Diageo stores spirits produced at its George Dickel distillery in Tullahoma at a site in Louisville, Kentucky

Diageo stores spirits produced at its George Dickel distillery in Tullahoma at a site in Louisville, Kentucky

Diageo has won a legal battle over spirits storage laws in the US state of Tennessee. 

The company filed a lawsuit in April to overturn a 77-year-old law that forces all spirits distilled in the state to be stored within its borders. Diageo launched the action after the Tennessee Alcoholic Beverage Commission (ABC) said it was breaking the law by storing spirits produced at its George Dickel distillery in Tullahoma at a site in Louisville, Kentucky.  

But, after evidence in a federal court by George Dickel's master distiller this week, Tennessee's assistant Attorney General said the state had decided not to pursue penalities against Diageo, the Associated Press reported

In reaction to the move, Guy Smith, Diageo North America's executive VP, said: "We had always hoped for an amicable resolution of this question. The parties will work together to develop an order to be entered with the court that sets aside this complaint."

He added: “We look forward to continuing to work co-operatively with Director Bell and his colleagues at the Tennessee ABC and with the Attorney General's office." 

Diageo is also involved in a similar legal tussle in the state. The company and smaller distillers are bidding to loosen the definition of Tennessee whiskey. Current laws, supported by Jack Daniel's producer Brown-Forman, mean that “Tennessee whiskey” must be made from fermented mash of at least 51% corn, aged in new oak barrels, charcoal mellowed and stored in the state. 

Proposed amendments to the law will be looked at by a summer study committee