Templeton Labeling, or Another TTB failure

[sku]

Thanks for your feedback Leopold. It's certainly not how I read the regs, but the TTB has a lot of latitude in their interpretations and it's always interesting to hear what they are saying to those in the industry who have to deal with them.

I don't think the state of distillation rule affects you since I don't think you market any sourced whiskeys but it would be interested in hearing what they are saying to those who do about what has to appear on the label.

[IowaJeff]

The regulator's interpretation of a regulation is of utmost importance and is often not clear from the text of the regulation itself. In my non-TTB regulatory realm anyway. It can be a maddening, Kafka-esque world.

[Leopold]

Well, for my part I would have no problem putting an age statement on the whiskey if that's what they asked us to do.

The State of distillation does not affect us, you are correct. In this case, I do believe that you and Brisko are correct that the bottlers are ignoring the rule. The TTB has to take them at their word.... unless they submit a formula, which is not required for whiskey COLA's. So the TTB isn't telling them anything, since the bottlers aren't telling them that they aren't making the whiskey. They aren't telling them anything about where the whiskey is distilled.... so there's nothing to rule on.

Edited November 1, 2012 by Leopold

[Brisko]

The BAM is a pamphlet, and nothing more. The CFR's are the controlling regs. Confused me, too, but the TTB set me straight in Cincinnati... focus on the CFR's.

You won't find an age statement on corn whiskey labels, as an example.

The other issue is that the TTB's institutional knowledge changes over time. As an example, they told me that the reg that vodka should be "without distinctive character, aroma, taste, or color" was relative. As in, it's without the character and aroma of other spirits... gin, whiskey, etc....

They told another distiller, years later, that it's an absolute situation. In other words, vodka should have no taste or aroma. This is logically absurd, obviously, since that's describing distilled water. Vodka has a VERY distinctive aroma... the aroma of ethanol that even an inexperienced drinker can identify with ease.

It's a complicated business, that's for certain. The TTB does the best that they can with what little resources they receive.

Well, I won't dispute that the TTB can and does interpret the rules however they want. And I'm willing to admit that I could be misreading the CFRs, too.

With regard to corn whiskey, I know that Platte Valley has a 3 year old age statement. It is a straight corn whiskey though so maybe that makes a difference (although I can't find any exceptions for corn whiskey in the CFR other than not having to state "used cooperage.") The flavored whiskey exception is in there.

I'm looking at the CFR, section 5.40 and it's very clear that all whisky (their spelling) under 4 years old must bear an age statement. Is there another section that makes other distinctions?

[DaveOfAtl]

No reason to doubt what the TTB told you, but what they told you orally carries even less weight than the BAM, which is more of an official interpretation of the relevant regs. Perhaps the TTB has failed to (or chosen not to) enforce the regs cited by Sku, but the plain language pretty clearly commands that an age statement be used. The government is never precluded from enforcing the regs as written, and there is no "everybody is doing it" defense.

Perhaps some of the confusion can be traced to a 1987 Treasury (52 Fed. Reg. 41419-02) decision in which the Department of the Treasury changed the regulations to permit mixtures of straight whiskies to be labeled "straight" as long as they were at least two years old. (There was previously a disparity that although "straight whiskey" needed only be two years old, mixtures of straight whiskey had to be at least four years old to be labeled as such.)

Three industry members were strongly opposed to the proposal in Notice No. 523 to allow mixtures of straight whiskies, which are to be designated as “straight,” to be made up of straight whiskies all of which are at least two years old. This proposal was a relaxation of the current requirement that all whiskies in such mixtures be at least four years old or more. Since the definition of “straight whisky” states that it must have been stored in the prescribed type of oak containers for a period of two years or more, ATF feels that there is insufficient justification to require that mixtures of such whiskies be made of whiskies all of which are at least four years old if the mixtures are to be designated as “straight.” ATF feels that a minimum two year age requirement for all whiskies in the mixture is sufficient to designate the mixture as straight.” ATF feels that the labeling requirement in CFR 5.40 which requires the age of the youngest spirits be shown on the label if any of the spirits are less than four years old is sufficient protection for the consumer and will alert such consumer to the fact that the “straight whisky” in the bottle is less than four years old. It will then be up to the consumer to decide whether such “straight whisky,” which is less than four years old, is good enough to compete successfully with other “straight whiskies.” (Emphasis added)

Although this decision was in the context to the definiton of straight whiskey, I don't think the ATF was saying that the Section 5.40 applies only to straight whiskey. I think they were saying that there is little danger in deceiving the customer regarding the age of the whiskey because all whiskey less than four years old must have an age statement anyway.

[cowdery]

Is it possible that Templeton is unaware of the regulation? They have at least one youtube video that is quite open about their "partnership" with then-LDI. I can't link it easily from my tablet but it's the one with "Lifecycle Project" in the title. It's not so much that I want to rat on them as I want to know that I can trust that labels, not just theirs, are accurate.

Very unlikely that Templeton doesn't know the rules.

I get that the TTB doesn't have the resources to actively police these things, and I can grasp how easily the industry could self-regulate prior to the craft movement.

Here's a question, totally unrelated to TR: what if a producer welched on an age statement? How would it be caught? I'm not thinking so much of 6 year old juice in an 8 year old label (though that's one scenario) but rather maybe 3 year old stock in an NAS? Do the produces have to maintain records to prove such things?

I don't know the full extent of the distillery data available to TTB but I know that they keep track of taxes paid, using computer data of barrels filled, barrels dumped, etc. But, yes, the distillery's records would show this and the TTB probably has access to that data. They pretty much have to be able to account for every barrel for tax purposes.

As for trying to beat the reg, what many people don't appreciate is that the ability to keep secrets declines in direct proportion to the number of people who know the secret. It would be hard to put significant quantities of an underage whiskey into a product without a lot of people knowing about it. It would be a hard secret to keep.

From my experience, the majors tend to be very scrupulous about abiding by the rules because the consequences of not are so potentially grave. Some micro-producers, on the other hand, have an 'outlaw' mentality that hates authority and tries to see how much they can get away with. I imagine at some point there will be something serious that will result in a temporary or even permanent loss of license and that will get people's attention. I know the Templeton folks took pleasure in jerking me around about the source of their whiskey in the early days, so I wouldn't put anything past them.

[Leopold]

No reason to doubt what the TTB told you, but what they told you orally carries even less weight than the BAM, which is more of an official interpretation of the relevant regs.

I agree completely. Which is why I sent in formulations for our whiskies which are tied to our label approval. I told them, in writing, that our whiskies would not exceed 2 years of age (for the bottlings in question). They approved the formula as well as the NAS COLA. I was merely sharing the story of how I confirmed that the age statement requirement only applies to straight whiskey.

The word straight means 2 years or older. If you don't see the word straight on a NAS label, you know it's less than two years old. So in other words: NAS Straight Whiskey is 4 years or older. NAS Whisky is less than two years old. That is how it was explained to me. Just trying to share the info.

Edited for clarity.

[cowdery]

This has always puzzled me and that's the best explanation I've heard.

[IowaJeff]

Thanks for the explanation Leopold. That makes a lot of sense. You should write regulations in your spare time.

[Leopold]

Spare time? What the hell is that? : )

I have handled all the COLA's for our wine, beer, and spirits for years... so it's second nature now. What I've learned is that the regulations don't saw what you think it does, so you have to read them very carefully... and try and avoid the contradictions in the way they are laid out and the way they read.

The TTB views (or at least, they did a decade ago) Straight Whiskey as hallowed ground. You don't get the honor of putting an age statement on that bottle if it isn't straight.... which makes sense in a way, and explains why you can't put age statements on flavored whiskey (something we make). Flavored Whiskey is a lower class, with straight whiskey being the gold standard for the TTB. I sort of like their way of thinking on the matter.... although the only problem is that few consumers know what the heck straight whiskey is anymore.

[Brisko]

Thanks for the clarification on age statements. To the original question: Templeton makes no secret (nowadays) of the source of their whiskey. They write on their website that "this distillery in Lawrenceburg, Indiana continues to be their trusted distillation partner today."

Now, off the top of my head I know that KBD labels the state of distillation rule on the Willett Ryes, and I know that McCormick does too with their Platte Valley corn whiskey and their straight bourbon. There may be others. The rectifier out in Park City uses a slightly different tack: they use what the BAM refers to as a "dispelling statement" that lets the customer know that, no, Rocky Mountain Rye (for example) wasn't distilled in the Rocky Mountains. Not sure why Templeton can't do the same.

[wadewood]

OK Cowdery, I took your advice and wrote Thomas Hogue a very polite email asking about the distilled in state requirement.

It's been a week and no response, I guess an ordinary consumer does not deserve an answer?

thomas.hogue@ttb.gov

Thomas,

I was hoping you could provide some clarification on 27 CFR 5.36 (d), which includes this:

"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."

As a consumer, i find it very confusing that whiskeys are being sold with information on the labels that contradict information that I know to be correct about where this product was distilled.

As noted, I'm a consumer, not a lawyer, and perhaps there is more to it than the statement above.

Thank you,

Wade Woodard

[cowdery]

Oh well. Government agencies can be inscrutable. Even if you don't get a reply, I think it's great when consumers query the TTB about these things. In addition to being a government agency, their mission is consumer protection, so it would seem like they should be responsive to consumer concerns. We should all keep beating the drums.