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How Are Organic Wine Labels Regulated in the U.S.?

Here is a good, and relevant, question. What happens if a wine label boasts the term, “ORGANIC,” or “CERTIFIED ORGANIC” but is neither organic nor certified as such? As organic products—including wines—become more popular among consumers, there is a greater risk of fraudulent use of the term “ORGANIC.” See, e.g., Is Your Organic Food A Fraud?; OverseasCompanies Fake Organic Certificates.

Last week, The Drinks Business reported that an Australian vineyard, Kings Court Vineyards in Victoria, was accused by the National Association for Sustainable Agriculture, Australia (“NASAA”) for falsely labeling its wines as “ORGANIC.” See Vineyard Caught Over False Organic Claimssee also Organic Chief: We Will Discredit Firms Who Claim False Certification. NASAA, the Australian associated responsible for certifying companies as organic, issued a statement that the certifier never certified Kings Court Vineyards. NASAA indicated that the association never approved Kings Court Vineyards as organic and, as such, the vineyard has been falsely labeling its wines. The association has since obtained an injunction from the Australian Federal Court against the vineyard, preventing the vineyard from labeling its produce as organic. NASAA recited its reasoning for pursuing action to include its desired to protect truth in labeling. In addition, the association noted that there are extremely high costs associated with certifying an operator, an expense that many companies undertake to proudly proclaim their product is organic. See, e.g.Vineyard Busted for Falsely Claiming Organic Status. Additionally, NASAA commented that:

This case is not only about NASAA protecting its brand and reputation but also about defending the brand value and integrity of our certified operators.

See Vineyard Caught Over False Organic Claims (quoting NASAA general manager Ben Copeman). The association’s response portrays the seriousness of certifiers with respect to the term “ORGANIC.” If NASAA were inactive with respect to the above allegation, it is quite possible “ORGANIC” could lose its bite, so to speak, and many companies might be less willing to pay for organic certification.

The U.S. Regulation of Organic on Wine Labels

The United States Department of Agriculture (“USDA”) promulgates regulations relating to the term “organic” and to the National Organic Program (“NOP”), which govern the handling, labeling, processing, marketing, and certification of organic products (including alcohol beverages). Such regulations are found at 7 CFR Part 205. While these regulations are not promulgated by TTB, such organic regulations must be followed when claiming “ORGANIC” on an alcohol beverage label.

In the U.S., TTB recognizes four different types of “ORGANIC” claims. They are as follows:

  1. 100% Organic—the product’s ingredients are all (i.e., 100%) organic and the product does not contain chemically added sulfites;
  2. Organic—the product contains at least 95% organic ingredients and no chemically added sulfites;
  3. “Made with Organic [Ingredients, i.e., grapes]”—the product contains at least 70% organic ingredients (and may contain chemically added sulfites); and
  4. If the product contains less than 70% organic ingredients or if the product is not certified by an organic certified, the product may only include organic ingredients in its ingredient statement.

In addition to the USDA NOP organic regulations, a wine label containing an “ORGANIC” claim must also comply with general TTB wine label requirements (e.g., alcohol by volume percentage statement, net contents statement, and government warning statement, to name just a few).

A TTB label application for a wine label containing an “ORGANIC” claim (i.e., other than an ingredients statement) is required to contain a document called an ACA preview. The ACA preview is issued by a USDA-accredited certifying agents (or “ACA”) and contains the actual image(s) of the wine label along with the ACA’s stamp or signature that the wine at issue complies with organic regulations. For more information, see Changes to the Organic Documentation Requirements. Generally speaking, if an ACA preview does not accompany an organic wine label application, TTB will not approve the application. There are several other specifications required for organic wine labels, in addition to general TTB requirements such as alcohol by volume statement, most of which are detailed here.

IOrganic Wine Label Certification Statement as required by TTBn addition to the ACA preview, TTB requires there to be a statement on the label (below the bottler or importer’s name and address) which states, “Certified Organic By [Name of Certifier].” And example of such requirement is shown on the label on the right.

Similar to the NASAA’s standpoint, the USDA maintains that a food product falsely represented as certified USDA organic violates federal regulations and law. The marketing, labeling, or selling of such products is punishable by fines. In some cases, the violation may be on behalf of the certifier (Some of the relevant regulations are found at 7 CFR 205.662). However, falsely representing a food product as “ORGANIC” is not always the fault of the certifying operation. In certain instances, a fraudulent organic certificate may be created without the authorization of the certifier. See, e.g., USDA Caution on Organic Fraud from China. The National Organic Program welcomes the reporting of such violations by individuals as well as certifiers and maintains an active list of such reported fraudulent organic certificates.

Image property of Patianna

For more information on wine or alcohol law, organic claims, or labeling, please contact Lindsey Zahn.

DISCLAIMER: This blog post is for general information purposes only, is not intended to constitute legal advice, and no attorney-client relationship results. Please consult your own attorney for legal advice.

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Jamieson Ranch Vineyards Trademark Lawsuit on Behalf of Pernod Ricard Irish Disillters (Jameson Whiskey)In March, Jamieson Ranch Vineyards launched a declaratory judgment suit against Pernod Richard’s Irish Distillers Limited, owner of the renowned Jameson Irish Whiskey, in response to the Ranch’s receipt of a cease and desist letter. See Jamieson Vineyards Takes On Pernod Ricard’s Irish Distillers. According to Jameson Clashes with Jamieson Over Name, the letter issued by Irish Distillers on or around February 25, 2014 stated that “Jamieson” is “confusingly similar” to “Jameson” and is likely “likely to cause consumer confusion and/or the appearance that your client’s business originates from or is endorsed or authorised by Irish Distillers,” the use of which is likely to dilute the mark “Jameson.” See Jameson Clashes with Jamieson Over Name (quoting the original Irish Distillers cease and desist letter). Accordingly, Irish Distillers urged Jamieson Ranch Vineyards to cease use of the Jamieson mark, confirm (in writing) that the mark would not be used in the future and that Irish Distillers owns the Jameson mark, and account for the amount of revenue secured from the Jamieson mark (as well as sales of services in Napa) so that Irish Distillers could assess the damages. See Irish Distillers In Trademark Dispute With U.S. Winemakersee also Pernod Faces Trademark Clash Over Wine Firm’s ‘Jamieson’ Brand.

On July 14, 2014, the distiller counterclaimed against Jamieson Ranch Vineyards, asserting trademark infringement with respect to the name “Jamieson Ranch Vineyards.” Irish Distillers Limited noted that Jamieson Ranch Vineyards had recently changed its name to “Jamieson Ranch Vineyards”—mark whose appearance and sound the distillers argued would confuse consumers with respect to Jameson Irish Whiskey—and had previously been known as Kirkland Ranch Winery and Reata Winery. See Jameson Distiller Says Napa Winery Can’t Use ‘Jamieson.’ The counterclaim alleges federal infringement, dilution, and unfair competition, as well as common law infringement. Id. Jamieson Ranch Vineyards denies the allegations, and insists that its mark does not dilute the Jameson Irish Whiskey and seeks declaratory judgment, as mentioned previously.

In the last few months, several other wine companies have been victims to cease and desist measures pursued by larger, global alcohol beverage companies. A good example is the alleged battle between Champagne House Veuve Clicquot and Italian sparkling wine producer Ciro Picariello (Note: Such suit was denied by the Champagne House, but Veuve Clicquot did acknowledge contacting the Italian producer to note several label similarities), and the clash between Chateau Mouton Rothschild and Burgundy wine producer Laurent Mouton. In many instances, a smaller producer may choose to pursue legal action against larger companies to avoid changing its brand or business name. There are a significant amount of costs associated with changing the name of a business, such as phasing out labels (and changing the names of wines and labels), submitting label applications for government approval, and edits to a company’s website, logo, business cards, stationery, and related elements—and such cost may be particularly high for smaller wine businesses, enough to pursue litigation against a large company. But that being said, there is also an element of pride in ones name or brand that may have intangible value or goodwill that provides even greater incentive to defend ones mark.

A hearing for the case between Jamieson Ranch Vineyards (Madison Vineyard Holdings) and Irish Distillers is scheduled in front of Judge Charles R. Breyer on August 22, 2014 at 8:30 AM at the United States District Court for the Northern District of California. See Calendar for: Judge Charles R. Breyer.

Image property of KQED Blog.

For more information on wine or alcohol law, labeling, or trademark, please contact Lindsey Zahn.

DISCLAIMER: This blog post is for general information purposes only, is not intended to constitute legal advice, and no attorney-client relationship results. Please consult your own attorney for legal advice.

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Upcoming Seminars and Opportunities in Wine Law

Upcoming Winery and Vineyard Law Seminars and Academic Opportunities

Two exciting opportunities in wine law are scheduled for the next few months. The first is the Wine and Spirits Law Academy at UC Davis on September 8th, 9th, and 10th. Wine and spirits legal experts from around the world will convene for a three-day conference to discuss topics including global wine and spirits market analysis, global issues facing wine entrepreneurs, comparative aspects of import/export law, current trends in U.S. regulations, and social media on the global wine market. The conference also features a private tour of Napa Valley’s Domaine Chandon and dinner at its world-renowned French restaurant, Etoile. More information is available at the UC Davis website here

The second opportunity relates to the next session of the International Seminar “Wine Law in Context” hosted by The Wine & Law Program at the University of Reims Law School. The Seminar is calling for papers for its third session, which aims to bring together internationally recognized specialists in the sector of wine & spirits law but also wine economics, sociology, ethnology or political science. The key point of the Seminar is based on the idea that wine law can and should be apprehended and analyzed through a historic, geographic, economic and even political context. For each session, a paper is presented either in English or in French. The most authoritative papers are published online in The Wine Law in Context Working Papers. More information is available at Wine Law in Context Call for Papers 2014-2015.

DISCLAIMER: This blog post is not intended as legal advice, and no attorney-client relationship results. Please consult your own attorney for legal advice.

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Penfolds: The Unfolding of China’s New Trademark Law

Penfolds Wine La Trademark China Brand Squatting

A new case that may show the effects of China’s recently updated trademark law made headlines this last week. Treasury Wine Estates reported that the company did not register the Chinese name for Penfolds and is currently engaging in a legal battle with Li Daozhi, an allegedly notorious trademark squatter. See Brand Wars: Battling China’s Trademark ‘Squatters’. (Li Daozhi is the individual responsible for registering a number of Castel Frères brands in China, as well as offering to sell the rights to these marks at exorbitant prices, as discussed previously at French Wine Company Castel Frères to Pursue Trademark Battle Against Panati in China’s Supreme Court.) Based on an investigation conducted by The Australian Financial Review, Li Daochi registered at least three variations of the Penfolds name. (Penfolds has done particularly well in China in the past, see, e.g.Chinese Appetite for Penfolds Driving Sales of Australian Fine Wine, but recently claimed a downturn in sales due to “government austerity measures.” See Penfolds Owner Fighting Trademark Battle in China.) While Treasury won the first legal battle against Li Daozhi, Li is appealing the ruling decided in favor of Treasury.

Castel is also appealing a case against Panati Wine Co., Ltd. (owned by Li Daozhi) to China’s Supreme Court, which was previously decided in favor of Panati. See French Wine Company Castel Frères to Pursue Trademark Battle Against Panati in China’s Supreme Court. In a separate case from June 2014, a Chinese company announced it would appeal a lower court’s decision after a favorable ruling for Roussillon winemakers against said Chinese company that sought to register the Chinese translation of Roussillon as a brand name. See The New Chinese Trademark Law In Effect: The Wine Version.

The outcomes of the aforementioned suits will set a tone for how China’s new trademark law is not only interpreted but also for how seriously the new law will be enforced. There are immeasurable reasons—not exclusive to wine or wine trade—why China should enforce its new law and offset or curtail brand squatters or individuals who register a mark in bad faith. The current environment in China with respect to registering a trademark is hostile and expensive for many companies despite the popularity of their products or success of sales. But an answer seems far off, as litigation often takes many months, if not years, to complete.

Until then, companies looking to pursue business in China can search China’s trademark database to see if their brand names have been registered. If the marks are not registered and a company even so much as anticipates doing business abroad, it is certainly advisable to register a mark as early as possible. If the company is victim to trademark squatting, prior matters involving Castel, Château Listran, Barrière Frères, and Château Ausone indicate few options: pay off the trademark squatter (usually at high cost), change the brand name (which can certainly be a high cost), pursue litigation (also at high cost, as well as the risk of an unfavorable judgment), or leave the market entirely. See, e.g., No Wine-ing: The Story of Wine Companies and Trademark in China. Perhaps some of these options will change in time to provide more supportive options to true brand owners.

Image property of Treasury Wine Estates.

For more information on wine or alcohol law, international trade, labeling, or trademark, please contact Lindsey Zahn.

DISCLAIMER: This blog post is for general information purposes only, is not intended to constitute legal advice, and no attorney-client relationship results. Please consult your own attorney for legal advice.

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Vote-2014-Wine-Blog-AwardsIt is quite an honor to share that On Reserve was named one of five finalists in the 2014 Wine Blog Awards category for Best Overall Wine BlogSee 2014 Wine Blog Awards Finalists Are…. I am humbled to be named among many very respected wine bloggers and writers, especially within the “Best Overall Wine Blog” category.

Blogging about wine law the last four years has been an incredible journey, and one I truly feel is only the beginning. I have said this before, but when I started On Reserve four years ago, I never imagined or anticipated the continued interaction I have thanks to this blog. The blog has certainly grown and changed over time, and I believe this is only proof that a lot is in store for On Reserve and the wine law community at large.

If you enjoy reading On Reserve, please consider voting for us as this year’s best overall wine blog here. I’ll be sure to pop open some bubbly very soon to celebrate such a true honor.

Thank you again to all for your continued support, communication, and readership, and congratulations to all finalists in this year’s competition!

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Last year, California-based Duckhorn Wine Co. filed a complaint against Long Island-based Duck Walk Vineyards alleging consumer confusion and breach of settlement agreement that resolved a prior trademark infringement action between the two parties. See Duckhorn Wine Co. Files a Complaint Against Duck Walk Vineyards Alleging Consumer Confusion on Wine Labelssee also Duckhorn Asks N.Y. Winery to Modify Labels and Sales. One of Duckhorn’s lawyers stated that Duck Walk Vineyards did not follow a 2003 settlement agreement in which Duck Walk agreed to several constraints—including placing the vineyard’s place of origin on the front label of Duck Walk wines containing duck images, as well as restrictions to production volume and geographic distribution of Duck Walk wines with duck images—the alleged breach of which was the foundation of Duckhorn’s complaint.

This past week, the United States District Court of Eastern District of New York denied Duck Walk’s motion to dismiss. See Duckhorn Wine Co. vs. Duck Walk Vineyards, Inc., 13-CV-1642. Duck Walk had moved to dismiss the original compliant for failure to state a claim upon which relief can be granted pursuant to Federal Rule of Civil Procedure 12(b)(6). In its complaint, Duckhorn alleged that Duck Walk had breached the settlement agreement between the two parties by:

  1. Failing to include the geographic location or place of origin (referred to as “Prefatory Language” in the Agreement) on the true front labels of Duck Walk’s cabernet sauvignon, merlot, and brut sparkling wines;
  2. Using duck images on its labels that were not approved or similar to those approved for use by the parties’ Settlement Agreement (i.e., use of two blue ducks in a silhouette is not similar to any of the approved images by Duckhorn, which generally contain about nine white ducks); and
  3. Selling Duck Walk wines in excess of agreed upon production and distribution limitations (i.e., selling more than 50% of Duck Walk’s annual Gross Production outside of New York, New Jersey, and Connecticut of wines containing the word “Duck” and/or the image or picture of ducks with the exception of Duck Walk’s corporate name, Duck Walk Vineyards, Inc.).

(One of the labels which Duckhorn opposed features blue duck silhouettes and is pictured at below. Duckhorn alleged that the label pictured on the left-hand side is the actual front label of the wine—not the label containing the Government Warning Statement, vintage year, origin, and producer’s name and address—and, as such, the actual front label fails to contain the requisite Prefatory Language of the Settlement Agreement. Duck Walk, however, argued that the front label is the label pictured on the right-hand side, the very same label that TTB recognizes as the wine’s “front” label under requirements outlined in 27 CFR Part 4.)

 It its motion to dismiss, Duck Walk argued:

  1. The Certificate of Label Approvals (“COLAs”), including that for its cabernet sauvignon, brut, and merlot, demonstrate that Duck Walk did comply with the Prefatory Language;
  2. The blue duck silhouette image does not violate the Settlement Agreement because the Agreement does not specifically restrict the color or amount of ducks; Duck Walk simply reduced the number of ducks and made them blue in color; and the duck is the same or similar type to those ducks approved in the Settlement Agreement; and
  3. Duck Walk has not sold more than 50% of its annual Gross Production outside of New York, New Jersey, and Connecticut.

Duck-Walk-Vineyards-Label-Approval-Merlot

 

In its motion to dismiss, Duck Walk interestingly argued that the Settlement Agreement made Duck Walk’s compliance “expressly contingent upon approval of the BATF [TTB].” Id. at 9 (quoting Duck Walk’s motion). Meaning, if the TTB approved of a label as the “front” label, such label would be considered the “front” label of the wine in the context of the Settlement Agreement. The vineyard furthered its argument for compliance by stating that TTB considered the front label of the wine at issue to be the label containing the “alcohol percentage, government warnings, and product bar code.” Id. The District Court found Duck Walk’s first argument to be “patently meritless.” Id. at 10. In interpreting the parties’ Settlement Agreement, the Court found that Duck Walk could not merely comply with the Agreement’s requirement by obtaining label approval from TTB. Further, the Court noted that if it accepted Duck Walk’s argument, then a “front” label with the Prefatory Language could be placed anywhere on the wine bottle as long as such was approved by TTB (i.e., on the neck, strip, etc.)—and this could not possibly be what the parties intended.

The Court also rejected Duck Walk’s argument about the blue silhouette ducks and stated the vineyard’s argument was “absurd” and the words of the Settlement Agreement “permits Duck Walk to use only one of the approved images . . .  or ‘such similar pictures or depictions.'” Id. at 13 (quoting the Settlement Agreement). After analyzing Duck Walk’s blue duck silhouette in comparison to one of the labels annexed in the Settlement Agreement, the Court concluded that “the only thing similar about these images is that they contain ducks.” Id. at 14. (See example label below indicating one of the styles of ducks approved in the Settlement Agreement.)

Duck-Walk-Vineyards-Windmill-Red-Label

With respect to the production and distribution restriction claim, Duck Walk provided a declaration from its CEO, which introduced allegations and documents outside of the Complaints. However, the Court noted that, pursuant to FRCP 12(b)(6), a court’s review is limited to the facts asserted within the “‘four corners of the complaint, documents attached to the complaint as exhibits, and any documents incorporated in the complaint by reference'” and thus could not consider such facts without converting the motion to dismiss into a motion for summary judgment (which the Court deemed inappropriate given the factual dispute and the absence of discovery or evidentiary hearing). Id. at 15 (quoting McCarthy v. Dun & Bradstreet Corp., 482 F.3d 184, 191 (2d Cir. 2007)).

Images property of the Alcohol Tobacco Tax and Trade Bureau.

For more information on wine or alcohol law, labeling, or trademark, please contact Lindsey Zahn.

DISCLAIMER: This blog post is for general information purposes only, is not intended to constitute legal advice, and no attorney-client relationship results. Please consult your own attorney for legal advice.

al advice.

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CLE-International-Wine-Beer-Spirits-Law-Conference-Washington-DC-September-2014

CLE International is hosting the 19th Annual National Conference on Wine, Beer, and Spirits Law this September in Washington, D.C. The conference will be Thursday, September 18th through Friday, September 19th at the Mayflower Renaissance Hotel in Washington, D.C. Additionally, attendees can earn up to 12 MCLE credits including one hour of ethics credit. More information, including the registration page, is available on CLE International’s website. See CLE International (CLE): Wine, Beer, and Spirits Law, Washington, D.C., September 18–19, 2014

The conference will include speakers from the following:

  • Alcohol and Tobacco Tax and Trade Bureau
  • Pillsbury Winthrop Shaw Pittman
  • McDermott Will & Emery
  • Diageo North America
  • Virginia Department of Alcoholic Beverage Control
  • New Belgium Brewing Company
  • Wine Institute
  • Federal Trade Commission
  • Hangley Aronchick Segal Pudlin & Schiller
  • And more to come!

Additional information on the conference will be posted on CLE International’s website in the upcoming weeks.

Update on July 20, 2014

CLE International has provided the following additional information regarding September’s conference:

CLE International Wine, Beer, Spirits Law Conference September 2014

CLE International Wine, Beer, Spirits Law Conference September 2014

 

Photos provided courtesy of CLE International.

DISCLAIMER: This blog post is not intended as legal advice, and no attorney-client relationship results. Please consult your own attorney for legal advice.

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There’s been a lot of news over the last few months with respect to China and wine trademarks, especially with respect to French winemakers. See, e.g.Is China Making a Step Forward in Wine Trademark Law? and French Wine Company Castel Frères to Pursue Trademark Battle Against Panati in China’s Supreme Court. On May 1, China’s new trademark law went into effect. The new law presents a number of significant changes, some of which are highlighted below:

  1. Aims to deter trademark hijacking (or squatting) by imposing an obligation to uphold the principle of good faith on new mark filings and similar for trademark agencies, and recognition of bad faith extended further;
  2. Attempts to deter infringement by, i.e., raising the compensation ceiling for trademark infringement to about $500,000 (U.S.), or roughly six times the previous limit;
  3. Greatly increases the allowable types of marks to be registered (inclusive of sound marks); and
  4. Overall increased improvement of administrative filing details such as introducing timelines for processing reviews and oppositions.

For more details on China’s new trademark law, see Trademark Law of the People’s Republic of China (2013, Comparison Version) and, for insight with respect to the wine industry, Section 4 of No Wine-ing: The Story of Wine Companies and Trademark in China.

This last week, a group of French wine authorities received a significant victory at a Beijing court with respect to trademark registration. A Chinese company sought to register the Chinese translation of Roussillon as a brand name as well as the Latin version of Roussillon and Banyuls, but its wines did not contain grapes from the Southern French wine region. See Roussillon Winemakers Win Trademark Case in China. The Tribunal of Commerce and Industry annulled the request to register on the grounds that registering Roussillon as a brand name had the potential to cause consumer confusion.

Is this the work of China’s new trademark law? Perhaps. At this point, and until we start to see more cases with similar results, it is hard to say. The new Trademark Law does clarify the terms of likelihood of confusion, and verifies that there must be a likelihood of confusion when similar marks are used on goods that are either the same or similar. Perhaps it is a strong enough outcome right now that the Court ruled against what might otherwise promote consumer confusion in the wine market. Still, it will be easier to conclude in favor of the new law should this case have the same (or similar) result on appeal. (As of now, the Chinese company is reportedly appealing the ruling of the Tribunal of Commerce and Industry. See id.) There have been both favorable and unfavorable results with respect to trademark registrations in China (before the new law went into effect), and one positive result may be too early to conclude the effectiveness of the amendments.

For more information on wine or alcohol law, international trade, or trademark, please contact Lindsey Zahn.

DISCLAIMER: This blog post is for general information purposes only, is not intended to constitute legal advice, and no attorney-client relationship results. Please consult your own attorney for legal advice.

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Uproot Wines Rose Wine LabelThere’s been some chatter recently about Uproot Wines and its newly introduced color-coded labels that represent the wine’s flavor palette. See, e.g., Millennials Targeted with Color-Coded Labels. The colored boxes on the true front label of the wine feature what Uproot Wines declares is a flavor palette, or a profile of what the wine in the bottle tastes like. The size of the boxes indicates how dominant a certain note is. For example, its 2011 Cabernet Sauvignon features a label with colored boxes in shades of raspberry, mustard yellow, burgundy, grape, and brown. The Cab’s flavor profile is said to correspond with these colors and consist of notes of raspberry, Cuban cigar, cherry, blackberry, and dark chocolate (with raspberry and blackberry appearing as the largest colored boxes and, hence, the most predominant notes). While the labels are unique, I’ll leave it to the marketers of the world to talk about the branding and design elements. Instead, I want to look at the labels from a legal perspective under 27 CFR Part 4, the relevant section of the Code of Federal Regulations on wine labeling and advertising. See generally 27 CFR Part 4 (outlining provisions of wine labeling and advertising regulations).

Generally speaking, like other wine labels within the labeling jurisdiction of the TTB, Uproot’s labels were pre-approved by the federal government. Such is evidenced by its Rosé Wine label approval here and its Grenache Blanc label approval here. Additionally, the true back labels of the wines produced by Uproot contain mandatory statements, such as the Alcohol by Volume statement, Net Contents Statement, and the Health Warning Statement. The true back label is a good example of the bare bones of a wine label, i.e., the back label contains only mandatory information that is required by federal law (with the exception of the website and social media addresses, which are considered to be voluntary information). I quite like the label design of these wines, and it left me wondering the following: are we heading toward a trend of textless wine labels? Or will demand for truth in labeling reign?

Uproot Wines Rose Wine True Back Label

Uproot Wines’ True Back Label of its Rose Wine

From a regulatory perspective, surely a textless label would make labeling specialists’ jobs easier and cut down the average processing time of a label (if not eliminate the processing time altogether). However, given that there are some requirements that must appear on a label, it is unlikely such requirements would disappear, especially after one considers the history and posture of these mandatory statements. If we were to ever come to a point where mandatory information was not required to be placed directly on a label, but could instead be viewed through a scannable Quick Response code (“QR code”), it is likely there would still be a level of government regulation with the type of information that could be presented (as well as the type that must be presented) by the scannable code. I can almost imagine a similar online submission process to COLAs Online, entailing the enduser to submit the information that appears through the scannable barcode to the government for prior approval.

From a marketing perspective, however, there are some features that producers may always want to keep on a wine’s label, such as a vintage year or an appellation of origin, so it is possible this aforesaid textless label may never appear discounting any regulatory reasonings. For some wines, the appellation may be the strongest branding for a wine produced and whose grapes are grown in a notable region whereas, for other wines, the brand name will always take precedence. These may be textual elements that, for marketing and other brand awareness purposes, may never leave a wine’s label. For Uproot, I think there is something to be said about placing a purely pictorial or graphic reference on the true front of its wine bottle as the focal point of the consumer, especially without referencing its brand name or producer (at least, not on the true front label). Its labels altogether are far off from a “textless” wine label, however its approach to minimalism is entirely respectable.

The age old story is, however, the law is persistently slow to catch up to innovation. Albeit, it is enjoyable to think about the possibilities that wine labels could take on. It should be noted, however, that it is TTB’s position that relevant sections of 27 CFR and the advertising provisions of the Federal Alcohol Administration Act (“FAA”) do apply to advertisements in social media, inclusive of QR codes and other 2D mobile barcodes that link to content that is a “written or verbal statement, illustration, or depiction that is in, or calculated to induce sales in interstate or foreign commerce.” See Use of Social Media in the Advertising of Alcohol Beverages.

Photographs property of Uproot Wines.

For more information on wine or alcohol law, labeling, or TTB matters, please contact Lindsey Zahn.

DISCLAIMER: This blog post is for general information purposes only, is not intended to constitute legal advice, and no attorney-client relationship results. Please consult your own attorney for legal advice.

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The following Alcohol Facts statement illustrates an acceptable panel display for a 750 milliliter bottle of wine containing 14 percent alcohol by volume.Last week, TTB updated its FAQ section on optional Alcohol Facts statements to include more information on Alcohol Facts statements (or alcohol facts panels). The updated information includes TTB’s insights on whether per-serving and per-container alcohol content information can be placed on labels and in advertisements which do not contain nutrient content information for the beverage. In its updated FAQ section, the agency stated that the use of per-serving alcohol content information on labels or in advertisements (without providing nutrient content information) is permissible provided such is truthful and accurate as per Serving Facts statement under TTB Ruling 2013-2. In its updated FAQ section, TTB noted that such information should be included under a heading titled “Alcohol Facts” (as opposed to “Serving Facts”) and must include the serving size, the number of servings per container, and the percentage of alcohol by volume statement along with a numerical statement indicating the amount of fluid ounces of pure ethyl alcohol per serving. See TTB: FAQs: Alcohol Facts Statements: AF1. The updated information on TTB’s Alcohol Facts statements FAQs includes information on the type of serving size to use if Alcohol Facts statements are included on labeling or in advertisements, how to calculate the number of servings per container and the fluid ounces of alcohol per serving, and whether a new application for a label approval must be submitted upon using an Alcohol Facts statement, among other related information. (Generally speaking, should a beverage alcohol label Alcohol Facts statement be formatted as depicted in TTB’s FAQ section AF9, a new COLA will not be required for beverage labels adding an Alcohol Facts statement; however, the agency notes that should the alcohol facts statement be formatted or positioned in a way other than those outlined by TTB, such will require a new COLA and will be approved on a case-by-case basis. See id.)

Last year, TTB issued a ruling titled “Voluntary Nutrient Content Statements in the Labeling and Advertising of Wines, Distilled Spirits, and Malt Beverages” as an interim policy on the use of Serving Facts statements with respect to the labeling and advertising of alcohol beverages. See Voluntary Nutrient Content Statements in the Labeling and Advertising of Wines, Distilled Spirits, and Malt Beverages. While this ruling spoke mostly to serving facts/nutrient content (i.e., calories, carbohydrates, fats, and protein) with respect to beverage alcohol products, the agency did remark that “[t]ruthful, verifiable numerical statements of alcohol content may be included in Serving Facts statements as an option.” Id. The interim policy is pending the completion of a final rule, in which TTB “propose[s] to issue regulations requiring Serving Facts statements on alcohol beverage labels.” Id. (According to TTB’s 2007 proposed rule entitled, “Labeling and Advertising of Wines, Distilled Spirits and Malt Beverages,” such would include information on the number of calories as well as the number of grams of carbohydrates, protein, and fat; alcohol content and the percentage of alcohol by volume would also be permitted in the Serving Facts statement. The agency received a significant amount of comments in response to the proposed rule, which can be viewed on the Regulations.gov website. See Labeling and Advertising of Wines, Distilled Spirits and Malt Beverages (Serving Facts Labeling.) While the ruling discussed including alcohol by volume statements (as well as fluid ounces of alcohol per serving) in the context of Serving Facts, the ruling did not address the ability to create an Alcohol Facts statement (as TTB’s FAQ section now acknowledges).

The flexibility to (voluntarily) include an Alcohol Facts statement is great for the industry, especially for those products with previously approved COLAs. TTB’s new FAQs are generally straightforward for those who wish to add the voluntary Alcohol Facts statement without nutrient content information. Further to the point, the addition of such a statement can usually be done without the need for a new COLA, which helps both industry  as well as TTB with saving time and curbing additional costs. Instituting a mandatory Serving Facts statement requirement, however, has proven quite contentious among industry members (as demonstrated by many of the comments to the proposed rule). It is true that mandating such will require industry members to redesign labels as well as analyze the contents of their products, both of which are timely and costly, however perhaps such initiative is yet another acknowledgement that the consumer demand for truth in labeling is dramatically increasing. Several weeks ago, I discussed FDA’s proposed redesign of its nutrition facts panel and the impact on the alcohol beverage industry. See Is TTB Next? FDA’s New Proposed Nutrition Label and its Effects on Alcohol Beverages. While it is not likely that the agency is close to establishing an FDA-styled nutrition facts panel, it is conceivable that the Alcohol Facts statement and the Servings Facts statement are both a step in this direction, i.e., a step in the direction of full(er) disclosure.

Photograph property of the Alcohol Tobacco Tax and Trade Bureau.

For more information on wine or alcohol law, labeling, alcohol facts, or TTB matters, please contact Lindsey Zahn.

DISCLAIMER: This blog post is for general information purposes only, is not intended to constitute legal advice, and no attorney-client relationship results. Please consult your own attorney for legal advice.

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