Handmade, Homemade, Handcrafted — What’s Safe These Days?

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If you pay attention to industry news, you’ve surely noticed an increase in stories about litigation surrounding “misleading” information on labels. Most recently, Anheuser-Busch’s use of “Bud Light Lime-a-Rita” is being questioned by two California-based law firms because it has twice the calories of regular Bud Light.

Other recent lawsuits include Maker’s Mark (Beam/Suntory) and Tito’s Vodka which address whether having the word “handmade” leads people to believe that the product is superior. Templeton Whiskey’s label states “Prohibition-Era Recipe” and Angel’s Envy indicates small-batch made in Kentucky. Both statements have also landed these whiskey producers in class-action lawsuits.

Screen Shot 2015-03-02 at 6.11.43 PMFor advanced analysis, we rely on LabelVision, a tool that enables full-text search of all TTB-approved beverage alcohol labels. LabelVision uses Optical Character Recognition (OCR) scanning to search for all text from all 1.6 million labels approved since 1995. That’s a fancy way to say that the tool converts label images to text, so we can search, using keywords.

Based on research we performed using LabelVision, we found the following data regarding the recent lawsuits:

  • 220 calories on a Lime-a-Rita label and 110 on Bud Light
  • 788 labels with “Handmade
  • 6,000+ labels with “Handcrafted” of which 5,000 are wine labels
  • 745 spirits labels with “Small Batch
  • Non-Kentucky suppliers in 21 states and 13 countries use “Kentucky” on their spirits labels
  • Six spirits labels sold by Indiana suppliers with “Kentucky” on their spirits labels

These numbers don’t necessarily represent suppliers with misleading text on their labels. They do, however, confirm that branding strategies such as using “Small Batch” and “Handmade” exist beyond Tito’s and Makers Mark.

Last month, Lagunitas opposed Sierra Nevada’s use of IPA with a distinctive font but was resolved quickly after an outcry from social media. Stone Brewery forced Boulder, Colorado’s Kettle and Stone Brewery into changing their name to Vindication Brewing because they were confusingly similar. And, Oskar Blues received notification from Gordon Biersch to discontinue use Gordon Knight Imperial Red. They happily changed it to G’Knight to leverage the media attention.

Finally, a major decision favoring Pom Wonderful last year in the food industry is relevant to the alcohol beverage industry with Pom Wonderful LLC vs. The Coca-Cola Company. It revealed that 99.4 percent of the juice blend in Minute Maid’s Blueberry Pomegranate consists of apple juice. For over 50 years, the Lanham Act allows a competitor to sue another provided it asserts unfair competition from false or misleading product descriptions. Case in point, any misleading text like “Handmade” or “Small Batch” is subject to additional scrutiny by one’s competition.

Growth and diversity in the spirits segment will lead to both increases in competition and in regulation. LabelVision tells us that 5,900 labels were approved in 2005 and 10,500 in 2014. Since the craft spirits market is lagging a little behind craft beer, similar growth could lead to similar issues, so preparedness is key.

There is more variety of wines, spirits flavors, and craft beers than ever before in the US. Each new brand wants to set themselves apart and make millions of dollars. But, make sure to carefully choose the next Hop branded beer, or Whipped Cream flavored vodka because they are likely already taken. Every word, percentage, logo, or text font added to a label today could end up in the news tomorrow.

If you’re curious how your labels compare to the industry, test-drive LabelVision! The tool offers a way to search the entire TTB database and also monitor brand names by other suppliers to confirm that your brands aren’t already in use.

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