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The United States is home base for pop culture and advertising. According to a 2007 New York Times article, people living in cities see up to 5,000 advertising messages a day, over twice as many as those living in cities 30 years ago saw. And that figure is four years old. Ever since Andy Warhol’s famous Campbell’s Soup Cans, the lines between art, advertising, entertainment, and social commentary have been continuously blurring. But, as the TTB recently reminded people, nowhere are those lines more defined and regulated than in the alcoholic beverage industry. On March 26^th and April 7^th, the TTB released industry circulars on the application of alcoholic beverage advertising regulations to media personality sponsorships and television advertising. The Code of Federal Regulations requires, among other things, that a responsible advertiser statement containing the name and address of the responsible party, appear in all advertisements for wines, malt beverages, and distilled spirits (See 27 CFR §§ 4.62, 5.63, 7.52). 

The TTB’s Industry Circular 2011-01 cautioned against the practice of media personalities who are compensated by alcoholic beverage companies, such as radio hosts, covering certain advertising talking points within a free form story told by the radio host (referred to as unscripted advertisements) without including the mandatory advertising language. The Circular also reminded the industry that such hosts should not make statements about alcoholic beverage products that are prohibited by the Federal Alcohol Administration Act (FAA Act) or TTB regulations. TTB Industry Circular 2011-02 addressed advertisements that are run by television stations more often than contractually required and in such instances often do not include the mandatory information required by the FAA Act and TTB regulations. On top of all that, there is the Federal Trade Commission, which prohibits deceptive and unfair advertising. Thus, if one is paying someone to say something nice about ones products that must be disclosed.

Which leads us to the question: What is an advertisement? The Code of Federal Regulations defines an advertisement as “any written or verbal statement, illustration, or depiction which is in, or is calculated to induce sales in, interstate or foreign commerce” (See 27 CFR §§ 4.61, 5.62, 7.51). The only exceptions from the definition are labels and things like press releases (“editorial or other reading material … in any periodical or publication or newspaper for the publication of which no money or valuable consideration is paid or promised, directly or indirectly, by any permittee, and which is not written by or at the direction of the permittee.”) That’s a pretty broad definition and it’s hard to see where the line exists in modern society. If Kim Kardashian (who reportedly earns $10,000 per tweet) mentions an alcoholic beverage company, does she need to fit the mandatory advertising language into 144 characters? Was Jay-Z’s “Show Me What You Got” music video an advertisement for Armand de Brignac? Whatever these projects are—Advertainment? Entertisement? (you heard the terms here first, unless you heard them somewhere else first)—marketers should remember they are still subject to the standard alcoholic beverages advertising regulations.

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

The deadline has been extended for comments on the Alcohol Tax and Trade Bureau’s (“TTB”) proposed amendment to regulations regarding common winemaking terms used on wine labels and advertisements.  Written comments are now due by March 4, 2011.  The TTB set out their proposed new regulations in Notice 109, “Use of Various Winemaking Terms on Wine Labels and in Advertisements”, published November 3, 2010 in the Federal Register.  The comment period was extended at the request of Napa Valley Vintners (“NVV”).  NVV has formed a subcommittee to research and survey members on the proposed new regulations. 

There are four main proposals set forth by the TTB in Notice 109.  First, the TTB proposes requiring the use of the terms “estate grown,” “estate,” and “estates” to meet the higher threshold definition it currently ascribes to “estate bottled.”  Second, the TTB proposes codifying its policy of only allowing the terms “proprietor grown” and “vintner grown” if 100% of the grapes used in a wine are grown on vineyards owned or controlled by the bottling winery.  Third, the TTB proposes to codify its current position that “single vineyard” may only be used when 100% of the grapes used in the wine come from one vineyard.  Further, it would extend that reasoning to the terms “single orchard,” “single farm,” and “single ranch.”  Fourth, the TTB is considering codifying definitions for the following terms: “Proprietors Blend,” “Old Vine,” “Barrel Fermented,” “Old Clone,” “Reserve,” “Select Harvest,” “Bottle Aged,” and “Barrel Select.”  The TTB made the proposals in an effort to ensure that consumers are not misled by wine labels and advertising.  Should these changes occur the TTB could revoke its approval of previously approved labels.

The Federal Alcohol Administration Act (“FAA Act”) sets forth the regulations for alcohol labeling and advertisements, including wine.  The TTB is responsible for the administration of the FAA Act and the promulgation of regulations thereunder.  The specific wine labeling and advertising regulations can be found in Title 27 of the Code of Federal Regulations.

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

This holiday season, thousands of households will be checking “whipped cream” off their shopping lists.  The Alcohol and Tobacco Tax and Trade Bureau, or TTB, wants to make sure those households are putting the right product in their cart come shopping time.  A handful of whipped cream products made with alcohol have popped up over the last year.  The products are typically made with grain alcohol and look like traditional whipping cream.  But they pack an alcoholic punch of around 16% alcohol per volume, or a little over 30 proof.  Such items are not considered food products, but rather alcoholic beverages.  As one manufacturer stated in the FAQ section of its website, they’ve never had the product tested for caloric content as it is “not a food product and is not subject to FDA [U.S. Food and Drug Administration] labeling requirements; it is an alcoholic beverage.” 

The fact that the product is an alcoholic beverage as opposed to a food product means it is regulated by the TTB.  For more information on the TTB’s relationship with the FDA, refer back to our post on caffeinated alcoholic beverages.  As the TTB reminded producers last week, all alcoholic beverage products must abide by federal labeling requirements that prohibit consumer deception.  Product labels for distilled spirits are required to have a statement of the class, type and alcoholic content, along with the government warning required by 27 U.S.C. 215, among other things.  Additionally, such manufacturers must comply with Federal Alcohol Administration Act, or FAA, advertising laws and the various relevant state regulatory laws.  If you are of the legal drinking age and decide to try one of these alcoholic whipped cream products this holiday season, just remember, as always, to imbibe in moderation.

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

At this point, we’ve all recovered from the landslide ban on alcoholic energy drinks that crossed the U.S. in November.  We covered the opening act, here, when Michigan, quickly followed by Washington, banned the sale of alcoholic energy drinks.  New York then reached an agreement with certain suppliers and distributors that halted caffeinated malt beverage sales in that state (review our coverage here).  After that, the U.S. Food and Drug Administration (FDA) issued warning letters to four caffeinated alcoholic beverage companies.  The letters warned those producers that caffeine added to their malt alcohol beverage products constitutes an “unsafe food additive.” 

Substances added to food products, which includes beverages, are considered food additives and are subject to review and approval by the FDA, unless the substance is specifically excluded from the definition of “food additive,” has been sanctioned by the FDA, or is recognized by qualified experts as adequately safe when used as intended.  This third category is referred to as Generally Recognized as Safe or GRAS. 

As many know, the FDA isn’t the usual stop for federal regulation of alcoholic beverages, but rather the Alcohol and Tobacco Tax and Trade Bureau (TTB) which operates under the Federal Alcohol Administration Act (FAA Act).  In this instance, the FDA’s statements meant that the beverages in question were considered adulterated under the Federal Food, Drug and Cosmetic Act (FFDCA).  The TTB takes the position that adulterated beverages, even if their formulas and labels have been approved by the TTB, are mislabeled under the FAA Act.  This means that shipping and selling such beverages violates the FAA Act, which can result in license revocations and misdemeanor penalties.  As the TTB stated, “…each producer and importer of alcohol beverages is responsible for ensuring that the ingredients in its products comply with the laws and regulations that FDA administers.  TTB’s approval of a label or formula does not imply or otherwise constitute a determination that the product complies with the FFDCA, including a determination as to whether the product is adulterated because it contains an unapproved food additive.” 

Producers of alcoholic energy drinks likely thought their products fell under the GRAS status.  The FDA’s announcement ended that assumption.  The question is, what other assumptions might it have ended?  Alcoholic beverage producers have been using caffeine in their products for years, the most popular being coffee.  In the FDA’s Questions and Answers section about the warning letters, it states that the letters are not directed at “alcoholic beverages that only contain caffeine as a natural constituent of one or more of their ingredients, such as a coffee flavoring.”  However, in that same section the FDA also stated that, “Other alcoholic beverages containing added caffeine may be subject to agency action in the future if the available scientific data and information indicate that the use of caffeine in those products is not GRAS.  A manufacturer is responsible for ensuring that its products, including the ingredients of its products, are safe for their intended use and are otherwise in compliance with the law.”  Further, the TTB stated that if requested by the FDA, it would share “formulas for beers containing added caffeine that are approved under 27 CFR Part 25 [TTB regulations].”  In the upcoming months, and perhaps years, it will be interesting to see how the GRAS standard is applied to other alcoholic beverages containing some form of caffeine.

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