Looking Back . . . The Vermont Origin Rule
About 16 years ago, the Vermont Legislature tasked the Vermont Attorney General’s Office, as part of its general consumer protection mission, with developing a set of rules defining when a product is a “Vermont” product and under what circumstances a business can use the word “Vermont” on its product label.
The result was the “Vermont Origin” Rule, which went into effect in January 2006. At the time the Legislature felt that “Vermont” had become a recognized geographical “brand” (like Napa, California) denoting quality and wholesomeness, etc., and that that the goodwill of that brand should be protected against improper or misleading use. At the time, there was at least one example of a packaged food company misusing the word “Vermont” on its product labels because its products were not made in Vermont and were not made with any ingredients originating in Vermont. The company’s only connection to Vermont was a post office address in the state. Another example was a breath mint company that had originated in Vermont but had been sold and now had no connection to Vermont, but continued to use the word “Vermont” on its product labels. The Origin Rule was intended to address misleading situations such as this. In an nutshell, the rule says that a food product cannot be labelled with the word “Vermont” unless either (a) the majority (75%) of the ingredients come from Vermont or (b) the product is completely or substantially manufactured in Vermont. Examples might be “Vermont” coffee or “Vermont” peanut butter. Neither coffee nor peanuts are grown in Vermont, but bags of coffee and jars of peanut butter can be labeled “Vermont” if they are roasted, ground, and packaged within the state. It is not enough that a company’s headquarters is in Vermont: if the company’s product is not “from” Vermont or “made in” Vermont it cannot use the word Vermont on the product label (without a prominent disclaimer).
The Origin Rule was controversial and generated hard feelings because, while it was well-intended, it did not have a “grandfather” clause to save existing Vermont-based businesses that could not meet the requirements of the Rule. One example was a long-standing and beloved Italian family restaurant in Burlington, Vermont. Before the enactment of the Rule, the restaurant had started canning its pasta sauce and selling it in supermarkets in Vermont and New England using the word “Vermont” on the label, which is where the restaurant and the company headquarters were located. But the ingredients (primarily tomatoes) did not come from Vermont and the processing and canning was done at a facility in upstate New York. The company was forced to remove the word “Vermont” from its labels. Another example was a well-known award-winning creamery and cheesemaker that had originated in and long been associated with Vermont. Over the years it had grown and expanded outside the state of Vermont, but continued to use the words “of Vermont” after the company name on its product labels and in its advertising, including on its large fleet of delivery trucks that traveled throughout the country. By the time the Original Rule went into effect much of the milk used to make the cheese came from outside Vermont and not all of the cheese was produced in Vermont. In these examples, the product had become so successful, and the Vermont-based companies that made them had grown so much, that the companies could not meet the strict definition of either manufacturing the product in Vermont or sourcing the ingredients in Vermont, and therefore their labels violated the Rule. In the case of Cabot Creamery, some people, including Vermont’s Governor at the time, were upset that Cabot was being forced (by enforcement of the Origin Rule) to remove the word “Vermont” from its products and delivery trucks, because the products were viewed as free national advertising for the state and the trucks were viewed as “rolling billboards” for the promotion of Vermont products and tourism. However, the law was never changed to allow pre-existing companies like Bove’s and Cabot to keep the Vermont reference in their logos.