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Whisky Lawsuit On the Rocks

 

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A distillery in Virginia is “toasting” the end of a “heavy-handed” lawsuit filed this summer by the Scotch Whisky Association.   https://wtop.com/virginia/2019/08/virginia-whiskey-maker-settles-with-scotch-whisky-group/ ; see also https://valawyersweekly.com/2019/07/22/whisky-business/ 

The lawsuit, brought in the United States District Court for the District of Delaware against an independent distillery in Lovingston, Virginia, called the Virginia Distillery Company LLC., alleged that the Virginia Distillery Company LLC engaged in false, misleading and deceptive labelling in violation of the federal Lanham Act, 15 U.S.C. 1051, et. seq.  See Scotch Whisky Association v. Virginia Distillery Co., LLC, Case 1:19-cv-01264-MN, Complaint, at p.1.  

In a case of whisky sour, the lawsuit sought to permanently enjoin the Virginia Distillery Company, LLC from using the words “Scotch” or “Highland” in connection with a whisky product and to force the company to recall at its own expense products already manufactured, distributed, sold or shipped with these offending words on their labeling.  Complaint at 11.  

The lawsuit has recently been dismissed and closed (see docket report at no. 8).  As part of the reported settlement, the Virginia Distillery Co. will stop using the word “Highland” after it sells remaining stock. The distillery will continue to label all products using “whisky” without the “e,” which it says is allowed under U.S. law.  https://wtop.com/virginia/2019/08/virginia-whiskey-maker-settles-with-scotch-whisky-group/  There will be no recall (so you can breathe a sigh of relief if you have one of the offending bottles).  Id.  

Images of some of the Virginia-Highland Products from the Complaint are set forth below:

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The product at issue is a whiskey sold under the brand name “Virginia-Highland Whisky.”  The Scotch Whisky Association claimed that the Virginia distillery’s spelling of “Whisky” without an “e” and prominent use of the term “Highland” falsely indicated to the public that Virginia-Highland Whisky is “Scotch Whisky” (which it is not) or that it originates in Scotland (which it does not).  Id.  The premise of the suit was that the public would be confused by the spelling of Whisky” without an “e” and the use of the term “Highland” into thinking that this American whiskey was in fact Scotch Whisky.

According to http://www.whiskyforeveryone.com/whisky_basics/whisky_or_whiskey.html, the Scottish spelling is “whisky” and the Irish and American spelling is “whiskey”, with an extra ‘e’. This difference in the spelling comes from the translations of the word from the Scottish and Irish Gaelic forms.  A rule of thumb is that if the country has an “e” in its name (i.e. Ireland or America) the spelling is typically “whiskey.”  In countries without an “e” (i.e. Scotland, Japan, Canada), it is “whisky.”  

The “Highlands” of Scotland of course are best known as the rugged northern and north-western portion of Scotland, that conjures up visions of tartans, bagpipes and kilts (and the hit Starz television series “Outlander”).  However, as a former federal law clerk for the great late United States District Judge Glen Williams in the Western District of Virginia, I can attest that  the southwestern part of Virginia is also referred to as the “Highlands” of Virginia – a heritage celebrated in the annual “Virginia Highlands Festival” in Abingdon, Virginia, an annual event that has been going on for seven decades.  https://vahighlandsfestival.com/.

The plaintiff, the Scotch Whisky Association, according to the Complaint, is the trade association for the “Scotch Whisky” association incorporated under the United Kingdom Companies Acts, with a principal place of business in Edinburgh, Scotland.  (Complaint at 2).  According to the Complaint, the 71 members the Scotch Whisky Association produce more than 90% of the Scotch whisky sold worldwide, including such well-known brands as Johnnie Walker, Dewars, Ballantine’s, Chivas Regal, Famous Grouse, Glenfiddich, The Macallan and J&B (Complaint at 3).  The suit was brought ostensibly to “protect the unique geographic identity of whisky produced in Scotland… and to protect the public from confusion or deception.”  Id. at 1-2.  

The website of the Scotch Whisky Association proudly lists various recent legal victories and proclaims:  “It is said that imitation is the sincerest form of flattery.  We disagree.”  https://www.scotch-whisky.org.uk/insights/protecting-scotch-whisky/  The website also encourages people to sign up to “protect Scotch Whisky” by becoming a “Dram Buster” and reporting on “fake” Scotch, stating: “If you come across a suspicious product or you have concerns about whiskies on sale in any country, please contact us. Your help with the vital task of protecting Scotch Whisky is greatly appreciated.”  https://www.scotch-whisky.org.uk/insights/protecting-scotch-whisky/become-a-dram-buster/ 

One point to have puzzled commentators about the lawsuit, see e.g., https://valawyersweekly.com/2019/07/22/whisky-business/ is that the plaintiff refers to the product as “Scotch” whisky.  As anyone who has ever been to Scotland can tell you —  It’s whisky, no “e.”  And you never mix it with anything but a little pure water and you never, ever call it “Scotch”  — that’s just a kind of tape.  Id.   

The defendant, the Virginia Distillery Company, LLC is a single malt whisky distillery located amongst the Blue Ridge Mountains in Central Virginia.”  https://vadistillery.com/our-whisky.  Formed in 2011 by the late Dr. George G. Moore, who was ironically a native Irishman, who “had a great passion for single malt whisky and his adopted home in Virginia.”  Today, Dr. Moore’s wife, son and daughter-in-law have “taken the helm to continue building George’s dream.”  https://vadistillery.com/our-story

Since the conclusion of the lawsuit, the website of the Virginia Distillery Company, LLC, now proudly and unequivocally states that it is an “American Single Malt Whisky Distillery.”  https://vadistillery.com/our-whisky.  

“Have the courage of your convictions” — reportedly a saying that the distillery founder, George Moore, often repeated to friends and family — is now the name of the distillery’s newest “American Single Malt whisky” Courage & Conviction.  In what may be a not so subtle gauntlet challenge to the Scotch Whisky Association, the Virginia Distillery Company, LLC notes that its “Courage & Conviction” whisky “rival[s] the finest in the world.” https://vadistillery.com/products/courage-and-conviction

In keeping with the season, we leave you with a “whisky Thanksgiving” comic (and please appreciate how hard it was to find one let alone one appropriate for circulation).  

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From all of us at Setliff Law, we wish you and yours a wonderful Thanksgiving!