Libation Law Blog

Alcoholic Beverage and Cannabis Regulatory and Legal Updates

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CANarchy brought two challenges to the Texas Alcoholic Beverage Code’s 225,000 barrel cap on brewery “beer-to-go” sales. The relevant portions of the statute authorize breweries in Texas to sell beer-to-go, provided they have a production rate below 225,000 barrels annually. This right was only recently added in 2019. The language of the statute empowering these “beer-to-go” sales reads: [T]he holder of a brewer’s permit whose annual production of ale, together with the annual production of beer by the holder of a manufacturer’s license at all premises wholly or partly owned, directly or indirectly, by the permit holder or an affiliate…
You can read about this case in our previous posts on it here, and here. A consumer brought suit against Bacardi based on a 150-year-old law on Florida’s books regarding some compounds and ingredients that, prior to decent Federal regulation and at a time when little was known about such compounds, declared different substances, including grains of paradise, adulterants and banned their use in liquor. The lawsuit sought a class certification and damages claiming because the statute declared the liquor adulterated, the alcohol was therefore worthless. Bacardi moved to dismiss arguing against the claims, in relevant part, stating…
Illinois Senate Bill 54 from the state legislature’s last session had a long and tortured history. Despite the fact that I fully support alcoholic beverage retailer delivery and shipping, I criticized the language and sloppy drafting of the various versions of the bill proposed over time during the last session because thoughtfulness in legislative drafting provides clarity and effective rights and sloppy drafting leads to more problems, confusion and improper enforcement. You can read my posts on the problems with various for the liquor delivery bill iterations here, here and here. The Illinois state legislature passed a version…
This morning, the United States Supreme Court denied the petition for certiorari filed by the plaintiffs in the 6th Circuit Lebamoff – Michigan wine retailer shipping case. For some background, here is our analysis of the 6th Circuit decision that was the subject of the cert. petition. The Northern District of Illinois case remains pending and headed to trial. The post SCOTUS denies Cert. in Lebamoff 6th-Circuit wine retailer shipping case. appeared first on Libation Law Blog.…
The Vermont Department of Financial Regulation recently issued an ex parte cease-and-desist order to a winery based on concerns that the winery’s SEC Regulation D, Rule 506(b) exempted offering failed to disclose important facts concerning the winery’s lack of licensure. You can read the order in the link above. According to the order, a former employee’s attorney reached out to the Vermont Department of Financial Regulation regarding the winery’s business practices. A deputy commissioner checked the Vermont Liquor Control website and learned that the winery’s license was “pending” but not issued raising concerns and the belief that the winery operated…
Just got an important reminder from the Hospitality Business Association of Chicago. Today is the last day to apply for the second round of the State of Illinois Business Interruption Grants to offset losses during the various pandemic shutdowns this year. The application overview is here: https://www2.illinois.gov/dceo/SmallBizAssistance/Pages/C19DisadvantagedBusGrants.aspx The application specifically is: https://accionilin.formstack.com/forms/big And if you are curious the State’s list of approved grants, with amounts, was updated on Dec 10th here: https://www2.illinois.gov/dceo/SmallBizAssistance/Documents/BIGRd2Awards_121020.pdf Federal CARES Act money funds this program and Illinois taverns and restaurants have a shot at some useful grant money if they can apply. HBAC informs me…
The country-spanning impact of South Dakota v. Wayfair just hit the Illinois direct-to-consumer wine market. The Illinois Department of Revenue has announced that beginning January 1, Winery Shipper’s License holders with no physical presence in Illinois will need to remit the Illinois Retailer’s Occupation Tax provided they do not have a physical presence in Illinois and they meet the $100,000 in sales or 200+ transaction benchmark. This is in-line Wayfair’s determination that out-state retailers must abide by and pay in-state and local taxes when selling to residents of another state (provided perhaps that the thresholds of transactions or volume of…
The saga over “fizzy” named hard seltzers Brizzy and Vizzy added another chapter in favor of Molson Coors with this 5th Circuit opinion upholding the lower court’s denial of an injunction to Brizzy-maker, Future Proof Brands, in its attempt to keep Molson’s Vizzy from competing under that name. You can read our review of the lower court decision here, and here, find the briefs in this hard seltzer fight here. Note in our earlier discussions that we called this for Molson a while ago. The 5th Circuit agreed with the lower court on much of the…
Back in May of this year the Commerce Clause provided a substantial victory for cannabis companies looking to achieve fair-play amongst the states that have authorized cannabis programs and sales. An out-of-state company looking to obtain cannabis licensure in Maine successfully fought a state court action and settled with Maine regulators to stop enforcing residency requirements for state licensure. An activist group is currently attempting to defend the statutory requirement and force Maine regulators to enforce the residency requirements in a federal case, but a recent motion to dismiss their claims makes apparent that even Maine’s top officials agree the
Yesterday, the Supreme Court denied the petition for certiorari that Wal-Mart had filed in its fight to overturn a 5th Circuit ruling that Texas retail liquor licensing rules and Wal-Mart’s case against them required further fact finding.  Initially, the District Court had agreed with Wal-Mart that the Texas ban on public companies owning liquor stores had a discriminatory intent against out-of-state interests violating the Commerce Clause. The 5th Circuit reversed that decision remanding the case for further fact-finding assessing that the District Court erred in applying the facts to precedent holding that simply having a history of prior discriminatory statutes…
You’ll recall that the court had recently dismissed this matter finding that Minhas’s second amended complaint (Mountain Crest SRL, LLC) had failed to allege Molson and Anhueser violated federal antitrust laws by conspiring to harm Minhas through their distribution and marketing practices at beer stores in Ontario, Canada. This was only after the Seventh Circuit had reversed an initial dismissal remanding for the lower court to make determinations about the second amended complaint for a detailed explanation from the court not regarding the challenges Minhas had brought over practices under the Ontario six-pack rule, but about whether Minhas had properly…
Omitting facts rarely ends well for people, let alone attorneys. Likewise, disregarding the law usually ends with a party on thin ice. So imagine the cringing surprise that hundreds of applicants for Illinois’ current round of adult use cannabis dispensary licenses felt upon reading this complaint filed by a few of the applicants that received the total points under the flawed scoring analysis conducted in the latest round of Illinois’ cannabis dispensary licensing. That cringe could have resulted from the use of the word “flagrantly” five times. But applicants are a hearty bunch, so the cringe really comes down to…
The good folks at the ILCC officially (this has been in the works for some time, but the process of getting a regulation approved in Illinois takes a while) adopted an updated regulation on the transfer of alcohol between retailers. You can find the new regulation Ill. Admin. Code tit 11 § 100.25 “Transfer of Alcohol” here. In brief, the new regulation explicates the process and justifications for retailers to transfer alcohol between each other. The old regulation just prohibited the practice absent Commission approval which didn’t give much guidance and, frankly, didn’t help regulators in determining what circumstances…
You’ll remember the fun of the 9th Circuit opinion in the VIP Products v. Jack Daniel’s case from back in April where the 9th Circuit reversed a finding in favor of the distiller finding that a dog toy called “Bad Spaniels” and bearing a striking resemblance to Tennessee’s favorite whisky bottle had First Amendment protection as an expressive work regardless of its commercial aspirations: You can read our piece on this liquor trademark case here. The best part of the opinion was this snippet: “Like the greeting cards in Gordon, the Bad Spaniels dog toy, although surely not the…
When we last wrote about this case we discussed how Pabst, the maker of Olympia beer removed the words “Pure Mountain Water” from the text on its website questioning whether that helped or hurt its push to dismiss the claims brought by the plaintiff in the false advertising suit against the beer maker over the Olympia brand asserting the packaging gives the false impression that the beer is made from artesian waters near the Olympia area of Washington as opposed to making the beer “at several mega-breweries throughout the country, including a location in Irwindale, California.”  The complaint has now…
The plaintiff, a wine and beer distributor bought beer in accordance with its contract with Walt Disney Parks and Resorts US Inc. On March 15, 2020, before the plaintiff shipped its product, Disney voluntarily closed the parkes due to the COVID-19 pandemic. Disney refused to accept Plaintiff’s product or to compensate the beer wholesaler for the beer. Four days later, the beer distributor filed an insurance claim for the loss of business income, extra expense, inventory, and accounts receivable caused by the pandemic asserting that the beer spoiled while Disney remained closed. The insurance company refused the beer distributor’s claim.…