A California federal court judge dismissed a false advertising lawsuit against Maker's Mark, holding that the whiskey's "handmade" claim would not mislead a reasonable consumer.
Travis Williams and Safora Nowrouzi sued the distillery last year, alleging that although the company touts its whiskey as "handmade" in three different places on the label, Maker's Mark employed an automated and/or mechanized process for mixing, fermenting, distilling, and the bottling of its whiskey, with "virtually no human involvement in [the] system, other than perhaps the pressing of a button."
The advertiser moved to dismiss the suit on two grounds. First, Maker's Mark relied upon the safe harbor doctrine, which bars a suit if a federal agency reviews and preapproves labels for regulatory compliance. The Alcohol and Tobacco Tax and Trade Bureau (TTB) reviewed and approved the label for its whiskey, the distillery told the court, and determined that it complied with applicable laws and regulations, including whether the label is false and misleading.
U.S. District Court Judge John A. Houston was not persuaded, due in part to a March decision from another California federal court that denied a motion to dismiss on safe harbor grounds even after a favorable TTB review.
The company had better luck with its second contention: that the plaintiffs failed to allege a likelihood of deception under California's unfair competition and false advertising laws. Not only was the "handmade" claim not a specific and measurable claim, but Maker's Mark also noted that its website contains videos and photographs that demonstrate the actual production process for its whiskey, and the label encourages customers to visit the website for more information about the product.
In granting Maker's Mark's motion to dismiss on the unfair competition and false advertising claims, Judge Houston wrote: "This Court finds that 'handmade' cannot reasonably be interpreted as meaning literally by hand nor that a reasonable consumer would understand the term to mean no equipment or automated process was used to manufacture the whiskey."
As for the plaintiffs' allegations of intentional and negligent misrepresentation, the court agreed with the defendant "that plaintiffs cannot plausibly contend defendant intends to deceive consumers about the nature of its processes when its label clearly describes the process and points consumers to its website."
To read the order in Nowrouzi v. Maker's Mark Distillery, Inc., click here.
Why it matters: The court dismissed the lawsuit with prejudice, ruling that no reasonable consumer would believe that Maker's Mark's "handmade" claims meant the whiskey was literally made by hand. Judge Houston also found persuasive the fact that the advertiser disclosed its entire production process in videos and photographs on its website and suggested on the label that consumers visit the site for more information.