The creation of fine wine is no mere accident of nature. Excellence demands vision and passionate adherence to standards of the highest quality. So it is with building a successful business within the wine industry. The stakes are high. To ensure success, you must avoid pitfalls with prudent decision-making, every step of the way.
Providing solutions to your most critical wine industry challenges is the power of CMPR:WINE. With a unique depth and breadth of wine industry experience and expertise, our seasoned team of legal advisors guides you through the full range of strategic and day-to-day business and regulatory issues.
CMPR:WINE is a practice group within Carle Mackie Power & Ross LLP, one of Northern California's most respected full service business law firms.
The combination of the expertise and experience of the CMPR:WINE team represents a unique resource able to quickly and efficiently respond to any situation.
JOHN MACKIE, a founding CMPR partner and leader of the CMPR:WINE team, has focused his practice on the wine industry since 1993 advising on a wide range of strategic corporate and real estate transactions as well as land use, and environmental compliance issues. He is also actively involved with WineVision, Sonoma County Food & Wine Center, Sonoma State University Wine Business Program, Sonoma Valley Vintners & Growers Alliance and Alexander Valley Wine Growers Association.
JAY BEHMKE has represented wineries, vineyard owners, wholesalers, importers, retailers, and other wine related businesses for more than 18 years. His areas of expertise include business formations, mergers and acquisitions, finance, real property, land use, federal and state alcoholic beverage regulation, and trademarks. Currently, he serves as counsel to the California Association of Winegrape Growers and Sonoma County Grape Growers Association.
PHILLIP KALSCHED regularly advises businesses in the wine industry particularly in the area of real estate matters, including acquisitions and sales of vineyards and winery facilities, vineyard leases, and land use and planning matters. His expertise also extends to business formations, grape contracts, secured lending, and partnership transactions.
Vintners, growers, lenders, investors, distributors, retailers, and other wine intermediaries benefit from the legal services of CMPR:WINE. our capabilities include:
Strategic and Financial Transactions:
Respected for a pragmatic, quality-driven approach, CMPR:WINE focues on key issues of each transaction to promote a speedy and satisfactory conclusion.
By tailoring real estate law to a wine industry specific context, CMPR:WINE helps you achieve your commercial objectives.
Business and Regulatory:
CMPR:WINE is dedicated to providing practical solutions for all the legal needs of our wine industry clients. Our knowledge and insights, honed over years of experience with day-to-day legal issues, offer you a competitive edge.
In a long-watched case, the California Supreme Court issued an opinion this week addressing how the use of private electronic devices intersects with the Public Records Act. In this case, San Jose v. Superior Court, a resident objected to a redevelopment project and submitted a request for public records under the Public Records Act to the City of San Jose. The request included all emails and text messages sent or received by city employees or officials on private devices. The trial court ruled that communications about public business, sent on private devices, were subject to disclosure. The Court of Appeal disagreed and said they are not. The California Supreme Court reversed, holding that substantive communications about public business are subject to disclosure under the California Public Records Act, even if the communication is sent or stored on a private device.
The California Constitution gives citizens a right to access information concerning the conduct of the public’s business by mandating that public officials’ writings “shall be open to public scrutiny.” The Public Records Act, a state statute, declares that access to information concerning the public’s business is a fundamental and necessary right belonging to every person in California. This statute must be broadly construed to provide access to the public and narrowly construed when limiting the public’s access to records. Essentially, all public records are subject to disclosure unless there is a stated, or express, exemption from disclosure.
As the Supreme Court observed, in these modern times with multiple devices, email accounts, text messages, and other electronic platforms, the lines between an official communication and an electronic aside can be blurry. The sometimes difficult job of distinguishing between an official communication and an aside requires looking at the content, context, purpose, intended audience, and author of the communication; as opposed to where the communication was stored or on whose device it was sent. Communications that substantively relate to the conduct of the public’s business must be disclosed under the Public Records Act, unless an exemption to disclosure applies. Conversely, primarily personal communications that only incidentally mention agency business do not need to be disclosed. Thus, a writing – which includes text messages and emails sent or stored on personal devices or email accounts – substantively related to the conduct of the public’s business, is subject to disclosure under the Public Records Act.
The Court stated this result is necessary in order to ensure open access to government communications so that the public can verify that public officials are acting responsibly and are accountable to the public. This result also prevents public officials from evading the Public Records Act by simply switching devices or email accounts.
The Supreme Court considered employee privacy issues and provided guidance on how public agencies can comply with the Public Records Act when records are on a public employee’s or official’s private device or email account. When this occurs, the focus should be on the content of the communication, not its location. Agencies can adopt policies addressing how to handle these situations and they can require employees or officials to copy their government accounts for all communications involving the public’s business. When responding to a request for public records, the agency may rely on the employee or official to search their personal files for responsive materials. This respects an individual’s privacy rights while responding to the request for public records. For materials and communications stored on private devices or accounts that are not disclosed, the official or employee may provide an affidavit, containing sufficient facts to show that the materials being withheld are not public records. The Court was careful to explain that it was not endorsing any particular search method, but was merely providing guidance to agencies struggling with this issue.
We now have clarity - anyone substantively interacting with a state or local agency in California about the conduct of the public’s business should assume that the communication is a disclosable public record, irrespective of how the communication occurs or where it is stored.
Please do not hesitate to contact Tina Wallis at firstname.lastname@example.org or (707) 526-4200 if you have questions or concerns regarding this article.
Now that we are back from the holidays, it's time to dust off the employee handbook, review your policies and procedures, and make sure they are compliant with the new employment laws taking effect in 2017. This year, we have a combination of new laws, and existing laws that have been updated with additional protections.
1. California Minimum Wage Raised – On January 1, 2017, employers of 26 or more employees must pay $10.50 per hour as the minimum wage. Employers of less than 26 employees will not be required to raise the minimum wage to $10.50 until beginning January 1, 2018. Action: Review your pay policies to ensure they meet the minimum wage requirements. Please note that many cities and counties in California have passed higher minimum wage requirements (Berkeley, Cupertino, El Cerrito, Emeryville, Los Altos, Los Angeles City and County, Malibu, Mountain View, Oakland, Palo Alto, Pasadena, Richmond, San Diego, San Francisco, San Jose, San Leandro, San Mateo, Santa Clara, Santa Monica and Sunnyvale).
2. Federal Salary Basis Adjustment – Under state and federal law, employees may be deemed exempt from overtime if their positions meet certain criteria, including salary paid above a set rate. In May of 2016, the DOL amended the federal rule to increase the minimum salary requirement from $455 per week to $913 per week ($47,476/year) exceeding the minimum salary set by California. This new salary minimum was scheduled to go into effect on December 1, 2016. However, the rule change was put on hold while the question of whether the DOL exceeded its authority in making this new rule is litigated. The DOL may end up withdrawing the rule when the new administration takes over. Thus, the California minimum salary requirement of two times the minimum wage (now $41,600 for employers under 26 people and $43,680 for larger employers) remains in effect. Action: Ensure your pay policy meets the minimum salary requirement for all exempt employees as the minimum wage increases. Also, keep an ear out for any policy shifts from the DOL as the administration changes.
3. Change to the I-9 Form – The government has issued a new I-9 form that must be used beginning January 1, 2017 for all new employees. The form is available online at the USCIS website: www.uscis.gov/i-9
4. California’s Legalization of Recreational Marijuana Use – With the passage of Proposition 64, California now allows people over the age of 21 to smoke or ingest marijuana, grow up to 6 plants and transfer up to 28.5 grams of marijuana without compensation. Employers may implement policies limiting the use of marijuana by their employees, up to and including total prohibition. Action: (i) Confirm your company’s stance on employee marijuana use (both on and off the clock); (ii) review your employee handbook to make sure it is consistent with your position; (iii) make necessary changes to the handbook; and (iv) communicate those changes to employees.
5. Trade Secrets [Handbook Edits Suggested] – In May of 2016, a federal law was created governing trade secrets, which supplements existing California law. The federal law is substantially similar to the laws in California, but provides a better mechanism for immediate relief from trade secret misappropriation, along with the ability to seek punitive damages and reasonable attorney’s fees and costs. Action: To take advantage of the new federal law, employers must notify their employees that whistleblowers of trade secret violations will receive criminal and civil immunity against claims of trade secret misappropriation so long as the report was made confidentially to a federal, state or local government official, an attorney or under seal in a lawsuit. The inclusion of this notice into new agreements governing confidential information or trade secrets and in handbooks is voluntary, but makes these significant additional remedies available to the employer.
6. Notice Required of Leave Available for Victims of Domestic Violence, Sexual Assault or Stalking [Handbook Edits Required] – Several years ago, Labor Code 230.1 was enacted, requiring employers of 25 or more employees to provide time off to victims of domestic violence, sexual assault or stalking to obtain medical attention, obtain services from a shelter or program, counseling or to plan for their safety. Beginning in 2017, employers are required to notify new employees of certain rights under this law. Current employees need only be notified of their rights upon request. Action: Employers must notify new employees of several rights under the law: (1) that the employer prohibits retaliation against employees who use this leave, (2) that employees can use vacation, sick or any other time off they are already entitled to, and (3) that the right does not extend the amount of time off they are entitled to under the FMLA. The Labor Commissioner will be creating a form for employers to use for this purpose. In lieu of the form, handbooks can include the required language.
7. Single-Occupant Restrooms Must Be Identified as “All-Gender” – By March 1, 2017, all business establishments that have single-user toilet facilities are required to change the sign to identify the restroom as “all-gender” and conform generally with normal signage requirements.
8. Venue and Choice of Law – Labor Code section 925 now prohibits employers from obligating California-based employees to sign agreements that require lawsuits to be brought outside of California or under other states’ laws, if the employee “primarily” works in California. This new law expands California’s right to adjudicate disputes between employers and employees. Previously, out of state employers could insert terms into their employment contracts applying their home state’s law and forums, making it difficult for California employees to sue their employer. Action: Review your employment contracts for any offending language and amend them to identify California as the choice of venue and law for California employees.
9. EEOC Defines Rules Regarding National Origin Discrimination – The federal EEOC implemented new guidelines that are similar to California law. The EEOC prohibits discrimination based on “national origin.” The guidelines state that the place of origin can be a country, former country, or geographic region closely associated with a particular national origin group. National origin discrimination includes discrimination based on:
Ethnicity: A person can not be discriminated against because he or she either belongs, or doesn't belong, to a particular ethnic group;
Physical, linguistic, or cultural traits: Subjecting a person to adverse employment action due to his or her accent, style of dress, or other traits associated with a certain origin may constitute discrimination;
Perception: Regardless of a person's actual origin, if he or she is discriminated against due to the belief that he or she is of that origin;
Association: A person's association with someone of a particular national origin (for example, his or her spouse or child);
Citizenship: Employers may not make hiring decisions based on an applicant’s status as a citizen or permanent resident (other than the fact that the applicant must be legally able to work in the U.S.).
Employers must have a legitimate business reason for making employment decisions based on accents, such as: (1) the ability to communicate in spoken English is required to perform job duties effectively; and (2) the individual's accent materially interferes with job performance. There must be a legitimate business reason to make decisions based on fluency, if it is necessary for the effective performance of the position. Finally, “English-only policies” are only legal if they are required to promote safe and efficient job performance or business operations, and are only enforced for those purposes. Action: Review handbook language and other management training documents to ensure they are compliant with the law.
10. Workers’ Compensation Coverage Exclusions Narrow for Business Owners – Previously, officers, directors and working partners were not required to be covered by a company’s Workers’ Compensation (WC) policy unless they opted in for coverage. Beginning January 1, 2017 (and including in-force policies), officers, directors and partners are required to be covered unless they meet the narrow exception to allow them to opt out. For corporations, only corporate officers and members of the Boards of Directors who own 15% or more of the issued and outstanding stock of a corporation may opt out of WC. General partners of partnerships and managing members of limited liability companies can also opt out of coverage. This law is intended to prevent employers (usually in high risk industries) from giving employees a small (e.g., 1%) ownership interest to avoid paying Workers’ Compensation insurance premiums. Action: contact your WC insurance carrier to ask for details on the new rules and for an opt in/opt out form.
Change on the Horizon: Agricultural Workers Right to Overtime Phase In Beginning 2019-AB 1066. The overtime rules for agricultural employees working for employers with 25 or more employees are changing beginning January 1, 2019. Agricultural workers who work more than 9.5 hours per day and/or 55 hours per week will be entitled to 1.5 times their regular hourly rate. The law will continue to roll-out between 2020 and 2025 until the overtime rules are in alignment with those for non-agricultural employees. Action: No action is required this year. However, we encourage agricultural employers to review their policies and increase their staffing if necessary to ensure they will be ready when the law goes into effect on January 1, 2019.
Britain’s decision to leave the European Union (“EU”) raises a number of issues for current and prospective owners of trademarks in the EU and the UK.
Prior to June 23, 2016, an applicant for an EU Trademark (“EUTM,” previously known as a “Community Trademark” or “CTM”) could rely upon a single application to obtain ownership of a registered EUTM, which provides trademark protection in the UK and 27 other European countries. By virtue of the Brexit vote, however, the UK has triggered a process by which recognition of trademark rights under the EU system may no longer extend to the UK.
For registered EUTMs, the protections currently afforded to such marks in the UK are expected to remain intact for at least two more years, while the EU and UK negotiate the terms of the UK’s exit from the EU. Thus, for existing EUTM owners, no immediate change in the status of your UK trademark rights is expected.
Ultimately, and subject to the outcome of the Brexit negotiations, each registered EUTM may be divided into two trademarks: (1) a new, stand-alone trademark in the UK, and (2) the pre-existing “mother” EUTM covering the remaining EU member states. This approach would preserve the prior rights and priority dates previously established under the pre-Brexit EUTM registrations.
For parties filing new EUTM applications after June 23, 2016, and who also seek to obtain trademark protection in the UK, such applicants should file separate EUTM and UK trademark applications to ensure that they have adequate trademark protection. Because the UK and EU will remain signatories to the Madrid Protocol, new applicants seeking trademark protection in the US, the UK, and the EU can continue to rely upon the Madrid Protocol’s “one application” approach to apply for and obtain trademark registrations in each of those jurisdictions.
Please do not hesitate to contact John B. Dawson email@example.com or (707) 526-4200 if you have questions or concerns regarding this historic event and the impact it may have on your international trademark rights.
On April 20, 2016, CMPR obtained an across-the-board victory on behalf of International Fruit Genetics, LLC (“IFG”) in a case involving termination of licensing agreements for proprietary table grape varieties. The United States District Court, Central District of California, granted summary judgment in favor of IFG, holding that IFG validly terminated the parties’ licensing agreements based upon defendants’ contractual violations. The court also denied defendants’ separate motion for summary judgment on defendants’ counterclaims. International Fruit Genetics, LLC v. P.E.R. Asset Management Trust, et al., (Case No. 14-5273).
IFG develops and owns proprietary hybrid table grape varieties in the United States and around the world. After developing a new grape variety, IFG applies for patents and other intellectual property registrations for the new variety in the U.S. and other countries. IFG licenses its proprietary grape varieties to authorized growers around the world under a licensing program designed to strictly control the propagation of its proprietary plant material and protect IFG’s intellectual property.
Pursuant to three licensing agreements with IFG, defendants were permitted to test and make limited plantings of certain IFG grape plants in South Africa. However, the agreements prohibited defendants from propagating IFG grape plants. After learning that defendants had wrongfully propagated those plants, and had illegally imported other IFG plant material into South Africa, IFG gave notice terminating the parties’ agreements. In July 2014, IFG filed this lawsuit to confirm the validity of its termination based upon defendants’ contractual violations and other wrongful conduct. The CMPR team of John Dawson, Rick O’Hare, and Kim Corcoran co-authored the winning briefs.
If you have any questions regarding intellectual property issues, please do not hesitate to contact John Dawson, head of the CMPR Intellectual Property Group (tel: 707-526-4200; email:firstname.lastname@example.org.)
Wineries and Growers were both Well-Dressed and Organized at Monday Night’s Sonoma County Public Forum.
Much has already been written about the “nuts and bolts” of the November 16th meeting, but the energy and determination that permeated the room was remarkable.. The meeting was the one and only chance for the public to finally have its say in response to the hours and hours of meetings held by the County’s Winery Working Group, prior to hearings before the Planning Commission, then the Board of Supervisors. . The members of that Group have been working for the last six months to provide direction to the County about new winery applications. Each of the previous meetings had been held before an audience that was required to stay silent at all times. Monday night was the time for the County to hear from all of the interested stakeholders, large and small.
Until Monday night, the wineries and growers appeared to be in two camps: those who were following every breath and sigh of the Winery Working Group and those who didn’t even know that the Group had been formed, or that a new County ordinance was working its way down to them. Although the discussion of the new ordinance is cast as applying only to new wineries, there is the distinct possibility that the County would apply any new ordinance to existing wineries (whether through applications for increased production or changes to use permits). As such, whether they knew it or not, every winery and grower will likely be affected by the new ordinance.
From the more than 500 people who met in Santa Rosa Monday night, the news had finally been disseminated. More than half of the audience members were there to support the wine business. It was a refreshing sight to see growers, winery owners, winemakers, and tasting room staff energized, motivated, and wearing brilliant green t-shirts or stickers (brilliant in both their color and their use as a statement). The anti-winery contingent was there with their plain white nametags and a few placards but Monday night’s energy belonged to the wineries and growers.
Three central themes came from this energized group. First, agriculture does not mean grapes growing peacefully by themselves, beyond the touch of human hands. Instead, agriculture means feeding your family and making the mortgage. That requires one to sell the grapes/wine, and selling necessarily requires marketing efforts. Speakers from small wineries presented a compelling case of why they needed what the County calls “events” and what theycall distributor meetings or wine club dinners. Without direct-to-consumer sales, only “the big guys” with their existing distributor outlets would be able to own wineries in Sonoma County. The “big guys” had their say as well – without being able to hold distributor lunches or dinners, their business model fails as well.
Another common theme was that the County should not regulate the type of activity going on at the winery. Instead, the County should be regulating impacts – it shouldn’t matter whether there is a tasting menu, whether a customer sits or stands, or whether there is a fee for a wine club party. No other business is in danger of having the County decide when, or whether, it can have business or staff meetings. How can the County do that to wineries?
Finally, the wineries and growers challenged the opposition’s continued mantra of “rural character”. Without high-end agriculture, the land would be sold for housing. Housing would not recharge the aquifer, would not maintain the job base, and would be anything but “rural”. The wineries and growers stepped up to the microphones Monday night by the dozens noting, among other things, that the first word on the Sonoma County seal is “Agriculture” and that pioneers like Sara Lee Kunde had worked tirelessly in the past to make agriculture economically viable. Making a good living from agriculture is what allows for rural character in the first place.
This is not isolated to Sonoma County. Napa is dealing with their own ordinance battles, as is Santa Barbara, Paso Robles and the other wine-growing areas of the state. Indeed, this “not in my backyard” approach to land use is also reflected in municipal ordinances restricting restaurants, nightclubs and wine stores in major cities throughout the state.
As the meeting approached 8:30 and then 9:00, many of the opposition group trickled out. The winery and grower contingent just filled-in their seats behind them (about 100 people had not been allowed into the meeting room due to occupancy requirements and had been relegated to the lobby to watch the proceedings on a screen.) When the meeting finally ended shortly after 9:00, the room was abuzz with energy from the green-clad growers and winery representatives finally being able to say their piece. Indeed, one of the anti-winery speakers said to another as he was walking out of the meeting early, “The wineries – they’re organized.” Ah – the power of working together toward a common goal.
By Kimberley Corcoran, Carle, Mackie, Power & Ross LLP
The California Competes Tax Credit is a business income tax credit intended to incentivize economic development in the State of California. If your business (whether organized as a corporation, limited liability company or partnership) is planning to hire and/or expand in California, please consider applying for the California Competes Tax Credit.
The credit is awarded through a competitive application process and is individually negotiated with the Governor’s Office of Business and Economic Development (“GO-Biz”) for approval by a statutorily created California Competes Tax Credit Committee. The credit is taken against income tax due to the California Franchise Tax Board.
Although not yet officially announced, we anticipate that GO-Biz will open the next application period in late September (prior application periods have typically lasted around one month). GO-Biz previously indicated that approximately $200 Million is available to be awarded in fiscal year 2015-16.
The evaluation process consists of two phases (though it is possible to bypass Phase 1 under certain circumstances). Phase 1 is an automated process in which the requested tax credit, aggregate employee compensation and aggregate investment are evaluated to arrive at a cost-benefit ratio. Those applications with the “most advantageous” cost-benefit ratio proceed to Phase II.
Phase II of the evaluation process focuses on several factors, including the number of jobs created, compensation paid to employees, amount of investment, geography and overall impact to the State of California.
Successful applicants enter into a tax credit agreement to provide for allocations of the credit to be made upon the successful completion of established milestones (e.g., hiring, investment targets). Awardees who fail to achieve the established milestones are at risk of having the credit recaptured.
Online applications will likely be submitted athttps://www.calcompetes.ca.gov. If unsuccessful, applicants may reapply in subsequent application periods.
If you have questions about the California Competes Tax Credit or for help applying, please contact Daren Shaver at Carle, Mackie, Power & Ross LLP. (tel: 707-526-4200; e-mail: email@example.com.)
- Daren Shaver, Associate
CARLE, MACKIE ANNOUNCES NEW ONLINE TRADEMARK SERVICE
SANTA ROSA, CA – April 2011 Carle, Mackie, Power & Ross, LLP (CMPR), a premier business law firm based in Santa Rosa, CA, announces the launch of their new online trademark service, CMPRmarks.com. CMPRmarks allows world-wide access to a full range of trademark services, from researching potential marks for use in the United States, to filing and prosecution of trademark applications at the U.S. Trademark Office, as well as maintenance of trademark registrations once they have issued. The website also offers information on trademarks generally, from choosing a mark to the timing of U.S. Trademark Office procedures.
Jay Behmke, CMPR’s lead trademark attorney, said “More and more companies depend on services offered over the Internet. We offer complete trademark search, filing, and registration service, backed by experienced attorneys, at very competitive rates. We think a large part of the future for the legal profession lies online, and we’re very excited to be part of that.”
All work done through CMPRmarks is overseen by the firm’s team of experienced trademark attorneys, and is offered through a secure website. The service is available not only to individuals and companies, but to law firms seeking a reliable outsourcing opportunity for trademark work.
Founded in 1998, CMPR offers a wide range of legal services to individuals, businesses, non-profits and public agencies, including corporate, commercial, and financial transations as well as employment, litigation, and tax advice. In addition, CMPR is widely recognized for its particular expertise with respect to the Wine Industry and to Affordable Housing transactions. The firm is experiencing substantial growth and expects that CMPRmarks will help fuel future expansion.
If you would like more information about this topic, or to schedule an interview with Jay Behmke, please call him at 707.526.4200 or email him at firstname.lastname@example.org
Contact: Jay Behmke
Carle, Mackie, Power & Ross, LLP
Alexander Valley Wine Growers Association, Allied Grape Growers, Belvedere Winery, Biagi Bros., Benziger Family Winery, Boisset America, Burdell Management Ltd., California Association of Winegrape Growers, Callaway, Carneros Creek Winery DaVero, Domain Chandon, Evans & Tate Limited, Flowers Vineyard and Winery, Fosters Wine Estates, Germain-Robin Brandy, Goosecross Cellars, Hangar One Vodka, HMT & Associates, J. Lohr Wine Company, J Wine Company, Kistler Vineyards, Lail Vineyards, Lasseter Family Winery, Marcassin, Martin Ray, McDowell Valley Vineyards, Mendocino Wine Group, Montecillo Vineyards, Novavine, Inc., Oak Creek Winery, Peter Michael Winery, Raymond Burr Vineyards, Red Truck, Rodney Strong Winery, Sauvignon Republic, Silverado Premium Properties, LLC, Sheela Family LLC, Silicon Valley Bank, Sonoma-Cutrer Vineyards, Sonoma County Grape Growers Association, Stagecoach Vineyards, Sunridge Nurseries, Trentadue, UCC Vineyard Group, White Oak Vineyards & Winery, WineVision