Hospitality

"What the Senate Immigration Proposal Would Mean for Wineries," Wine America, The National Association of American Wines

Tue, 23 Apr 2013 00:00:00 GMT

Advisory on When Food Production Leads to Prosecution

Sat, 09 Mar 2013 16:54:43 GMT

Over the last few weeks, two big stories have made headlines in the food industry. Beginning in early February, news media across Europe began reporting that food products tested in several European countries contained horsemeat, purportedly marketed as beef. The reports also indicated that it was highly likely that consumers had eaten this mislabeled, and in some cases tainted, product. A few weeks later, word came that the U.S. Department of Justice handed down a 76-count indictment against individuals formerly associated with the Peanut Corp. of America related to the company’s handling of a Salmonella outbreak in 2009. Both of these stories reflect the increased awareness of food issues among consumers, regulatory agencies and the media alike, and also provide lessons to be learned by food producers. The Peanut Corp. of America case is also part of a trend to criminalize conduct involving food safety that is alleged to present a danger to the public.

Cary Greene, Former General Counsel to WineAmerica, Joins Davis Wright Tremaine

Fri, 12 Apr 2013 18:38:43 GMT

Cary Greene, former general counsel to the influential association of U.S. wineries, WineAmerica, has joined Davis Wright Tremaine in its Washington, D.C. office. During his tenure at WineAmerica, Greene successfully supported the passage of winery direct-to-consumer shipping legislation in Maryland and Pennsylvania, and worked with distillers and brewers to defeat state and federal legislation that threatened to restrict the sale and distribution of alcohol beverages.

The addition of Greene marks the third major hire in DWT’s food and beverage practice in the past twelve months. Don Buder, a highly experienced transaction lawyer with deep experience in the food, beverage, and restaurant industries, joined the firm’s San Francisco office earlier this year. And Charles M. (Chip) English, who has extensive experience representing businesses and trade associations before the U.S. Food and Drug Administration and the U.S. Department of Agriculture, joined the firm in D.C. last year. To learn more about Cary Greene, and to read the full press release, click here.

Cary Greene, Former General Counsel to WineAmerica, The Influential National Association of U.S. Wineries, Joins Davis Wright Tremaine LLP

Thu, 11 Apr 2013 00:00:00 GMT

FDA Food Safety Rulemaking Tour Heads to the Northwest

Tue, 19 Mar 2013 21:07:08 GMT

The federal Food and Drug Administration (FDA) will hold a public meeting on FDA’s proposed food safety rules in Portland, OR on March 27-28. The rules implement portions of the recent Food Safety Modernization Act by imposing sweeping federal regulation of local farming practices and food processing operations across the nation.

The proposed rules are detailed and complex, but they ultimately provide little practical guidance to farmers and food processors. Instead, the rules give FDA broad discretion to make case-by-case determinations as to whether a business has adequately controlled food safety risks.

For example, the proposed rules include provisions to prevent contamination of produce by waste from wild and domesticated animals. The rules state that if there is a “reasonable probability” that grazing domesticated animals will contaminate crops, then a farmer must implement an “adequate waiting period” before harvest. See Proposed Sec. 112.82. The rule does not define “adequate waiting period,” but FDA’s commentary on the proposed rules states that FDA “would not expect it to be necessary” for the waiting period to exceed nine months. The proposed rules therefore give FDA discretion to dictate grazing and harvest schedules on farms utilizing both livestock and planted crops. This could be particularly problematic on organic farms that utilize chickens or goats for weed control.

Another related issue concerns discrepancies between FDA’s explanation of its rules and the actual text of the rules. For example, the proposed rules forbid the distribution of “produce that drops to the ground before harvest” unless the produce is subsequently treated to prevent contamination. Sec. 112.114. FDA asserts that this rule does not apply to tree nuts and other crops that are “dropped to the ground as a part of the harvesting practice.” The dropped produce rule, however, plainly applies to any produce that hits the ground before it is harvested. Unless amended, therefore, this rule could force changes in the production of crops such as Oregon hazelnuts that are harvested from the orchard floor after the nuts have naturally dropped to the ground.

Finally, the proposed rules contain intensive monitoring requirements and harsh consequences for the discovery of perceived food safety risks. For example, the proposed rules regulate all irrigation water that could come into direct contact with produce. Farmers using such water must test the water for E.coli bacteria every three months during the growing season and must immediately discontinue water use if any E.coli is found in the water. This requirement applies even when a growing crop will be subsequently washed or processed to eliminate bacterial contamination. A farmer may not resume irrigation until the farmer treats the water source or can prove that E.coli is no longer present in the water and is not likely to return. See Sec. 112.44-45.

The Portland meeting will provide an important forum for Northwest farm businesses to provide feedback to FDA on the proposed rules. FDA has little experience with agriculture and needs information about how its ideas will affect actual farms and farm businesses. Those unable to attend the public meeting may submit written comments to the FDA by May 16, 2013.

Loko Liability: Claims Against Alcohol Beverage Manufacturer for Intoxication Injuries

Sat, 20 Apr 2013 18:17:38 GMT

By Ashley Watkins, Cary Greene, Chip English and Dave Ernst

Recently, the parents of a young man who died of alcohol poisoning filed a wrongful death suit against Phusion Projects, Inc., the company behind the “Four Loko” Beverage. This type of lawsuit against the manufacturer of an alcohol beverage is uncommon. Dram shop laws facilitate lawsuits against retailers for over-serving someone who subsequently causes a drunk- driving accident, but courts typically have not found a manufacturer liable for harms to the consumer caused by his own over-consumption. However, Four Loko has seen its fair share of this kind of litigation (see an overview of them in this insurance coverage lawsuit).

Four Loko was an innovative product, combining caffeine and malt liquor into a single beverage. While initially very popular, the drink came under attack after a string of incidents in 2011. In Washington, nine college students were hospitalized after consuming Four Lokos at a party, leading the Attorney General to push for a national restriction on the sale of the product. In the face of this backlash against the product, the company removed caffeine from its formulation, and added additional labeling on the can under pressure from the FTC.'

This latest complaint makes allegations under the Washington Product Liability Act. The complaint parrots two of the major criticisms of the product. First, that the 23.5 ounce drink contained the alcohol equivalent of up to four or five beers, rather than the one or two advertised. Second, that the combination of alcohol and caffeine allegedly prevented the consumer from feeling the effects of the alcohol, leading him to drink more than he otherwise would have.

On a case-specific level, the plaintiff’s claims must overcome a few hurdles. First, claims of defective design require a plaintiff to show that the product was unsafe to an extent beyond what a normal customer would contemplate. A jury could be asked whether an ordinary consumer would likely anticipate that a malt liquor drink could get them drunk, even with the presence of caffeine. While the presence of caffeine does add an additional hook for potential liability, a court may be hard-pressed to overlook combinations of caffeine and alcohol so readily accepted in other situations; bars and restaurants have been serving "rum and Cokes" or Irish coffees for years without facing these sorts of claims.

Beyond the case-specific analysis, the case raises a number of public policy concerns that relate to the beverage industry as a whole. Imposing liability in this instance rejects the “individual responsibility” approach often favored in American society. The pushback from Big Brother-type restrictions on drinking is what led to the repeal of Prohibition and the 21st Amendment (notably, the only amendment actually repealing a prior amendment).

While this complaint is unique to the particular issues related to Four Loko, it is worth following as it pertains to the treatment of new alcohol beverage products. Many other products have been met with allegations of dangerousness when first introduced onto the market, including malt liquor, wine coolers, and flavored malt beverages. It will be interesting to see how Four Loko charts its path following this latest round of litigation.

National Academy of Sciences Publishes Paper on Future Climate Change and Shifts in Growing Regions for Viticulture

Fri, 12 Apr 2013 21:10:09 GMT

By Peter Sergienko

In a paper published in the Proceedings of the National Academy of Sciences on April 8, researchers have projected changes in suitable growing regions for wine grape production in 2050 using runs on 17 different global climate models and assuming two different carbon emissions scenarios. The findings project major global geographic shifts in suitability for viticulture, with significant declines in traditional wine producing regions with Mediterranean climates such as Bordeaux, Rhone and Tuscany. Current suitability is retained in smaller areas, especially at higher elevations and in coastal areas. Increases in suitability are projected in more northern regions in North American and Europe.

Because climate stability is critical to all agriculture, it is important to look briefly at the greenhouse gas emissions scenarios incorporated in the models and to consider other scientific literature addressing climate stability, climate equilibrium, and the relative importance of both mitigation of and adaptation to climate change to put the study’s findings into context.

The two emissions scenarios considered in the study are “Representative Concentration (or Carbon) Pathways (RCP) 8.5 and 4.5. RCP 8.5 is a business as usual scenario with no coordinated global effort to cap and reduce global greenhouse gas emissions through the year 2100. More information concerning RCPs is here.

Notwithstanding all current voluntary and compulsory efforts by private businesses and individuals, states, local governments, and many countries to reduce greenhouse gas emissions, RCP 8.5 is a road to catastrophe. The effects of this scenario on wine grape production in 2050 are probably irrelevant because successful human adaptation to the changes in climate under this emissions pathway is unlikely.

RCP 4.5 is considered to be a “weak mitigation” emissions scenario. Notably, the projected global average temperature increase by 2100 under this scenario ranges from 2.25 to 4.11 degrees Celsius with a 53 percent chance of keeping the increase below 3 degrees Celsius. In general, all greenhouse gas emissions policies under consideration nationally and internationally are designed with the goal of keeping the temperature increase below 2 degrees Celsius. This goal is somewhat arbitrary and based on dated science. A safer goal is likely 1.5 degrees Celsius.
Whether or not the 2 degree Celsius goal is already beyond reach, mitigation to prevent as much warming as possible and to stabilize climate as soon as possible is critically important to wine grape growers and to all agriculture for two basic reasons.

First, as the study suggests, the lower the future greenhouse gas emissions are, the greater the chances of successful adaptation in place by changes in practices, such as water use for misting or sprinkling to reduce grape temperatures on the vine. Once adaptation in place becomes impossible, the only alternative is to move into new areas that are suitable for wine grape growing. This form of adaptation is fraught with many problems for current growers, including loss of existing land value and competition for new, suitable land.

Second, successful adaptation by moving into new areas that are suitable for viticulture (and for any crop) depends in large part on future climate stability. Recognizing that climate change is largely irreversible and, depending on emissions scenarios, climate stability may not be reached by 2100 or even 2200, let alone by 2050, is critically important to understand the priority and importance of mitigation over adaptation. If we have to move crops to new areas because of climate change, we certainly don’t want to move them every 30 or 50 years because the future climate is still unstable. A good article discussing climate stability and irreversibility with many links to source materials is here.

The most important aspect of the study is to make us look at probable future climate change and how it would impact a specific and vital agricultural industry. It is very difficult to envision the world in 2100 and beyond. Unfortunately, much of climate change discussion is taking place in that context. 2050 is within many of our lifetimes and certainly within the lifetimes of most of our children and grandchildren. If we want to preserve the opportunities for them that we have enjoyed, studies such as this make a compelling case for policies that will result in peak global greenhouse gas emissions no later than 2020 with significant annual emissions reductions to near zero by mid-century following the peak.

More coverage of the paper can be found in this article in The Guardian.

New Guidance Issued on Social Media Use for Alcohol Beverage Companies

Sat, 18 May 2013 00:00:00 GMT

New Iran Sanctions Enactments Apply to U.S. Companies’ Foreign Affiliates and Subsidiaries, and Require SEC Reporting by Public Companies

Thu, 21 Feb 2013 00:00:00 GMT

New York's Love Affair with Portland Food Carts

Fri, 10 May 2013 22:23:16 GMT

The New York Times’ love affair with Portland, Oregon continues in this article that describes New York City’s byzantine regulatory scheme for food carts and ends with a shout-out to Portland, food cart nirvana.

Portland Requires Employers to Provide Paid Sick Leave Starting in 2014

Tue, 02 Apr 2013 19:02:58 GMT

By Carol Bernick

The Portland City Council has passed a paid sick leave mandate that requires employers to provide paid leave for employees to use for personal and family member illness as well as certain safety concerns. The new ordinance takes effect on Jan. 1, 2014. Employers who already offer paid sick leave or paid time off still need to review, and likely revise, their policies.

Detailed provisions related to accrual rates, carry-over, and other aspects of use and administration are included in the ordinance. There are required postings and record keeping. Employers not in compliance may be subject to enforcement by BOLI or through private lawsuits brought by employees.

Portland joins Seattle, San Francisco, Washington, D.C., and the entire state of Connecticut, all of which have similar requirements either in effect or set to take effect soon. Many other cities are considering similar legislation.

Importantly, this ordinance applies to any employer who has employees who perform work in the City of Portland, regardless of where the employer is headquartered or where the the employee primarily performs services.

Key aspects of the Portland ordinance include:

Covered employers: Employers with a minimum of six employees must provide paid leave as described below. Small employers—those with a maximum of five employees—must also provide sick time, but it may be unpaid.

Accrual rate: Employees must receive a minimum of one hour of paid (or unpaid for small employers) sick time for every 30 hours of work performed. Full-time exempt employees are presumed to work 40 hours per week.

Counting hours: The accrual is based on hours worked within the City of Portland. This includes employees not regularly employed in Portland but who occasionally perform services in Portland. All hours worked in Portland must be counted.

Carry-over and caps: Employees may accrue a maximum of 40 hours of sick time per calendar year and may carry over a maximum of 40 hours to the next year. If the employee is rehired within six months, the employee must have his or her previous accrued sick time restored.

Cash-outs: Accrued but unused sick time is not required to be paid out upon separation of employment.

Permitted uses of paid sick leave: The ordinance mandates leave for situations that go beyond ordinary sick leave. Employees may use this accrued leave:

Use of sick time: Employees may use sick time in increments of one hour, unless the employer allows less time and only for an otherwise qualifying absence from work performed in Portland.

Waiting period for new employees: Leave begins accruing immediately upon hire, but may not be used in the first 90 days of employment, unless the employer’s policies otherwise allow for earlier use.

Existing PTO and other paid leave: Employers who already provide paid sick time or other paid time off (“PTO”) do not have to provide additional leave as long as their sick time or PTO policies or practices meet the minimum accrual rates prescribed by this ordinance, and employees have access to the paid leave for the same reasons and in the same manner.

Non-retaliation and enforcement: Employees may not be retaliated against for exercising their rights under the ordinance. The ordinance will be enforced by the Oregon Bureau of Labor & Industries (BOLI).

Requiring verification: Employers may require documentation of illness if three consecutive days of leave is used. The employer must pay any cost not covered by insurance of obtaining such documentation. It is not clear how these verification provisions of the ordinance will be reconciled with different rules under the FMLA related to shorter absences and healthcare provider certifications of serious health conditions.

Regulation deadline: The administrative rules governing implementation of the sick leave code must be adopted before Aug. 31, 2013.

Posting requirement: Employers must provide and post notice of employee rights under the ordinance. The notice must be in in English and other languages used to communicate with the employer’s workforce. The city will be preparing a template. Use of a poster is also an acceptable form of notice.

Recordkeeping: Employer must keep records documenting hours work and sick time accrued and used by employees for at least two years.

Davis Wright Tremaine will be monitoring this ordinance, including the publication of proposed regulations. Employers who have questions or concerns, or who wish assistance in providing input on the regulations, are invited to contact us.

Proposed Oregon Law to Allow Wine Growlers at Restaurants and Stores Advances in Salem

Wed, 06 Mar 2013 18:00:11 GMT

DWT developed the concept and wrote this bill for the Oregon Winegrowers Association. We hope that this becomes model legislation for our winery and brewery clients in other states as well.

See the KGW news report, featuring our clients Chehalem Winery and Hopworks Urban Brewery.

The 10 Biggest Regulatory Potholes for Food Service Franchises

Wed, 08 May 2013 15:51:16 GMT

By Rochelle Spandorf and Laura Warf

The foodservice industry’s leading news source, Nation’s Restaurant News, is currently conducting a survey asking readers to choose among eight regulatory issues for the one they think will have the biggest impact on food service businesses in the next two years: menu labeling; soda/ingredient bands; health care reform; tax reform; immigration; mandatory paid time off; minimum wage; or environmental issues. We’ve added two more regulatory potholes to the list: food safety and ADA. Click here for the 10 biggest regulatory potholes for food services franchises today.

When Food Production Leads to Prosecution

Thu, 07 Mar 2013 00:00:00 GMT

When Food Production Leads to Prosecution

Thu, 07 Mar 2013 17:19:52 GMT

World's Tallest Hotel Opens Today

Thu, 28 Feb 2013 17:32:27 GMT

While the real estate market may be climbing back to its former position, the world’s tallest hotel opens for business to the public today. Where can one find this Guinness World Record holding hotel? In Dubai, of course. With over 800 rooms in just one of its towers (the second tower will open in late 2014), this hotel has 77 floors and is just shy of the height of the Empire State Building. This soaring hotel is branded under the new and exclusive JW Marriott Marquis brand. Learn more about this towering hotel here.