Casamigos, Don Julio, and the Tequila Purity Lawsuit: A Legal and Cultural Reckoning

Rachel L. Wright, Esq.
May 14
4 min read

In 2018, my final project in Advertising Law discussed how scaling small production tequila distillation was both destroying the quality of the product, undermining international regulatory agencies, and creating labor issues in rural farming areas, leading to a major sustainability issue for agave. Since the meteoric rise of Casamigos, I have touted that I can taste the vanillin additives, and I stand by that assessment.

In May 2025, a class-action lawsuit was filed in the U.S. District Court for the Eastern District of New York against Diageo North America, the parent company of premium tequila brands Casamigos and Don Julio. The plaintiffs—a Brooklyn sushi restaurant and a bartender—allege that Diageo falsely markets these products as “100% agave” tequila while incorporating undisclosed additives, including cane-derived alcohol.

The complaint seeks $5 million in damages and an injunction to halt what the plaintiffs describe as deceptive marketing practices. The central legal theory hinges on false advertising and consumer fraud, invoking both state law and the Federal Trade Commission Act (15 U.S.C. § 45), which prohibits unfair or deceptive acts or practices in commerce.

What Does “100% Agave” Mean? The Role of NOM-006 and the CRT

Under Mexican law, the term “100% agave” is defined by NOM-006-SCFI-2012, the official Mexican regulation that governs tequila production. Specifically:

Tequila labeled as "100% agave" must be made solely from Blue Weber agave sugars.
Production must occur within a legally protected Denomination of Origin, primarily in Jalisco.
Up to 1% by volume of undisclosed additives (such as glycerin, caramel coloring, and oak extract) are permitted under NOM-006 for flavor correction and consistency.

The Consejo Regulador del Tequila (CRT) is the regulatory authority responsible for verifying compliance with NOM-006 and certifying both the origin and quality of tequila. All tequila labeled for export as “100% agave” must carry a CRT seal and be verified through on-site inspections, formula registration, and production audits.

However, the plaintiffs contend that the alleged use of non-agave ethanol, such as sugarcane-based spirits, would exceed the 1% permissible limit and invalidate the “100% agave” designation, making Diageo’s representations materially false.

Legal Tensions: Compliance vs. Transparency

From a legal standpoint, this case raises an important distinction between regulatory compliance and consumer transparency. A company may technically comply with NOM-006 and U.S. TTB (Alcohol and Tobacco Tax and Trade Bureau) labeling standards while still engaging in conduct that misleads the reasonable consumer.

As the Ninth Circuit noted in Williams v. Gerber Products Co., 552 F.3d 934 (9th Cir. 2008), consumer protection statutes are “designed to protect consumers who are not versed in the art of inspecting and judging a product.”

If it is established that Diageo relied on non-agave spirits while labeling products as “100% agave,” this could constitute a material misrepresentation actionable under statutes such as:

New York General Business Law §§ 349–350
California Unfair Competition Law (Bus. & Prof. Code § 17200)
Magnuson-Moss Warranty Act (15 U.S.C. § 2301 et seq.), if implied warranties are found to be violated.

Why Tequila Integrity Matters: Culture and Craft

Beyond the black-letter law, this case touches on a broader issue: the cultural and historical significance of tequila. The beverage is deeply rooted in Mexican heritage, protected not only by NOM-006 but also by international agreements like the Lisbon Agreement for the Protection of Appellations of Origin and NAFTA/USMCA provisions on geographical indications.

Traditional tequila production involves:

7–10 years of agave growth before harvest.
Slow-roasting in brick ovens or autoclaves.
Crushing via tahona stone or roller mills.
Natural fermentation and copper distillation.
Aging in spent oak barrels

Producers who take shortcuts—via diffusers, enzymatic hydrolysis, or additive-heavy flavor engineering—may still qualify under current laws, but they arguably dilute the authenticity consumers seek when paying for premium products.

Sustainability and the Agave Crisis

A growing but underexamined aspect of this case is the environmental sustainability of large-scale tequila production. The global tequila boom has led to:

Agave monoculture, weakening biodiversity.
Overharvesting of immature agave due to demand.
Soil depletion and pesticide use in the Tequila Valley.
Water pollution from fermentation waste (vinazas).

Sustainable producers are beginning to adopt agroecological practices, such as polyculture farming, composting, and the use of bat-friendly agave cultivation (bats are critical agave pollinators). By contrast, additive-heavy production models are sometimes used to mimic the flavor of long-matured agave without waiting for actual maturity—thus bypassing the environmental costs of responsible farming.

In this light, the lawsuit raises an environmental justice question as much as a commercial one.

What Happens If Diageo Loses?

If the plaintiffs prevail, potential outcomes include:

Monetary damages and restitution for consumers.
Mandatory label changes and disclosure of additives.
Precedent for other spirits with protected designations, such as mezcal, bourbon, or Champagne.

It could also prompt reform of NOM-006 or increase pressure on the CRT to mandate public additive disclosure, especially for export products sold at a premium.

Law, Labeling, and Legacy

The Diageo tequila lawsuit is not just about marketing—it’s about the intersection of law, tradition, and corporate accountability. As the spirits industry grapples with explosive growth and changing consumer expectations, this case could signal a shift toward more rigorous standards of transparency and authenticity.

For lawyers, regulators, and producers alike, this litigation underscores the need to align regulatory frameworks with consumer protection goals—ensuring that what’s on the label reflects not only what’s in the bottle, but also the values of the culture behind it.

References & Resources:

NOM-006-SCFI-2012 Full Text (Spanish): DOF - Diario Oficial de la Federación
CRT Official Website: https://www.crt.org.mx/
Federal Trade Commission Act, 15 U.S.C. § 45: Link
Williams v. Gerber, 552 F.3d 934 (9th Cir. 2008): Justia
Food & Wine coverage: A Federal Lawsuit Accuses Casamigos and Don Julio of Spiking Their Tequilas