California winery to change labels for Oregon brands

A California winery may lose its permit to do business in Oregon after state regulators determined the company repeatedly and intentionally violated labeling laws aimed at protecting Oregon's $5.6 billion wine industry.

A Napa Valley winery at the center of a labeling dispute in Oregon has agreed to put new labels on two brands of Oregon Pinot noir, following an investigation by federal regulators.

The wines in question — Elouan and The Willametter Journal — are made by Copper Cane LLC, based in Rutherford, Calif. The winery buys grapes from roughly 50 Oregon growers to make Pinot noir and rosé back in California.

Oregon winemakers raised concerns about Copper Cane’s labels earlier this year, which they felt were misleading to consumers by suggesting the wines were made in one of Oregon’s high-value American Viticultural Areas, or AVAs.

Federal law prohibits using an AVA name on labels, containers or bottles unless the wine was made in that state, and likewise forbids language that “tends to create a misleading perception.”

Copper Cane surrendered nine labels to the Alcohol and Tobacco Tax and Trade Bureau, though the company was granted a “use-up” allowance, which allows them to finish selling what they have already bottled and labeled.

Tom Hogue, a spokesman for the TTB in Washington, D.C., did not comment specifically about the investigation, but said the agency determined labels for Elouan and The Willametter Journal should not have been approved in the first place.

In the case of The Willametter Journal, the label was stylized as an old telegram, hailing the wine from the “Willamette region of Oregon’s coastal range” and sourced from the “Territory of Oregon.” Cases of Elouan Oregon Coast Pinot noir also referenced the Willamette, Rogue and Umpqua valleys, all three of which are federally designated AVAs.

Joe Wagner, founder and owner of Copper Cane, defended his labeling practices, saying the grapes are 100 percent from Oregon and they had hoped to communicate that fact through fun and fanciful language.

“We’ve never misguided consumers,” Wagner said. “We’re very transparent about all those elements.”

Wagner said they received new labels for the brands on Nov. 19, which drops all mention to specific geographic regions. Instead, the wines will be labeled as “Grown in Oregon, Made in California.”

Jim Bernau, founder and CEO of Willamette Valley Vineyards south of Salem, Ore., has been a vocal critic of Copper Cane’s labels. The laws are in place for a reason, Bernau said, and that is to protect the authenticity, value and reputation of unique wine growing areas.

Bernau said he was pleased to see the TTB take quick and serious action, though there is still work to be done. He said two more Elouan labels are still causing problems, including Missoula Wash and Klamath’s Kettle, which infer the Willamette and Rogue AVAs.

“This is a pattern of deception quite sophisticated in nature,” Bernau said. “If this kind of behavior is allowed to continue, we won’t have an Oregon wine industry.”

The issue has also drawn the attention of Oregon legislators, including Rep. David Gomberg, a Democrat representing the central coast. Gomberg — who owns an investment stake in Willamette Valley Vineyards — testified about Copper Cane’s labels during a hearing Sept. 24 before the House Interim Committee on Economic Development and Trade, and issued a statement Nov. 19 after the labels were surrendered.

“This is consumer fraud, pure and simple, and I am glad the federal agency has caught it,” Gomberg said.

However, both Gomberg and Bernau expressed disappointment about the “use-up” allowance, saying it will continue to denigrate Oregon’s AVAs by allowing an estimated 900,000 more bottles to be sold into the market with deceptive labels.

“That’s more than the annual production of 15 Oregon wineries,” Gomberg said.

Wagner said they should finish off the remaining inventory within the next six months. Jim Blumling, vice president of operations for Copper Cane, said they see nothing but positive growth for their brands across the country.

“We love being a part of the Oregon wine enterprise, and we feel privileged to get the fruit from the growers we do business with,” Blumling said.

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