Like Al Capone, Templeton Rye's Label May Violate Federal Law

A lot of non-distiller producers (NDPs) source their whiskey, especially rye whiskey, from the old Seagrams distillery located in Lawrenceberg, Indiana called MGPI (it was called LDI until 2011). If you've ever had Bulleit, High West, Redemption, Willett (the younger 3-4 year old stuff), Smooth Ambler, Riverboat, or Templeton ryes, you were drinking MGPI-distilled whiskey. There are plenty of others. MGPI rye is distilled from a very high rye (95%) mashbill and can be quite good. High West, who was early to the MGPI rye party, has released several great whiskies using this rye.

A lot of the NDPs peddling MGPI whiskey have created fanciful stories that they use to market their products. These stories generally bear no relationship to reality. Case in point: Templeton Rye. Templeton's marketing tries to convince people that its rye is a recreation of the prohibition era recipe made in Templeton, Iowa and which Al Capone called "The Good Stuff." Templeton's website spins a tale of Templeton founder Scott Bush convincing a prohibition era bootleg distiller from Templeton, Iowa to give him the 80 year old recipe (only after his Uncle Gus vouched for him), which is what is now sold as Templeton Rye. 

This story is, of course, not true. Templeton Rye is not made with some long lost Iowa prohibition era recipe. It is made with the same recipe that all MGPI rye is made with: 95% rye, 5% barley. Templeton just buys it, ages it, and bottles it.

This type of marketing is troubling. Fortunately, there is supposed to be a sure fire way to determine whether a whiskey is MGPI make. Federal law requires that whiskey list the State of distillation on the label. A regulation of the Alcohol and Tobacco Tax and Trade Bureau (TTB), a division of the U.S. Department of Treasury, requires that "the State of distillation shall be shown on the label of any whisky produced in the United States if the whisky is not distilled in the State given in the address on the brand label." 17 C.F.R. § 5.36(d). This requirement is particularly effective in identifying MGPI whiskey, since there aren't a ton of distilleries in Indiana like there are in Kentucky. The problem is that Templeton Rye does not disclose Indiana as the State of distillation on its bottle.

Although this is a pretty clear violation of the TTB regulations, whiskey enthusiasts have become accustomed the the TTB refusing to enforce its own laws. That might be changing, however. Whiskey-guru Chuck Cowdery penned this post on Tuesday that the TTB may be looking to enforce the State of distillation requirements. Based upon that post, I questioned on Twitter whether Templeton would finally have to disclose on its label where #TheGoodStuff comes from.

Rather than ignoring me, Templeton defended their practice with the following curious tweets.

@ATLEpicurean @FredMinnick We built our distillery in Templeton in 2005. We ferment & distill a variety of spirits and age & bottle TR.
— Templeton Rye (@TempletonRye) May 14, 2014

@ATLEpicurean @FredMinnick It say "Templeton Rye Spirits, LLC. Templeton, IA." That is because all bottling is finished in Templeton, IA.
— Templeton Rye (@TempletonRye) May 14, 2014

So, basically, Templeton's position is that it need not list the State of distillation because (1) it has a distillery in Iowa that distills and ferments alcohol that is not Templeton Rye; and (2) Templeton Rye is aged and bottled in Iowa. These explanations, of course, are specious and not supported by the TTB regs. If the TTB is indeed starting to enforce Section 5.36(d), I would expect Templeton Rye labels to start disclosing that the whiskey comes from Indiana.

Some may find this all to be a little too technical to get worked up about. "If the whiskey is good, who cares where it is distilled," you might say. That may be true, and indeed Templeton is decent, if overpriced, low proof whiskey (though that is a bit of an oxymoron to most whiskey geeks). The larger issue here is that whiskey companies apparently feel that they can intentionally violate TTB regulations with no fear of reprisal. If that type of thing can go on, what is to stop distillers from ignoring other more significant legal requirements like the legal requirements to call whiskey bourbon or rye?

Also, in today's ultra-competitive whiskey market, consumers have a right to know whether they are buying just another MGPI rye instead of unique Iowa-distilled whiskey. And although the Templeton website now acknowledges that the company partnered with an unnamed Indiana distillery to make Templeton Rye, the label does not disclose this fact for one simple reason. A large number of consumers are making purchasing decisions while standing at the store looking at whiskey labels, and Templeton would prefer that people think they are buying Al Capone's favorite whiskey, not sourced whiskey from a bulk producer. And that, after all, is the reason that the TTB labeling regulations exist.