NVV right, TTB wrong on proposed new rules
Like many people, I’ve been following the brouhaha up in Napa Valley concerning the use of the word “Calistoga” on two wines (Calistoga Cellars and Chateau Calistoga) whose grapes don’t come from that area, and that are not made there. This sort of deceptive practice has been going on forever (remember the flap a few years ago over Fred Franzia’s “Napa Ridge” brand?). Now, the Napa Valley Vintners (NVV) is in full battle mode, charging the Treasury Dept.’s Alcohol and Tobacco Tax and Trade Bureau (TTB) with a “cover up” and hoping to bring enough political pressure on them so that they’ll change their position on the key issues.
They even got Sen. Dianne Feinstein’s chief of staff to meet with the TTB’s administrator. That’s hard ball.
NVV’s beef is with two rules TTB proposed last year. Notice # 77 proposed the establishment, long-awaited, of a Calistoga American Viticultural Area (AVA). Notice # 78 proposed certain revisions in the way AVAs are determined. The NVV opposes both proposed rules, arguing that, if they pass into law later this summer, they will impact, not just Calistoga and Napa Valley, but “all other American wine regions,” in the words of Terry Hall, the NVV’s communications director.
The problem with # 77, says NVV, isn’t the establishment of a Calistoga AVA. It’s that the rule proposes to “grandfather protection for certain [existing] brand names,” including Calistoga Cellars and Chateau Calistoga. In the TTB’s words, the owners of Calistoga Cellars “demonstrated a legitimate interest in not losing the ability to continue to use its long-held Calistoga Cellars brand,” and TTB sympathizes with them. NVV says this opens the door to unscrupulous producers “to sell…wine with a misleading label, trading on the quality reputation” of famous winegrowing regions with which they have no connection.
The problem with # 78, according to NVV, is that it proposes to eliminate the practice of “nesting” AVAs within larger AVAs (the way, say, Stags Leap District is “nested” within Napa Valley). TTB argues that “a comprehensive review of the AVA program is warranted in order to maintain the integrity of the program.” In key words, TTB argues that “because the establishment of an AVA can limit the use of existing brand names [e.g. Calistoga Cellars — italics mine], approval of an AVA can have a deleterious effect on established businesses…”. In my reading of # 78, TTB does not actually ban the creation of nested AVAs, but would make the approval process much harder. The TTB’s key wording, it seems to me — words that trouble NVV — are these: “In any case in which an AVA would be created entirely within another AVA…the petition must dispel any apparent inconsistency or explain why it is acceptable.” [Italics mine] This seems to put an unduly harsh burden on the petitioner. In the case of Calistoga, it makes the petitioners of a Calistoga AVA responsible for proving that their case is stronger than the case of Calistoga Cellars, whose economic fears the TTB, in # 77, is on record as commiserating with.
It wouldn’t be the end of the world if both # 77 and # 78 become law as written. I also think the whole AVA thing can get a little silly; anyone can buy their own AVA, if they have enough money to hire lawyers and petitioners. Still, I’m with NVV on this one. TTB, for unknown reasons, is trying to change the rules in the middle of the game. They shouldn’t.