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Imbiblog is published for general informational purposes only and is not intended as legal advice.

Category archives for “Wine”

Wine Liberty for All (Adults) in Massachusetts

July 17th, 2014

Massachusetts wine consumers will soon have equal access to Napa Cabs, Oregon Pinot Noirs, and New York Rieslings, as the commonwealth finally joins the ranks of direct shipping states with the passage of House Bill 294. Effective January 1, 2015, the bill will allow the Massachusetts Alcoholic Beverages Control Commission to issue licenses allowing out-of-state and in-state wineries to ship a limited amount of wine, by common carrier, directly to Massachusetts residents.

Prior to the passage of HB 294, out of state wineries were effectively shut out by the Massachusetts direct shipping law, which purported to allow direct shipping, but included so many restrictions and limitations that it was unworkable. Despite a successful court challenge to the existing law, in which the 1st Circuit Court of Appeals ruled that Massachusetts shipping law was discriminatory, the legislators have been unable until now to pass replacement legislation. In 2013, House Representative Theodore Speliotis introduced HB 294, and with the help of fellow lawmakers and a celebrity endorsement from New England Patriots quarterback-turned-Washington state vintner Drew Bledsoe, the measure was approved and has now been signed by the governor July 11th 2014. Under the new law, all U.S. wineries with a federal basic permit and home state winery license may obtain a license to ship up to 24 cases of wine per year to a Massachusetts resident 21 years of age or older. Like most direct shipper licenses, the Massachusetts license will also require the winery to submit a yearly report to the Commission and Department of Revenue detailing the total gallons of wine shipped, as well as require taxes be paid on all products shipped. The initial license fee will be $300.00 per winery, with a $150 annual renewal fee.

Common carriers delivering in the state are required to have a fleet permit and each vehicle transporting alcohol under the permit must have a certified copy of it in the vehicle, at a cost of $50 per certified copy.

The new law has drawn some criticism because it permits shipments only from U.S. wineries, effectively prohibiting direct shipment of imported wines to Massachusetts consumers. The Massachusetts law is not alone in this restriction; importers and retailers are excluded by the direct shipping laws of some other states, as well. But the law nonetheless represents another step forward in direct to consumer wine sales. Only eight states continue to have a complete ban on winery shipments direct to consumer. If you are interested in learning more about direct shipping law in Massachusetts or elsewhere, contact one of the attorneys at Strike & Techel.

Imbiblog is published for general informational purposes only and is not intended as legal advice. Copyright © 2013 · All Rights Reserved ·

TTB Reconsiders Use of “Estate Bottled” Following a Winery Sale

May 21st, 2014

To be labeled as “estate bottled,” a wine must be, among other things, made from grapes grown in an American Viticultural Area, on land that is owned or “controlled by” the winery, and the winery must crush, finish, age and bottle the wine in a continuous process.

Previous guidance from the Alcohol and Tobacco Tax and Trade Bureau (“TTB”) suggested that a wine would not be entitled to use the “estate bottled” designation if a change of ownership of the winery occurred at any point during the winemaking process, because the new owner technically would not have “controlled” all phases of the process. To address this issue, sellers and buyers of wineries that produce “estate bottled” wines would sometimes enter into an Alternating Proprietorship Agreement (“AP”) whereby the seller would maintain its bonded winery operations until all wine in process at the winery as of the closing date had been bottled and labeled. This approach was difficult for both sellers and buyers, given that the AP could be in effect for a lengthy period of time depending on which stage of production the “estate bottled” wine was in.

In a recent private letter ruling, the TTB advised that it has reconsidered its position and that the proprietor of a winery can  use an “estate bottled” designation for wine that was grown and fermented by a predecessor proprietor and bottled by a new proprietor (provided the wine also met the other requirements under 27 C.F.R. § 4.26). The ruling provides that the ownership of a winery may change while the wine is in process as long as the bottling winery does not change. The TTB further explains that the definition of “controlled by” refers to the land on which the grapes are grown and the winery operates, as opposed to the owner of such land. With a change in winery ownership, the “estate” land is not altered, and thus the new owner can maintain the “estate bottled” designation.

This guidance from the TTB should come as a welcome relief to potential purchasers and sellers of wineries that produce “estate bottled” wines.

For questions about the acquisition or sale of a winery, please contact one of the attorneys at Strike & Techel.

Imbiblog is published for general informational purposes only and is not intended as legal advice. Copyright © 2014 · All Rights Reserved ·

Tennessee House of Representatives Overwhelmingly Passes Wine in Grocery Stores Bill

February 24th, 2014

Last Thursday, the Tennessee House of Representatives passed House Bill 610 by a vote of 71-15, voting to allow the issue of the sale of wine in grocery stores to be submitted to voters in local referendums, and creating a permit for the sale of wine by grocery stores. On January 30, the Senate had approved Senate Bill 837 by a vote of 23-8. The Bill will now be returned to the Senate to review the remaining differences between the two bills, before it goes to the Governor for signature. If signed by the Governor, it is anticipated that the issue could be on local November ballots for consumers to weigh in on local approval of grocery store wine sales.

One of the key differences between the two bills was fixed by the House in its new version, with the reduction of minimum size for grocery and convenience stores from 2,000 to 1,200 square feet, allowing about 500 more convenience stores to qualify. The House also reduced the fee for a grocery store wine license to $1,250 from $2,000, bringing it closer to the $850 in the Senate Bill. Already, following the House vote, Sen. Bill Ketron, the Republican who sponsored the Senate Bill, indicated to reporters that he planned to accept the House version and could ask for a vote as soon as March 3.

Even if approved, wine sales won’t be possible in grocery locations until summer 2016 due to an agreement reached with lobbies for liquor stores and wholesalers that had opposed the proposals. In another concession to liquor stores, both bills open up opportunities for traditional liquor stores to sell items other than alcohol and to do so as soon as this summer, two years before any grocery store wine sales could begin. Liquor stores are currently allowed to sell only wine and distilled spirits and a few minor accessories like corkscrews. Additionally, grocery stores would be subject to a minimum 20% markup on wines sold, in an attempt to address volume discounting, and would be prevented from offering combined deals of wine and other grocery items. To encourage wholesaler support, the Senate Bill allows for wholesalers to be located outside the four major cities in the state which they are currently restricted to, and the House Bill would extend that even further to any county which currently permits bars or liquor stores to operate. Blue laws, preventing Sunday sales of alcohol, will not be affected by any new legislation, and such sales will continue to be prohibited.

The debate in Tennessee has been ongoing since 2006. It is not the only state which has been discussing this issue as we previously blogged here. Currently, thirty-five states do not restrict the sale of wine in grocery stores. No state has managed to pass legislation changing the status quo since Iowa permitted grocery store sales in 1985. Factions in New York, now the second largest wine-producing state by volume, have attempted to pass wine in grocery store bills on numerous occasions, including a significant push in 2011. The Kansas House Commerce, Labor and Economic Development Committee held a hearing Wednesday on House Bill 2556 which would allow the sale of full strength beer and wine in grocery stores, inducing vigorous debate. A bill introduced to the Oklahoma Legislature this month, which would permit wine to be sold in grocery stores and nonalcoholic beverages and refrigerated beer and wine to be sold in liquor stores, died in Committee. And last month, a federal appeals court in Kentucky ruled that the state’s ban on grocery store sales of wine and liquor was constitutional. The court said that the state had every right to ban such sales, “just as a parent can reduce a child’s access to liquor.” The grocers who filed the original challenge to the law are reviewing rehearing and appeal options now.

If you have any questions about where wine can be sold, contact one of the attorneys at Strike & Techel.

Imbiblog is published for general informational purposes only and is not intended as legal advice. Copyright © 2014 · All Rights Reserved ·

Wine Growlers From a Keg

October 29th, 2013

Keg wine is a growing trend. Packaging and selling wine in kegs has a lot of advantages. Wine kegs are refillable and reusable. Wineries save on packaging costs, and restaurants enjoy the convenience of serving many customers without constantly uncorking bottles.

Alcohol laws dictating permissible containers and packaging for wine are expanding in concert with retailer and consumer interest in keg wine. For example:

- Effective July 1, 2013, Florida allows the sale of wine in 5.16 gallon canisters, which can be tapped like kegs, to restaurants and bars.

- Effective April 1, 2013, Oregon allows any wine shop, grocery store, wine bar or restaurant to buy wine by the keg and resell it to consumers by the glass, or in some establishments, consumers can fill their own containers in a size that is 2 gallons or less.

Most states continue to have restrictions on this “growler” type of service by a wine shop. Those restrictions comport with federal rules saying that packages cannot be filled with wine except at a winery or at a “tax paid bottling house.”

We expect to see more legislation in the coming months and years if this trend continues.

If you have any questions about keg wine, feel free to consult one of the attorneys at Strike & Techel.

Imbiblog is published for general informational purposes only and is not intended as legal advice. Copyright © 2013 · All Rights Reserved ·

Strike & Techel Speaking at Upcoming Conferences

October 15th, 2013

Barry Strike will be a presenter at the International Wine Law Association (AIDV) International Conference on October 18-20 in Vienna, Austria.  This annual conference brings together speakers and participants from around the world to discuss global strategies for legal issues related to the wine industry.  Barry will present on U.S. regulatory agencies available to assist international wine companies.

Kristen Techel will be speaking at the Wine Law Forum on Friday November 22, from 9:00am-5:00pm at Hotel Paradox in Santa Cruz, California.  Kristen will share her expertise on the emerging role of third party providers in a discussion entitled “Third Party Providers:  Unlicensed Participants in a Licensed Industry.”  The event is co-sponsored by the International Wine Law Association (AIDV).

If you would like more information on the AIDV organization or about either conference, please click here.

Imbiblog is published for general informational purposes only and is not intended as legal advice. Copyright © 2013 · All Rights Reserved ·

Governor Cuomo Signs Law Allowing New York Wine to be Sold at Local Farmers’ Markets

October 10th, 2013

On October 1, 2013, Governor Andrew Cuomo signed into law S. 267/A.1512, creating a new venue for New York wineries to sell their wines to consumers.  As of March 26, 2014, farm market stands may apply for a new “roadside farm market license” to sell New York State labeled wine that is produced by no more than 2 licensed farm wineries, micro-wineries or special wineries located within 20 miles of the roadside farmers’ market.

This law is in keeping with Governor Cuomo’s efforts to bolster the New York wine industry.  In a statement released after enacting the new law, Governor Cuomo said: “These new laws will build on our continuing efforts to promote New York’s wine industry across the state and beyond, boosting tourism, local economies and job growth.  We are increasing market opportunities for local producers and farmers…Our state is home to hundreds of wineries that produce some of the best wine in the world, and we want both New Yorkers and visitors to come and enjoy them.”

The new law does not include tasting privileges at the farm stands, which is probably not surprising, given the possible connection between wine tasting at a roadside stand and driving a car.  We’ll be interested to see if other states follow New York’s lead and enact legislation to license farm stands.

For the full text of the new law, click here.

Contact one of the attorneys at Strike & Techel if you have questions about licensing in New York or any other state.

Imbiblog is published for general informational purposes only and is not intended as legal advice. Copyright © 2013 · All Rights Reserved ·

Winery Direct Shipping Coming Soon to Montana

August 26th, 2013

Starting October 1, 2013, Montana will allow the direct shipment of wine to Montana residents by wineries that hold a Direct Shipment Endorsement. Holders of a Direct Shipment Endorsement may sell and directly ship up to 18 nine-liter cases of wine annually to an individual in Montana who is at least 21 years of age. Any in-state or out-of-state winery that is already registered with the Montana Department of Revenue must pay $50 and file associated paperwork to receive a Direct Shipment Endorsement, and wineries not already registered with the state will be able to simultaneously register with the state and apply for a Direct Shipper Endorsement. Applicants must submit a signed affidavit that they will contract only with common carriers that agree that wine will be delivered only to an individual in Montana who is at least 21 years old and who signs upon receipt of the wine. Records may be due every month and every quarter, and must be held for state inspection for up to three years. All taxes must be paid quarterly and tax records submitted monthly (by the 15th date of the following month) to the Department of Revenue. If a holder of a Direct Shipment Endorsement uses a bonded wine warehouse for fulfillment purposes, the endorsement holder must file a written notice that includes the name and address of the warehouse. The state also requires pre-approval of all wine labels to be shipped into the state. Stay tuned as Montana will likely issue regulations and step-by-step instructions in the coming months.

If you have any questions about shipping wine directly to Montana residents, or residents of any other state, contact one of the attorneys at Strike & Techel.

Imbiblog is published for general informational purposes only and is not intended as legal advice. Copyright © 2013 · All Rights Reserved ·

TTB Says Alcohol Content Can Move to the Back Label for Wine

June 10th, 2013

Announced today, and effective August 9, 2013, the Alcohol and Tobacco Tax and Trade Bureau (the TTB) has announced changes to its labeling requirements for wine. Amending 27 CFR 4.32, the alcohol content for wine no longer must appear on the brand label, and instead it may be printed on the brand label or on other labels affixed to the bottle, including the back label. The TTB also amended 27 CFR 4.36 to the effect that wines with alcohol content of at least 7 percent and no more than 14 percent may still be labeled with either (a) the designation of “light wine” or “table wine” on the brand label, or (b) the numerical alcohol content of the wine. The new amendments do not permit the “light wine” or “table wine” designations to appear on any label other than the brand label. A new COLA is not required if the only change made to an approved label is the relocation of the alcohol content statement.  If you have any questions about labeling, contact an attorney at Strike & Techel.

Imbiblog is published for general informational purposes only and is not intended as legal advice. Copyright © 2013 · All Rights Reserved ·

Brewing and Winemaking in the Comforts of Home

September 12th, 2012

Home brewing. Even Obama does it. Well, maybe not Obama himself, but he reaps the rewards of his staff’s fermentation adventures. Earlier this month, the White House’s beer recipes were released on the White House Blog (check them out here). With the release of the recipes, questions about home brewing and home winemaking have been rising. Each state has its own laws and regulations about making alcoholic beverages at home. Distilled spirits may never be made at home, as the distillation process raises too many safety issues. Most state laws are broad enough to encompass home production of both wine and beer. California’s law separately allows for home wine and home beer production (see Cal. Bus. & Prof. Code § 23356.2), while other states’ laws are often broad, like Illinois’ allowance which states that their laws do not “prevent the making of wine, cider or other alcoholic liquor by a person from fruits, vegetables or grains, or the products thereof, by simple fermentation and without distillation, if it is made solely for the use of the maker, his family and his guests…” 235 Ill. Comp. Stat. 5/2-1. Alabama and Mississippi still do not recognize home brewing, although Mississippi does allow people to make homemade wine (see Miss. Code Ann. § 67-3-11.)

What’s most important to remember is the part in every state’s allowance about the products being made for the home. Home brewed beers and homemade wines cannot be sold to the public. Some states don’t allow homebrew to be taken outside the home, while others allow homebrew to be entered into contests and consumed by others, so long as there’s no charge involved. The federal allowance for home brewing without payment of tax caps production at 200 gallons per year for a household in which two or more adults reside and 100 gallons per year for a household with only one adult (see 27 C.F.R. § 25.205). Home wine production without payment of federal tax has the same 200 gallons for households with two or more adults and 100 gallons for households with only one adult yearly production cap under the federal regulations (see 27 C.F.R. § 24.75). Like other alcoholic beverage laws, allowances vary by state. So if you’re planning on whipping up your own White House Honey Ale or Honey Porter this fall, remember to keep in mind your state’s laws and regulations on home fermentation.

[Your brand].wine, [Your brand].beer, [Your brand].sucks: ICANN Applications for Generic Top Level Domain Names Revealed

June 13th, 2012

The Internet Corporation for Assigned Names and Numbers (“ICANN”) manages the internet’s domain name system. Before 1998 the following generic top level domains (“gTLDs”) were in existence: .com, .edu, .gov, .int, .mil, .net, .org, and .arpa. In 2000, seven additional gTLDs were added: .aero, .biz, .coop, .info, .museum, .name, and .pro. Then in 2004, eight additional gTLDs were added. They were: .asia, .cat, .jobs, .mobi, .post, .tel, .xxx, and .travel. In 2008, ICANN began a move to open up the recognized gTLDs to a much wider scope by allowing applicants to apply for any gTLD they wanted.  However, the process was expensive and complicated, which curbed participation.

The first round of applications was announced today. ICANN received 1,930 applications from 60 countries and territories. Of the applications received, 911 are from North America, 675 are from Europe, 303 are from Asia-Pacific, 24 are from Latin American and the Caribbean, and 17 are from Africa. There are a few applications relevant to the alcoholic beverage business (.beer, .vodka, .wine, and .restaurant). Only one entity applied for .beer and .vodka, while three separate entities applied for .wine and four entities applied for .restaurant. There are also a few applications relevant to any business, such as .sucks and .best.  The applications are subject to a 60-day comment period during which anyone in the world can submit comments or file formal objections to the applied for registrations. Additionally, ICANN will review all applications to determine whether or not they should be registered. The full list of applied for gTLDs is available here: http://newgtlds.icann.org/en/program-status/application-results/strings-1200utc-13jun12-en. If you have questions about your brand and the new gTLDs feel free to contact any of the attorneys at Strike & Techel.

Imbiblog is published for general informational purposes only and is not intended as legal advice. Copyright © 2012 · All Rights Reserved ·