Dispute over New Mexico Hatch chili labeling is heating up

SANTA FE, NM (AP) – A federal appeals court has teamed up with a group of green chilli growers in New Mexico’s southern Hatch Valley to argue over which foods can be labeled with the well-known Hatch name.

The U.S. 10th Circuit Court of Appeals ruled Friday in favor of the Hatch Chile Association and allied Albuquerque grocer El Encanto for a subpoena to cite records showing whether a rival’s products, as marketing suggests, are entirely from Hatch contain cultivated chilli.

The subpoenas could influence the outcome of a related dispute before a federal trademark office over the efforts of Hatch Chile Co. to identify the term “Hatch” for its exclusive use.

The written court ruling pays tribute to the winding Hatch Valley in the desert for “producing some of the best chili peppers in the world” and daring the area to “possibly be chilies what Napa is for grapes”.

A three-judge panel overturned a district court ruling, finding that Hatch Chile Co. initially did not know where its chilies were coming from, and put questions to supplier Mizkan Americas, owner of Border Foods and its chili processing operations in the south of New Mexico.

When Mizkan was issued a subpoena asking about the origins of his green chilli pepper, both Hatch Chile Co. and Mizkan filed successful motions to block the motion in federal court.

“This seemingly mild argument became heated during the discovery,” the judges wrote. “After Hatch Chile appeared to encourage El Encanto to only ask its suppliers for this information, he filed an application for a protection order.”

El Encanto operates under the Bueno Foods label.

Ross Perkal, an attorney for Hatch Chile Co., declined to comment on the ruling, citing pending litigation.

Preston Mitchell, board member of the Hatch Chile Association, welcomed the ruling as a possible step in reserving the Hatch name for chilies that can be traced back to the Hatch Valley through a joint certification process. The association is looking for a certification mark for Hatch Chile to help consumers verify the source.

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