Pinot Law

Most small, farm wineries have enough things to worry about: the heavy hand of federal and state regulation, confusing shipment laws, and now even the weather. But be sure to add one more thing to the list: scam artists.

A few weeks ago, our winery received an e-mail from Mr. John Nelson. Claiming to be an American living in Seoul, South Korea. Mr. Nelson said he came across one of our wines at a Christmas party, loved the taste and wanted to have some shipped to Seoul for his birthday party.

Being raised in New Jersey and having gone to school in the Bronx, my radar immediately went up.  Fortunately, after typing a few search terms into Google (i.e., “John Nelson” Seoul, wine) I came across this website from a winery in California.  The blog entry — by Mary Baker of Dover Canyon Winery — confirmed my suspicions: Mr. Nelson and his wine request was nothing more than a major scam.

Mary Baker’s entry is well worth the read and goes into this scam in far greater detail than I ever could.  But the bottom line for all of us out there is this: if it sounds too good to be true, and/or just a tad bit suspicious, it probably is.

I am sure that most of you are aware that the wine industry lost a legend yesterday — Robert Mondavi passed away at 94. There is not much that I can say about the man that has not already been said. However, my favorite insight in Mr. Mondavi is that according to this article, when he sold his wine empire to the highest bidder in 1992, he vowed at the time to “start over.”

And one other point I think is worth mentioning. The above article points out that many in the wine industry point to Mondavi as the singular driving force that propelled California winemaking from a “cottage industry” to a global force. I think that speaks volumes to what one person can do for an industry region, in this case winemaking in California.

Be sure to head over to Tom Wark’s Fermentation Blog to vote for the wine blog of the year. He has some notable ones over there including two of my favorites: the Ship Compliant Blog and Vinography. Hurry up, though. Voting closes on March 29th!

In the wine industry, insurance is critical. Crop insurance, liability insurance and now . . . nose insurance. I came across this story regarding winemaker and taster Ilja Gort who has insured his nose for about $8 million (USD). Of course, the insurance was provided by Lloyd’s of London.

Among the highlights from the insurance, Mr. Gort is not allowed to ride a motorcycle or be a boxer, knife thrower’s assistant or a fire-breather. He should also probably not carry Charlie Rose’s Mac Book.

Big Nose Strikes Again used under a Creative Commons license provided by bazusa.

There is an interesting entry today over Capitol Confidential regarding a bill in the New York General Assembly regarding wine ice cream. As Irene over at Capitol Confidential notes, the memo accompanying the bill is “as fun as its subject.” My favorite tag line from the memo? “There is no doubt that with the passage of this bill there will be no more whining for wine ice cream.”

Of course, many of the commenters to the post emphasize their apparent nerdiness, and I hope to do them one better. You see, I actually took the time to determine whether TTB had regulations regarding such a product. And of course, I was not disappointed.

Specifically, 27 CFR Section 17.133 of the TTB’s regulations provides guidance regarding food product formulas. Formulas for nonbeverage food products on TTB Form 5154.1 may be approved if they are unfit for beverage purposes, but approval does not authorize manufacture or sale contrary to state law (hence the New York State bill).

Among the examples TTB provides of food products that have been found to be unfit for beverage purposes is “ice cream and ices where only sufficient spirits are used for flavoring purposes.” In light of this, maybe I ought to talk to my brother about some wine ice cream for the Summer? Perhaps with a Viognier?

Screaming used under a Creative Commons license provided by Bombardier.

Interesting article over at Wine Business.com, regarding new developments in the expanding Virginia wine industry.

Specifically, there is a new custom crush facility that has just opened in the state. The new facility, just outside of Charlottesville, will serve independent growers interested in launching their own brands and winemakers creating their own labels. These guys started in 2007 with three clients and now have about a dozen in early 2008.

I find this development exciting for the Virginia wine industry. As the article notes, there are about 147 bonded wineries in Virginia, up from 96 just three years ago. This new custom crush facility will be a fantastic resource for a lot of Virginia wineries that may not have access to their own crush facilities.

Tom Wark over at the Fermentation wine blog has a great entry that touches on that shrill strongly worded letter from the Wine and Spirit Wholesalers that I wrote about the other day. All of Tom’s points are great ones, in particular, his observation that the state regulators must choose from the following: 1) heed Craig Wolf’s letter and spend state resources protecting wholesaler profits; or 2) adopt reasonable direct shipment laws and increase the state’s coffers. Tough choice.

Tom correctly views the wholesalers as imploding — and that’s what got me thinking. You see, in addition to being a part owner of a winery, I also work in the telecommunications field as a policy guy and yesterday I heard a fantastic speech. It was a speech about the impact of communications, and it got me thinking about direct wine shipping (bear with me!).

Throughout history, developments in communications, have led to massive societal change. The development of the written language? That led to the establishment of societies. Creation of the Printing Press? That led to the Enlightenment. The telegraph and Pony Express? Each contributed to the expansion of the West. And now of course we have that new-fangled Internet that is revolutionizing communications throughout the world — and this brings me to the wholesalers.

When massive technological change sweeps through society, people either embrace the technology, or shun it out of fear, ignorance or both. The Internet is revolutionizing how people communicate, how businesses conduct transactions, how governments function and — yes — how consumers buy wine. A major paradigm shift is underway. I do not know the role of the wholesalers in this revolution, but they either need to adapt to the technology or stand aside.

Old Bakelit Phone used under a Creative Commons License provided by aussiegall.

The Los Angeles Times covered an issue the other day that many wineries throughout the country – including in Virginia — are beginning to deal with on a more regular basis. The article is identical to a similar story covered by the New York Times in July. discusses the problem of drunks — usually in limos or tour buses — coming to wineries and generally . . . well, one winery employee sums it up here:

It’s a pervasive problem,” said Craig Root, a tasting-room consultant based in the Napa Valley town of St. Helena. “The limo crowd appears to have great demographics on the surface, but some of them tend to — and there’s no polite way to put this — they tend to just get juiced.”

Both articles are worth the read, and what many people may not realize is that wineries can be summonsed for serving a drunk. That’s certainly the case in Virginia and most other states. As a result, a lot of wineries are just saying ‘no’ to limos and tour buses. But another interesting approach raised in the article is that some of these wineries have banded together and forced the tour operators to police their customers. This seems to me to be an interesting approach, but judging from the article, it has mixed results.

Dec. 07 200, used under a Creative Commons License provided by Lord Jim.

Hi. I’m Kevin, and I am fortunate enough to be the General Counsel for one of the newest wineries in northern Virginia — Bluemont Vineyard. It is has been about a year in the making, and since that time, we have crossed a lot of legal terrain. From ABC to TTB, it has been a long and interesting road. Not to mention the whole label approval process.

The purpose of this blog is to shed some light — and hopefully generate some discussion — on issues in wine law. I hope that in the months ahead, you can look to this website as an interesting resource for issues relating to wine and the law.

I am passionate about wine, and I love the law. And having worked in Washington, DC for the last ten years, I suppose I can consider my good friends at TTB my friendly neighbors (for those of you unfamiliar with TTB, they are the the Alcohol, Tobacco Tax and Trade Bureau). There are a lot of topics out there we can discuss, but I suspect that most of my posts will fall into some of the following categories:

• Goings-on at the TTB;
• Interesting news stories where wine and law intersect;
• Developments in direct shipment law;
• TTB labelling developments (do you really need to know how many carbs are in your wine?);
• Whatever else catches my fancy.

Thanks for stopping by, and keep checking back for updates.