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Diageo Faces Lawsuits Over ‘100% Agave’ Claims in Tequila

UPDATE: Diageo, the global beverage giant, is now under fire as two class-action lawsuits have been filed alleging that its popular tequila brands, Casamigos and Don Julio, are misleadingly marketed as “100% agave.” The lawsuits, lodged in federal courts in New York and California, claim that these brands contain substantial amounts of non-agave-derived alcohol, contradicting their labels.

In the New York case, plaintiffs assert that independent lab tests reveal that Casamigos Blanco contains only 33% agave-derived ethanol, while Casamigos Reposado has just 42%. Meanwhile, the California suit echoes similar findings regarding Don Julio Blanco and Don Julio 1942. These shocking allegations raise critical questions about the integrity of premium tequila branding.

Both lawsuits argue that Diageo deceived consumers into paying premium prices for products that do not meet the labeling standards mandated by both Mexican and U.S. laws. The New York complaint, filed on behalf of a mixology instructor, a social media bartender, and a kosher sushi restaurant, seeks at least $5 million in damages and an injunction to stop Diageo from these alleged deceptive practices.

Under existing regulations, any tequila labeled as “100% agave” must be made entirely from Blue Weber agave and cannot include added sugars or alcohol sourced from elsewhere. If the lab findings are verified, Diageo could face significant legal repercussions, including regulatory scrutiny and financial penalties.

In a statement, Diageo has strongly denied the allegations, declaring that it “categorically denies” any claims of misrepresentation or noncompliance with regulations. The company asserts that it stands firmly behind the quality and authenticity of its tequilas, describing the lawsuits as baseless.

Casamigos, co-founded in 2013 by George Clooney, Rande Gerber, and Mike Meldman, was acquired by Diageo in a staggering $1 billion deal in 2017. The brand has soared in popularity, selling over 3 million 9-liter cases in 2023 and solidifying its position as one of the world’s top-selling tequila brands. Don Julio, another flagship brand under Diageo, is marketed as a luxury product, further heightening the stakes of these allegations.

The lawsuits highlight a growing concern over the accuracy of labeling in the booming tequila market, prompting some industry advocates to call for enhanced testing methods, such as nuclear magnetic resonance testing, to ensure compliance and authenticity.

As these legal battles unfold, the implications could extend beyond Diageo’s brand reputation, potentially reshaping industry standards and practices. If the plaintiffs succeed, it may lead to stricter regulations on how premium tequilas are marketed and certified, impacting consumers and producers alike.

Stay tuned for further updates on this developing story, as the outcome could shift the landscape of the tequila industry and consumer trust in premium brands.

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