Duncan Liquor Law Letter

In this edition:

Court Finds State’s 3 Store ownership limit unconstitutional – Read

BevMo Complaint On Total Wine Is Referred To FTC, But Total Says It’s Without Merit – Read

Understanding the Three-Tier System: Its Impacts on U.S. Craft Beer and You – Read

Dan Aykroyd Breaks Down Booze Bottle Angles In IP Trial  
ROUND TWO: KAH TEQUILA V. CRYSTAL HEAD VODKA – Read More

And for more news – go to Duncan Liquor Law Letter

THE STATE OF SOUTH CAROLINA In The Supreme Court Retail Services & Systems, Inc., d/b/a Total Wine & More, Appellant, v. South Carolina Department of Revenue and ABC Stores of South Carolina, Respondents. Appellate Case No. 2014-002728 Appeal From Aiken County Doyet A. Early III, Circuit Court Judge Opinion No. 27709 Heard November 5, 2015 – Filed March 29, 2017

COURT FINDS STATE’s 3 STORE OWNERSHIP LIMIT UNCONSTITUTIONAL.

http://www.sccourts.org/opinions/advSheets/no132017.pdf

Retail Services owns and operates three separate liquor store locations in Charleston, Greenville, and Columbia, South Carolina. SCDOR is charged with the administration of South Carolina’s statutes concerning the manufacturing, sale, and retail of alcoholic liquors. S.C. Code Ann. §§ 61-2-10 & -20. Retail Services petitioned SCDOR to open a fourth store in Aiken, however, SCDOR refused to grant Retail Services a fourth liquor license under sections 61-6-140 and -150 of the South Carolina Code,1 which limit a liquor-selling entity to three retail liquor licenses. Additionally, ABC Stores lobbies before the General Assembly on behalf of its members who are owners and holders of retail dealer licenses. Therefore, Retail Services brought this action against SCDOR and ABC Stores seeking a declaratory judgment that these provisions of the South Carolina Code are unconstitutional. Appellant argues that sections 61-6-140 and -150: (1) exceed the scope of the General Assembly’s police power provided for in article VIII-A of the South Carolina Constitution2 because the licensing limits do not promote the health, safety, or morals of the State, but merely provide economic protection for existing retail liquor store owners; (2) violate its rights to equal protection3 under the law by creating arbitrary distinctions, in that the three-store limit unfairly treats large retailers differently from small retailers and that section 61-6-150’s “grandfather clause,” unfairly discriminates against those that did not have an interest on or before July 1, 1978, and unfairly differentiates between owners of stores that sell liquor for on-site consumption and those that sell liquor for off-site consumption; and (4) violate its due process rights4 because they unfairly prevent Appellant from operating in its chosen field of business. The trial court found the provisions constitutional because (1) they are within the scope of the State’s police power; and (2) they satisfy the rational basis test, which, because they do not infringe on a fundamental right or implicate a suspect class, is all that is required. Therefore, the circuit court granted Respondents’ motions for summary judgment. Appellant appealed the circuit court’s decision. We now review the circuit court’s decision and reverse.

BevMo Complaint On Total Wine Is Referred To FTC, But Total Says It’s Without Merit 

The National Advertising Division, an industry self-regulatory group, has referred a complaint by liquor retailer BevMo against rival Total Wine & More to the U.S. Federal Trade Commission (FTC).

The BevMo complaint disputes Total Wine’s advertising claims that its prices are lower than BevMo’s. Concord, California-based BevMo contends that Total Wine makes “unsupported price comparison claims using outdated BevMo prices and prices from BevMo stores that are well outside the geographically relevant market area.” 
However, a Total Wine spokesman told SND that BevMo’s complaint is without merit. “Total Wine & More has been running ‘Paymo at Bevmo’ advertisements in California for a decade,” said the spokesman. “Our prices are simply lower than BevMo’s prices. It appears their newest management team objects to us recording the prices off their website, which is where we get them.” 

The matter was referred to the FTC after Total Wine declined to participate in a proceeding before the NAD. The NAD is an ad industry self-regulating investigative unit that’s administered by the Council of Better Business Bureaus.