July 08.2009

In Memoriam: Susan C. Cagann

by David Bruns

It is with great sadness that Farella Braun + Martel informs you of the tragic passing of our colleague and friend Susan Cagann on July 2, 2009. Susan's incredible warmth and spirit touched all who met her and she will be dearly missed. Below is a link to the eulogy from Susan's husband Chuck. www.caringbridge.org/visit/cagann/journal In lieu of flowers, Susan's family has asked that donations be made in her memory to the Brain Aneurysm Foundation, 269 Hanover Street, Building 3, Hanover MA 02339. Tel 888.272.4602. http://www.bafound.org/. Additionally, a college fund has been established for her two sons. If you would...

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June 23.2009

Alternating Proprietors - Hot Topic at TTB Expo

by Susan Cagann

TTB has been strictly enforcing a new policy when examining applications of alternating proprietors. TTB examines these applications to determine whether the applicant will control winemaking and take responsibility for production decisions, winemaking functions, record keeping and tax payment. In recent months, TTB has asserted that no host winey employees may perform work for an alternator. This fairly new interpretation is purportedly based on Industry Advisory 2008-4. The plain language of the advisory does not forbid host winery employees from performing work. Rather it states that the totality of the circumstances will be taken into account by TTB analysts. We...

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June 05.2009

CA: ABC Issues Industry Advisory on Outsourcing Marketing, Compliance and Logistics

by Susan Cagann

Today, CA ABC issued an advisory to respond generally to the explosion of service providers that enable wineries to outsource one or more components of their D2C and D2T channels. http://www.abc.ca.gov/trade/Advisory-Third%20Party.pdf Activities Requiring Licenses: The Department describes when third party providers require a license. In CA a license is required when a business sells (transfers title), solicits a sale or delivers alcohol pursuant to an order. (B&P Code 23025) If interpreted according to its plain language, the definition of sale would require the following types of businesses to obtain licenses to sell wine: delivery companies, credit card companies that offer...

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Posted in Wine

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June 04.2009

Alternating Proprietors Beware: TTB Scrutiny of AP Agreements

by Susan Cagann

TTB now limits how APs can get the job done. Last year, TTB issued Advisory 2008-4. Even if you read this industry guidance for alternating proprietorsand submit an AP agreement following its guidance, your agreement may be rejected. As we all know, an AP agreement must demonstrate that the alternator is really making wine, is truly in control, and is responsible for production, record keeping and taxes. Often an AP will contract with a consultant, labor provider or even the host winery to have some work done, such as a pumpover, cleaning out a line, or moving a barrel. The...

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Posted in Wine

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May 18.2009

WA: New Tied-House & Trade Regulation Law HB 2040

by Susan Cagann

May 15 -- HB 2040 was signed into law. The law ends Washington’s prohibition on vertical integration among the three tiers of wine and beer distribution and creates some modest exceptions to trade regulation prohibitions. Some of these exceptions were required to conform Washington law to the 9th Circuit’s 2008 Costco v. Hoen decision. However, many onerous trade regulation restrictions remain in place. Most notable is the ban on quantity discounts to retailers. Key Provision of HB 2040 Vertical Integration Allowed HB 2040 allows certain relationships and financial interests between the manufacture and distributor tiers of the liquor industry and...

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March 20.2009

Marketing Through Private Parties: News in CA and IL

by Susan Cagann

In California and Illinois, agencies are rulemaking through bulletins and advisory opinions. California's new law allows suppliers to market beer, wine and spirits at private events with a cost. With passage of Business and Professions Code section 25600.5, these events can not take place at licensed retail establishments. California ABC published two recent advisories that clarify how these new rules work and that other previously permitted practices are no longer acceptable. ABC has clarified that suppliers may not pay for any entertainment at a retail licensed establishment from the occasional mariachi band to bagpipes to rock bands. Private events can...

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Posted in Regulatory

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February 27.2009

Ides of March: EU Ban on Chateau Clos & Vintage on US Wines

by Susan Cagann

Last week we explained that effective March 10 ,2009 traditional expressions such as chateau, clos and vintage can no longer be used on wine labels exported the EU. The complete list of banned terms are chateau, classic, clos, fine, late bottled vintage, noble, ruby, superior, sur lie, tawny, vintage, and vintage character. This stems from the September 8, 2008 written notification to the US explaining that it would no longer extend the derogation permitting such use after the signing of the EU/US wine accords. For more information visit www.ttb.gov. The effect of this notice is that all US wine producers...

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February 11.2009

EU Allows Use of Traditional Expressions Just Until Stocks are Exhausted

by Susan Cagann

The EU will not allow use of traditional expressions on wine imported to the EU after March 10, 2009. This ban applies to terms such as "Clos" and "Chateau" even if terms are on labels approved by TTB. Other banned terms are: classic, cream, crusted/crusting, fine, late bottled vintage, noble, ruby, superior, sur lie, tawny, vintage, vintage character COMMISSION REGULATION (EC) No 113/2009 of 6 February 2009 concerning the use of certain traditional terms* on labels for wine imported from the United States of America Wine originating in the United States of America and imported into the Community before 10...

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Posted in Regulatory

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February 06.2009

Blog Launch; CA ABC Furlough; Bans on Retail to Retail Sales

by Susan Cagann

Today we are launching this blog about wine, beer and spirits law. Notable news: Today is the first work furlough day for California's Department of Alcoholic Beverage Control. http://www.abc.ca.gov/news/Furlough.html We will be posing questions under the category "Stop Making Sense". Please join me in creating a lively forum to discuss why archaic laws written in 1930s and 40s make no sense in today's global economy with startlingly different economic dynamics from those that existed when these laws were passed. The first topic for discussion -- why do states ban retail to retail sales of alcohol? If a local restaurant runs...

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December 11.2008

Changes to the California Alcoholic Beverage Control Act for 2009

by Susan Cagann

The 2008 legislative session was awash in bills changing the Alcoholic Beverage Control Act. The legislature expanded winery privileges, increased caps on consumer give-aways for brewers, created new tied-house exemptions, and added new labeling requirements for flavored malt beverages and wines from certain regions. This article provides a recap of changes to the Act and some action items for you to consider. AB 2004: WINERIES MAY SELL WINE BY THE GLASS & IN PICNIC AREAS This new law allows wineries to sell wine by the glass in tasting rooms at the original winery premises. The new law does not allow...

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Posted in Regulatory

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