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New York is home to over four hundred wineries as of March 2014. See New York Wine and Grape Foundation: Wineries by County. While this number may not compete with the amount of wineries currently housed by California, it makes New York home to the greatest number of wineries on the East Coast. See North American Winery Total Passes 8,000. As of Year 2013, the state boasted wineries in 53 of its 62 counties (this number includes both traditional wineries and satellite stores or branch offices). See New York Wine and Grape Foundation: Wineries by County. This is a significant increase from 1976, or the year the New York State Farm Winery Act was passed. See id. (compare with fourteen wineries in nine counties, circa 1976; compare also with 125 wineries in 24 counties as of Year 2000). 

In 2012 alone, New York State boasted that its wine industry had a state-wide economic impact of $4.8 billion. See, e.g., Economic Impact of Grapes, Grape Juice, and Wine: $4.8 Billion. Its nearest East Coast competitor, the state of Virginia, maintains that its wine industry had an economic impact of just under $750 million in Year 2010. See Virginia Wine Industry Jobs Grow by 50%; Economic Impact Doubles, New Study Finds.

While the aforesaid numbers speak considerably well of New York’s wine business, in an industry so highly regulated by federal, state, and local officials, one must not rely on numbers alone. The laws, rules, regulations, and state agencies must also be in favor of a growing industry, as well as support and cultivate development and expansion. That being said, there are a number of examples of how New York’s wine industry has significant backing from the state government, as well as from numerous private ventures.

New York’s Farm Winery License and Other Legislative Measures

Perhaps the most significant development in New York’s legal landscape with respect to fostering the growth of the state’s wine industry is the amendments to the farm winery license. The farm winery license, which (generally speaking) allows a licensee to manufacture wine and sell their wine to wholesalers or retailers, has a significantly reduced annual license fee ($175 as opposed to $1,075) and requires a lower surety bond ($1,000 as opposed to $10,000) than that for a full New York State winery license. While farm winery licenses are limited to businesses that produce 150,000 finished gallons of wine per year or less, the simplified requirements and costs of the farm winery license serves as a great initiator for smaller wineries in New York State. N.Y. ABC LAW § 76-a.

Further, in June 2011, Governor Cuomo signed a bill called the Fine Wine Bill, which significantly reduced the regulatory requirements for the state’s farm wineries. See Friendlier Legislation for New York State Farm Wineries. Since becoming law, the farm winery license now allows a licensed farm winery to open branches within the state without needing to apply for additional licenses (and such branches enjoy the same privileges, such as the ability to conduct tastings, as the licensed farm winery), among several other advantages and relaxed requirements. See Analyzing N.Y.’s New Wine Law. The aim of this new legislation was to foster and cultivate the growth of New York’s industry, especially among smaller producers. Effectively, the revised farm winery law places tools in the hands of smaller, local wineries and gives them the power to grow, expand, and promote their wines throughout the state with reduced entrance hurdles. (Note: Since the enactment of the Fine Wine Bill in 2011, the number of New York farm winery licenses has grown from 195 licenses in 2011 to 273 licenses in 2014. See Number of Farm-Based Breweries, Cideries, Distilleries, and Wineries Increase 72% since 2011.)

To another extent, there have been a number of legislative measures enacted in the last year or so that continue to encourage the growth and development of the state’s wine industry. Of particular and relevant interest are the following:

  1. The sale of wine at roadside stands (the roadside farm markets bill); and
  2. The rebranding and designation of the state’s wine trails.

The farm markets bill (now law) authorizes a roadside stand to sell wine from up to two licensed farm, special, or micro wineries within a twenty-mile radius of the stand. See S-2617/A-1512. This new measure increases the availability and awareness of locally-sourced wine, generates what the bill’s authors anticipated would be increased revenue for both the stand owner and the wineries, as well as contributes to the excise tax collection on behalf of the state. See, e.g., New Laws to Help New York Vintnerssee also Legislative Gazette: New Laws to Help New York Vintners (NY). The roadside farm market license is currently available from NYSLA and costs $100 per year as of April 1, 2014. See Application for Alcoholic Beverage Control Retail License: Roadside Farm Market.

The rebranding and designation of New York State’s wine trails is supported by four bills, now law. One of the new laws expands the Shawangunk East Wine trail. See A.4616-a/A.2790. The other new laws include expansion and renaming of the The Niagara Escarpment Wine (now to be called the Niagara Wine Trail Ridge), The Niagara Wine Trail (to be renamed Niagara Wine Trail Lake), and The Chautauqua Wine Trail (to be renamed Lake Erie Wine Country Trail) and establishes establishes the Adirondack Coast Wine Trail. See A02024A/S01095-A; A05721/S03923-B; and A03758/S01013-B. Further, Governor Cuomo’s dedication to New York State wineries is also demonstrated through Taste NY, which is a program designed to promote awareness and availability of New York-made food and beverage products (including wines) among local residents and visitors to the state through retail venues and events.

From a more academic perspective, Cornell University has shown great initiative in the State with the introduction of its 3,900 square foot teaching winery on its Ithaca campus. See Cornell Shows Off New Teaching Winery. While the teaching winery aims to instruct students of the university using small-scale winemaking equipment and winemaking processes typical of small lot sizes, the true gem of Cornell’s commitment to the wine industry stems from its four-year viticulture-enology major that exposes students to both the theories and practices of grapegrowing and winemaking. Id. Cornell’s teaching winery facility remains the only university teaching winery in the Eastern United States.

Legislative Drawbacks

While the above highlights some of the major legislative (and academic) measures taken to support New York’s growing wine industry, the state is not without its faults (from a legislative perspective). For example, New York has a proposed “at-rest law” which would require alcohol beverages delivered to New York retailers to be “housed” or to “rest” at the premises or warehouse within the state, owned by a licensed New York State wholesaler, for at least twenty-four hours before delivery to a retail licensee. See S3849-2013; Regional Macroeconomic and Fiscal Impacts of New York’s Proposed At-Rest Legislation. While the State cites concerns regarding authenticity or legality of products and proper payment of taxes as reasons why such an amendment should be enacted, there is much opposition both intra and interstate. See, e.g.New York Alliance of Fine Wine Wholesalers: The Impact of Proposed “At Rest” Legislation on New York State’s Economysee also New York Cork Report: Op-Ed: In New York, a David & Goliath Story Unfolds. Without getting into further detail, this is a significant proposal to amend New York’s legislation, one that (as many argue) has a serious potential to negatively impact many aspects of New York’s alcohol beverage industry. See, e.g., Baffling Wine Bill Leaves Sour Taste (arguing that the proposed at-rest law could increase the cost of wine and could cause smaller distributors to go out of business or avoid the New York market). Although this proposed law does not directly regulate the state’s winegrowers, the inevitable flow of wine products through the three-tier distribution model will impact growers and producers to the extent that the types of wines offered at retail to consumers could be more limited should the bill become law.

Further, although still pending a declaratory ruling, there seems to be much concern about NYSLA’s position with items like third party marketers and Internet wine sales. See, e.g.New York Crackdown on Internet Wine Sales Just Another Slap in the Face to the State’s Wine Lovers.

While the state’s wine industry is clearly booming from a growth perspective, many of its legislative initiatives must still be altered to recognize and respect that New York’s wine industry is a major contributing factor to the state’s economy. Further to the point, laws and regulations that foster the growth and expansion of a New York wine industry will only assist state producers gain additional international recognition, as well as remain one of the top domestic producers of grape wine. It seems indisputable that Governor Cuomo’s regime supports the advancement and prosperity of New York’s wine industry—this is evident through recent bills passed into law under his governorship—however, the development of counterproductive laws and bills, such as the “at rest” law, could be a restraining factor in the state’s successes.

In 2013, the American Wine Consumer Coalition graded states on the basis of how friendly each was to consumers with respect to wine accessibility. While California unsurprisingly received an A+, New York ranked number 28 in friendliness and received a grade of a D+. See New Report Reveals Which States Are Friendliest to Wine Consumerssee also The 2013 State-by-State Report Card On Consumer Access To Wine. The reasoning? New York’s prohibition of grocery store wine sales and refusal to allow retailers to directly ship to consumers. See Wine-Drinker Lobby Gives California Laws an A+; New York Gets a D+. Note: Virginia, New York’s closest East Coast competitor, received a grade of A+ for consumer accessibility to wine. For a state that boasts the third highest domestic production of wine, and is the greatest producer of wine on the East Coast, I have one word: Ouch.

In other words, New York, we have much work to do.

For more information on New York State wine or alcohol law, or establishing a winery, brewery, or distillery in New York, 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.


Three renowned wine regions recently signed the Joint Declaration to Protect Wine Place & Origin. By signing the Declaration, the new signatories—the American wine region of Santa Barbara County and the French wine regions of Bordeaux and Bourgogne/Chablis—become part of a global movement to protect wine place names and ensure that such are not used improperly or in a misleading fashion.

While the declaration contains signatures of recognized and respected wine regions—including, but not limited to, Napa Valley, Douro Valley, Sonoma County, Walla Walla Valley, and Willamette Valley—the addition of great regions Santa Barbara County, Bordeaux, and Bourgogne/Chablis simply reinforces the movement’s success and prominence. Further, the recognition of the Declaration by such prominent regions indicates how important truth in labeling is to the consumer as well as regional producers. More importantly, the supplementary endorsers confirm the underlying importance of accurate labeling in the context of global international trade, particularly with respect to provincial characteristics of the land that simply cannot be reproduced or manufactured, which is (more often than not) a struggle for producers of many global wine regions to properly protect in international commerce.

More appropriately:

By becoming signatories of the Declaration, members agree that geographic names are fundamental tools for consumers to identify the special wines associated with specific winegrowing regions. And as such, they commit to work together to bring the necessary awareness and advocacy to bear to ensure these names are protected and respected. From great winegrowing regions to consumer rights groups to everyday wine consumers, more and more are making their voices heard in the campaign to protect wine place names. 

Two Renowned Wine Regions Join Growing Global Coalition to Protect Wine Place Names.

The addition of wine region parties to the Joint Declaration to Protect Wine Place & Origin is likely to become more and more frequent as wine regions grow and as wine trade expands and evolves. Specifically, it is not inconceivable that more wine regions will join the Declaration as signatories to fortify their recognition in the global market. This may even become more prevalent as wine regions enter markets where producers from other regions use similar or the same names on wine products that do not originate from the actual region that gained place and name recognition.

For more information on wine or alcohol law, international trade, or geographical indications, 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.


New TTB Ruling on Bottling Taxpaid Wine in Growlers

Environmentally-conscious and corkscrew-phobic wine lovers alike will be thrilled to hear that TTB issued a ruling on March 11, 2014, allowing the filling of wine growlers by TTB-licensed taxpaid wine bottling houses (“TPWBH”). The ruling is in response to a new Washington state law allowing state-licensed wineries to sell wine off-site in kegs or “sanitary containers” (i.e., growlers) for off-premise consumption.  Oregon passed a similar law in April 2013.  

Continue reading the full article at Bevlog.

Reprinted with the permission of Lehrman Beverage Law, PLLC.

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


The San Antonio Winery recently obtained a preliminary injunction against Constellation Brands. On March 11, 2014, Judge John Kronstadt of the U.S. District Court for the Central District of California ruled that Constellation’s Rosatello brand was too similar to the Stella Rosa wine of San Antonio Winery. See San Antonio Winery Earns Victory in Stella Rosa Trademark Litigationsee also San Antonio Winery Earns Victory in Stella Rosa Trademark Litigation. A good comparison of the two labels can be seen here.

San Antonio Winery—which (despite its name) is an historic, family-owned winery located in Los Angeles, California—filed a complaint against Constellation in August of last year. In its complaint, the winery argued that the two products would cause consumer confusion due to the similar names and packaging. The Rosatello wine is a sparkling rosé from Italy and is imported by Constellation. Both labels feature the word “Rosa” on the front label in red with a crown-like emblem on top of the name. The fonts and colors used on the labels are very similar.

The hearing for San Antonio Winery’s motion for a preliminary injunction was held on January 27, 2014. An order was entered on March 11, as per the below:

Defendants, their officers, agents, servants, employees, and attorneys, and all persons in active concert or participation with them who receive notice of this Order, are preliminarily enjoined from importing, distributing, and/or selling wine or other products that are packaged and/or labeled as [image depicting Constellation’s Rosatello wine]. San Antonio Winery v. Constellation Brands, Case No. CV13-6409 DDP.

The injunction can be accessed here.

While this clearly marks a strong victory for San Antonio Winery, it also signifies another wine lawsuit pursued against a global entity by a domestic winery. Recently, Madison Vineyard Holdings, owner of the Jamieson Winery in Napa Valley, filed a complaint against Pernod Ricard’s Irish Distillers Limited following a cease-and-desist letter issued by Irish Distillers Limited. See Jamieson Vineyards Takes On Pernod Ricard’s Irish Distillers. As noted previously, the interesting aspects about both the Jamieson v. Jameson case and the San Antonio Winery v. Constellation Brands case is the eagerness and courageousness of smaller wineries to pursue larger and, in these particular suits, global corporations. While each case should be evaluated on the basis of their individual facts, this achievement for San Antonio Winery is notable for smaller or regional producers who believe their intellectual property rights might be infringed upon by larger corporations.

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


On February 27, 2014, the Napa Valley-based vineyard Madison Vineyard Holdings, LLC, the owner of Jamieson Ranch, filed a complaint against Pernod Ricard’s Irish Distillers Limited, owner of the renowned Jameson Irish Whiskey, in the United States District Court Northern District of California. See Madison Vineyard Holdings, LLC vs. Irish Distillers Limited. The suit follows the receipt of a cease and desist letter sent by Irish Distillers to Madison Vineyard Holdings, the owner of Jamieson Ranch, last month. 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 Madison Vineyard Holdings 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.

The Napa Valley-based vineyard changed its name from Reata Winery to Jamieson Ranch in mid-2013 and started to sell wine under the Jamieson label in or around September 2013. See Madison Vineyard Holdings, LLC vs. Irish Distillers Limited, at 3. Madison filed for a new trademark with the USPTO on February 15, 2013. According to the complaint, after reviewing the trademark application, the USPTO examining attorney found no conflicting marks that would bar the registration of Jamieson. Id. On December 3, 2013, the mark JAMIESON RANCH VINEYARDS was published for review in the Trademark Official Gazette. Id. On December 19th, Irish Distillers subsequently filed a request for a 90-day extension of time to oppose the mark and USPTO granted said request, extending the time to oppose to April 2, 2014. Id. Shortly thereafter, its counsel issued the aforementioned cease and desist letter, after which Madison Vineyard Holdings filed said complaint for declaratory relief.

In the complaint, Madison asserts the following:

  1. There is no likelihood of confusion between the marks, and Madison’s use of Jamieson Ranch Vineyards does not infringe the trademark rights of Irish Distillers; further, Madison seeks declaratory judgment certifying Madison’s rights to continue to use the Jamieson Ranch Vineyards mark with respect to its wine products and vineyard;
  2. Madison’s use of the Jamieson Ranch Vineyards mark on wine does not constitute trademark dilution and thus seeks declaratory judgment certifying Madison’s rights to continue to use Jamieson Ranch Vineyards with respect to its wine products and vineyard; and
  3. The vineyard’s use of Jamieson Ranch Vineyards with respect to its wine and vineyard does not establish trade dress infringement, thus Madison seeks declaratory judgment certifying its rights to continue to use the term Jamieson Ranch Vineyards with respect to its wine products and vineyard.

Id. at 4–5.

The interesting aspect about this case is the sheer willingness and bravado of a smaller producer (here, Jamieson Ranch) to take on a legal battle against an extremely endowed corporate company like Pernod Ricard. The Ranch does ask, in its complaint for declaratory relief, that the Irish Distillers reimburse its counsel fees. Perhaps this suit is Jamieson’s way of showing it will not be victim to what Jamieson Ranch may deem to be a means of intimidation. Still, perhaps fighting this battle is considerably economical in comparison to pursuing another name change, and all of the repercussions that inevitably come with a new business name.

To find in favor of likelihood of confusion, a court would consider several factors, commonly referred to as the DuPont factors in the federal circuit, including (but not limited to) the following: strength of the prior mark (here, Jameson); similarity of the marks with respect to appearance, sound, connotation, or commercial impression; similarity of the products or services; the intent of Jamieson in adapting its mark; evidence of actual confusion by consumers; number and nature of similar marks; and the sophistication of the buyers. In re E.I. du Pont de Nemours & Co., 476 F.2d 1357, 177 USPQ 563 (CCPA 1973). In this case, there are certainly a number of arguments that can be made in favor of either party. Irish Distillers will likely argue the strength of its mark through evidence including sales history, global recognition, and advertisements to establish that the mark has acquired secondary meaning, as well as point to the similar trade channels and the marks’ similarity in sound. Jamieson may argue that the wine market tends to contain sophisticated buyers, individuals who have a greater tendency to be informed purchasers and may be less likely to confuse and/or associate the Jamieson mark with the Jameson whiskey mark.

What do you think? Jamieson versus Jameson—are the names too close for comfort, or is it quite unlikely a consumer would confuse and/or associate the two marks?

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.


Last year, I blogged several times about nutrition facts panels and ingredients statements in relation to wine and other TTB-regulated alcohol products. See A Regulatory Analysis: Nutrition Fact Panels and Ingredient Statements on Alcohol BeveragesFull Ingredients List to Appear on 2011 Ridge Vineyards Wine Label. As many know, for the majority of alcohol beverage products that fall within its labeling jurisdiction, the TTB does not require calorie counts, nutrition facts, or ingredients statements that are frequently seen on FDA-regulated food and beverage products. Such information is voluntary for TTB-regulated alcohol beverages.

Over the last few years, however, there’s been a trend in the amount of voluntary disclosure by producers of items like calories and ingredients. For example, last year Ridge Vineyards announced its 2011 vintage would feature a full disclosure of the wine’s ingredients as well as the actions followed to produce the wine. In other words, a food-styled ingredients list appeared on the labels of Ridge’s 2011 release. Ridge was not the first winery to release a full ingredients list on its wines, but Dave McIntyre speculated that Ridge’s ingredients statement might have a greater influence over the industry than other full disclosure labels (including those from Bonny Doon, as here and here, and Shinn Estate, as here and here). Finally, companies like Skinnygirl boast calorie counts on their back labels and entice the consumer to enjoy the product “without the guilt.”

Ridge Vineyards 2011 Vintage with Ingredients Statement on Label

Since then, the powerhouse MillerCoors very recently announced its adaptation of the first U.S. beer nutritional facts label on its Miller64 beer. See MillerCoors Adopts First U.S. Beer Nutritional Labeling. Scott Bussen, a marketing communications representative for MillerCoors, stated the company’s decision to include such on its Miller64 line stems from the company’s belief that adding a nutritional label is “right for [its] business and [its] consumers.” Id. The new labels are said to debut in mid-March. The COLA for Miller64, as of February 20, 2014, indicates that the cans will include the serving size, calorie count, carbohydrates, fat, and protein content.

Last week, the FDA proposed some significant changes to its nutrition facts label. See Nutrition Facts Label: Proposed Changes Aim to Better Inform Food Choices. The nutrition facts label that currently appears on the labels of FDA-regulated food products was born in 1993 with the mission to educate consumers about the nutrient, vitamin, and mineral contents of food products on the marketplace. (And, with its introduction, came over 900 pages in the Federal Register as to why such a panel was needed.) After a life of twenty years, the panel is about to take on some hearty alterations, the highlights of which are:

  • A greater emphasis on calorie count (larger and bolder text);
  • A line indicating the amount of “Added Sugars”;
  • Removal of “Calories from Fat”;
  • Greater prominence of the amount of servings per package;
  • Updated serving size requirements;
  • Updated Daily Values (which are used to calculate the Percent Daily Value, or % DV, on the label) of many nutrients;
  • Moving the % DV of nutrients to the left-hand side of the label; and
  • Requiring the label to disclose the amount of potassium and Vitamin D present (Vitamins A and C can be listed voluntarily).

Id. FDA cites matters such as the updated scientific evidence corresponding to obesity and heart disease, the change in how people eat, and an attempt to curb obesity as reasons for this cardinal change. FDA’s proposed rule appeared in the Federal Register on Monday, March 3, 2014. Public comments can be made through June 2, 2014.

FDA New Proposed Nutrition Facts Panel

These proposed changes are significant to a nutrition facts panel that has not seen many transformations in its twenty year history. But more specifically, they exhibit the agency’s clear awareness of how the food consumer market has changed since 1993: a desire to be an informed buyer of food products. For those consumers who do regularly check the nutrition facts panel of products they purchase, the panel provides greater insight to the packaged product. The separation between sugars and added sugars informs a potential purchaser of how much sugar is present in the product naturally—and just how much sugar is supplemented by processing or similar. Further, the enlarged calorie count is certainly eye-catching at the least, if not almost foreboding.

All of these significant proposed changes for food products leave us with two questions: Is TTB next? And how will FDA’s proposed nutrition label changes affect alcohol beverage labels? The answers to these questions are not so simple, and show the clear division of how the two agencies regulate products that fall within their labeling jurisdiction.

Last year I posed two questions through one of my posts:

Are we, as consumers, entering a time period where full ingredient disclosure on wine labels is influential to our purchases? Is there ever an instance where it is advantageous for a winemaker to tell a full story on a label?

The answer is this: it takes three to label an alcohol beverage product. Those three are, of course, the consumers, the producers, and the agency.

The changes to the FDA nutrition facts panel indicates a trend, over the last twenty years, for greater consumer awareness in the types of food consumed. Specifically, in the amount of calories consumed, the level of sugar intake, and a greater understanding of percent daily value. The shortage of nutrition labels on most alcohol beverage products does not, in any way, discount this trend. TTB has been pressured by a number of consumer groups over the last few years, encouraging the agency to to develop a standardized nutritional labeling policy to allow consumers to monitor calorie intake of alcohol beverages. See, e.g., Consumer Groups Push for Mandatory Alcohol Labeling. However, the overwhelming interests of other industry members, i.e., producers and the agency, may simply curtail these efforts.

In May of last year, TTB published a ruling, Voluntary Nutrient Content Statements in the Labeling and Advertising of Wines, Distilled Spirits, and Malt Beverages, after the Federal Trade Commission required Four Loko to apply to TTB for permission to post a nutrition facts panel on its products. See Voluntary Nutrient Content Statements in the Labeling and Advertising of Wines, Distilled Spirits, and Malt Beverages. The ruling was considered by many to be a “good step” in the direction of standardized nutrition and serving facts labeling, but the agency was still encouraged to produce a final rule and mandate nutritional labeling on all alcohol beverage products. Specifically:

A voluntary approach simply won’t assure that consumers are provided this important information on all alcoholic beverages they choose to consume. And a standardized serving facts label would help consumers more easily understand the information presented and be able to compare information across products and categories.

What’s In Your Drink? TTB Takes a Step Toward Alcohol Labeling. The new FDA proposed nutrition facts panels puts additional pressure on TTB to formulate a mandatory policy for its own nutrition labels. However, while the promotion of FDA’s new and improved panel will likely encourage TTB to address its own labeling, the agency is not yet at a point where nutrition facts panels will become mandatory elements of alcohol beverage labels. That being said, the time is still approaching.

If we were much closer to a point where consumers, producers, and the agency (here, TTB) were ready and prepared to tackle the nutrition facts panel question, it would be of great cost to the industry—aside from the obvious costs to producers to add such a panel to current products, the agency would also exhibit an exorbitant amount of costs given its pre-market approval requirement for alcohol beverage labels. There would need to be a significant “phase out” time period in the interim before the change over to mandatory nutritional labeling. Further to the point, when considering the nutrition facts panel and the alcohol industry, we must be mindful of the fact that the FDA does not have a pre-market approval system for food product labels whereas TTB requires pre-market approval for its beverage labels. The answer, very simply, amounts to this: if nutrition facts panels similar to those found on FDA products were to become mandatory elements of alcohol beverage labels, TTB does not have the resources at this time to review a full nutrition facts panel on label applications of beverage products and instead must develop a panel that conforms with its regulatory style. While (some) consumers may be ready, willing, and eager to enter a marketplace stocked with full disclosure of ingredients and/or nutrients on alcohol beverage products, a TTB-mandated panel will take many seasons to develop, let alone go into effect.

FDA’s progress does, however, serve as an additional advocate for mandatory nutritional labeling on alcohol beverage products. The food agency’s progress, combined with the great steps by industry members like MillerCoors, Skinnygirl, and Ridge Vineyards, are only proof that we are heading toward an age of full disclosure.

Photographs property of the Alcohol Tobacco Tax and Trade Bureau and the Food and Drug Administration, respectively.

For more information on wine or alcohol law, labeling, FDA, TTB, or nutrition fact panels, 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.


In late 2011, Jackson Family Wines filed a compliant against Diageo North America after Jackson issued a cease and desist letter that Diageo stop use of one of Diageo’s marks in August 2011. See, e.g., Jackson Family Wines Sues Diageo Over La Crema Trademark. The complaint argued that the Crème de Lys brand, wine selected by Diageo Chateau & Estate Wines, infringed upon Jackson’s La Crema brand. Further, the complaint named Jennifer Josephson, a director of Consumer Planning for Diageo North America, as the “conduit” between the marketing team of Diageo and a third-party market research group, Northstar Research Partners LLC, that conducted focus groups for the selection of the Crème de Lys brand. According to Courthouse News Services, Ms. Josephson made an inquiry to Northstar as to why some focus group participants apparently voiced potential confusion with La Crema but such was not included in Northstar’s report to Diageo. See Sanctions Ordered in Wine Trademark Spat

In March 2012, Jackson served Diageo with document requests for production of all documents concerning the “‘selection, adoption, and/or use’ of the Crème de Lys mark.” See Jackson Family Wines, Inc., et al., v. Diageo North America, Inc. et al, No. 11-5639, N.D. Calif.; 2014 U.S. Dist. LEXIS 19420. Although Diageo had IBM copy (or image) Ms. Josephson’s work-provided laptop in 2011 after Ms. Josephson left Diageo, Diageo followed its standard policy for departed employees and deleted the hard drive in August 2012, eight months after the commencement of Jackson’s lawsuit. Diageo, however, did not reveal the destruction of Ms. Josephson’s laptop until a court-ordered Rule 30(b)(6) deposition on the preservation of Ms. Josephson’s documents in December 2013. “This involuntary disclosure occurred six months after Defendants discovered a ‘gap’ in their production of Josephson’s documents, and five months after they represented to the Court that ‘every single document’ for Ms. Josephson had been produced.” Id. Thereafter, Jackson moved for sanctions against Diageo’s spoliation and requested an adverse inference instruction for the trial on the case (which is to commence next month). Diageo argued that sanctions were not appropriate because: (1) Diageo acted in good faith when deleting the hard drive; (2) the deletion of the hard drive did not prejudice Jackson; and (3) Jackson’s own conduct precluded sanctions.

While Diageo argued that it acted in “good faith” and lacked culpability because the company was not aware that there might be documents of relevance on Ms. Josephson’s laptop, the Court was not persuaded. Pointing to Ms. Josephson’s role with Diageo, and Diageo’s own admittance of such, the Court was skeptical to find that the work of such an employee could not “at least [be] potentially relevant” from the point in time when litigation was reasonably anticipated (e.g., when Jackson first sent a cease and desist letter in mid-2011). Further, the Court reasoned that, despite being on notice that the documents were potentially relevant, Diageo failed to intervene with its own internal document retention policy and issue a litigation hold. The Court determined that, due to Diageo’s knowledge of Ms. Josephson’s role and her connection to Jackson’s claim—coupled with Diageo’s continued representation to the Court that every document in Ms. Josephson’s custodial file had been produced and the Court’s finding that the destroyed evidence contained relevant documents—Diageo’s failure to preserve her documents was willful spoliation. Id. at 11.

Spoliation sanctions are generally determined on a case-by-case basis. In determining what spoliation sanction to impose (the adverse inference instruction), courts generally consider three factors: (1) the degree or severity of fault of the party that altered or destroyed the evidence at issue; (2) the level of prejudice which the opposing party suffers; and (3) whether a lesser sanction is available to avoid substantial unfairness to the opposing party. Diageo argued that Jackson did not suffer prejudice because Diageo strongly believed Jackson received every relevant document concerning the focus groups and Ms. Josephson, either from Northstar or other custodians. While the Court was convinced that a large capacity of Ms. Josephson’s documents were produced by other custodians and Northstar, the Court reasoned that there was no way Jackson could represent, with complete confidence, that every relevant document had been produced.  Id. at 12. Additionally, the Court found that:

[A]lthough it is difficult, if not impossible, to identify what relevant documents are completely missing, and to what degree those documents would affect the outcome of this case, the Court finds it equally challenging—in light of Defendants’ efforts to conceal the spoliation—to conclude that the entire universe of relevant documents has been produced . . . . If Defendants had nothing to hide, then why did they willfully conceal the spoliation from the Plaintiffs and the Court? Because Defendants have not provided an answer to that question, they cannot defeat the presumption of prejudice. Id. at 12–13.

The Court decided that, given the combination of Diageo’s fault for destruction, the likelihood of prejudice, and the void of lesser sanctions, an adverse inference instruction was appropriate. Id. at 14. The Court’s proposed instructions to the jury are as follows:

Defendants Diageo North America, Inc. and Diageo Chateau and Estate Wines failed to preserve the only copy of witness Jennifer Josephson’s laptop hard drive after their duty to preserve arose. The hard drive may have contained emails, notes, and other documents relating to focus group sessions concerning the proposed mark that eventually became CRÈME DE LYS. Whether this fact is important to you in reaching a verdict in this case is for you to decide. Id.

In its instruction, the Court proposed a modified version of Jackson’s proposed instructions, reasoning that the instructions relay to the jury the Court’s findings regarding spoliation. The Court asserted that a harsher sanction would be improper given the “voluminous” evidence that Diageo did, in fact, produce. Id. The Court awarded monetary sanctions against Diageo, to be determined after the impending trial. See Magistrate Judge Imposes Adverse inference, Monetary Sanctions For Spoliation

Awarding sanctions does not necessarily mean a default win for Jackson. The trial is still to be litigated, and, because the adverse inference instruction speaks namely to Ms. Jennifer Josephson, much will depend on whether the jury finds Ms. Josephson to be an essential witness to the original suit. However, should the jury find Ms. Josephson to be an important witness, the adverse inference instruction does allow a jury to infer that the destroyed evidence would have been adverse to the destructive party.

Do you think the jury will find Ms. Josephson to be an important witness? Throughout the course of litigation, Diageo argued that she was a minor player in the development of its Crème de Lys brand (i.e., “‘limited and circumscribed role’ in the development of the brand”). Jackson Family Wines, Inc., et al., v. Diageo North America, Inc. et al at 12. 

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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Is China Making a Step Forward in Wine Trademark Law?

Castel French Winery Malbec Wine Label Trademark Law ChinaOne of my recent pieces was published by Cornell International Law Journal Online, which is an incredible online collection of short publications written by attorneys and law students discussing contemporary legal issues in various fields. I wrote about China with respect to trademark and the wine industry. Specifically, I discussed the success of two wine companies, Château Ausone and Barrière Frères, in front of the China Trademark Office (“CTMO”) at the dissatisfaction of two others, Castel Frères and Château Listran. See No Wine-ing: The Story of Wine Companies and Trademark in China.

For Château Ausone and Barrière Frères, it seemed as though China’s trademark office might be progressing and navigating away from its past history of awarding applicants who were first-to-file with the trademark (regardless of the applicant’s actual affiliation with the mark and irrespective of whether the true mark owner had evidence of prior use of the mark in Chinese commerce). Unfortunately, for Castel, the CTMO went in another direction. Back in July, a Chinese wine distributor, Panati Wine Co., Ltd., won trademark rights against an established French wine company, Castel Frères. See  See Largest Trademark Lawsuit in China’s Wine Industry Won Against French Castel. Although Castel’s wine was present in the Chinese market since 1999, the company did not register its mark and thus Panati, who filed first, established rights to the mark. Generally speaking, in the past, it has been the tradition of the CTMO to award trademark rights to individuals who are first to file a trademark application for the mark at issue. More information on the Castel and Panati dispute is available at On Reserve’s recent post French Wine Company Castel Frères to Pursue Trademark Battle Against Panati in China’s Supreme Court.

In October, On Reserve blogged that Castel decided to pursue the case in China’s Supreme Court in Beijing and would essentially “do whatever it takes” to receive a favorable outcome. See Castel Takes Trademark Battle to China’s Supreme Court. Last week, Decanter  noted that Castel received a notable and favorable ruling from China’s Supreme Court. This ruling is with respect to the fine issued by the lower court only (i.e., the Supreme Court has not reviewed Castel’s actual trademark). According to Decanter, the Supreme Court of China suspended the lower court’s decision to fine Castel CNY34m, or $5.6 million, which was payable to Panati and its owner. See China’s Supreme Court Suspends Castel Trademark Fine.

While China’s Supreme Court is still yet to review the actual trademark dispute, its decision to suspend Castel’s fine is a significant victory for the French wine company. In some ways, this is an indication that the outcome of Castel’s overarching trademark case may be very favorable to Castel. In many ways, this suspension is also a game changer for China; China’s trademark landscape is notorious for its “race to file” notion, causing many true mark owners to either change brand names or pursue more litigious and (what can be) costlier options. See, e.g., Bordeaux Chateau Changes Name to Bypass Chinese Trademark ‘Squatters.’ Recently, wine companies including two Bordeaux companies, Château Ausone and négociant Barrière Frères, saw positive outcomes with the CTMO. See, e.g., Ausone Wins China Trademark Case. These triumphs, coupled with Castel’s recent enthusiastic suspension, leave us with one dire question: Is China making a step forward in recognizing true mark owners?Castel French Winery Sans Facon Label 

For a producer like Castel, one of France’s leading producers and the top brand of imported wines in China, it may be feasible to take on China’s ruthless trademark office. But, for smaller wineries with limited market share or one simply starting out in the Chinese market, the issue of practicality remains. How many resources can these wineries truly devote to the Chinese market? While China is continually marked as containing one of the largest markets of wine consumers, barriers to entry for wine companies inevitably exist, and perhaps trademark is one of the greatest. Not all companies have the means to fight a battle like Castel, and not all companies have the foresight to realize that, down the line, China will be a potential market for their product. But hopefully, with the combined persistence of Castel and the slowly emerging Chinese trademark landscape, concerns regarding trademark filing at the CTMO can be alleviated.

That being said, much of the above result from China’s Supreme Court may very well be in preparation of its new trademark law, which goes into effect on May 1, 2014. For more details on China’s new trademark law, see Trademark Law of the People’s Republic of China (2013, Comparison Version) and Section 4 of No Wine-ing: The Story of Wine Companies and Trademark in China.

Images property of the Alcohol and Tobacco Tax and Trade Bureau

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.


As many  know, on August 5, 2013, FDA issued a final rule regarding the labeling of gluten-free foods. See 78 FR 47178, Food Labeling; Gluten-Free Labeling of Foods. As noted by On Reserve previously, TTB announced on August 22, 2013 that the agency would review its policy on the use of the term “gluten-free” on alcohol beverage labels and advertising that are regulated by TTB. See TTB to Review its Policy on the Term “Gluten-Free” for Alcohol Beverage Labeling. While FDA’s final rule does, in fact, define the term “gluten-free,” the finalized definition only applies to food products that fall within the labeling jurisdiction of the FDA. On its Questions and Answers page, FDA specifically noted that the final rule does not apply to food and beverage products regulated by the United States Department of Agriculture (“USDA”) and the TTB. The agency clarified that, “USDA regulates the labeling of meats, poultry, and certain egg products (FDA regulates the labeling of shell eggs). TTB regulates the labeling of most alcoholic beverages, including all distilled spirits, wines that contain 7 percent or more alcohol by volume, and malted beverages that are made with both malted barley and hops.” Questions and Answers: Gluten-Free Food Labeling Final Rule. FDA’s final rule on gluten-free allows a food product to be labeled as free from gluten unless the product contains any of the following:

  1. An ingredient that is a gluten-containing grain (e.g., wheat, rye, barley, or cross-bred hybrid of these grains);
  2. An ingredient that derives from a gluten-containing grain but has not been processed to remove gluten (e.g., wheat flour); or
  3. An ingredient that derives from a gluten-containing grain but where the ingredient been processed to remove gluten (e.g., wheat starch), if the use of that ingredient results in 20 parts per million (ppm) or more gluten in the food. 21 C.F.R. 101.91(a)(3), 78 FR 47178.

Effectively, a food can bare a gluten-free claim on the label if that food product is inherently free of gluten or if the presence of a gluten-containing ingredient in the food product is processed to contain less than 20 ppm. If the food label contains a gluten-free claim but does not meet the aforementioned standards, the FDA would consider the food to be misbranded. (This standard applies to the claim regardless of whether the claim is “Gluten-Free” or “Free of Gluten,” “No Gluten,” “Without Gluten,” or similar.)

On February 11, 2014, TTB issued a revised interim policy on gluten content statements on the labels of wine, spirits, and malt beverages that fall within TTB’s labeling and advertising jurisdiction. See Ruling 2014-2 Revised Interim Policy on Gluten Content Statements in the Labeling and Advertising of Wine, Distilled Spirits, and Malt Beverages. In TTB’s interim policy for gluten-free labeling, the Agency concluded that the term “gluten-free” may be used on TTB-regulated beverages for labeling and advertising if the product meets the standards determined by the new FDA regulation for gluten-free at 21 C.F.R. 101.91. The Agency goes on to clarify this by reasserting its prior determination in Ruling 2012-2 that products that inherently do not contain gluten, such as wine fermented from grapes and do not include any gluten-containing ingredients, may continue to use gluten-free claims on their labels and advertisements. TTB noted that “this revision only clarifies the standards for these products and should not require any changes to TTB-approved labels for wines and distilled spirits that are made from ingredients that do not contain gluten and currently are labeled or advertised as ‘gluten-free.'” Revised Interim Policy on Gluten Content Statements in the Labeling and Advertising of Wine, Distilled Spirits, and Malt Beverages.

TTB recognized FDA’s allowance of gluten-free claims on food products where gluten-containing ingredients (i.e., not the food) are processed to removed gluten and the use of the ingredient in the food does not result in 20 ppm or more of gluten in the food. In its interim policy, TTB asserted that it generally does not believe this standard will be relevant to malted beverages fermented from malted barley or other gluten-containing grains or to distilled spirits distilled from gluten-containing grains because “these products are usually made from the grains themselves, not from ingredients such as wheat starch or barley starch.” Id. The difference here, from TTB’s point of view, is to claim gluten-free, the product must contain ingredients  that derive from a gluten-containing grain and were processed to remove gluten, not where the product derives from the actual gluten-containing grains themselves.

TTB further rules in its interim policy that foods containing a gluten-containing grain, such as wheat, rye, barley, or a cross-bred hybrid of those grains, are disqualified from containing a gluten-free claim, regardless of the amount of gluten in the finished product. Id. “TTB will continue to consider ‘gluten-free’ label claims for TTB-regulated alcohol beverages made from gluten-containing grains to be misleading.” Id. Moreover, TTB noted that because of FDA’s determination that there is no scientifically valid way to evaluate claims that a beer made from gluten-containing grains can be processed in a way to remove gluten, and there is no current method to determine if such evidence is valid or effective, TTB maintains its position that it would be misleading for such products to claim “gluten-free” on their labels or advertisements. “Accordingly, consistent with FDA’s decision to maintain the status quo for the labeling of beers subject to its regulations pending further rulemaking, TTB has decided that . . . TTB will also maintain its current policy . . . with regard to alcohol beverages made from gluten-containing grains.” Id. The Agency will continue to allow products made from gluten-containing grains to bear claims such that the product was “Processed” or “Treated” or “Crafted” to remove gluten, along with an appropriate qualifying statement as spelled out in Ruling 2012-2, but such products cannot bear a gluten-free claim.  See Ruling 2012-2, Interim Policy on Gluten Content Statements in the Labeling and Advertising of Wines, Distilled Spirits, and Malt Beverages. (The qualifying statement noted in 2012-2 informs consumers that: (1) the product was fermented or distilled from a gluten-containing grain; (2) the exact gluten content of the product cannot be confirmed; and (3) the product may contain gluten.)

In its 2012-2 ruling, TTB noted that some of the alcohol beverages that fall within its labeling jurisdiction generally do not contain gluten if manufactured under good manufacturing processes (e.g., wine fermented from grapes or vodka distilled from potatoes) and reminded industry members that the bottler or importer was responsible for ensuring the accuracy and truthfulness of a gluten-free claim. In the 2012-2 ruling, brewers also asked TTB to consider allowing “gluten-free” claims on beverage products (e.g., malt beverages fermented from malted barley and other gluten-containing grains) that were crafted, processed, or treated to remove gluten if the product contained low amounts of gluten (e.g., 10 ppm). In its prior ruling, TTB determined in that it would be misleading to state “gluten-free” on products produced using wheat, barley, rye, or a cross-bred hybrid of  gluten-containing grains, but would allow the label to claim that the product was “[Processed or Treated or Crafted] to remove gluten,” along with an appropriate qualifying statement. In its 2014-2 ruling, TTB noted that it will continue to allow such claims (i.e., Processed, Treated, or Crafted with an appropriate qualifying statement) pending any subsequent rulemaking on behalf of the FDA.

In this new policy, TTB noted that:

Although TTB labeling regulations for alcohol beverages are not always identical to FDA labeling regulations for foods, given the important consumer health considerations relating to “gluten-free” claims, TTB believes that it is important to adopt an approach on this issue that is as consistent as possible with the regulations issued by FDA, while taking into consideration the differences in the statutes administered by TTB and FDA, respectively. Ruling 2014-2 Revised Interim Policy on Gluten Content Statements in the Labeling and Advertising of Wine, Distilled Spirits, and Malt Beverages

This is an important consideration given the consumer reliance on the term “gluten-free” on food products. For a claim like gluten-free, it is greatly important for there to be a particular level of congruence between agencies in determining and agreeing to a definition, especially given the use of the term on a wide variety of food and beverage products that fall into the labeling jurisdiction of multiple agencies. TTB’s declaration is also another demonstration of the workmanship between agencies, particularly TTB and FDA, especially with respect to food and beverage products. 

For more information on wine or alcohol law, labeling, gluten, or claims on a label, 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.

The Alhambra; Granada, Spain

The Alhambra; Granada, Spain

I spent several weeks one summer in the Andalucía region of Spain. My trip included Granada, Seville, Cádiz, Córdoba, Madrid, Toledo, Segovia, and a few other cities. While the weather—particularly the mid-afternoon—was sweltering, one thing I did look forward to was trying the sangria at the many tapas restaurants we frequented. I found that most sangrias were made from fresh fruit (usually peaches, oranges, limes, and sometimes lemons or apples), red wine, brandy, and (sometimes) seltzer or a similar carbonated liquid. It was certainly a refreshing way to sit down after spending a day under the scorching sun and each restaurateur seemed to have a different way of making the traditional fruity beverage. Despite touring many cities that summer, Granada probably remains at the top of my list for Spain. Granada itself is a beautiful city known for its gratis tapas and tasty sangria, and is quite a different aesthetic from that of the streets of either Madrid or Seville.

The Alhambra; Granada, Spain

The Alhambra; Granada, Spain

In recent news, the European Parliament passed legislation that imposes stricter geographical labeling rules for Sangria. In particular, the European legislation attests that “real” Sangria comes from Spain and Portugal. See True Sangria Wine Comes from Spain, Portugalsee also ABC News: True Sangria Wine Comes from Spain, Portugal. Going forward, aromatized wines from other European countries will need to include country of origin labeling. “European lawmakers in Strasbourg passed the motion—which also protects the Vermouth and Gluehwein aromatized wines—in a 609-72 plenary vote with four abstentions.” True Sangria Wine Comes from Spain. The new legislation is still awaiting a “rubber stamp” from European Union governments. Id.

The legislation had an overwhelming 90% of the Parliament’s votes in favor of restricting Sangria to Spain and Portugal unless the product includes a designated country of origin label. See It’s Only ‘Sangria’ if it Comes from Iberia. I am yet to see the exact legislation, but according to the European Parliament website, both the fruit and the wine must come from Spain or Portugal to be labeled “sangria” (i.e., without the designated country of origin labeling). See Things We Learnt in Plenary: EU Presidency, Greener Vans, Public Procurement. The legislation also applies to clarea, or sangria blanca, the white wine version of the traditional red wine beverage. See Off Limits: EU Bans ‘Foreign-Made’ Sangria.

What is interesting to consider is whether the addition of fruit produced only in Spain or Portugal has been the tradition of Spanish and Portuguese sangria producers. Council Regulation (EEC) No 1601/91 from June 1, 1991 suggests that, at least with respect to European Union law, sangria is

a drink obtained from wine, aromatized with the addition of natural citrus-fruit extracts or essences, with or without the juice of such fruit and with the possible addition of spices, sweetened and with CO2 added, having an acquired alcoholic strength by volume of less than 12 % vol. The drink may contain solid particles of citrus-fruit pulp or peel and its colour must come exclusively from the raw materials used. The description ‘Sangria’ must be accompanied by the words ‘produced in . . .’ followed by the name of the Member State of production or of a more restricted region except where the product is produced in Spain or Portugal. The description ‘Sangria’ may replace the description ‘aromatized wine-based drink’ only where the drink is manufactured in Spain or Portugal. Council Regulation (EEC) No 1601/91 of 10 June 1991.

The above definition of sangria under European Union law is from a 1991 Council Regulation, however the Regulation does not directly comment on whether the fruit used in Spanish and Portuguese sangria must be of Spanish or Portuguese origin. Perhaps the Council Regulation suggests such by indicating “the product is produced in Spain or Portugal,” and perhaps there are more restrictive laws or regulations within the countries of Spain and Portugal with respect to the labeling of sangria. From my understanding of geographical indications, it  follows through that both the wine and fruit must be of Spanish or Portuguese origin, but from the literal interpretation of the 1991 Regulation, this requirement is not as clear. It will be interesting to review the actual text of the new legislation once it is available from the European Parliament.

Photographs property of Lindsey A. Zahn.

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