Blog Posts - The Law Offices of Brian D. Kaider, LLC

Navigating the Minefield of Wine Advertising and Promotion

4/5/2019

One of the take-home messages from the State of the Industry address at this year’s Unified Wine and Grape Symposium was that per capita alcohol consumption is flat. This means that the various sectors of the alcohol industry can only increase sales by re-dividing the pie in their favor. Although wine and spirits are making headway at the expense of beer, new players in the space, such as hard seltzers and pre-mixed cocktails are carving out their own slices.

One of the areas where wine is losing market share is with millennials, who are adopting wine as their drink of choice at a slower pace than prior generations. Winning in this sector, and others, will require strong marketing efforts. But, advertising and promotion in the alcohol industry is a messy affair with wildly contradictory rules in different jurisdictions.

This article surveys the laws in several states, not to provide a complete picture as to allowable advertising practices in the wine industry; that would be impossible, but to highlight some of the issues and how differently they are addressed in different states.

To read the rest of the article on The Grapevine Magazine website, click here.

CONGRATULATIONS to Silver Branch Brewing Co!!

2/25/2019

I am thrilled to congratulate my client, Silver Branch Brewing Company, on their official opening today!

I first met Christian Layke almost three years ago, while he was still the head brewer at Gordon Biersch in Rockville, MD. At that first meeting, I knew immediately that this was going to be a very different brewery client. His dreams were huge and anyone else wanting to take on the scale of project he was describing, I would have thought them crazy. Not Christian. He was aiming high, but something told me he could hit his target. Later, when I met his business partner, Brett Robison, who was the General Manager at Republic in Tacoma Park, I was certain. These guys were the real deal.

Together, we worked through several stressful trademark issues, a very thorough operating agreement, and a long lease negotiation. But, that was just the tip of the iceberg of what these guys had to go through to get their doors open. They have been working non-stop and what was a gleam in Christian's eye three years ago is now a reality.

My wife and I had the pleasure of attending the Founder's and Investors party this past weekend and the place is fantastic. It's open and inviting with something for everyone. Of course, Christian is well-known for his outstanding beer, but they also have a full bar and will be open for gourmet coffee in the mornings. There are different areas of the brewery with high-top tables, picnic tables, and a more coffee-house type area. There are corn-hole boards and a foosball table with a big screen TV, but it's not a "sports bar."

The focus of the brewery is "gemütlichkeit," the German word for the sense of camaraderie, coziness, and a sense of belonging one gets when enjoying time with good friends. They hit that goal right in the bullseye.

3he grand opening is Sunday, March 3, 2019. I encourage everyone to come enjoy this amazing new brewery in Silver Spring at 8401 Colesville Road (right across from the Silver Spring Metro station).

TTB Proposes New Rules for Wine Labeling and Advertising

1/9/2019

On November 26, 2018, the TTB published in the Federal Register a notice of proposed rulemaking, titled, Modernization of the Labeling and Advertising Regulations for Wine, Distilled Spirits, and Malt Beverages (83 Fed. Reg. 60,609). The purpose of these proposed rules is to “simplify and clarify regulatory standards, incorporate guidance documents and current policy into the regulations, and reduce the regulatory burden on industry members where possible.”

When the federal government wants to change rules Americans are subject to, they must first publish the proposed rules and provide a period of time for the public to comment and make suggestions. The government agency is required to review and consider all suggestions before implementing a final rule.

This process is not a formality. TTB wants the rules to adequately protect the public while being as fair and unobtrusive as possible to industry members. It is actively seeking comment on many issues in this notice. As members of the industry affected by these rules, winery owners would be well-advised to review TTB’s proposals and provide feedback before the March 26, 2019 deadline.

This article is meant to introduce some of the key issues with which TTB is grappling.

To read the rest of the article on The Grapevine Magazine website, click here.

Protecting Your Business From Employee Poachers

11/27/2018

You’ve been in business for several years and have a dozen hard-working, dedicated employees working for your company, or so you think. Out of the blue, a new competitor enters the market and the next thing you know, all 12 of your employees have jumped ship to join the new firm. With them, they have taken company records and customer lists. What do you do? Do you have any legal recourse against the poaching company? Against your former employees? How could you have prevented this?

Can a Competitor “Poach” Your Employees?

In most states, yes. Many people are surprised to learn that, generally, poaching is a perfectly valid and legal way to find new employees. There are exceptions and limitations, of course...

To read the rest of the article on The Grapevine Magazine website, click here.

Does Your Wine Require Formula Approval?

9/6/2018

The Alcohol and Tobacco Tax and Trade Bureau (TTB) has the authority to regulate the production and importation of wine in the United States. In some cases, the TTB requires approval of the formula before a manufacturer may make certain wines. The rules relating to whether a formula is required, however, can be confusing. For example, is a formula required for a wine made from both apple and raspberry? What about a dry-hopped mead?

There is a well-known joke among lawyers:

A law school professor said to a graduating class, “Three years ago, when asked a legal question, you could answer, in all honesty, ‘I don’t know.’ Now you can say with great authority, ‘It depends.’”

Thus it is with wine formulas; the answer to both questions above is… it depends.

To read the rest of the article on The Grapevine Magazine website, click here.

Special Events: Identifying Legal Issues - Part 2

7/2/2018

Special events are a valuable source of supplemental income for wineries, but they also present a variety of legal concerns, which if not properly addressed may have significant consequences. In the first part of this article, we discussed limitations on holding special events as well as the winery’s responsibilities at such events. In this second part, we will discuss various types of events and the specific issues they raise.

Weddings and family gatherings

Vineyards provide an attractive backdrop for weddings, family reunions, and company retreats. Many wineries also have indoor event space perfect for receptions and other gatherings. While visiting a winery recently, I spoke with the owner who told me the following story.
One Saturday afternoon, she was in the tasting room, which was about half full at the time. Suddenly, the room filled with people in suits and dresses and in walked a bride and groom followed by an entourage of groomsmen, bride’s maids, a photographer, and a videographer. As the owner approached the bridal couple, she noticed two people in the parking lot unloading a wedding cake from a catering truck.

To read the rest of the article on The Grapevine Magazine website, Click Here

Special Events: Identifying Legal Issues - Part 1

5/7/2018

Acres of rolling hills covered in fruit-covered vines are an idyllic setting for large gatherings and special events. But, for wineries, there are a host of legal concerns that must be addressed or they could lose their license or even be subject to criminal prosecution.

ARE YOU ALLOWED TO HAVE THE EVENT?

Whether it is a hosted event that is open to the public or a private event, like a wedding or anniversary party, the threshold question is whether the winery is even permitted to hold the event.

Zoning Laws
Zoning laws vary dramatically, not only state-to-state, but even among cities and counties within a state. Most, however, have some limitation on the number and/or size of special events. Wineries need to know how their jurisdiction defines a “special event” and what restrictions are in place. For example, in Placer County, California, a winery is required to have one parking space for every 2.5 attendees of a promotional event.

To read the rest of the article on The Grapevine Magazine website, click here.

Grape Purchase Agreements & Smoke Taint

3/10/2018

As I traveled to Sacramento for this year's Unified Wine and Grape Symposium, I began writing this article, intending to focus on key provisions of Grape Purchase Agreements (GPAs) that parties should negotiate. But, upon arrival at the symposium,

I spoke with other conference attendees and it became clear that one thing was on everyone's minds - smoke taint.

Certainly, I had heard about the fires in October, but living on the East Coast, it was difficult to get any specific information about where the fires were located, what vineyards were affected, and the extent of the damage. I heard anecdotal bits of information from friends who live in the area and were reporting on the latest evacuations and there were, of course, some very dramatic videos posted on social media. But, it wasn't until I spoke with grape growers, vintners, négociants, and insurance companies that I began to understand the scope of these fires. Or so I thought.

To read the rest of the article on The Grapevine Magazine website, click here.

Distributor Agreements: 'Til Death Do Us Part?

1/8/2018

Many early stage wineries market their products via tasting room sales, wine clubs, direct-to-consumer shipments and, to the extent permitted, self-distribution to local restaurants, grocery stores, and wine stores. Eventually, winery growth will necessitate working with a distributor, a relationship not to be entered into lightly.

A distributor becomes an ambassador for the winery’s brand and, once retained, the supplier may have little control over how its wine is marketed. Further, these relationships can be difficult or financially impossible to break once established.

Supplier/distributor relationships are governed by franchise laws in many states. In the absence of franchise laws, the relationship is defined entirely by a distribution agreement between the parties. But, even in franchise states, the distribution agreement can play a critical role, particularly in the termination of the distributor relationship.

To read the rest of the article on The Grapevine Magazine website, click here.

Wine Labels 201: Protecting Your Design

11/14/2017

In the July/August Issue, The Grapevine published an article by attorney, Lindsey Zahn, entitled “Wine Labels 101: Navigating TTB’s COLA Process.” The article described the information that must be contained on the label as well as how the label gets approved for use.

This article will discuss how to protect the design of the label. Aside from the required information relating to contents, origin, etc., a label contains many creative aspects, including: brand names, logos, pictures, drawings, color schemes, unique label shapes, backgrounds, and fanciful descriptions of the winery and the product. But, in a crowded market, how can those elements be protected against copying by competitors? There are three tools available to wineries to protect their labels: trademarks, trade dress, and copyrights.

To read the rest of the article on The Grapevine Magazine website, click here.