Tito’s claims do not fall under safe harbour

Tito’s Handmade Vodka cannot eliminate liability under safe harbour just because the TTB signed off on the use of the word ”handmade” on its labels, plaintiffs argue.

Tito’s Handmade Vodka has faced lawsuits alleging the brand has duped consumers into believing it is handcrafted

Safe harbour is a provision of law that states certain actions will be considered not to violate a given rule, usually in connection with a more vague, overall standard.

Plaintiff Gary Hofmann is in a proposed class action accusing Fifth Generation Inc. of misleading consumers over the fact its Tito’s Handmade Vodka is made mostly with machines.

He told a California judge that the firm’s claims cannot fall within California’s safe harbour simply because the US Alcohol and Tobacco Tax Bureau approved its use of the word “handmade”.

Last month, a federal judge dismissed five out of six lawsuits against Tito’s Handmade Vodka, which alleged the brand has misled consumers with false labelling

“The TTB’s issuance of a COLA [Certificate of Label Approval] is not subject to notice and comment rulemaking or anything like it,” Hofmann said, as reported by Law360. “Thus, the TTB’s approval of a given label – one of roughly 135,000 such approvals carried out by the TTB – is not the type of formal regulatory action sufficient to trigger the safe harbour.

“The TTB’s regulations are a floor on the regulation of alcohol beverage labelling, not a ceiling; thus, the TTB’s approval of a label does not mean that the label is ‘clearly permitted’ by law.”

He added that the issuing of a COLA does not protect alcohol producers from complying with stricter state alcohol and consumer protection laws.

Furthermore, Hofmann stated that Fifth Generation’s argument that a state law imposing stricter standards than the TTV is attempting to make an “end run around” the TTB’s authority based on various false premises.

“Firstly, the TTB does not have ‘exclusive jurisdiction’ over the labelling of alcoholic beverages,” said Hofmann. “Quite the contrary… the TTB shares that regulatory burden with California and the other states, which are free to impose their own, more stringent rules on alcohol manufacturers.”