Tuesday, May 13, 2014

TTB May Crack Down on Section 5.36(d) Violations


Tasseography is a fortune telling method that interprets patterns in tea leaves, coffee grounds, and wine sediments. It's unfortunate that bourbon enthusiasts are so often forced to engage in divination to figure out where certain whiskeys are made, but it has always been so.

The Federal regulator, the Alcohol Tax and Trade Bureau (TTB), is supposed to help by requiring producers to put certain information on their labels. Section 5.36(d), for example, requires that "the State of distillation shall be shown on the label of any whisky produced in the United States if the whisky is not distilled in the State given in the address on the brand label."

So since Templeton Rye's label gives its address as Templeton, Iowa, but its whiskey is distilled in Lawrenceburg, Indiana, the words "distilled in Indiana" should appear somewhere on the Templeton label, but they don't. That's a violation of Section 5.36(d).

Templeton is far from alone. Other producers with one or more whiskeys not in compliance include Whitmeyer, Troubadour, Yellow Rose, Red River, Witherspoon, Rebecca Creek, and Treaty Oak.

You can view the list and a thread about it on straightbourbon.com here. They found at least 29 offenders. That list has been provided to TTB, at their request.

Some producers have already caught on. Smooth Ambler's first Old Scout releases didn't show the state of distillation but the more recent ones do.

This has come to light because so many small producers are getting their whiskey from the same distillery, MGP of Indiana. In many cases, the omission may be a mere oversight. In others, it looks like a deliberate attempt to convey a misleading impression about the whiskey's origins, exactly what 5.36(d) is intended to prevent.

Communicating with the TTB about these issues requires some divination too, as it is their policy never to discuss enforcement activities. An email yesterday to Tom Hogue, TTB's point of contact for all media inquiries, asked if we are interpreting 5.36(d) correctly. "5.36(d) is pretty straight forward and it sounds like you are reading it correctly," he replied. "If there are concerns about the accuracy of specific labels, please let us know and we will address the issue as appropriate directly with the affected industry member(s)."

Finally, since so much of this sourced whiskey is coming from MGP of Indiana, perhaps they should be encouraged by TTB to alert their non-Indiana customers to this requirement.

If your reaction is "So what? It's just a bunch of little guys I've never heard of," consider this. Through action by the Tennessee ABC, it was revealed that Diageo is distilling whiskey in Tennessee that it is aging in Kentucky, in violation of Tennessee law. All Diageo has said about this whiskey is that it is not intended to be sold as George Dickel Tennessee Whisky. It appears that none of this whiskey has been COLA’d yet, but when it is TTB should be alert to the potential for a 5.36(d) violation.

As we wrote last month, TTB fails like this have become all too frequent as the bureau has been bombarded by thousands of COLAs from hundreds of new, small producers. It matters because it undermines confidence in the TTB's entire consumer protection mission.

10 comments:

Dan Garrison said...

Chuck,

Thanks for all you do to protect America's greatest spirit. Amid all the marketing and propaganda, we ca always count on you to TELL IT LIKE IT IS. Bless you.

Carlton said...

Chuck,

Regarding your statement that none of the Dickel-made whiskey aged in Kentucky has been COLA'd yet, I believe some has already hit the shelves.

A new five year-old bourbon going by the name of Barrell Bourbon is being sold in New York. It has the somewhat unusual mashbill of 70% corn, 25% rye, and 5% malted barley. It advertises that it was distilled in Tennessee but aged in Kentucky. I think Dickel (read Diageo) is the only TN distiller with aging facilities in KY, so this would have to be Dickel distillate. The bottler would seem to be in compliance with 5.36(d), though.

Coincidentally, we had a new straight whiskey released in TN (my home state) last year, called Cumberland Cask. It states it is distilled and aged in Tennessee and is composed of of 6.5 and 8.5 year old whiskey. It was not put through the Lincoln County Process. This left me wondering about the identity of the producer. I figured it could only be one of three possibilities: Dickel, Prichard's, or Jack Daniel's. It has the same mash bill as the Barrell Bourbon described above, so once I heard about Barrell Bourbon, it seems a sure thing that Dickel makes both products. Interesting to me is the fact that no Lincoln County Process is involved, at least with the Cumberland Cask. (Barrell Bourbon doesn't say one way or the other on their website.)

Thanks for your informative posts.

mbroo5880i said...

Little guys or not, the regulations were originally passed for a reason - to protect consumers from misleading and fraudulent products. Of course, we decide to not purchase products of questionable origins. But, for every whiskey aficionado, there is someone spending their hard earned money on misleading products.

I would think that the major producers would be at the forefront of pursuing enforcement of the regulations.

Thanks to Chuck, Wade and others who bring this issue to everyone's attention.

d dss said...

How does this effect producers like High West? Where they are purchasing and re packaging as well?

Quintilian B. Nasty said...

I'm glad they'll start cracking down on these marketing practices. As a native Iowan, when I first heard of Templeton, my reaction was positive, but then I quickly learned that it's an Iowa whiskey in marketing garb only. Looks like if I want to drink a true Iowa spirit, I'll have to go with Cedar Ridge. Haven't tried any of their products yet though.

Funky Tape said...

Good ole government at its finest.

I've noticed Willet on their 4 yr rye doesn't actually list the state of distillation on their label, however they do put a sticker over it with a barcode and clear identification of Indiana.

Maybe this compliance issue could be fixed by not actually having to reprint the original labels?

Chuck Cowdery said...

Brown-Forman, which owns Jack Daniel's, has aging facilities in Kentucky too, but you're right, Carlton. This Barrell Bourbon certain has Diageo's fingerprints all over it. Thanks for the good work.

Anonymous said...

Underline and bold the word "may" in the title of this post.

mike g said...

As a distiller in Texas that doesn't just repackage someone else's work, I thank you. I cannot count the number of times "distillers" of "Texas Whiskey" have had all levels of their sales team blatantly lying about the product source.

Their whole business model is based on moving units with low overhead. And at any cost possible, they will create a supporting mythos to manipulate consumers.

This is unethical on many levels and hinders the art of spirits making irreparably.

We need these dialogues and we need them now.

Thanks again.
Mike G

Anonymous said...

I'm [figuratively] shedding two tears: one for those of us who care, the other for people who just want to get tanked and don't care where their s*** comes from :-/