Over a year ago, I wrote about a pending federal Alcohol and Tobacco Tax and Trade Bureau (TTB) regulation that would remove certain common-sense labeling exceptions for wines sold within a single state. As I explained then, under the proposed rule, if a winemaker chooses to label their wine using an “appellation of origin” from a recognized viticultural area like Napa, then the wine must meet certain requirements. Those requirements include: 85 percent of the grapes used to make the wine must be grown in the named area, and the wine must be “finished” (i.e. fully produced and bottled) in the state where the grapes are grown. However, winemakers are exempt from the labeling regulations if they only sell their wine intrastate. So, if a winemaker in New York purchases grapes from a Napa vineyard and ships the grapes to its New York facility where it crushes the Napa grapes and bottles the wine, then it can only label its wine as a Napa wine if it restricts sales of the wine to within New York. This is true even if, for example, the wine includes a disclaimer that the wine was “produced and bottled in New York with grapes grown in Napa, California.” The proposed rule would remove this exception. And as a result, a wine made and sold in New York with Napa grapes could not include information on the label informing the consumer that the grapes are of Napa origin.
Aside from the logical point that prohibiting winemakers from including useful factual information on labels is not a rational way of preventing consumers from being mislead, PLF submitted written comments discussing the serious First Amendment problems with the proposed rule. Today, the government reopened public comments for an additional 90 days. For the moment I’ll ignore TTB’s, at best, clueless timing of the comment reopening. It’s not like winemakers in Napa and Sonoma don’t have other extremely serious wildfire concerns calling for their attention right now. Interestingly, though, the notice of reopening points out various alternative proposals mentioned in a number of earlier submitted comments. Some are better than others, but it does appear that TTB has taken note that where more disclosure can prevent consumers from being mislead, then an outright ban on speech is constitutionally prohibited. I eagerly await the conclusion of this already-lengthy process, and will definitely be keeping an eye out for the final rule. Hopefully TTB will heed the First Amendment and not restrict winemakers’ speech when they have ample less-restrictive means of protecting consumers.