Templeton Rye Settles Labeling Lawsuits

July 13, 2015 – Iowa’s Templeton Rye Whiskey has settled a series of class-action lawsuits filed last year over allegations that the company intended to defraud consumers about the origins of its whiskey. Terms of the settlement, which must still be approved by U.S. District Court Judge Joan Gotschall, will offer consumers who purchased Templeton Rye since 2006 a refund of $3 per bottle for up to six bottles with no proof of purchase. Consumers with receipts will be eligible to receive $6 per bottle for up to six bottles, according to the Chicago Tribune. The deal also requires that the terms “Small Batch” and “Prohibition Era Recipe” be removed from the Templeton Rye label. The terms of the settlement have not yet been filed with the court.

The first suit was filed last September in Chicago’s Cook County Chancery Court, and accused Templeton Rye Spirits LLC of misrepresenting Templeton Rye as a “small-batch” whiskey distilled in Iowa by not disclosing that it was distilled at the MGP Ingredients distillery in Lawrenceburg, Indiana using a standard rye whiskey recipe. Two additional lawsuits filed in Chicago and Iowa making similar claims were consolidated in Judge Gotschall’s court late last year, and the court docket shows settlement talks have been underway for the last six months. Federal law gives the federal court system jurisdiction over interstate class-action lawsuits, as well as those seeking more than $5 million in damages.

Templeton Rye co-founders Keith Kerkhoff and Scott Bush committed last August before the suits were filed to change the whiskey’s labeling to reflect its original state of distillation. In a prepared statement, Kerkhoff said the company was able to prove to the plaintiffs that Templeton Rye was not a “stock whiskey” because of its use of additional flavorings to match the taste of the original Kerkhoff family recipe and local water.

“Though the relationship between Templeton Rye and our Indiana-based distillery partner is described on our website, we recognize that our marketing efforts should have provided more clarity about our production process. As a result, we’ve made adjustments to our label and marketing materials. With these changes, we’re eager to move ahead and refocus on bringing the history and spirit of the community of Templeton, Iowa, to life through Templeton Rye Whiskey as we share ‘The Good Stuff’ with whiskey lovers everywhere.”

According to a spokesperson for Templeton Rye, neither Kerkhoff nor Bush intend to comment publicly on the settlement, though the Chicago Tribune report quoted Kerkhoff as saying “This is unfortunate, but we’re not looking back, we’re only looking forward.” WhiskyCast has asked attorneys for Chicago-based Edelson PC, which represented the plaintiffs, to comment on the case, but has not received a response.

Since the terms of the settlement have not been filed with the court, it is not known whether there is a limit on the total amount of refunds that Templeton Rye Spirits LLC will have to pay. The distillery’s owners will be on the hook for the entire amount of the settlement after their insurance company filed a separate lawsuit in an Iowa federal court seeking to be released from any obligation to cover the costs of defending Templeton Rye in the labeling lawsuits. Society Insurance cited the class-action lawsuits’  accusations of deceptive marketing as being outside the scope of its coverage for Templeton’s policy. That lawsuit was dismissed in April after Templeton accepted Society’s position and withdrew its claims for coverage under the policy.

Update: A web site for filing claims has been established as of August 7, 2015.

Editor’s note: This story was updated with details of the settlement as reported by the Chicago Tribune, along with additional information on Templeton Rye’s insurance coverage. 

Links: Templeton Rye | Edelson PC

Mark Gillespie

I'm the host and executive producer of WhiskyCast.

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