The Theft of Equity in Napa Valley

I’m every bit as strident as Representative Thompson, Bo Barrett of Montelena and others in Napa Valley when it comes to the idea that  American Viticultural Area designations we see on labels really should have integrity! If the wine label’s appellation says "Oakville" or "Anderson Valley" then the grapes that went into the wine damn well should have come from Oakville or Anderson Valley.

Toward that end, there is a move to designate the area in and around the town of Calistoga in Northern Napa Valley as an American Viticultural Area. If approved, when a winery puts "Calistoga" on its label, the consumer will know the grapes for that wine were grown in the well-delineated region identified by law as the Calistoga Viticultural Area (whatever that might imply beyond the obvious is up for debate).

However, in a nice piece of reporting by the St. Helena Star, we are reminded that there are an awful lot of folks who in creating this new AVA, have no problem effectively destroying a couple wineries that have been using the term "Calistoga" in the their brand name…WELL BEFORE there was any hint of a Calistoga Viticultural Area. This is wrong.

"Calistoga Cellars owner Roger Louer of St. Helena has been using the
Calistoga brand for years and contends he would lose millions of
dollars if he is forced to give up the label. He also sees no point in
using Calistoga grapes since he owns vineyards in St. Helena and
throughout the Napa Valley."

The contention among those that have little concern about the wineries that, up until now, have been building a business called Calistoga Cellars and Calistoga Estate is that with the new AVA coming these wineries should not be allow to use this brand unless all the grapes they use in their wines come from Calistoga based vineyards.  But no one every suggested this was a requirement when they founded their winery or when they applied for label approvals. Still, the strident don’t seem to care about this unfair backdating of the laws.

"[CA Rep. Mike] Thompson said [John] Manfreda (head of the U.S. Treasury Department’s Alcohol and Tobacco Tax and Trade Bureau (TTB)) once suggested that Calistoga Cellars and
Calistoga Estates might be allowed to print a “disclaimer” on its
bottles, exposing the fact that the wine did not come from Calistoga.

said that wouldn’t solve the problem of false labeling because
consumers who buy wineCalistogaestate
in restaurants off wine lists, see it
advertised, read wine reviews and catalogs and use the Internet, would
draw the conclusion the wine is from Calistoga."

With all due respect to Representative Thompson, only those who don’t understand Americas AVA system would conclude this. All labels must carry a federally approved AVA on their label saying where the grapes came from. The label might read, "2005 Calistoga Cellars, Russian River Valley, Pinot Noir".

The bottom line here is that many in Napa Valley and their representative in Congress want to take away what was legally given to these Calistoga wineries. They have and still do have the right to have the "Calistoga Cellars or Estate brands. They were approved. The labels themselves were federally approved. And now, after the fact, the creation of a new Calistoga AVA means they can no longer use the brand names they’ve built or they have to completely change their entire business model.

The sensible, the neighborly, the right thing to do is to make an exception for "Calistoga Brands" that were in existence before the application for a Calistoga AVA was submitted. Or, someone should be monetarily compensating these winery owners using now legally using "Calistoga" in their brand name for the theft of equity that is being suggested.

Posted In: Wine Business


6 Responses

  1. TrevR - June 12, 2008

    Here, here. VERY well said Tom, couldn’t agree more. Sadly, like most things involving politics, the decision makers side with those who back them financially more often than not.

  2. Arthur Przebinda - June 12, 2008

    “With all due respect to Representative Thompson, only those who don’t understand Americas AVA system would conclude this.”
    (?) But what percentage of the American wine buying public *really* understands the the AVA system?
    That said, How about a modification of the Brand name: “CALISOTGA CELLARS/ESTATE” [large font] and “of Napa Valley” [below, in smaller font]?

  3. Tish - June 12, 2008

    Totally with you on this, Tom. Even the argument by Rep. THompson doesn’t hold up. A person seeing “Calistoga Cellars” on a wine list has no more reason to think the wine is from a desginated area called Calistoga than someone seeing Newton Vineyards might think that wine is from a place called Newton.
    Here’s my question, though, is: will there be a domino effect if an exception is NOT made for the two Calistoga brands? Will Stag’s Leap Wine Cellars and Stags Leap Winery be allowed to make wine that is simply from Napa Valley? And whither Dry Creek Vineyard’s Chenin Blanc from Clarksburg? I love the Chenin, but it seems more likely someone would mistake that as a wine from Dry Creek Valley…

  4. JohnLopresti - June 12, 2008

    Thompson’s politics usually are blueDog marginal for my sensibilities, but we tend to align more closely on his beloved viticultural and enologic politics.
    I think the Calistoga Cellars as label actually is so close to St. Helena that organoleptically it will be similar to genuine AVA Calistoga wine.
    I have yet to hear who has developed the American name for the disputed label word port, either.
    It used to be the French chafed at Americans calling Chablis or Champagne by their native regional names. Part of the political hassling certainly must be the dignity of the beverage. Americans who purchase chablis likely care little whether it is called French colombard or chenin blanc.
    I was reminded recently of the DCV chenin, which actually dates back to the time when folks were wondering whether calling a jug wine chablis would lose customers but if named chenin would provide an avenue for product improvement and commensurate price escalation. Knowing DCV’s vinification expertise, I might even buy a DCV chenin, though conceptually trying a chenin after 20 years of preferring much more subtlety from white table wine, would seem a regression, and a purchase I would avoid, unless, say, Wilma herself were to visit and wish for a tart but fruity veranda sip that was not sauvignon blanc.
    The entire issue of falsification of labels is contentious, so I guess I would approach a Calistoga AVA as needing to be from there really.
    I was in a Starbucks coffee house in Healdsburg a year ago, and walked by a table with a few merchants, a winery owner, and his attorney sitting in heated discussion over future blend design, the attorney crowing that hey they only need to place 60% or is it 75% of the varietal in the blend to satisfy the tricky label words. But cost savings figure into owners’ equations. The grandfathering issue in Calistoga is very difficult, because you folks are neighbors. It is nice to have good fences, and get along with neighbors. Maybe all their new label should be required to say is, Calistoga Cellars, in St. Helena, near the Calistoga AVA; with a penalty clause, if the so grandfathered labels begin to appear on less deserving blends, then they should be ungrandfathered and brought into compliance with the pure Calistoga AVA content proportion requirement.

  5. Phyll Sheng - June 12, 2008

    Wouldn’t a shared negative opinion of Calistoga Estate’s and/or Calistoga Cellars’s wines affect the business of wineries (new or otherwise) that make wines from grapes grown within the Calistoga AVA? I mean, I’m talking about a regular Joe who doesn’t understand the AVA system and who tells his friends he’s had various wines from “Calistoga” (he forgot the brand).
    And Joe represents the majority of wine-drinking consumers.

  6. Tom Wark - June 12, 2008

    “Wouldn’t a shared negative opinion of Calistoga Estate’s and/or Calistoga Cellars’s wines affect the business of wineries (new or otherwise) that make wines from grapes grown within the Calistoga AVA?”
    It probably would, Phyll. But it’s a little late to be thinking about that now isn’t it? Shouldn’t this thought come up a decade ago, before the owners did what they were told to do, applied for what they were told to apply for, got a legal approval for their label and invested in building the brand?

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