In The News

Regaining Ownership over Copyrights



The Tennessean recently published my article on recapturing copyrights.  This is what I wrote: 


         
             If they’re not scrambling yet, Nashville songwriters, recording artists, publishing houses and labels soon will be as they jockey to control copyrights.  Starting this year, authors can begin to give notice to terminate the transfer of any copyright that was published on or after January 1, 1978. 

            Generally, whoever owns the copyright owns the right to distribute, sell and reproduce the work in question, whether it be lyrics or music to a song, sound recordings, motion pictures, manuscripts, software, architectural designs, or photographs.  When an author transfers ownership, he or she loses those rights.  But by terminating the transfer, authors redirect royalty streams away from the current owners (labels, publishers, and so forth) and back to the original authors.

            A five year window opens up 35 years after publication, allowing authors to terminate transfers they made in the past.  For those works published in 1978, the first opportunity to terminate the transfer will be in 2013.  (For works published or registered prior to 1978, different rules apply, but authors can still recapture their copyrights.)  The Act requires authors to provide at least two years notice, so those who want to terminate their 1978 transfers in 2013 must send notice in 2011.

            Historically, when working to get established, authors (be they poets, songwriters, filmmakers or sculptors) have had little leverage with their publisher or label.  In exchange for receiving financial advances and getting published, young authors often must transfer ownership of the copyright in the work to the publisher/label.  For example, Garth Brooks currently has a lot more negotiating power than newer artists because he has a track record of producing huge hits. 

            Recognizing the uneven bargaining power that authors possess when first trying to make it big, Congress leveled the playing field by giving them the ability to recapture the copyrights they transferred to the publisher/labels 35 years ago.  Whether an artist’s record contract says he has created a work made for hire, or whether she has signed a contract promising never to terminate the transfer, it doesn’t matter because the right to terminate transfer is irrevocable.

            Congress left open many unanswered questions that courts across the country will have to answer.  With Nashville’s stature in the music and publishing industries, as well as our growing technology community, this has the potential to wreak as much havoc on business as the switch from vinyl to digital.  Given the impact of this law on our own community, I feel certain that Nashville’s federal courts will be in the center of this storm.

            The rules in this area are complicated, even to many lawyers.  They are highly technical and require jumping through many hoops.  Once the window to recapture closes, it generally closes for good.  Authors who are interested in recapturing their copyrights should start working on this right away, take this into account when writing their wills, and enlist professional help from a lawyer in this field. 

August 2011 Newsletter Features Can That Post Get Me Fired? The Do's and Don'ts of Social Media and Employment Law

Join us for our interactive panel to learn about common concerns with Employment Law, Human Resources and  Social Media. To read the rest of our newsletter, click here.

Attorney James Mackler Discusses Pentagon's Investigation Into Cutting Military Pension Plans

James Mackler was interviewed by Channel 2 about the possible pension cuts facing the US Military.


NASHVILLE, Tenn. – Almost 10 years ago America, for the first time in modern history, was attacked at home.


Thousands of young men and women decided they couldn't sit at home. They wanted to serve.


Attorney James Mackler was one of them.


"I was in private practice for about seven years in Colorado and after September 11, I decided to join the army and be a part of the fight that was going on," Mackler recalled. "Our country had just been attacked, so I went to my local recruiting station and said, ‘Hey I want to join up.'"




Mackler went to flight school and in 2005 was deployed with the Ft. Campbell 101st Airborne Division as a Black Hawk Pilot. Today he's a Reservist back to practicing law in the private sector.


 

Click here for the entire story and the video
zp8497586rq

August 2011 Newsletter Features Legislative Recap of Beer and Liquor Laws.

The Bone McAllester Norton Alcoholic Beverage Group has kindly published a legislative recap to help you stay aware of beer and liquor laws.  To read the rest of our newsletter click here.

Stephen Zralek speaks to PPAMS Mid-South

Jailbirds Don't Tweet: The Smart, Sane, and Legal Approach to Social Media


Social media is changing everyday.  Whether you are a pro or novice, there's always something new.  Come to the PPAMS MidSouth PromoShow and learn:




  • How to avoid liability when making online product endorsements and marketing to children

  • The three features of successful content

  • What to include in a social media policy for employees

  • Real world examples

  • Practical ideas to spice up your own social media strategy

  • Issues surrounding privacy

  • Practical steps to shield against claims of defamation and copyright infringement when using social media


SEMINAR: Jailbirds Don't Tweet: The Smart, Sane, and Legal Approach to Social Media


Sponsored by Bulova


Date/Time: Monday, August 8, 2011 · 12:30am - 2:00pm


Location: Broadlands A


Speaker: Steven Zralek (Bone, McAllester, Norton), Amanda O'Brien (The Harmon Group)


 

Alcoholic Beverage Group Provides a Recap of 2011 Liquor and Beer Laws

By Will Cheek and Rob Pinson

It was another busy year for liquor and beer laws at the Tennessee General Assembly.  Although most citizens were watching the wine in grocery stores legislation, a number of important liquor industry bills passed, and many failed.

Tastings Kosher at Package Stores.  State law now allows retail liquor stores to offer tastings inside the store.  This is a major change from prior law, which limited liquor stores to selling wine and spirits, selling lottery tickets and cashing checks.  Liquor stores could also do tastings off-site, but every other business was illegal. The new law simply provides:  "a retail licensee may offer complimentary samples of the products it sells for tastings to be held on the premises of the retail licensee. Such tastings shall be for sales, education and promotional purposes."  The law prohibits wholesalers from providing any products, funding, labor, support or reimbursement for tastings. Unlike LBD tastings, no notice is required and servers do not have to hold server ABC permits.  In fact, the law does not require servers, leaving open the possibility of self-service by customers.   There is no limitation on the number or duration of tastings - it may be legal to leave bottles up front for customers to sample as desired. The law raises many questions.  Liquor stores cannot sell mixers.  Can they provide mixers with spirits?  How about ice?  Can stores even provide glassware or plastic for serving wine and spirits - they certainly cannot sell it?  Can food be served? The ABC plans to adopt regulations for retail tastings and the process is set to begin this week.  Long Live the ABC.  In prior legislative sessions, there has been discussion about merging the ABC with another agency.  The ABC has been plagued by a bad audit that disclosed bad cash management procedures and employee theft auditors thought was not properly handled, among other issues.  Last year, the ABC was approved at the eleventh hour of the legislative session. The future of the ABC is a little brighter after this year’s legislature extended the life of the ABC through June 30, 2013, and did so relatively early in the session, without much fan fare.

 

Mail Order Wine to Dry Counties.  The legislature removed a restriction on the direct shipment license that previously limited direct shipment sales to “wet” cities and counties.  Now, you can order wine from any licensed winery by mail, anywhere in the State of Tennessee.

 

Shelby County.  This law fixes a problem in unincorporated areas outside Memphis.  For years, there has been confusion about Memphis’ city limits.  Over the years, a handful of restaurants were issued liquor licenses because they appeared to be in Memphis, but were actually located in dry areas of Shelby County.  Liquor by the drink is legal in Memphis and the suburban cities inside Shelby County.  Liquor by the drink was not legal in unincorporated areas of Shelby County, where the handful of restaurants were operating with liquor licenses, but not legally authorized to sell liquor.  This law legalizes liquor by the drink in unincorporated areas of Shelby County.

 

Adventure Tourism.  This law creates a significant tax credit for creation of “adventure tourism” jobs.  The law is complicated, but for qualifying businesses, we read the bill as providing a tax credit of $4,500 for three years for each new adventure tourism job.  The state department of tourist development is charged with defining what jobs are adventure tourism.  For creative entrepreneurs, this could be an attractive opportunity.  $13,500 over three years is a big incentive to create jobs.

Wholesalers Importing.  Rumor has it that some wholesalers have been acting as importers of wine and spirits, although the practice was not specifically authorized by Tennessee law.  With the proper permit, the practice is now clearly legit.
Lexington.  Most folks ask why we are reporting about a Kentucky law, but yes, Virginia, there is a Lexington, Tennessee.  The law authorizes Lexington, by ordinance adopted by a two-thirds vote, to levy an occupancy tax on the privilege of staying in any hotel or motel in Lexington.  Lexington can set the rate of the privilege tax; but the proceeds must be spent for “tourism development.”

 

A City United.  Goodlettsville, a city long divided by county lines for alcohol, will now be able to conduct a referendum for the sale of alcoholic beverages at retail package stores in the Sumner County portions of the city.

 

Sunday Sales. The law sets the hours for the sale of beer on Sunday in a county to be the same as the hours set by a municipality that adopts liquor-by-the-drink in a referendum. The law does not apply if the county legislative body by a 2/3 vote has already set the hours for the sale of beer on Sunday in areas outside the municipality.

As usual, a few pet projects in dry areas were designated as Premier Type Tourist Resorts.  Here is our best guess at who gets liquor:

  • Buffalo River Resort in Perry County, which has 95 acres, three log cabins, 20 RV pads and a 40-seat restaurant.

  • East Fork Stables in Jamestown, with space to hold up to 220 horses and a restaurant.

  • The nonprofit Franklin Theatre may sell alcoholic beverages for consumption on  premises.

  • Blue Porch Inn in Rutherford County may sell alcoholic beverages for consumption on premises.

  • Woodlake Golf Club in the East Tennessee town of Tazewell may sell alcoholic beverages for on-premises consumption.

  • The National Ornamental Metal Museum in Memphis may sell alcoholic beverages..


The special license in dry areas known as “Tennessee River Resort District” now includes a limited service restaurants, which is last year’s new license for places that sell less than 50% food.

Down and Out for 2011
Here are some bills of interest that failed.

 

Wine in Grocery Stores The bill was not expected to advance this year, and indeed it did not.  Insiders reported that last legislative session, a deal was struck to defer serious consideration of wine until 2012.  Read more about our analysis at Will Cheek's Blog.

Pay the Piper.  The bill would have required that all ABC fines be paid before renewal of liquor licenses and specifically authorize the ABC to charge costs from setting citations for hearing.  The ABC has historically required payment of all outstanding citations at renewal, and this bill would have made it law.  In addition, the bill would have required licensees to pay the expenses of setting a citation for hearing, even if the citation settled.  This would have been an effective tool for the ABC to clear a backlog of older citations. Currently, some licensees ignore citations because there are no clear consequences.  The bill died in the House for no apparent reason.

LBD Audits.  The bill would have changed the method to audit taxes paid on alcoholic beverages sold in restaurants.  The current system simply taxes restaurants based on a formula derived from the wholesale sales to the restaurant.  The bill would have directed the commissioner of revenue to explore the possibility of developing an on-line filing system which would permit the automatic deduction from the collector's business account for the payment of the tax due on sales of mixed drinks and setups.

Selling on Satellite.  As introduced, would have allowed TN licensed wineries to conduct business at up to two satellite locations, allowing wineries to locate in urban tourist areas, among other places.

New License Fees.  This bill would have required the ABC to implement a new licensing fee structure for restaurants and limited service restaurants based on liability insurance codes. Present fees are based on percentages of food service.  Some saw this as a way to assess higher fees for riskier businesses such as nightclubs.

Order Up Red Bull and Vodka.  With caffeinated alcohol drinks being banned at the federal level, legislators tried to extend the ban to mixed “energy” drinks at bars.  The bid to say goodbye to selling caffeinated mixed drinks this year failed.  In all fairness, it is difficult to craft a law that bans Red Bull and Vodka, but allows Jack and Coke.

For Profit Movie Theaters Stay Dry.  Bills to allow liquor sales at a Knox County Theatre and two Nashville theaters were rejected.  The Davidson County proposal required one auditorium to be restricted to patrons 21 years of age or older.  Although a few nonprofit theaters have been approved for liquor, the legislature clearly declined to extend the right to for profit businesses.

*Many thanks to our intern, Eliot Goldfarb, for his research and input to this year's Legislative Recap. Eliot is a recent graduate of USN and is part of our service center team for the summer.

Bone McAllester Norton Hosts Technology Panel

Attorney Stephen Zralek gathered a panel of Nashville's finest business owners and interactive experts to discuss how technology can lead to a new revenue stream for companies for an invitation only breakfast event.


Panelists included:
David A. Owens is professor of the practice of management at Vanderbilt’s Graduate School of Management, where he focuses on entrepreneurship. Specializing in innovation and new product development, he is known as a dynamic speaker and is the recipient of numerous teaching awards. He provides consulting services for a wide range of clients around the world,  including NASA, The Smithsonian, Nissan LEAF, Gibson Music, TVA, Cisco and LEGO, and his work has been featured in The New York Times, The Wall Street Journal,  and NPR’s Marketplace. Prior to his time at Vanderbilt, David was the CEO of Griffin Technology in Nashville.

Nicholas Holland is Founder of centresource, an interactive agency in Nashville, which was recently named the 46th fastest growing inner-city firm in the United States. Centresource's motto is to "build, brand and boost" and they help businesses look at their overall strategy and find new ways to make or save money through interactive media.
Before starting centresource, Nicholas worked as a Risk Analyst, which provided a foundation in business analysis and that has been invaluable to operations and financial management.

Carter Hopkins, a recent college graduate, co-founded CityStreak. Finding his way from Shreveport, Louisiana, Carter occasionally finds his roots with his thick Cajun accent.  When he can be understood, he is most likely talking wild ideas about traveling the country or passionately pursuing life. Described by some as a combination of "Groupon" and the "Amazing Race," CityStreak already has an amazing following after launching just a few months ago. Their mission is to connect people with each other to make memories and have a blast in their city. Come hear how two young entrepreneurs turned a dream into a thriving business that's built on a digital platform.

Parker Polidor is the Founder of Cell Journalist, which provides a real-time, hyper local content platform to 150+ local TV stations and newspapers.  Prior to Cell Journalist, Parker, an inveterate entrepreneur, started and later sold Mountain Valet, the first parking management company in Vermont serving ski resorts. Mountain Valet grew from three employees and one account to seven locations with over 40 employees across three states. Parker has traveled to 37 countries and participated in humanitarian trips to Asia and Central Africa.

 

CommunityNashville Names Charles Bone as Honoree for 40th Annual Human Relations Award Dinner

Bone McAllester Norton founder and chairman, Charles Bone was honored for making a difference at the 40th Annual CommunityNashville Human Relations Award Dinner.  He was honored along with Ellen and John Tighe, Rev. Neely Williams, Gail Kerr and the Jewish Federation of Nashville and Middle Tennessee.

The dinner raised money for the CommunityNashville Building Bridges Program at Oasis Center, which helps youth learn about themselves, to respect others and to understand the root causes of prejudice.

"The annual Human Relations Award Dinner is one of the biggest and most important events in our city recognizing outstanding individuals whose commitment to human rights makes Nashville a better place for all of us," said co-chair Art Rebrovick.

 

Entertainment Industry's New Copyright Alert System May Create New Form of Evidence in Copyright Infringement Lawsuits & Lead to Higher Damages


It was big news earlier this month when many of the big entertainment companies entered into an agreement with Internet service providers (ISPs) regarding efforts they will take to self-regulate and self-police copyright infringement. The name of this plan is the "Copyright Alert System."
According to the Wall St. Journal and the Center for Copyright Information, the plan has six steps, from the mildest (in issuing warnings), to the intermediate (in requiring users to acknowledge that they received notice), to the most severe (in slowing down the speed at which alleged infringers may access the Internet).
As a copyright lawyer who goes to court to resolve disputes, I am most interested in the intermediate step. It strikes me that if users are forced to acknowledge that they have received a warning that their conduct may constitute infringement and yet they proceed forward anyway, the fact that they acknowledged such warning may be used against them in a copyright infringement action. The ISPs will not be releasing the identity of these users voluntarily. But a court can always grant permission to subpoena material showing that they took this intermediate step. This new policy may be opening up a whole new world of evidence of willfulness that can be used against people who knowingly infringe on others' copyrights. And willful infringement entitles copyright plaintiffs to increased money damages.

 

Entertainment Industry's New Copyright Alert System May Create New Form of Evidence in Copyright Infringement Lawsuits & Lead to Higher Damages


It was big news earlier this month when many of the big entertainment companies entered into an agreement with Internet service providers (ISPs) regarding efforts they will take to self-regulate and self-police copyright infringement. The name of this plan is the "Copyright Alert System."

According to the Wall St. Journal and the Center for Copyright Information, the plan has six steps, from the mildest (in issuing warnings), to the intermediate (in requiring users to acknowledge that they received notice), to the most severe (in slowing down the speed at which alleged infringers may access the Internet).


As a copyright lawyer who goes to court to resolve disputes, I am most interested in the intermediate step. It strikes me that if users are forced to acknowledge that they have received a warning that their conduct may constitute infringement and yet they proceed forward anyway, the fact that they acknowledged such warning may be used against them in a copyright infringement action. The ISPs will not be releasing the identity of these users voluntarily. But a court can always grant permission to subpoena material showing that they took this intermediate step. This new policy may be opening up a whole new world of evidence of willfulness that can be used against people who knowingly infringe on others' copyrights. And willful infringement entitles copyright plaintiffs to increased money damages.


"Always On," Consumers Expect Businesses to Embrace Technology Even More

In this new iPhone world, where consumers can download an app at the press of a button, businesses must embrace technology or risk being left behind.  When I say embrace technology, I'm not talking about just having an Internet presence or just using social media for marketing.  I mean using technology to create new apps, tools or games that let you instantly connect and engage with your customers.

Brian X. Chen, a writer for Wired Magazine, was recently interviewed on NPR's Fresh Air from WHYY.  Here's a link to the story and the interview.  In the interview, he discussed his new book, Always On: How the iPhone Unlocked the Anything-Anytime-Anywhere Future -- and Locked Us In.

From a business perspective, the most fascinating part of the book is Chen's comment on how consumers' expectations have changed in light of the way the iPhone lets them unlock worlds of knowledge in the swipe of their phone screen.  In an excerpt from his book, he writes: "The iPhone changed our standards for what we expect from technology, and as a result, businesses are being forced to give us more for our money. We don't want seven pieces of hardware to perform seven different tasks; we want a single gadget capable of doing anything-anytime-anywhere. Soon, manufacturers will no longer be able to sell single-function gadgets lacking an internet connection because those gadgets will soon be obsolete. Consequently, a large number of companies and industries find themselves threatened because a downloadable app can easily replace nearly any dedicated, single-use product."

How is your business using technology to satisfy consumer expectations?  What app could you develop to keep your customers engaged?  Are you thinking from the mindset of a customer who owns an iPhone, and who expects information immediately? No matter your industry -- entertainment, publishing, banking, technology, professional services, arts, health care, environmental -- customers want more from you, and they expect it in the form of instantly accessed technology.

"Always On," Consumers Expect Businesses to Embrace Technology Even More

In this new iPhone world, where consumers can download an app at the press of a button, businesses must embrace technology or risk being left behind.  When I say embrace technology, I'm not talking about just having an Internet presence or just using social media for marketing.  I mean using technology to create new apps, tools or games that let you instantly connect and engage with your customers.

Brian X. Chen, a writer for Wired Magazine, was recently interviewed on NPR's Fresh Air from WHYY.  Here's a link to the story and the interview.  In the interview, he discussed his new book, Always On: How the iPhone Unlocked the Anything-Anytime-Anywhere Future -- and Locked Us In.

From a business perspective, the most fascinating part of the book is Chen's comment on how consumers' expectations have changed in light of the way the iPhone lets them unlock worlds of knowledge in the swipe of their phone screen.  In an excerpt from his book, he writes: "The iPhone changed our standards for what we expect from technology, and as a result, businesses are being forced to give us more for our money. We don't want seven pieces of hardware to perform seven different tasks; we want a single gadget capable of doing anything-anytime-anywhere. Soon, manufacturers will no longer be able to sell single-function gadgets lacking an internet connection because those gadgets will soon be obsolete. Consequently, a large number of companies and industries find themselves threatened because a downloadable app can easily replace nearly any dedicated, single-use product."

How is your business using technology to satisfy consumer expectations?  What app could you develop to keep your customers engaged?  Are you thinking from the mindset of a customer who owns an iPhone, and who expects information immediately? No matter your industry -- entertainment, publishing, banking, technology, professional services, arts, health care, environmental -- customers want more from you, and they expect it in the form of instantly accessed technology.

July 2011 Newsletter Features James Mackler, Freedom Run, Las Vegas & Online Reputation Management

Bone McAllester Norton welcomes attorney James E. Mackler to our team!  To read our newsletter, click here

Privacy? Anyone Remember What That Is?

Does privacy really exist any more?  Sure it does, but sometimes it's easy to forget. 

Take the story's in today's Tennessean: "Nashville Residents Take on Google Wi-Spy, Join Privacy Lawsuit."  Google is accused of tapping into wireless networks while it drove by individuals' houses to capture a copy of their homes for placement on Google Earth.  According to the article, the wire tapping had nothing to do with capturing images of the homes; rather, it was done to improve Google's LBS -- location based services.

What's LBS? It's new technology that allows us consumers to get more accurate information at our fingertips when we log into a new app.  For example, when you go to TripAdvisor's App, if you allow it to track your location, it can send you a map showing you restaurants, parks, hotels, and music venues -- all tailored to your location.  When I go on vacation this fall, I can open up my iPad, tap on the app, and it will move with me, knowing I'm in another location, and providing me with the same instant information -- I don't have to key in the location, because the app does it for me. 

Are there privacy concerns in this?  Of course there are.  And that's ignoring Google's alleged wire tapping.  The concerns are that we give up some privacy when our smart phones know our location.  Who else knows our location?  Surely someone's finding a way to sell that information and make money -- this is called "monetization."

As I explained while recently speaking on a panel at Lipscomb University, our free Internet, and our incredibly tech savvy tools, are not truly free, even though they appear to be.  They come at a price and, as a society, we're just beginning to see what that price is: our privacy.

The lawyers at Covington & Burling have compiled a great summary of privacy bills pending before Congress.  As Congress wades through these bills, it is faced with the same tensions we all face: how much privacy are we willing to give up in exchange for the luxuries of information technology?  To protect our privacy, we may decide it's time to pay to protect ourselves, and we may begin to realize that things that seem too good to be true (an Internet without a price tag) really might be.

Privacy? Anyone Remember What That Is?

Does privacy really exist any more?  Sure it does, but sometimes it's easy to forget. 

Take the story's in today's Tennessean: "Nashville Residents Take on Google Wi-Spy, Join Privacy Lawsuit."  Google is accused of tapping into wireless networks while it drove by individuals' houses to capture a copy of their homes for placement on Google Earth.  According to the article, the wire tapping had nothing to do with capturing images of the homes; rather, it was done to improve Google's LBS -- location based services.

What's LBS? It's new technology that allows us consumers to get more accurate information at our fingertips when we log into a new app.  For example, when you go to TripAdvisor's App, if you allow it to track your location, it can send you a map showing you restaurants, parks, hotels, and music venues -- all tailored to your location.  When I go on vacation this fall, I can open up my iPad, tap on the app, and it will move with me, knowing I'm in another location, and providing me with the same instant information -- I don't have to key in the location, because the app does it for me. 

Are there privacy concerns in this?  Of course there are.  And that's ignoring Google's alleged wire tapping.  The concerns are that we give up some privacy when our smart phones know our location.  Who else knows our location?  Surely someone's finding a way to sell that information and make money -- this is called "monetization."

As I explained while recently speaking on a panel at Lipscomb University, our free Internet, and our incredibly tech savvy tools, are not truly free, even though they appear to be.  They come at a price and, as a society, we're just beginning to see what that price is: our privacy.

The lawyers at Covington & Burling have compiled a great summary of privacy bills pending before Congress.  As Congress wades through these bills, it is faced with the same tensions we all face: how much privacy are we willing to give up in exchange for the luxuries of information technology?  To protect our privacy, we may decide it's time to pay to protect ourselves, and we may begin to realize that things that seem too good to be true (an Internet without a price tag) really might be.

July 13, 2011 Newsletter Features Recap of Beer and Liquor Legislation

The Bone McAllester Norton Alcoholic Beverage Group has kindly published a legislative recap to help you stay aware of beer and liquor laws.  To read the rest of our newsletter click here.

Changes to TABC Regulations

The TABC revised regulations governing all liquor licensees.  Our Alcoholic Beverage Group is pleased to highlight the major changes for you.  Grouped by the license held, the summaries should not replace consultation or full review.  Contact Will Cheek or Chris Raybeck with questions.

General Applicability—All Types of Licensees





  • Responsible Vendor Mitigation Program:  The TABC has established an informal program for licensees, similar to that of the responsible vendor for beer retailers.  Licensees following the program may have fines alleviated (by up to half) for any citations.  The program requires a written policy that all employees complete a course in alcohol awareness (including training on applicable laws and regulations) and annual refresher courses.


  • Prior Approval of Advertisements:  In most cases, prior TABC approval of advertising copy is no longer necessary.


Liquor-by-the-Drink (“LBD”) and Catering

  • Advertising.  The ABC eliminated the rules prohibiting advertising happy hour and drink prices.  Licensees may now advertise both, provided the happy hour on liquor ends at 10:00 p.m. and the drink price covers the cost of the ingredients.  Outside signs and billboards may advertise the name of a licensed establishment and the name of a particular brand of alcohol, as long as the LBD licensee pays for the advertising.  Also, availability of alcoholic beverages can be advertised on radio and TV, subject to the same restrictions imposed on other types of licensees.

  • Marketing.  While licensees are still prohibited from giving away alcohol, the term “give” has been refined by replacing the word “drink” with “alcoholic beverage or wine.”  Also, LBD licensees have been removed from the regulation restricting advertising novelties and specialties to consumers, broadening the types of items LBD licensees may give to customers.

  • Managers:  The TABC has specified that new managers and assistant managers have seven days to submit questionnaires to the TABC or face a citation.  Also, all managers and assistant managers should expect to need their own server permits, if they supervise those who serve alcohol.

  • Seating:  The TABC has specified that seats at bars will be counted toward the minimum 75-seat restaurant requirement if the bar is big enough and if meals are regularly served there.  Patio seating that is not heated and cooled year-round will not count toward the minimum seating requirement but will count toward the seat count for license fees.

  • Server Permits:  Temporary server permits will no longer be issued.  Also, LBD licensees must have available for review documentation of the date of hire (dated employment application, dated W-4, etc.) of all servers and managers on premises.  Without it, it will be assumed the employee has been working for more than 61 days.

  • Changing Locations:  For LBD licensees who want to change locations, an abbreviated application process is now available.

  • Catering.  For the first time, there are regulations explicitly governing catering licensees.


Retail Licensees (Off-Premises Consumption)

  • Direct Mail:  Retailers now only need a written request authorizing direct mail, eliminating the requirement of signing the request on–premises.  The rules require removal of recipients within 30 days of the second request to remove.

  • Donations to 501(c)(3) Organizations:  Retailers are authorized to make withdrawals from inventory for donations to non-profits with 501(c)(3) exempt status.

  • Tastings / Consumer Education:  Written notification to the TABC is required for tastings where the retailer hosts, sponsors, or provides an employee to work at the tasting (not just where alcohol is consumed).  The $50 processing fee for notifications has been eliminated.  Also, employee-only tastings may be held on the retailer’s premises in areas not accessible to the public.

  • Marketing:  Retailers may sell gift cards to consumers.


Manufacturers / Importers and Wholesalers

  • Visits to Retailers:  The regulations have been revised to allow manufacturers and importers to visit retailers—on and off-premises consumption—for the purpose of promoting products or attending to displays.

  • Non-Resident Sellers:  For the first time, there are regulations that explicitly govern non-resident importers and application requirements.

  • Wholesaler Deliveries:  Employees of wholesalers may now deliver up to 20 cases of alcohol in vehicles that are not owned or leased by the wholesaler, and the wholesaler name need not be affixed to the vehicle.  But, the employee must possess documentation with the seller and purchaser identity and type and size of delivery.  Also, the regulations have removed the restriction that a wholesaler may deliver to another wholesaler only if in the same county.

  • Retail Orders; Wholesaler Employee Permits:  Wholesalers are expressly prohibited from delivering and invoicing part of an order made by one retailer to another retailer.  Wholesaler employee permits are not explicitly valid for 5 years.

  • Tied-House Provisions:  The regulations prohibiting tied-houses now include references to third-party marketing entities, which are not allowed as intermediaries between industry members (manufacturers, importers, and wholesalers) and retailers.  The regulations now explicitly prohibit arrangements that result in exclusion of brands.  The monetary value of items that may be provided to retailers by industry members is now aligned with TTB amounts.  Industry members may supply outside signs to retailers, and the allowable point-of-sale advertising materials have been updated.  Industry members may provide retailers with routine business entertainment (meals, events, parties), subject to restrictions.

  • Donations:  Industry members are authorized to withdraw from inventory donations to special occasion permittees; manufacturers must do so through wholesalers.


Wineries

  • Record-Keeping:  Records regarding the source of all agricultural products used in wine production must be kept for three years.  All Tennessee-licensed wineries must file, with the TABC, their contracts with Tennessee grape growers regarding their intention to purchase grapes.

  • Sale on Premises:  The 15,000 gallon / 20% rule for annual on-premises sales has been deleted in favor of the amounts allowed by state statute.

  • Samples; Selling Non-Wine Products:  The regulations now provide that wineries may provide samples to winery visitors in certain limited areas of the winery.  Also, wineries may now sell gift-related items with wine themes or related to wine drinking.


Beer Permittees / Responsible Vendor Program

For the first time, there are regulations that explicitly govern off-premises beer permittees that have enrolled in the Responsible Vendor Program.  Many of the regulations simply articulate the TABC’s past practices.

Non-Profits (Special Events)

Regulations have been made explicitly governing special occasion permits, one-day permits allowing alcohol service in a specifically designated area by “qualified entities” (non-profits).  A formal application process is set forth, and proceeds from the special event must be deposited with the special occasion

Direct Shipment of Wine Takes Off

Shipment of wine into Tennessee was illegal until the 2009 legislature authorized a new direct shipment license.   Many industry observers thought that the direct shipment was a token to placate oenophiles, but result in few sales.  Surprisingly, nearly 400 out of state wineries have paid the $300 application fee and $150 yearly license fee, plus registering to pay Tennessee taxes.

This year, the legislature legalized direct shipment to the entire state, including dry areas where wine cannot be purchased at package stores.  Wineries no longer have to worry about determining which areas of Tennessee are approved for direct-to-consumer shipping.

Direct shipment was opposed by wholesalers and retail liquor stores, which saw direct shipment as new competition and potentially a method to avoid payment of Tennessee taxes.  Opposition to direct shipment touted the dangers of sales to minors, among other concerns that have apparently not materialized.  Direct shipment of wine was quite controversial at a national level during the 2000’s, but most states have legalized some form of direct shipment and only a handful still have an absolute prohibition.

Tennessee taxes wine at $1.21 per gallon, plus applicable sales taxes.  Despite only being able to ship one case of wine to any individual during a calendar month and an annual limit of 3 cases, the license has proven to be popular.

According to shipcompliantblog.com, “Approximately 35% of wineries that ship wine direct are licensed to ship into Tennessee. The increased market access [to dry areas in Tennessee] is likely to encourage additional wineries to add Tennessee to their direct shipping programs, meaning more consumer choice and increased state revenue.”

 

Stephen Zralek discusses online reputation management with News 2

Stephen Zralek was interviewed by WKRN on Friday in regards to online reputation management and offers his professional insight on how to handle different situations from a legal standpoint.
Posted:   Jun 24, 2011 9:13 PM CDT   


By Tiani Jones, Reporter







NASHVILLE, Tenn. – A  person"s online reputation is becoming increasingly more important as employers take to the Internet as a reference, which is why   lawyers around the country are seeing more cases involving online reputation assault.





Stephen J. Zralek is an attorney at the Bone McAllester Norton law firm in Nashville.

 

Will Cheek moderates panel on beer growlers and wine kegs.

Alcoholic Beverage Team Leader Will Cheek was a prominent attendee at the national liquor conference in Las Vegas.  Cheek moderated a panel on beer growlers and wine kegs, featuring Master Brewer Kevin Reed of the country's largest brew pub chain, CraftWorks Restaurants & Breweries, and growler compliance expert Alex Heckathorn.