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If you didn’t partake in the toast that New York wineries made at the end of July when New York Governor Andrew Cuomo signed bill S4143A into law, perhaps now is the time. The bill, known as the Fine Winery Bill, made a number of revisions to the state’s alcoholic beverage code regarding wineries and farm wineries. A number of the revisions to the law were originally suggested by the industry member group the New York State Grape Task Force in a 2008 report to the commissioner of the Department of Agriculture and Markets. Below is a brief outline of the legal changes:

Branch Offices

The licensing process for up to five branch offices of a farm winery was simplified through the elimination of separate licenses for each branch. Perhaps more importantly, the privileges of the branch offices now mirror those of the farm winery, as opposed to those of an off-premise retailer as was previously the case.

Custom Crush

Farm wineries also gained the legal authority to perform custom crush services. The individual requesting a custom crush must be present during the entire production process and purchase the final wine product.

Charitable Events

Wineries can now obtain an annual permit allowing them to participate in events sponsored by charitable organizations. Previously, participation in a maximum of five events was allowed and the licensing process was more arduous.

Other Events & Tastings

Wineries may now charge for use of their premises and for wine tastings.

Reporting

Farm wineries can now maintain interstate shipping reports on their premises and present them when requested by the State Liquor Authority as opposed to filing those reports semiannually with the State Liquor Authority, thereby reducing reporting expenses.

Elimination of Redundant Licensing

Farm wineries that produce less than 1,500 gallons of wine annually are no longer required to apply for a micro-winery license in addition to their farm winery license.

Imbiblog is published for general informational purposes only and is not intended as legal advice. Copyright © 2010-2011 · All Rights Reserved ·

Paper or plastic, Bordeaux or rosé? Two states, Tennessee and New York, currently have active bills aimed at permitting grocery stores to sell wine. Proponents of the bills argue the change will generate jobs and create new tax revenue by expanding the consumer base. Opponents argue that liquor stores in the states, which are small and locally owned by law, will suffer steep losses in revenue and possibly face layoffs. In Tennessee, it appears that the bill’s opponents have been more persuasive to date, with a vote on the measure postponed until the summer of 2012. The New York Bill has bipartisan support and is possibly up for a vote before the legislative session ends in late June. Similar bills have been defeated in New York by the liquor store lobby in the past. As a preemptive measure, the new bill includes incentives for liquor stores, including the right to own more than one store. Even the title of the bill, “the wine industry and liquor store development act” reflects the hope that the liquor store lobby can be appeased. Given the fiscal climate, one factor that may garner additional emboldened supporters this time around is the “changeover” fees potentially generated by the measure: $346.7 million in new revenue in the first year through franchise and license fees, excise taxes and sales taxes.

Imbiblog is published for general informational purposes only and is not intended as legal advice. Copyright © 2010-2011 · All Rights Reserved ·

Just when you thought the caffeinated alcoholic beverage saga was finally over, New York state senator Jeffrey Klein is keeping the saga alive. As a response to the ban on caffeinated alcoholic beverages that spread throughout the nation toward the end of 2010, the largest producer of such beverages, Phusion Projects, eliminated caffeine, guarana and taurine from its beverages. Senator Klein (D-Bronx/Westchester), chairman of the New York Senate Alcohol and Drug Abuse Committee, however, believes the products are still dangerous and being accessed and abused by minors. As a result, at the end of March he introduced a plan of action to decrease minors’ access to the beverages by creating a new defined term within the New York alcoholic beverage code, “Flavored Malt Beverage,” and requiring that such products falling under the new definition are only sold in New York liquor stores as opposed to convenience stores. Many phrases have been used to describe these beverages, from Progressive Adult Beverages (PABs), Flavored Alcoholic Beverages (FABs), Malternatives, Ready to Drinks (RTDs), and the catchy Alcopops. But if the new bill, S4221-2011 becomes law, it appears that FMB will become the beverages’ official title in New York. The proposed definition of FMBs set forth in S4221-2011 is:

“’Flavored Malt Beverage’ means and includes any alcoholic beverage of any name or description that is manufactured from malt, wholly or in part, or from any substitute therefore including, but not limited to, liquor, spirit or wine; and containing more than six per centum alcohol by volume and more than one per centum sugar by volume which is manufactured with the addition of flavorings or other ingredients including, but not limited to, fruit, fruit juice or fruit flavor, or herbs, nuts or spices (including, but not limited to, chocolate, licorice or vanilla, or stimulants (including, but not limited to caffeine, guarana, ginsing (sp), taurine or wormwood oil). The authority may, pursuant to subdivision fifteen of section seventeen of this chapter, further defined those alcoholic beverages that shall be included within such term. Provided that, Flavored Malt Beverages shall not be deemed to be beer, cider or a wine product.”

Senator Klein also introduced S3889-2011 to ban the sale of caffeinated alcoholic beverages, which a convenience store in Klein’s district was apparently still selling despite Phusion Project’s statement that is was no longer making the product and the agreement between New York’s largest distributors and the State Liquor Authority to stop selling the beverages to retailers. The ban in S3889-2011 also comes by way of creating a new defined term within the New York alcoholic beverage code: Caffeinated or Stimulant-Enhanced Alcoholic Beverage. The term would include alcoholic beverages with more than 5% but not more than 15% alcohol by volume that also has more than six milligrams per ounce of caffeine or other stimulant that has an effect equivalent to that of caffeine. The maximum 15% alcohol by volume in the definition is designed to exempt coffee-based liquors from the definition. The bill’s summary explains the logic for this distinction:

 “The differentiation between these coffee based products and CABs is that caffeine is naturally occurring in coffee and herbs such as guarana, ginseng, taurine or wormwood oil are not added. Further, these products are sold exclusively in liquor stores, which can only be patronized by adults. In addition, coffee-based alcoholic beverages tend to be mixed with milk or cream, which makes them heavier and less vulnerable for over consumption. However, CABs tend to be lighter in body, sweeter to mask its alcohol content, and hence, are more easily subject to over consumption and abuse.”

We will continue to follow the progress of the two New York bills and are interested to see if additional states follow suit.

Imbiblog is published for general informational purposes only and is not intended as legal advice. Copyright © 2010-2011 · All Rights Reserved ·

New York is the latest state to jump on the alcoholic energy drinks ban-wagon.  On Sunday, November 14, 2010, New York Governor David Paterson and Chairman of the State Liquor Authority Dennis Rosen announced a voluntary agreement with Phusion Products, the makers of Four Loko, to stop shipment of caffeinated alcoholic beverages to New York by Friday, November 19, 2010.  Additionally, the largest beer distributors in New York State agreed to stop selling malt beverages containing caffeine and other stimulants.  Those distributors have until December 10, 2010 to sell off the remainder of their in-state inventory.  The voluntary agreement effectively bans the products from New York State.  In addition, Phusion Products agreed to fund educational alcohol awareness programs concerning binge drinking.  The agreement comes after NYPD sting operations revealed sales of Four Loko products to minors by numerous stores in the Bronx area.

On Tuesday, November 16, 2010, New York Senator Charles Schumer went further, indicating that the Food and Drug Administration was expected to release findings that caffeine is an unsafe food additive for alcoholic drinks.  Were such findings made, the Federal Trade Commission would send letters to manufacturers of such beverages warning that marketing such products could be illegal.  The FDA spokeswoman Siobhan DeLancey did not confirm whether or not such findings were expected or when any findings on the matter would be released. 

Precluding the need for any such findings, however, Phusion Products announced that same day, via their website, that it would remove caffeine, guarana and taurine from Four Loko.  Phusion Products maintains that their products as originally formulated were safe; however, the company felt changes were necessary due to the current regulatory environment.  Phusion Products isn’t the first company to remove ingredients from an alcoholic energy drink in response to regulatory pressure.  In 2008, MillerCoors announced it would remove caffeine, guarana, ginseng, and taurine from its Sparks beverages after voluntary negotiations with various state attorney generals.  Anheuser-Busch InBev underwent a similar reformulation process with its Tilt beverages in 2008.

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