ALCOHOL LAW ADVISOR
ALCOHOL LAW ADVISOR
Regulatory and Distribution Law Updates for the Alcohol Industry
ALCOHOL LAW ADVISOR
Regulatory and Distribution Law Updates for the Alcohol Industry
TTB COLAs and Formulas
Subscribe to TTB COLAs and Formulas's Posts

Hard Cider for Brewers

by | Jul 15, 2014 | , , ,

Hard cider has shown phenomenal growth in the past several years.  With rising consumer demand, more and more craft brewers are entering this rapidly expanding market. Although hard cider is typically distributed and mar­keted like a beer product, the federal gov­ernment and most states actually tax and regulate cider as a type of wine.  Brewers contemplating the production of cider ac­cordingly must carefully consider the legal issues surrounding cider production and distribution that distinguish cider from beer.  This article outlines some of the most important (though certainly not all) of these issues.

This article was originally published in the May/June 2014 issue of The New Brewer.



read more

Distilling 101 for Brewers

by and | Jul 3, 2014 | , , ,

The craft distilling movement is growing rapidly. Indeed, the tor­rid pace of new distillery openings and the boundless enthusiasm of new entrants seem strangely reminiscent of craft brewing (then “microbrewing”) in the late 1980s and early 1990s.  Craft dis­tillers even have a simmering product in­tegrity issue (the use of purchased neutral spirits) that splits the new industry like contract brewing divided craft brewers 20 years ago.  There are, no doubt, signifi­cant differences, but craft distilling today seems poised for a period of growth like the one craft brewers have been (mostly) enjoying for the past 25 years.  Not surprisingly, then, a growing num­ber of craft brewers have followed the path of Anchor Brewing (or should I say Anchor Distilling) and expanded their offerings to include distilled spirits.  But as brewers quickly discover, there are numerous legal, regulatory, and tax differences between these related, but distinct, businesses.  While a full exploration of those differences could fill a rather thick book, this article briefly highlights the most important.

This article was originally published in the March/April 2014 issue of The New Brewer.



read more

New TTB FAQs on Sugar Claims

by | Jul 2, 2014 | ,

On Tuesday, July 1, 2014, the Alcohol and Tobacco Tax and Trade Bureau (TTB) released new Frequently Asked Questions (FAQs) concerning sugar claims made on labels and in advertising.  The FAQs articulate, for the first time, a clear TTB policy on the subject and apply to all malt beverages (e.g., beer), wines and distilled spirits subject to TTB’s Federal Alcohol Administration Act jurisdiction.

The FAQs are notable in three primary respects:

  1. TTB will permit truthful and non-misleading sugar claims, provided that they are adequately supported by testing.
  2. TTB will consider a sugar claim the same as a carbohydrate claim and, thus, labels and advertisements making such claims must include a statement of average analysis in accordance with TTB Rulings 2004-1 and 2013-2.
  3. TTB will permit products containing less than 0.5 grams of sugar per serving to make the claims “zero sugar,” “no sugar” or “sugar free.”

The new policy does not apply to certain terms applied to wines and related to sugar content (e.g., “late harvest”) that were subject to prior rulings on such terms.



read more

Regulation of Social Media by TTB

by and | Jun 18, 2014 | ,

Facebook and similar types of social media have become increasingly popular as a promotional tool for craft brewers.  Ease of setup, simplified maintenance, the lure of almost immediate ex­posure to the general public and the ability to reach targeted audiences all make social media extremely attractive. Craft brewers use social media to introduce new products, generate interest or attendance at an event or solicit feedback on proposed new beers, among many other uses.  Brewers should bear in mind, however, that social media is not without regulation.

This article was originally published in the January/February 2014 issue of The New Brewer.



read more

TTB Issues Ruling on Formulas for Beer

by and | Jun 6, 2014 | ,

On June 5, 2014 the Alcohol and Tobacco Tax and Trade Bureau (TTB) issued TTB Ruling 2014-4, exempting from TTB’s formula  and pre-import approval (PIA) submission requirements beer made with dozens ingredients as well as beer subjected to wood aging processes.  TTB now finds these ingredients and processes to be traditionally used in the production of beer.  The Ruling stems from a Brewer’s Association Petition filed with TTB in 2006 with the assistance of McDermott Will & Emery.  As the Ruling explains, TTB initially rejected the petition, but with continued industry interest and additional fact-finding the TTB has reversed its position.  The Ruling includes an attached list of exempted ingredients and processes, as well as examples of acceptable label designations.

Materials that brewers (including for imported or PIA beer) can now use without the need for a formula include:

  • Fruits:  Apples, apricots, blackberries, blueberries, cherries, cranberries, juniper berries, lemons, oranges, peaches, pumpkins, raspberries and strawberries.
  • Spices:  Allspice, anise, pepper/peppercorns, cardamom, cinnamon, clove, cocoa (powder or nibs), coriander, ginger, nutmeg, orange or lemon peel or zest, star anise and vanilla (whole bean).
  • Other Ingredients:  Brown Sugar, candy (candi sugar), chili peppers, chocolate, coffee (beans or grounds), honey, maple sugar/syrup, molasses/blackstrap molasses and lactose.
  • Wood Aging:  Allows aging beer with plain barrels, woodchips, spirals or staves, as well as those previously used in the production or storage of wine or distilled spirits.

Ingredients

TTB determined that ingredients including honey, certain fruits, certain spices and certain food ingredients are part of the traditional beer making process.  Industry members remain responsible for ensuring that all ingredients are suitable for food consumption in compliance with applicable Food and Drug Administration regulations and standards.  TTB notes that when using brown sugar, candy (candi) sugar, maple sugar/syrup or molasses/blackstrap molasses in the fermentation of a beer, the beer label is not required to refer to these ingredients.  Instead, the label may identify it as a “beer,” “ale” and so forth.

Wood Aging

The Ruling finds that the process of aging beers in barrels (or with woodchips, staves or spirals from those barrels) that were used previously in the production or storage of wine or distilled spirits is a traditional process.  This finding does not apply to the use of woodchips soaked or infused with wine or spirits for the sole purpose of making beer.  Moreover, brewers must ensure that the use of previously-used barrels or chips will not add any “discernible quantity” of wine or distilled spirits to the beer.  Labels do not need to state that the beer was aged in these types of containers.

Labeling

TTB determined that the use of the ingredients listed in the Ruling will no longer require a statement of composition on the label that distinguishes between the exempt ingredients added before or during fermentation and those added after.  A brewer or importer now has the flexibility to label the products in accordance with the trade understanding, and the precise wording is left up to [...]

Continue Reading



read more

The Legal Aspects of Barrel Aging Distilled Spirits

by | May 28, 2014 | ,

Distillers have used barrels to age whiskies, brandies and other distilled spirits for centuries.  Today, American craft distillers increasingly seek to innovate and extend their product offerings by barrel aging spirits, both traditional (e.g., whiskies) and non-traditional (e.g., barrel-rested cocktails).  Not surprisingly, the thicket of alcohol beverage laws and regulations impose certain requirements and place certain limits on the use of barrels.

This article, originally published in the Fall 2013 issue of Artisan Spirit, briefly outlines some of the most important considerations.



read more

TTB Permits Online Now Fully Electronic

by | Apr 18, 2014 |

The Alcohol and Tobacco Tax and Trade Bureau (TTB) announced that starting on April 28, 2014 industry members will no longer be required to submit original paper copies of bond and power of attorney forms with electronic applications.  Recent changes to TTB’s regulations and Permits Online program will allow electronic receipt of these forms and other required documentation within the Permits Online system.  TTB hopes that this change will not only encourage industry members to take full advantage of the Permits Online system, but also improve application turnaround times as there will no longer be a delay between submission and TTB’s receipt of the paper forms.  Access TTB’s Permits Online Customer Support.



read more

Proposed FDA Labeling Revisions Would Impact Wines Below 7 Percent ABV and Certain Non-Malt Beers

by and | Mar 17, 2014 | ,

On March 3, 2014, the Food & Drug Administration (FDA) published a Notice of Proposed Rulemaking (NPRM) that, if and when finalized, would make important changes to the labeling of all foods subject to FDA’s primary labeling jurisdiction.  While most alcohol beverages fall under the primary labeling authority of the Alcohol and Tobacco Tax and Trade Bureau (TTB), wines below 7 percent alcohol by volume (ABV) and beers containing no malted barley or no hops fall within the scope of FDA’s primary labeling authority.

The NPRM seeks to adjust FDA’s labeling and related rules to address certain concerns about the American diet, particularly the so-called obesity epidemic.  As such, it aims to increase and improve the amount of labeling information about critical attributes like calories and the addition of sugars to food.  FDA’s proposed regulations would:

  • Put a greater emphasis—with larger and bolder type—on calories.  FDA believes the number of calories is especially important to maintaining a healthy weight.
  • Place greater emphasis on the number of servings per package and amount per serving.
  • Delete the requirement to list calories from fat; however the quantity (in grams) of total, saturated and trans fat will still be required.  FDA has shifted its focus to the type of fat rather than the total amount of fat.
  • Require the amounts of potassium and Vitamin D on the label, but not the amounts Vitamins A and C.
  • Update certain serving size requirements. These updates would reflect the reality of what people actually eat, according to recent food consumption data.
  • Update Daily Values for various nutrients.  In addition, the Percent Daily Value (%DV) would shift to the left of the Nutrition Facts label.  FDA says it wants to help consumers visually and quickly put nutrient information in context.

Significantly, the NPRM expressly addresses the subject of wines below 7 percent ABV and beer falling within FDA labeling jurisdiction in its proposed rules for added sugar labeling.  As noted above, a proposed regulation would require the mandatory declaration of added sugars as a line item in the familiar Nutrition Facts label required by current regulations.  That declaration would include any brown sugar, corn sweetener, corn syrup, dextrose, fructose, fruit juice concentrates, glucose, high-fructose corn syrup, honey, invert sugar, lactose, maltose, malt sugar, molasses, raw sugar, turbinado, sugar, trehalose and sucrose.  And because (according to FDA) no scientific means permits the measurement of added sugars (as distinguished from sugar intrinsic to the food), the NPRM proposes a new record-keeping requirement to document the addition of sugars to foods subject to the labeling rule.

Fermentation, of course, consumes sugar as yeast converts that sugar into alcohol (and other byproducts like CO2).  The NPRM acknowledges this fact, but indicates that FDA does not possess adequate information to assess the degradation of added sugars during the fermentation of wine and beer.  FDA asks commenters to provide information on this issue.

Notwithstanding FDA’s apparent lack of information on the subject, it proposes a specific regulation for beer and wine (plus [...]

Continue Reading



read more

Supreme Court Will Rule on Whether Agency-Approved Beverage Label Can Be Challenged as ‘False Advertising’ in Federal Court

by | Jan 15, 2014 | , ,

On January 10, 2014, the U.S. Supreme Court agreed to hear an appeal by Pom Wonderful LLC against The Coca-Cola Company.  The Court will examine whether Pom can bring a federal Lanham Act false advertising claim against a Minute Maid juice product label that had been approved by the U.S. Food and Drug Administration (FDA).  (Pom Wonderful LLC v. The Coca-Cola Co., U.S. Supreme Court case no. 12-761).

At issue in the lawsuit is a Minute Maid label for “Pomegranate Blueberry Flavored Blend of 5 Juices.”  The label presents the words “Pomegranate Blueberry” in larger type than the remainder of the phrase.  Pom claimed that the label was misleading because the product contains 0.3 percent pomegranate juice and 0.2 percent blueberry juice.

A California federal trial court and the 9th Circuit federal appeals court in California both ruled that Pom could not bring a Lanham Act false advertising claim against the label, since it had been specifically examined and approved by the FDA.  Pom has argued that the decisions were contrary to established law in other U.S. courts, and that federal regulations establish a floor –but not a ceiling — on what an advertiser is required to do to avoid a claim that the advertising is false and misleading.  Coca-Cola has argued that product labeling that is specifically authorized by the Food, Drug and Cosmetic Act (FDCA) and approved by the FDA cannot be charged as false or misleading under another federal statute such as the Lanham Act.

Although the question before the Supreme Court is whether a private party can bring a Lanham Act claim challenging a product label regulated under the FDCA, the Supreme Court’s decision could potentially have significant implications for the alcohol beverage industry.  For example:

  • If the Supreme Court rules that a competitor cannot bring a Lanham Act claim against a label that has been approved by the FDA, a natural question is whether the same rule will apply with regard to alcohol beverage labels that have been reviewed and approved by the Alcohol and Tobacco Tax and Trade Bureau (TTB) (by its terms, the Federal Alcohol Administration Act does not preempt the Lanham Act); and
  • If a Lanham Act claim would be barred against labels approved by TTB, a question may arise about whether a Lanham Act claim would be barred on elements of the label that TTB does not specifically review as a matter of policy – such as contrast, size and placement of label elements.

The Supreme Court is expected to hear argument this spring and decide the case by June 2014.  Depending on the decision, alcohol beverage industry members could find they have additional insulation against a federal false advertising claim, but they may likewise be limited in bringing a federal false advertising lawsuit against a competitor’s label that has been approved by TTB.



read more

Impact of Government Shutdown

by | Sep 30, 2013 |

With the possibility of a government shutdown fast approaching, it is important to note that this will affect operations at the Alcohol and Tobacco Tax and Trade Bureau (TTB).  TTB falls under the U.S. Department of Treasury and as a result the processing of all formula and COLA submissions will cease during the shutdown.  In addition, TTB specialists will not be permitted to contact industry personnel or respond to any inquiries.



read more

BLOG EDITOR

Alva C. Mather

STAY CONNECTED

Subscribe

TOPICS

ARCHIVES

RankedInChambersUSA 2022