A federal class action lawsuit filed on May 5, 2025, in the Eastern District of New York has rocked the global spirits industry, targeting Diageo North America over allegations that its flagship tequila brands, Don Julio and Casamigos, have been falsely marketed as “100% agave.” The suit, backed by independent lab testing, claims these luxury tequilas contain significant amounts of cane or other non-agave spirits, making their labeling deceptive and their products allegedly illegal in both the U.S. and Mexico.
The plaintiffs—Avi Pusateri, Chaim Mishulovin, and Sushi Tokyo Inc.—assert they paid premium prices under the belief that the tequilas were produced solely from Blue Weber agave, as stated on the bottles. They seek USD 5 million in damages, plus an injunction requiring Diageo to halt what they describe as misleading advertising practices.
Filed by law firm Hagens Berman, known for its aggressive litigation against corporate giants, the complaint builds on revelations published earlier this year by Mezcalistas, where agave farmers accused large producers of diluting tequilas with cane alcohol. According to the lawsuit, testing based on Nuclear Magnetic Resonance has verified these adulterations, undermining both consumer trust and the income of agave farmers.
At the center of the controversy is the Consejo Regulador del Tequila (CRT), the Mexican regulatory authority tasked with certifying tequila purity. Although Diageo insists its products comply fully with both Mexican NOM standards and U.S. Alcohol and Tobacco Tax and Trade Bureau (TTB) regulations, the lawsuit challenges the CRT’s credibility, citing unverified reports of corruption and lax enforcement. The complaint references claims that CRT officials have allowed tequila producers to incorporate cane spirits while still certifying the products as “100% agave.”
Sophie Kelly, Diageo’s global head of agave, has rejected the allegations as “outrageous and categorically false,” stating that both tequilas are “crafted from 100% Blue Weber Agave” and are properly certified.
The stakes are high: Don Julio and Casamigos are among the most successful premium tequila brands on the market, with Diageo acquiring Casamigos in 2017 for nearly USD 1 billion. A court ruling against the company could damage its prestige portfolio, shake consumer confidence, and further intensify scrutiny on the CRT, already under fire from industry transparency advocates and producers in Mexico.
The case marks a major development in a long-simmering dispute over tequila purity, one that has been largely sidelined by regulators and media until now. With jury proceedings pending and public interest growing, the outcome could reshape tequila labeling practices and influence global beverage standards for years to come.
