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Five Tips for Making Boozy Ice Cream That’s Legal

When you think of the relationship between alcohol and food, the classics come to mind: tiramisu, coq au vin and beer cheese. While there is a long culinary tradition of using alcohol in food, the newest trend is to utilize alcohol in innovative ways in the culinary world. Recently, a popular food/alcohol combo has been in the freezer aisle where alcohol has lent its flavor to ice cream and freezer pops. Fans consider this a win-win…it cools us down in the summer and acts as a little adult refreshment at the same time. As the tasty treats gain popularity, more and more states are approving the manufacture and sale of such items. 

Recently, New York Governor Andrew Cuomo signed legislation that allows ice cream to be mixed with liquor. He stated this would, “help New York’s dairy farmers, liquor and craft beverage producers, dairy processors and manufacturers, food retailers, and restaurants meet the increasing consumer demand for these new and innovative products.” While New York has been able to have beer and wine mixed ice cream, liquor is new. Other states, like Ohio, have created special licenses for the explicit manufacture and sale of ice cream with beer or intoxicating liquor. 

While we believe this is a win-win for adults, this space lends itself to a number of legal hurdles. We suggest the following tips:

1. Advertise specifically to adults. While this is a given in alcohol beverages, it is a good reminder to gear your advertising towards adults only. 

2. Ensure your label is clearly marked with 21+ and the Government Warning Statement. New York specified in its most recent legislation that the label must have warnings and label requirements similar to confectionary products that contain beer, wine and cider.

3. Avoid the risk of unaware consumption. Ensure that the packaging and marketing make it very clear that the product contains alcohol.

4. Check each state to learn its specific laws. For example, in New York the maximum alcohol by volume allowed in ice cream is 5% while Ohio allows up to 6%.

5. Food that has alcohol mixed in requires the submission of a nonbeverage formula to the Tax and Trade Bureau (TTB).   




Non-Alcoholic Beer Regulation 101

As part of the general move to better-for-you beverages, non-alcoholic (NA) options have been and will likely continue to be on the rise. However, how NA is treated, or not treated, as “beer” has significant impact on its potential route to market. The below summarizes the overall treatment of NA beer under US federal law, as well as examples of restrictions on direct-to-consumer (DTC) shipments imposed by certain states.

FEDERAL TREATMENT OF NA BEER

  • Tax Treatment: The Alcohol and Tobacco Tax and Trade Bureau’s (TTB) regulations define “beer” as a fermented beverage containing 0.5% or more alcohol by volume (ABV) and brewed or produced from malt, wholly or in part, or from any substitute for malt. (See: 27 C.F.R. § 25.11.) The regulations refer to a malt beverage containing less than 0.5% ABV as a “cereal beverage.” (See: 25.11.) Because NA beer contains less than 0.5% ABV, TTB will not treat it as a “beer” under the Internal Revenue Code (IRC), and accordingly it will not be subject to federal alcohol excise taxes in the United States.
  • Formula Requirements: Once a process is developed for an NA malt beverage and prior to production, a formula must be submitted and approved by TTB. If an NA malt beverage is “alcohol-free,” TTB policy is to require submission of laboratory testing results.
  • Labeling: The Federal Alcohol Administration Act (FAA Act) regulates malt beverages, regardless of their alcohol content, if they meet the Act’s requirements of containing some malted barley, some hops (or hop parts or products) and having been subject to fermentation. An anomaly exists because the FAA Act’s definition of “malt beverage” does not include any minimum or maximum threshold of alcohol content. Because nonalcoholic and alcohol-free beers are produced like conventional beer and then de-alcoholized, they fall under TTB’s labeling and advertising jurisdiction. Several regulations specifically address such products. (See: 27 CFR § 7.71.)
  • FDA Requirements: The Food and Drug Administration (FDA) requires NA beverages that are not malt beverages under the FAA Act (beverage without malt and hops or an unfermented beverage) to be labeled in accordance with the Food, Drug, and Cosmetic Act (FD&C Act), Fair Packaging and Labeling Act (FPLA) 15 U.S.C. §§ 1451-1461, and the Nutrition Education and Labeling Act 21 U.S.C. §§ 343-350. (Click here for more information.) These statutes and the FDA regulations require a full ingredient list and nutritional facts label. If an NA beverage without malt or hops or an unfermented beverage is being considered, a full explanation of the FDA requirements will be needed to develop a compliant production, labeling and marketing plan. The FDA has industry guidance on labeling and formulation of “dealcoholized beer.” (See: FDA CPG Sec. 510.400, updated Nov. 2005.)
  • Production Process Issue: If the production process for an NA beverage includes removal of alcohol from beer through reverse osmosis or other processes that separate alcohol from the other components of a beverage, the process may be considered distilling operations, which will require a federal basic permit for a distilled spirits plant. (SeeATF Ruling 85-6.)
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TTB Relaxes Consignment Sale Restrictions in Wake of Coronavirus Cancellations

On Friday, March 13, 2019, in the wake of growing concerns and related mass cancellations of large events all across the United States, the federal Alcohol and Tobacco Tax and Trade Bureau (TTB) announced that it is relaxing federal restrictions on alcoholic beverage returns that might otherwise violate prohibitions associated with consignment sales.

(more…)




McDermott’s Marc Sorini Named a 2019 NLR ‘Go-To Thought Leader’

We are very pleased to share that one of our editors for Alcohol Law Advisor and head of McDermott’s Alcohol Regulatory & Distribution Group Marc E. Sorini was named a 2019 National Law Review Go-To Thought Leader. The National Law Review’s 2019 “Go-To Thought Leader Awards” spotlight 75 legal authors—less than 1% of the publication’s 15,000 thought leaders—selected from a pool of over 100,000 news articles published in 2019. Sorini was one of three thought leaders recognized in the “Food & Drug” category. According to the awards description, “The NLR Go-To Thought Leadership recipients not only demonstrate a depth of legal knowledge but also outline the steps needed for compliance and/or adaptation. These designated authors are not only reader favorites but are often quoted in other publications and/or syndicated in other media.”

Recognized as one of the leading lawyers in his field, Sorini has represented alcohol beverage suppliers before federal and state courts, the US Alcohol and Tobacco Tax and Trade Bureau (TTB) and Federal Trade Commission (FTC) and state alcohol beverage control agencies. He advises clients on compliance with the regulations and policies of the TTB, FTC, Food and Drug Administration (FDA) and Customs and Border Protection (CBP). Here, he shares his thoughts on the recognition, how he stays on top of industry trends and the advice he has for peers and future thought leaders.

Q: What are your thoughts on being named a NLR ‘Go-To Thought Leader’?

A: My first instinct is to say, “Dude, it rocks!” But sincerely, I’m honored to be included in such a selective list of my peers. Over the past year especially, our practice group has focused on optimizing our content: getting to the heart of why, say, a regulatory update really matters and how readers should take action in response. It’s validating to see that approach has resonated.

Q: What have you found most useful in your tenure in terms of staying on top of industry trends for this practice, which led you to this recognition?

A: It starts with discipline, first and foremost. I carve out the time to read up on industry developments through daily updates like Alcohol Issues INSIGHTS, Beer Business Daily, INSIGHTS Express and Wine & Spirits Daily. I also try to keep tabs on bills and case law, as well as the monthly and bimonthly publications like The New Brewer and Artisan Spirit Magazine. Making the time to stay up to date really pays dividends, in my experience. Court cases, for instance, become old news very quickly if you don’t stay on top of them.

Q: As an established thought leader, what would you advise the peers and future thought leaders? How are you already working with the next class to ensure a continued stream of valuable content in this space?

A: As we know, the way lawyers are compensated can sometimes create a perverse incentive: The instant reward is for putting in billable hours, not for the deeper practice [...]

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Cannabis and Hemp Update

Cannabis legalization receives widespread popular support. According to opinion polls, more than two-thirds of Americans support full legalization—a steep rise in support considering that as recently as 2005, almost two-thirds of Americans opposed legalization. The country appears on the path to full cannabis legalization, but until that time, citizens and companies should be aware of the legal risks involved in entering the cannabis space.

Access the full article.

Originally published in The New Brewer, July/August 2019.




Implications of the Supreme Court’s Tennessee Retailers Decision

As virtually everyone in the US alcohol beverage industry knows, last week the US Supreme Court handed down its opinion in Tennessee Wine and Spirits Retailers Assn. v. Thomas, S.Ct. No. 18-96 (June 26, 2019). Now that over a week has passed since the release of that decision, it’s time to reflect on what it means and what is coming next.  (more…)




Data Breach: How to Prepare for What Experts Have Deemed Is Inevitable

Data security experts often say there are two types of businesses: those that have been hacked and those who will be hacked. Many small business owners believe they are too small to attract a hacker or fall victim to a breach, but this is not true. Given the costs and broad reach of data breaches, small businesses must take a proactive role in preparing themselves for a breach and mitigating its effects. A small business can take practical steps to better protect itself and its brand from the effects of a data breach.

Read the full article.

Originally published in Artisan Spirit: Summer 2019.




24th Annual Wine, Beer & Spirits Law Conference

On September 16–17, CLE International will host the 24rd Annual Wine, Beer & Spirits Law Conference in Charlotte, North Carolina. Those attending will include the alcohol beverage industry’s leading practitioners, including in-house counsel for producers, distributors and retailers, as well as industry lawyers and state administrators. Conference topics include:

  • Updates on TTB developments and trends
  • An overview of recent developments in alcohol trade practice and trademark law
  • The significance of regulatory compliance, and the state of data security and ownership
  • Updates on the cannabis industry, including the latest legalization efforts and how it could affect the alcohol beverage industry

McDermott partner Marc Sorini serves as co-chair for the event and will also present. Other McDermott presenters will be Michael Kimberly and Anthony DeMaio.

Click here for the full agenda and registration information.




Winds of Change Blowing for Craft Brewers

For those who follow developments in the law and craft brewing with equal passion, every year has its share of substantial issues. This year has been no exception, with a pending Supreme Court case; a substantial upswing in federal trade practice enforcement activity; a massive rewrite of US Tax and Trade Bureau (TTB) labeling and advertising regulations; and prospects for extending the biggest cuts in the excise tax on beer since the repeal of Prohibition.

As these developments play out over the next year, we may see changes translate into the marketplace. Find out what you can expect.

Access the full article.

Originally published in The New Brewer, May/June 2019.




TTB Spring 2019 Updates to Semi-Annual Regulatory Agenda

The spring edition of the federal government’s semi-annual Unified Agenda of Federal Regulatory and Deregulatory Actions (Regulatory Agenda) has been published. Like other federal agencies, the Alcohol and Tobacco Tax and Trade Bureau (TTB) uses the Regulatory Agenda to report on its current rulemaking projects.

The Regulatory Agenda provides glimpses into TTB’s policy focus and aspirations. But, readers should recognize that TTB rulemaking moves very slowly, and the Agency often does not meet the aspirational dates published in the Regulatory Agenda.  (more…)




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