https://www.ttb.gov/system/files/images/pdfs/rulings/2008-1....
But yeah calling anything Champagne apart from stuff coming from Champagne is a bad form and looked down upon a bit. Small kids do such mistakes and thats fine, adults shouldn't.
You will get an entirely different style of wine.
The origin location is really secondary. “Franciacorta” gets you something like Champagne, “sparkling wine” does not.
And no, "trademark" definition aside, it's not "generic" in the US by any definition of "generic" commonly used in the US, legal or otherwise.