fast. The above table shows that normal formulas take two weeks or less. It’s been a really long time since the processing times have been less than a month. This is a huge benefit for producers everywhere. Over on the label side, things are also getting better. This scary looking table shows that beer, wine and spirits labels were flirting with 40 and more days of processing time, toward late 2014, until the trends started to improve (things got particularly ugly here).
As of today, TTB says the processing time for labels is right around 21 days.
I reached out to TTB to see why things seem so much better. TTB said:
Although workloads have continued to increase since FY 2015, we have recently been able to improve our processing times in part through cross-training and because new staff hired last year are reaching full proficiency. However, the improvements you are seeing right now are also due in large part to increased use of overtime and the temporary reassignment of staff from other mission areas, which are short term fixes until we are able to fully implement the long term solutions (such as additional personnel and IT improvements) made possible by the additional funding we received for FY 2016.
There are already millions of labels approved in the past 20 years or so, and this should be great news for everyone who wants just a few more choices.
Last week, a federal court dismissed a putative class-action lawsuit against Diageo, holding that Red Stripe’s labeling and packaging does not, as a matter of law, mislead reasonable consumers into thinking that Red Stripe is made in Jamaica with Jamaican ingredients.
The suit, Dumas et al. v. Diageo PLC et al., began in July 2015, when class-action Plaintiffs alleged that Diageo deceived consumers into believing that Red Stripe is manufactured in Jamaica. Plaintiffs argued that Diageo’s use of the phrases “Jamaican Style Lager” and “The Taste of Jamaica,” incorporation of the Desnoes & Geddes logo, and allusions to the “spirit, rhythm, and pulse of Jamaica,” misled consumers to believe that Red Stripe was a Jamaican Beer.
Chief Judge Barry T. Moskowitz of the United States District Court for the Southern District of California issued the opinion, disagreeing with Plaintiffs, and holding that “no reasonable consumer would be misled into thinking that Red Stripe is made in Jamaica with Jamaican ingredients based on the wording of the packaging and labeling.”
Key to Judge Moskowitz’s decision was the fact that Red Stripe says “Jamaican Style Lager” and “Brewed & Bottled by Red Stripe Beer Company, Latrobe, PA.” Judge Moskowitz concluded that the word “Jamaican” modifies the word “Style” (not “Lager”), and indicates that the product is not from Jamaica. Additionally, Judge Moskowitz concluded that the brewed and bottled by language indicating “Latrobe, PA,” was legible. Judge Moskowitz also concluded that the phrase “The Taste of Jamaica” and the allusions to the “spirit, rhythm, and pulse of Jamaica” were vague and meaningless (i.e., mere puffery), and could not reasonably be relied upon as designations of source.
Regarding the Desnoes & Geddes logo, Judge Moskowitz stated that the “logo itself does not impart information regarding the source of the product.” Judge Moskowitz added, in a footnote, that “the Court doubts that the average consumer would know that the D&G logo is associated with Desnoes & Geddes Limited, the Jamaican brewery, as opposed to, say, Diageo-Guinness.”
Overall, Judge Moskowitz appears to have reached the correct decision. I am, however, skeptical of some of his conclusions. First, regarding the Desnoes & Geddes’s logo, I tend to disagree that the logo “does not impart information regarding the source of the product.” Imparting information regarding the source of a product is the key function of a trademark. Accordingly, I don’t think it’s unreasonable for a consumer to believe that a beer bearing Desnoes & Geddes’s logo (a registered trademark) originates from Desnoes & Geddes in Jamaica.
Second, regarding the brewed and bottled by statement, Judge Moskowitz stated, “It is likely that anyone examining the label carefully enough to read the language on the back of the label would see that the beer is brewed and bottled in Pennsylvania.” I agree that someone examining the back label would understand that the beer is brewed in Pennsylvania, but that’s the problem—the fact that a consumer would have to carefully examine the back label to glean the beer’s true origin suggests that the rest of the labeling and packaging might be misleading.
My two qualms notwithstanding, I believe that this case was correctly decided, based on the “Jamaican Style Lager” language. As Judge Moskowitz noted, consumers are exposed to numerous examples of beers with a geographic indicator modified by the word “style” (Belgian-Style, Cubano-Style), denoting that the beer is not actually made in the geographic location identified.
Plaintiffs have until April 21, 2016, to file an amended complaint, if they so choose.
The Washington Times and CityPages claim that TTB recently rebuffed a Minnesota brewer, in its efforts to hint about LSD on a beer label.
In doing so, the CityPages article took a few tough shots at TTB, calling them a “bunch of unchill tightwads,” “notoriously persnickety,” and describing the anatomy of people who work there, in an even less flattering way.
But if the label at issue looks anything like the above, why should a government agency give it a thumbs up? What’s the point of a review process, if it’s so porous that an LSD label would go through? By contrast, this one looks to be the version that did go through, and I really don’t think it’s so bad, or such a gross imposition on free speech. This seems like a good balance; the approved version certainly gets the point across, in a slightly more subtle way.
Even the brewer seems to acknowledge the above name might go too far, saying “With the name, I think we were pushing the envelope, too. Unfortunately, the envelope broke.”