In this article we explore some of the key legal and regulatory issues facing “virtual wineries,” including securing the right licenses and permits, and protecting intellectual property. For the sake of simplicity, we have limited the scope of this article to California state law.

1. UNDERSTANDING STATE LICENSES AND FEDERAL PERMITS

The first thing you need to know about “virtual wineries” is that there is no such thing as a “virtual winery” in the alcohol beverage regulatory world. A “winery” is a business that holds the necessary state and federal licenses and permits to produce wine, is responsible for the production activities that take place on the bonded premises, and takes care of all record keeping and reporting to the Alcohol and Tobacco Tax and Trade Bureau (“TTB”). Under California law, wineries are called “winegrowers, and are defined as “any person who has facilities and equipment for the conversion of grapes, berries, or other fruit into wine and is engaged in the production of wine.”
 

2. PROTECTING YOUR MOST VALUABLE ASSET: INTELLECTUAL PROPERTY

Now you’ve found a custom crush winery to work with, and you’ve secured the proper licensing. Congratulations! But in order to be able to secure a path for growth for your fledgling wine company, you should invest in your intellectual property. If you haven’t protected your brand by conducting a thorough trademark search and filing of a trademark application, you are in jeopardy of losing your investment. (Side note – you don’t need to wait for you TTB/ABC permits and licenses to apply for a trademark).
 

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