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Amending the TTB Basic Permit: Overview, Options, and Tips

You’ve finally gone through that grueling process of getting licensed on the TTB level and you have all your formulas and COLAs in hand. Production is taking off and business has been better than ever. While you’re glad to see such great success, production space is limited and you are in dire need of expansion. However, the thought of going through the permitting process again is daunting—and you are not quite sure you want to have two separate DSP permits. Luckily, you’ve heard something about TTB amendments, but you do not know what this entails.


On September 15, 2016 at 2:00 PM EST, I will be presenting a CLE on beer, wine, and distilled spirits law with my colleague John Messinger. The CLE, titled “Beer, Wine & Distilled Spirits Law: Federal Regulation 101″ will have a live broadcast and will also be available on demand. A summary is below:

Beer Wine Distilled Spirits Law Federal Regulation 101When a consumer pops open a bottle of wine or sips his favorite scotch, rarely does one consider the level of regulation the beverage has passed through in order to find its way to market and on the dinner table. Alcohol beverages, however, are subject to a web of federal, state, and even local regulations that are often arcane, unclear, and reflective of Prohibition-era attitudes. This seminar will start with a discussion of the history of alcohol beverage regulation, along with an overview of the federal agency that has primary jurisdiction to regulate alcohol beverages. Then we’ll examine the types of licenses required for industry members and classification of products, along with formulation requirements for beer, wine, and spirits. Finally, we will discuss labeling, advertising, and recent updates to federal laws, class action lawsuits, and direct shipping to consumers.

Key topics to be discussed:

  • Introduction (History of beer, wine, and spirits regulation in the U.S.)
  • Licensing (Federal Permits)
  • Classification of Products
  • Labeling
  • Advertising
  • Hot Topics in Beer, Wine and Distilled Spirits Law

Is Home Brewing Co. Merely Descriptive of Beer?

Home Brewing Co TTAB USPTO Trademark Merely Descriptive Beer LawRecently, an application before the United States Patent and Trademark Office sought to register the mark Home Brewing Co. in standard characters on the Principal Register for “Beer; Beer, ale and lager; Beer, ale and porter; Beer, ale, lager, stout and porter; Beer, ale, lager, stout, porter, shandy; Beers; Black beer; Brewed malt-based alcoholic beverage in the nature of a beer; Coffee-flavored beer; Flavored beers; Malt beer; Pale beer; Porter” in International Class 32. See In re The Homebrewer, LLC, Serial No. 86273728 (July 19, 2016) [not precedential]. Even though the application disclaimed the words “Brewing Co.,” the Trademark Examining Attorney initially refused registration. The Attorney refused registration of the mark on the grounds that the mark is merely descriptive of the identified goods. See 15 U.S.C. § 1052(e)(1). When the refusal was finalized, Applicant appealed and requested reconsideration (the latter of which was denied, thus resuming the appeal before the Trademark Trial and Appeal Board or TTAB).


Lessons from Marketing a Wine and Beverage Law Practice

I was recently interviewed by Bentley Tolk for his podcast Legal Marketing Launch, which helps attorneys focus on marketing their legal practice. In the episode, I talk a lot about my blog and the development of the blog over the last several years, as well as practicing in a niche area like food and beverage law. For those interested, the episode can be accessed at the middle of Bentley’s blog here in the horizontal blue bar (you can press the triangle/play button).


Wine-Beer-Spirits-Law-CLECLE International will host its annual wine, beer, and spirits law conference in Colorado Springs, Colorado this September 22nd and 23rd. This year is the program’s 21st anniversary of the wine, beer, and spirits conference and, from its lineup, it promises to have some interesting topics in beverage law. Topics include the following:

  • Non-Traditional Trademarks in the Alcohol Beverage Industry
  • Intersection of First Amendment and Tied-house Law
  • Third Party Providers and the New Direct Delivery Channel
  • TTB Update
  • State Regulators Panel
  • Strategies and Tactics in Supplier-Distributor Disputes
  • Ethics
  • Wine Labeling
  • False Advertising

and  several others.


Uinta Brewing Duo Compass CansUinta Brewing Company (Applicant) filed an application before the United States Patent and Trademark Office (USPTO) to register on the Principal Register the mark DUO in standard characters for beer. The Trademark Examining Attorney refused registration under § 2(d) of the Trademark Act, 15 U.S.C. § 1052(d), for the reason that Applicant’s mark (as used in connection with Applicant’s goods) resembled a registered mark DUO as likely to cause confusion. (The registered mark is for wine and is owned by a Chilean wine company named Alto de Casablanca, S.A. but was originally registered by Franciscan Vineyards in Rutherford, California.) When the Examining Attorney’s refusal was issued, Applicant brought an appeal before the Trademark Trial and Appeal Board (TTAB), and both the Applicant and Examining Attorney filed briefs. In re Uinta Brewing Company, Serial No. 86333439 (June 29, 2016) [not precedential]. As is standard in a likelihood of confusion analysis, the TTAB considered whether or not there were similarities between the marks as well as similarities between the goods at issue.


Starting a New Winery? Ten Questions You Should Ask

Starting any new business can be overwhelming, and taking the leap to start a winery is certainly no exception. The details can be intimidating and a newcomer can often lose sight of the larger picture. This article aims to review ten of the very basic legal or compliance steps all new winery businesses should consider when starting out. And for those already producing wine, the below may provide a point or two of new insight.

What Are Ten Questions Every New Winery Should Ask?

  1. Who are the owners and how will the business be organized? First and foremost, you should determine who the owners of the winery will be and how it will be funded. This is a key point in the TTB federal winery permit application, as well as mot state license applications. Depending on the setup, you will be required to submit certain types of information to both the federal and state governments. Furthermore, you should consider how the business entity itself will be set up. For example, sole proprietorship, partnership, LLC, corporation, or similar. Each entity type has its own benefit and drawbacks, and the type of entity you choose may depend on your business itself, the owners, and your ultimate goals. You should work with an attorney well-versed in business law to determine the entity that is best for your needs.
  2. Is my business information filed with the state and is it up-to-date? When forming a new business, the state may require business information to be filed with the state. For example, this may include the Articles of Organization or the Articles of Incorporation. This step should be completed before you submit your winery permit application with TTB. If you are a new entity, you will not necessarily be concerned about whether the information on file with the state is accurate and up-to-date. However, if you are using an entity that was previously formed and whose information has been on file with the state for a while, you should consider whether any of this information (such as address, ownership, etc.) has changed and may need to be updated with the state. If ownership or addresses or similar have changed, certain documents may need to be updated.
  3. Do I have an EIN? An Employer Identification Number (EIN) is absolutely one of the first steps when setting up a new business. The EIN can be set up online through the Internal Revenue Services (IRS) website and can generally be obtained instantaneously. The number will be used for tax purposes and is also necessary for the TTB federal winery permit application, as well as for most state applications.
  4. Should I register my business? Most likely, your state government will require you to register the business and obtain a certificate of authorization (or similar) in order to do business within the state. Because every state varies, this step—along with the cost—can be quite different from one state to another. However, at the very least, you should consider whether or not (1) your state requires the business to register; and (2) whether or not you also want to file a Doing Business As (DBA) name. The DBA name is used as a “fictitious” business name as an alternative to the actual entity name. It is a popular option for companies that have been formed using human names and may want to operate under a more professional or industry-specific name.
  5. Is my winery registered with FDA as a food facility? This is an essential step for almost every winery. If your facility is manufacturing, processing, packaging, or holding food in the U.S., your facility is required to be registered with the Food and Drug Administration (FDA) as a domestic food facility and maintain an active FDA food facility registration. For food facility registration purposes, “food” is defined by federal regulations to include wine. A TTB federal winery permit does not exempt wineries from this requirement. Keep in mind that the FDA food facility registration needs to be renewed every even-numbered year for FDA’s biennial renewal and in order to remain active with FDA. The good thing about this registration is that is can be obtained instantaneously once the application is completed and is generally easy to update.
  6. Do I need to obtain a bond for my TTB permit application? A bond is a legal guarantee that federal excise taxes will be paid for wine produced or stored at the specific winery location for that specific winery. It is also one of the top reasons why the TTB winery application will be sent back to the applicant for corrections. The required penal sum of the bond for the TTB winery permit application ranges from $1,000 to $100,000 depending on the winery’s tax liability, which is determined by the volume, type, and alcohol content of the wine produced at the winery. It covers the tax liability that the winery owes to the federal government in regard to excise taxes; it does not authorizes the production, purchase, or sale of the wine itself. There are three ways for a bond to be issued: (1) by a surety company; (2) in cash; or (3) through a treasury note. The best option will depend on your business, as well as the tax liability owed. As of July 2016, the bond is mandatory for the TTB winery permit application.
  7. Do I have all paperwork organized for the federal TTB winery permit application? This application is incredibly time consuming and requires many details before you will obtain an approved license from the TTB. On top of that, it generally takes at least three months (if not more) for the license to be reviewed and approved by TTB. There can be many bumps along the way, and the specialist assigned to the application may get in touch with you multiple times to request more information or clarification. It is thus incredibly important that all documents submitted to TTB are in top shape and contain specific requirements that TTB will need to review the application. Small oversights can hold the application back weeks, if not months. Review every step of the application at least two times to ensure that the information you are submitting is complete, thorough, and accurate.
  8. Do I need a state license to operate as a winery? In all likelihood, yes. The type of license and the agency overseeing licensure will vary by state. In some instances, you may need multiple licenses depending on whether you will, for example, have a tasting room. You may also need to register with multiple state agencies. Some states also provide several types of winery license options, which can be less costly and may provide benefits like self-distribution. These alternative licenses may depend on your proposed production amount and the raw ingredients you plan to use. Every state winery license application varies and requires knowing the particulars and complexities of state regulations.
  9. Do I need a formula approval for my wines? There are some wines that are required to have formulas approved by TTB. Traditional table wines (i.e., grape wine between and including 7% alcohol by volume to 14% alcohol by volume) or dessert wines (i.e., grape wine above 14% alcohol by volume) will generally not require a formula approval unless you start adding additional ingredients, like flavors, colors, other fruit wines, etc. to the process. Other products, like mead, sake, and vermouth, will require a formula approval before you can obtain a label approval from the federal government. The formulation process for a domestic wine requires you to submit a list of ingredients, their use rates, and a method of manufacture. The process can be tricky and requires many details. It can also be extremely time consuming and may take several weeks (or even months) to obtain formulation approval. The average processing time can vary significantly depending on a number of factors..
  10. Do I need a label approval for my wine? Generally speaking, yes. Wines at or above 7% alcohol by volume will generally be required to obtain a Certificate of Label Approval (COLA) from TTB before the wines can be sold at market. While you may be eager to start printing your labels, the label approval cannot be obtained until after you have the federal basic winery permit from TTB. The average processing time for federal wine labels varies significantly and can be as little as 10 days to about 40 days. This is something you must budget for in the time it takes to get your wine to market. Further, the label submission process can often require many intricate details, as there are federal regulations that govern both mandatory and non-mandatory language that must and can appear on wine labels. See 27 CFR Part 4 for more information.

SPONSORED: A Taste of Rhode Island Wine

Disclosure: This post was sponsored by Rhode Island Tourism, which organized and provided transportation to the below Rhode Island wineries. I was not otherwise compensated for this article. The below remains my opinion of Rhode Island wines from my experience at the properties.

Rhode Island wine.

I consider myself fairly knowledgeable about wine. I say “fairly”  because I strongly (and personally) believe that with wine—and especially with wine—there is always more to learn and more to taste. I am, by no means, an expert, but I do enjoy tasting and learning and experiencing. My palate, for example, is forever changing and increasingly expanding. Perhaps that is what makes wine so interesting to me. I can say with some degree of affirmation that my preferences have certainly changed in a matter of several years and, in some instances, even months. On my first trip to Champagne, I found myself reaching for older blanc de blancs, but on a more recent return to the region, I surprised myself and gravitated toward a younger blanc de noirs during a tasting. (Of course, that could be the product of so many factors.) When I was approached with an invitation to visit several Rhode Island wineries to taste Rhode Island wine, I was not only intrigued but also somewhat reserved. I did not know much about Rhode Island wine, which may not be dissimilar to your own experience with Rhone Island wines.


On Wednesday, June 22, 2016, TTB published a notice in the Federal Register proposing important changes to wine labeling regulations and recordkeeping requirements. Comments to the proposed changes will be accepted through August 22, 2016 and can be submitted through the Federal Register website). The notice proposes to amend TTB’s labeling and recordkeeping regulations to maintain that standard grape wines at or above 7% alcohol by volume that are covered by a certificate of exemption from label approval may not be labeled with any of the following:

  1. A varietal (grape type) designation;
  2. A type designation of varietal significance;
  3. A vintage date; or
  4. An appellation of origin (unless the wine is labeled in compliance with the corresponding requirements found in 27 CFR Part 4)

The notice also proposes amendments to Part 4 (wine labeling regulations) to include a reference to the new Part 24 requirement.

In its industry newsletter, TTB states, “[w]e are taking this action in response to concerns raised by wine industry members and members of Congress about the accuracy of label information on certain wines covered by certificates of exemption from label approval, particularly the labeling of certain wines that may not meet the part 4 regulatory requirements for using American viticultural area (AVA) names.”

27 CFR Part 24 talks to the records a proprietor must maintain to substantiate label information in regard to wines. Specifically, Part 24 requires a proprietor who removes a bottled or packed wine with certain information on the label (such as the varietal, type designation, vintage date, or appellation or origin) maintain complete records so that the information appearing on the label can be verified by TTB during an audit. This includes information from the beginning source material to the removal of the wine for consumption or sale and these requirements apply to all wines (not just wines that are required to obtain a COLA from TTB).

However, as the regulations currently stand, Part 24 does not discuss the conditions under which a proprietor may use a grape variety as a type designation, an appellation of origin, or vintage year on a wine label.  Instead, TTB wine labeling regulations are found in 27 CFR Part 4. Part 4 covers labeling requirements with respect to vintage years, appellations of origin (and AVAs), type designations of varietal significance, and similar. 

Certificates of exemption from label approval are generally issued when a wine will only be sold within the state where it is bottled and not, for example, in interstate commerce (thus subjecting the wine to labeling requirements in 27 CFR Part 4 as well as the need for a Certificate of Label Approval from TTB). These wines are usually quite easy to differentiate from those sold in interstate commerce because the labels of wines covered by the certificate of exemption contain a statement along the lines of, “FOR SALE IN [STATE] ONLY.” Further, if a bottler or packer of wine can show that the wine will not be sold, offered for sale, or shipped or delivered for shipment, or otherwise introduced into interstate commerce, the wine will be exempt from the requirements of Part 4.

The specific concern that appears to be common among industry members (per the proposed rule) is the use of AVAs on these wine labels covered by the certificate of exemption from label approval. The wines covered by the exemption are labeled with AVA  names but allegedly do not meet the Part 4 requirements with respect to using an AVA name on a label. To use an AVA name on a label, the following conditions must be met per 27 CFR 4.25(e)(3)(iv):

  1. The AVA name must have been approved under 27 CFR Part 9;
  2. Not less than 85% of the wine must be derived from the grapes grown within the boundaries of the AVA (Note that this is the federal requirement and some state or local laws may be more restrictive); and
  3. The wine must have been fully finished within the State, or one of the States, within which the labeled viticultural area is located (with few, minor exceptions).

The proposed rule proceeds to say that a wine labeled with “Napa Valley” as the AVA but also containing a statement, “Produced and bottled by ABC Winery, Anytown, Illinois” would not meet the provisions of 27 CFR 4.25(e)(3)(iv) because the wine was not fully finished in California and the wine would thus not qualify for a COLA (i.e., if submitted to TTB for review, the label would likely come back either needing corrections with respect to the above mentioned statement or be rejected). The loophole that currently seems to exist is that such wine labels can instead request a certificate of exemption from label approval from TTB as long as they are sold only within the state of the permittee submitting the label (Illinois in the above example) and not introduced into interstate commerce. Should the label be eligible for the certificate of exemption from label approval, the label would be exempt from Part 4 provisions (and thus exempt from provisions detailing AVA, vintage year, and other similar requirements). This is a very realistic concern as, if one quickly browses the TTB public COLA database or LabelVision, it is very evident that several industry members are submitting certificate of exemption from label approval applications to TTB and using recognized AVAs on the label (a practice which could easily beguile an unsuspecting consumer). Understandably, this is very much a concern of industry members, trade groups, and other players who have sought to protect and form strict regulations pertaining to, for example, AVAs.

While TTB’s proposed rule may solve industry concern that some wines (at or above 7% alcohol by volume) covered by the certificate of exemption from label approval that do not meet the regulatory label requirements in Part 4, it leaves an interesting loophole open and calls to question the following: What about wines under 7% alcohol by volume whose labels are subject to the regulations of the FDA? These wines are not required to obtain a COLA or a certificate of exemption from label approval. While I have not seen many wine labels under the 7% alcohol by volume threshold that would cause the type of industry concern that many of the at or above 7% alcohol by volume wine labels have, there still seems to be an interesting loophole here that, should the proposed rule become finalized, may provide opportunity for creative industry members.

For more information on wine or alcohol law, AVAs, 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.


Empire Wine Bill Passes in New York Senate

Empire Wine Bill Passed in New York SenateThe “Empire Wine Bill” (version 2.0) passed in the New York State Senate on Friday, June 17th per the New York State Assembly website. The matching Assembly bill, A10248, passed earlier on June 15th.

The summary of the Senate bill is as follows:

Relates to clarifying the basis upon which the state liquor authority has the authority to revoke, suspend or cancel a license or permit by excluding perceived violations of the laws of other states unless the conduct falls within certain exceptions and established standards in statute for the delivery of beverage alcohol.

The  bills now await the Governor’s review.

As previously noted by On Reserve, these bills are very similar to the “Empire Wine Bill” that appeared in New York’s Assembly and Senate and 2015, which passed in both the Assembly and Senate, but was ultimately vetoed by Governor Cuomo at the end of 2015. For more information on the specific changes to the 2016 bill in comparison to the 2015 bill, please see here

For more information on New York State wine or alcohol law, direct shipping, or establishing a New York beverage business, 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.