AAIAC

The Alliance of Alcohol Industry Attorneys & Consultants is a select organization of alcoholic beverage licensing and compliance professionals.

Gov. Haslam taps newest ABC Commissioner

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Category: abc, Alcoholic Beverage Commission, Tennessee Alcoholic Beverage Commission, Ashleigh Harb Roberts

03.23.18

This week's Tennessee Alcoholic Beverage Commission meeting featured a new face up front. 

Ashleigh Harb Roberts is the new Commissioner for the Middle District of Tennessee.  Commissioner Roberts replaces Commissioner Kaegi, who resigned in December 2017 and we blogged about on Last Call

Commissioner Roberts joins Commission Chair Richard Skiles, who we blogged about here and long-term Commissioner John Jones, East Tennessee Commission Member.  The Commissioners are appointed by the Governor and meet on a monthly basis to conduct ABC business.

Commissioner Roberts is a lawyer, having served as deputy legal counsel to Gov. Haslam.  She is a Vanderbilt Law grad, a self-described fan of red wine and a mother to five young children, including quadruplets.  Married to Gabe Roberts, chief legal officer of the Tennessee Division of Finance and Administration’s Bureau of TennCare, both were recognized as members of the 40 Under 40 class in 2016 by the Nashville Business Journal.

Reminds us of Beyoncé’s Run the World:

Girls we run this motha, girls

Who run the world?

Girls

This goes out to all my girls

That's in the club rocking the latest

Who will buy it for themselves

And get more money later

In other ABC news, the next two ABC Meetings were set:

            Thursday, April 26 at 11 a.m.

            Thursday, May 24 at 11 a.m.

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Tennessee Alcoholic Beverage chairman Bryan Kaegi resigns

Tennessee ABC puts the smack down on Jell-O shots

Dead again: Court strikes down Tennessee residency requirement for liquor store owners

Can I bring my own wine into a restaurant in Tennessee?

Original author: William T. Cheek III
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Gov. Haslam taps newest ABC Commissioner

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Gov. Haslam taps newest ABC Commissioner

Mar 23, 2018

This week's Tennessee Alcoholic Beverage Commission meeting featured a new face up front. 

Ashleigh Harb Roberts is the new Commissioner for the Middle District of Tennessee.  Commissioner Roberts replaces Commissioner Kaegi, who resigned in December 2017 and we blogged about on Last Call

Commissioner Roberts joins Commission Chair Richard Skiles, who we blogged about here and long-term Commissioner John Jones, East Tennessee Commission Member.  The Commissioners are appointed by the Governor and meet on a monthly basis to conduct ABC business.

Commissioner Roberts is a lawyer, having served as deputy legal counsel to Gov. Haslam.  She is a Vanderbilt Law grad, a self-described fan of red wine and a mother to five young children, including quadruplets.  Married to Gabe Roberts, chief legal officer of the Tennessee Division of Finance and Administration’s Bureau of TennCare, both were recognized as members of the 40 Under 40 class in 2016 by the Nashville Business Journal.

Reminds us of Beyoncé’s Run the World:

Girls we run this motha, girls

Who run the world?

Girls

This goes out to all my girls

That's in the club rocking the latest

Who will buy it for themselves

And get more money later

In other ABC news, the next two ABC Meetings were set:

            Thursday, April 26 at 11 a.m.

            Thursday, May 24 at 11 a.m.

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Duncan Liquor Law Letter - March 2018

Happy-St-Patricks-Day-from-RE-Tuck-Duncan
 
Recent Kansas case on breath tests
 
TTB PLANS TO SUBSTANTIALLY INCREASE TRADE PRACTICE INVESTIGATIONS
 
KANSAS CASE ON UNREASONABLE TRAFFIC STOPS
 
TOTAL WINE AND MORE
 
VINTER SUES NAPA VISION 2050
 
NEW HAMPSHIRE BOOTLEGGING
 
TENNESSEE: SUPERSTORE COMES TO TENN.
 
INJURED MAN WINS $37.5 MILLION IN DRAM SHOP CASE
 
MICHIGAN: LIQUOR STORES TAKE 1/2MILE RULE TO COURT
 
DUNCAN'S MARCH 2018 BEVERAGE NEWS ARTICLE
ON PENDING KANSAS LEGISLATION
 
$18 MILLION WINE ROW

REGULATORS INVESTICATE CALIFORNIA WINERIES
FOR ILLEGAL TRADE PRACTICES
 
KOMBUCHA MAY BE SUBJECT TO ALCOHOL REGULATIONS
 
RIPPED OFF CONSUMERS SUE
 
MILLER COORS SUES COMPETITOROVER CONTRACT BREACH
 
TREASURY WINES SUES "COPYCAT"
 
ILLEGAL SALES CHARGE DROPPED AGAINST WINE STORAGE FIRM
  
IMMIGRATION COMPLAINCE
 
PALM BEACH FILES TRADEMARK LAWSUIT
 
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Can I bring my own wine into a restaurant in Tennessee?

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Category: brown bagging, wine in restaurants, ABC, Alcoholic Beverage Commission

03.09.18

Image title

Here's an oft-repeated question: can I "brown bag" — bring my own wine —  in a restaurant, hotel or bar that holds a liquor license in Tennessee?

Surprise, surprise — yes, you can.  In an unusual twist of Tennessee liquor laws, it is legal to brown bag into a restaurant, bar or club that holds a liquor-by-the-drink license.  However, it is still ultimately up to the owner to decide whether customers can bring in their own beer, wine or spirits. 

Brown bagging raises numerous questions:

Can a server uncork a bottle of wine for a customer?  Can the server provide glassware?  Once opened, should a server pour wine into a glass?  Can the server bring in an ice bucket and chill the wine or champagne?

The Tennessee Alcoholic Beverage Commission will look at control when determining whether a restaurant has violated the law concerning brown bagging. As with so many other liquor “laws,” none of the laws concerning what a restaurant can do with brown bagged wine are actually written down somewhere. 

We believe it is safe for a server to uncork a bottle of wine and provide glassware.  This shows very little control over the wine. 

When the server pours the wine, however, we believe the server may be exercising too much control over the customer’s wine.  We recommend that customers pour their own wine, in order to avoid stepping over that unwritten line of what is legal, and what is not. 

Setups are recognized as part of standard services for brown bagging.  A server can provide things like glasses and ice.  Mixing drinks, pouring wine and other bartending services fall outside the scope of what is generally accepted for brown bagging. 

We find ourselves singing Nickelback’s “Bottoms Up”:

So grab a Jim Beam, JD, whatever you need.

Have a shot from the bottle, doesn't matter to me.

'Nother round, fill 'er up, hammer down, grab a cup, bottoms up!

Although brown bagging spirits is legal in Tennessee, the ABC has a strong policy against allowing bottles of spirits in a liquor-by-the-drink establishment.  The ABC has indicated that it will cite a restaurant or bar owner if it sees a bottle of spirits on a table. 

We encourage owners to ban brown bagging of spirits.  There is nothing in the law that says that a liquor-by-the-drink establishment has to allow any form of brown bagging.  You can clearly decide to allow brown bagging wine, but not spirits. 

Tennessee law also allows an owner to charge corkage for brown bagging.  Although the law is not entirely clear, we believe that liquor-by-the-drink and sales taxes have to be paid on corkage. 

If all this seems terribly confusing, it is very simple to have a black-and-white rule.  You can prohibit brown bagging.  Nothing stops you from prohibiting customers from bringing their own alcoholic beverages into your establishment.  It is your restaurant, it is your liability, and ultimately, it is your decision.

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Tennessee Alcoholic Beverage chairman Bryan Kaegi resigns

Tennessee ABC puts the smack down on Jell-O shots

Dead again: Court strikes down Tennessee residency requirement for liquor store owners

Gov. Haslam taps newest ABC Commissioner

Original author: William T. Cheek III
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Can I bring my own wine into a restaurant in Tennessee?

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Can I bring my own wine into a restaurant in Tennessee?

Mar 9, 2018

Image title

Here's an oft-repeated question: can I "brown bag" — bring my own wine —  in a restaurant, hotel or bar that holds a liquor license in Tennessee?

Surprise, surprise — yes, you can.  In an unusual twist of Tennessee liquor laws, it is legal to brown bag into a restaurant, bar or club that holds a liquor-by-the-drink license.  However, it is still ultimately up to the owner to decide whether customers can bring in their own beer, wine or spirits. 

Brown bagging raises numerous questions:

Can a server uncork a bottle of wine for a customer?  Can the server provide glassware?  Once opened, should a server pour wine into a glass?  Can the server bring in an ice bucket and chill the wine or champagne?

The Tennessee Alcoholic Beverage Commission will look at control when determining whether a restaurant has violated the law concerning brown bagging. As with so many other liquor “laws,” none of the laws concerning what a restaurant can do with brown bagged wine are actually written down somewhere. 

We believe it is safe for a server to uncork a bottle of wine and provide glassware.  This shows very little control over the wine. 

When the server pours the wine, however, we believe the server may be exercising too much control over the customer’s wine.  We recommend that customers pour their own wine, in order to avoid stepping over that unwritten line of what is legal, and what is not. 

Setups are recognized as part of standard services for brown bagging.  A server can provide things like glasses and ice.  Mixing drinks, pouring wine and other bartending services fall outside the scope of what is generally accepted for brown bagging. 

We find ourselves singing Nickelback’s “Bottoms Up”:

So grab a Jim Beam, JD, whatever you need.

Have a shot from the bottle, doesn't matter to me.

'Nother round, fill 'er up, hammer down, grab a cup, bottoms up!

Although brown bagging spirits is legal in Tennessee, the ABC has a strong policy against allowing bottles of spirits in a liquor-by-the-drink establishment.  The ABC has indicated that it will cite a restaurant or bar owner if it sees a bottle of spirits on a table. 

We encourage owners to ban brown bagging of spirits.  There is nothing in the law that says that a liquor-by-the-drink establishment has to allow any form of brown bagging.  You can clearly decide to allow brown bagging wine, but not spirits. 

Tennessee law also allows an owner to charge corkage for brown bagging.  Although the law is not entirely clear, we believe that liquor-by-the-drink and sales taxes have to be paid on corkage. 

If all this seems terribly confusing, it is very simple to have a black-and-white rule.  You can prohibit brown bagging.  Nothing stops you from prohibiting customers from bringing their own alcoholic beverages into your establishment.  It is your restaurant, it is your liability, and ultimately, it is your decision.

Click here to learn more about Waller's alcoholic beverage team.

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Dead again: Court strikes down Tennessee residency requirement for liquor store owners

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Category: ABC, liquor stores, residency requirement

02.22.18

Image title

Source: Miosotis Jade 

The verdict is in.  The two-year residency requirement for Tennessee liquor stores is officially dead.  Again.

This week, the U.S. Court of Appeals for the Sixth Circuit upheld a lower court finding that Tennessee residency requirements violate the Commerce Clause of the U.S. Constitution.  The court struck down portions of state law that require a liquor store owner to live in Tennessee for at least two years prior to applying and to be a resident for 10 years to renew a liquor store license.

This quote pretty much sums up the court’s finding:

“The Twenty-first Amendment gives a state the power to oversee the alcoholic-beverages business, but it does not give a state the power to dictate where individuals live.”

Click the link to read the court's full decision. Byrd v TN Wine and Spirits.pdf

Out of state residents qualify for retail liquor licenses in Tennessee.  This question appears to be settled, once and for all.

Just last month, the Tennessee ABC approved the first Total Wine location at 11370 Parkside Drive in Knoxville.  For those that live under a rock, Total Wine is a Maryland-based chain of liquor superstores.  Overall, it has more than 170 superstores in 20 states. Total Wine challenged and won the local residency requirement.  Twice in court, as of yesterday.

In recognition of the 50th anniversary of Mr. Roger’s immortal public TV show, this tune comes to mind:

So, let's make the most of this beautiful day.

Since we're together we might as well say:

Would you be mine?

Could you be mine?

Won't you be my neighbor?

Let’s all be neighbors and open a friendly neighborhood liquor store.  Whether you hail from Minnetonka, Minnesota; Missoula, Montana; or Moscow, Tennessee.

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Tennessee ABC puts the smack down on Jell-O shots

Can I bring my own wine into a restaurant in Tennessee?

Gov. Haslam taps newest ABC Commissioner

Tennessee Sunday alcohol sales: What you need to know

Original author: William T. Cheek III
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Dead again: Court strikes down Tennessee residency requirement for liquor store owners

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Dead again: Court strikes down Tennessee residency requirement for liquor store owners

Feb 22, 2018

Image title

Source: Miosotis Jade 

The verdict is in.  The two-year residency requirement for Tennessee liquor stores is officially dead.  Again.

This week, the U.S. Court of Appeals for the Sixth Circuit upheld a lower court finding that Tennessee residency requirements violate the Commerce Clause of the U.S. Constitution.  The court struck down portions of state law that require a liquor store owner to live in Tennessee for at least two years prior to applying and to be a resident for 10 years to renew a liquor store license.

This quote pretty much sums up the court’s finding:

“The Twenty-first Amendment gives a state the power to oversee the alcoholic-beverages business, but it does not give a state the power to dictate where individuals live.”

Click the link to read the court's full decision. Byrd v TN Wine and Spirits.pdf

Out of state residents qualify for retail liquor licenses in Tennessee.  This question appears to be settled, once and for all.

Just last month, the Tennessee ABC approved the first Total Wine location at 11370 Parkside Drive in Knoxville.  For those that live under a rock, Total Wine is a Maryland-based chain of liquor superstores.  Overall, it has more than 170 superstores in 20 states. Total Wine challenged and won the local residency requirement.  Twice in court, as of yesterday.

In recognition of the 50th anniversary of Mr. Roger’s immortal public TV show, this tune comes to mind:

So, let's make the most of this beautiful day.

Since we're together we might as well say:

Would you be mine?

Could you be mine?

Won't you be my neighbor?

Let’s all be neighbors and open a friendly neighborhood liquor store.  Whether you hail from Minnetonka, Minnesota; Missoula, Montana; or Moscow, Tennessee.

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Tennessee ABC puts the smack down on Jell-O shots

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Category: Tennessee Alcoholic Beverage Commission, ABC, infused liquor

02.13.18

Image title

Source: TMAB2003 on Flikr

Late last year, we began hearing from restaurants and bars that were being cited for unlabeled Jell-O shots. It seems the Tennessee Alcoholic Beverage Commission (ABC) is treating this all-American treat as an infused beverage.

Although we disagree with the ABC’s conclusion that Jell-O shots are an infusion, we lack an army of agents out in the field — busily issuing citations. Better label your favorite delightful slurpable treats, or face fines.

Here’s the fun part. There are no rules for how to label infusions. Current Tennessee law merely states that “a batch of infused product shall be labeled with a list of each ingredient contained in the infusion.”

We suggest that each batch contain the date it was made, the ingredients and the name of the infusion.

Jell-O shots are not an infusion, in our humble opinion. An infusion “is not intended for immediate consumption.” The infusion statute applies to mixtures that steep or ferment “over a sustained period of time.” Infusions are not intended to apply to mixtures that need to chill, such as frozen drinks, or jell, like Jell-O shots.

Given the ongoing confusion over infusions, we recommend that folks also label all pre-batched cocktails. Why not? It’s easy, not a bad idea, and could save you a few hundred bucks next time your friendly ABC agent stops by for a visit.

We are going to need a serious cocktail to get the Jell-O song out of our heads:

Watch it glimmer

See it shimmer

Cool and fruity

Jell-O brand gelatin

If that didn’t stick the song in your head, check out the vintage 1979 commercial:

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Dead again: Court strikes down Tennessee residency requirement for liquor store owners

Can I bring my own wine into a restaurant in Tennessee?

Gov. Haslam taps newest ABC Commissioner

Original author: William T. Cheek III
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Tennessee ABC puts the smack down on Jell-O shots

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Tennessee ABC puts the smack down on Jell-O shots

Feb 13, 2018

Image title

Source: TMAB2003 on Flikr

Late last year, we began hearing from restaurants and bars that were being cited for unlabeled Jell-O shots. It seems the Tennessee Alcoholic Beverage Commission (ABC) is treating this all-American treat as an infused beverage.

Although we disagree with the ABC’s conclusion that Jell-O shots are an infusion, we lack an army of agents out in the field — busily issuing citations. Better label your favorite delightful slurpable treats, or face fines.

Here’s the fun part. There are no rules for how to label infusions. Current Tennessee law merely states that “a batch of infused product shall be labeled with a list of each ingredient contained in the infusion.”

We suggest that each batch contain the date it was made, the ingredients and the name of the infusion.

Jell-O shots are not an infusion, in our humble opinion. An infusion “is not intended for immediate consumption.” The infusion statute applies to mixtures that steep or ferment “over a sustained period of time.” Infusions are not intended to apply to mixtures that need to chill, such as frozen drinks, or jell, like Jell-O shots.

Given the ongoing confusion over infusions, we recommend that folks also label all pre-batched cocktails. Why not? It’s easy, not a bad idea, and could save you a few hundred bucks next time your friendly ABC agent stops by for a visit.

We are going to need a serious cocktail to get the Jell-O song out of our heads:

Watch it glimmer

See it shimmer

Cool and fruity

Jell-O brand gelatin

If that didn’t stick the song in your head, check out the vintage 1979 commercial:

Continue reading
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Craft distillers, brewers are big winners with Trump tax cuts

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Category: craft distillers, brewers, Tax Cuts and Jobs Act of 2017, tax cuts, federal excise tax, Will Cheek

01.17.18

Image title

Craft distillers, vintners and brewers generally don’t boast about being in the profession for the money. Their passion and love of the artisan trade inspire long hours in often inhospitable conditions cooking up their favorite hooch. Or so they say.

The 2017 tax cuts make it a lot easier to pocket some extra change, particularly for small distilleries. Love him or hate him, President Trump gives reason to celebrate selling more small-batch whiskey, bourbon, gin and vodka.

Starting January 1, 2018, the federal excise tax for distilled spirits is slashed from $13.50 to $2.70 per proof gallon for the first 100,000 gallons produced. With savings of $10.80 per gallon, a distillery can save up to $2.16 million in taxes over the two-year life of the tax cut.

That’s not chump change, President Trump.

The challenge, of course, is selling all that extra product. Hard to save money if you have 100,000 gallons of liquor lying around to sell. That’s roughly 500,000 bottles of whiskey on the wall – take one down, pass it around …

Even the big boys can make money from the tax cuts. Excise taxes are reduced by 16 cents for production of 100,000 to 22 million proof gallons of distilled spirits. Doesn’t sound like much, until you do the math. That’s roughly $9 million in savings, assuming you can make – and sell – 44 million gallons of booze in the next two years.

The tax cuts are nearly as profitable for small brewers, who had already been enjoying an $11 per barrel reduction. The excise tax for brewing less than 60,000 barrels is reduced from $7 to $3.50 per barrel until December 31, 2019. A small brewer can save up to an additional $210,000 per year for the next two years. That’s a $1.74 million reduction from the normal $18 per barrel excise tax rate.

The tax bill also cuts the rates for wineries, starting at $1 per gallon of wine for the first 30,000 gallons.

Which brings us to the song of our blog, our raison d’etre, dredging up catchy lines penned by our favorite composers. As we blog, we keep humming ABC’s infectious hit “(How to Be a) Millionaire”

I've seen the future, I can't afford it
Tell me the truth sir, someone just bought it
Say Mr. Whispers! Here come the click of dice
Roulette and blackjacks - gonna build us a paradise
Larger than life and twice as ugly
If we have to live there, you'll have to drug me

The full text of the law is here. HR1 Craft Beverage Modernization and Tax Reform.docx

There are a number of other provisions that impact narrow segments of the industry and we recommend a complete review of the law for those with acute insomnia.

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Can I Sell Sake in My Grocery Store in Tennessee?

To 8-K or Not to 8-K: the SEC’s Guidance on the Impact of the Tax Cut and Jobs Act

Tennessee Alcoholic Beverage chairman Bryan Kaegi resigns

Original author: William T. Cheek III
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Craft distillers, brewers are big winners with Trump tax cuts

blog

Craft distillers, brewers are big winners with Trump tax cuts

Jan 17, 2018

Image title

Craft distillers, vintners and brewers generally don’t boast about being in the profession for the money. Their passion and love of the artisan trade inspire long hours in often inhospitable conditions cooking up their favorite hooch. Or so they say.

The 2017 tax cuts make it a lot easier to pocket some extra change, particularly for small distilleries. Love him or hate him, President Trump gives reason to celebrate selling more small-batch whiskey, bourbon, gin and vodka.

Starting January 1, 2018, the federal excise tax for distilled spirits is slashed from $13.50 to $2.70 per proof gallon for the first 100,000 gallons produced. With savings of $10.80 per gallon, a distillery can save up to $2.16 million in taxes over the two-year life of the tax cut.

That’s not chump change, President Trump.

The challenge, of course, is selling all that extra product. Hard to save money if you have 100,000 gallons of liquor lying around to sell. That’s roughly 500,000 bottles of whiskey on the wall – take one down, pass it around …

Even the big boys can make money from the tax cuts. Excise taxes are reduced by 16 cents for production of 100,000 to 22 million proof gallons of distilled spirits. Doesn’t sound like much, until you do the math. That’s roughly $9 million in savings, assuming you can make – and sell – 44 million gallons of booze in the next two years.

The tax cuts are nearly as profitable for small brewers, who had already been enjoying an $11 per barrel reduction. The excise tax for brewing less than 60,000 barrels is reduced from $7 to $3.50 per barrel until December 31, 2019. A small brewer can save up to an additional $210,000 per year for the next two years. That’s a $1.74 million reduction from the normal $18 per barrel excise tax rate.

The tax bill also cuts the rates for wineries, starting at $1 per gallon of wine for the first 30,000 gallons.

Which brings us to the song of our blog, our raison d’etre, dredging up catchy lines penned by our favorite composers. As we blog, we keep humming ABC’s infectious hit “(How to Be a) Millionaire”

I've seen the future, I can't afford it
Tell me the truth sir, someone just bought it
Say Mr. Whispers! Here come the click of dice
Roulette and blackjacks - gonna build us a paradise
Larger than life and twice as ugly
If we have to live there, you'll have to drug me

The full text of the law is here. HR1 Craft Beverage Modernization and Tax Reform.docx

There are a number of other provisions that impact narrow segments of the industry and we recommend a complete review of the law for those with acute insomnia.

Continue reading
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Tennessee Alcoholic Beverage chairman Bryan Kaegi resigns

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Tennessee Alcoholic Beverage chairman Bryan Kaegi resigns

Jan 8, 2018

ABC patch

Source: State of Tennessee

We bid farewell to Tennessee Alcoholic Beverage Chairman and Commissioner Bryan Kaegi.

Commissioner Kaegi announced his resignation at the December 2017 ABC meeting. 

A replacement for the Middle District seat was not announced, but we expect Governor Bill Haslam to name one soon, probably before the January 2018 meeting. There are three ABC Commissioners, each appointed by the Governor. Richard Skiles is the West Tennessee Commission Member and John Jones is the East Tennessee Commission Member.

Commissioner Keagi logged over six years of service for the Tennessee ABC. We thank him for his leadership and time. He will be missed.

A B.B. King classic comes to mind – Paying the Cost to Be the Boss:

    You must be crazy woman

    Just gotta be outta your mind

    As long as I foot the bills

    I'm payin' the cost to be the boss

Although Commissioner Kaegi was undoubtedly the boss, this was not his paying gig. ABC Commissioners are volunteers that receive a modest stipend to attend meetings. Which is cause to double our thanks.

Best wishes, Commissioner Kaegi.

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Can I Sell Sake in My Grocery Store in Tennessee?

Tennessee liquor laws are hopelessly complicated, and the rules for sake are among the most byzantine.

Sake is rice wine.  Is it wine under Tennessee law?

No.  Wine is made from grapes or other fruit.  Rice is a grain.

Sake is clear and tastes like liquor.  It must be liquor.  Ever slammed a sake bomb?  But sake is not distilled and is not a spirit.

Sake is brewed.  Is it a beer?  It doesn’t have malt and hops and certainly doesn’t taste like Budweiser.

But voila, sake is beer under Tennessee law. Brewed from grain, like our favorite cereal in a can – beer.

Yes, Virginia, you can sell sake in your grocery or food store.  Well, at least some kinds of sake.

Remember that pesky high gravity rule about beer?  Beer under 8% by volume and 10.1% by weight can be sold in a food store or convenience market.  Beer over 8% ABV must be sold in a liquor store.

Same rules apply for sake, because sake is beer under Tennessee’s tortuous liquor laws.

We ransacked what is left of our minds, and turned up naught for songs about sake.  But we couldn’t resist the Vapor’s infectious one hit wonder “Turning Japanese”

I’ve got your picture, I’ve got your picture
I’d like a million of them all round my cell
I asked the doctor to take your picture
So I can look at you from inside as well 

You’ve got me turning up and turning down
And turning in and turning ’round
I’m turning Japanese
I think I’m turning Japanese
I really think so
Original author: William T. Cheek III
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Can I Sell Sake in My Grocery Store in Tennessee?

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Can I Sell Sake in My Grocery Store in Tennessee?

Dec 10, 2017

Tennessee liquor laws are hopelessly complicated, and the rules for sake are among the most byzantine.

Sake is rice wine.  Is it wine under Tennessee law?

No.  Wine must be made from grapes or other fruit to legally be wine in Tennessee.  Rice is a grain.

Sake is clear and tastes like liquor.  It must be liquor.  Ever slammed a sake bomb?  But sake is not distilled and is not a spirit under Tennessee law.

Sake is brewed.  Is it a beer?  It doesn't have malt and hops and certainly doesn't taste like Budweiser.

But voila, sake is beer under Tennessee law. Brewed from grain, like our favorite cereal in a can - beer.

Yes, Virginia, you can sell sake in your grocery or food store.  Well, at least some kinds of sake.

Remember that pesky high gravity rule about beer?  Beer under 8% by weight or 10.1% by volume can be sold in a grocery, food store or convenience market.  Beer over 10.1% ABV must be sold in a liquor store.

Same rules apply for sake, because sake is beer under Tennessee's tortuous liquor laws.

We ransacked what is left of our minds and turned up naught for songs about sake.  But we couldn't resist the Vapor's infectious one hit wonder "Turning Japanese"

I've got your picture, I've got your picture
I'd like a million of them all round my cell
I asked the doctor to take your picture
So I can look at you from inside as well

You've got me turning up and turning down
And turning in and turning 'round

I'm turning Japanese
I think I'm turning Japanese
I really think so

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Online Applications Going Live With the Tennessee ABC

The Tennessee ABC will be launching its new online system, RLPS, starting January 22, 2018.  Zack Blair, Assistant Director for the Tennessee ABC, lead an informative session for industry members yesterday, December 5, 2017, where ABC staff previewed the system and answered questions.

Assistant Director Blair tells us that “The Commission is excited to be able to revolutionize and create more efficiency in licensing.  We look forward to allowing customers to complete everything in an electronic form and provide them the ability to pay online.”

The new system, known as RLPS, becomes available on January 22, 2018 for users to:

·         preview

·         create accounts

·         enter information, but not submit applications.

Starting February 1, 2018, RLPS goes live.  At that point, all applications must be filed on RLPS.

This includes renewals.

The ABC will be in the process of scanning and uploading existing files into RLPS.  We expect this process to take some time.  In the meantime, applicants may want to upload PDFs of documents to be referenced in existing files.

RLPS is being implemented without any additional user fees.  We were pleased to learn that credit cards can be used without additional user fees, which we consider to be a hidden tax often assessed by regulatory agencies.  Kudos to the ABC for eliminating these charges.

RLPS eliminates the need for notaries on questionnaires, declarations and many other documents.  No authentication is required for information submitted in lieu of questionnaires and other documents.

TTB applicants will find RLPS familiar, as it is based on the same system.

The ABC is creating master files for licensees with multiple licenses, which we expect to be particularly helpful for large grocery stores filing WIGS renewals.

The cryptic lyrics to the 1969 hit song “In The Year 2525” come to mind:

In the year 2525, if man is still alive

If woman can survive, they may find

In the year 3535

Ain’t gonna need to tell the truth, tell no lie

Everything you think, do and say

Is in the pill you took today

Original author: William T. Cheek III
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Online Applications Going Live With the Tennessee ABC

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Online Applications Going Live With the Tennessee ABC

Dec 6, 2017

The Tennessee ABC will be launching its new online system, RLPS, starting January 22, 2018.  Zack Blair, Assistant Director for the Tennessee ABC, lead an informative session for industry members yesterday, December 5, 2017, where ABC staff previewed the system and answered questions.

Assistant Director Blair tells us that "The Commission is excited to be able to revolutionize and create more efficiency in licensing.  We look forward to allowing customers to complete everything in an electronic form and provide them the ability to pay online."

The new system, known as RLPS, becomes available on January 22, 2018 for users to:

·         preview

·         create accounts

·         enter information, but not submit applications.

Starting February 1, 2018, RLPS goes live.  At that point, all applications must be filed on RLPS.

This includes renewals.

The ABC will be scanning and uploading existing files. We expect this process to take some time.  In the meantime, applicants may want to upload PDFs of documents to be referenced in existing files.

RLPS is being implemented without any additional user fees.  We were pleased to learn that credit cards can be used without additional user fees, which we consider to be a hidden tax often assessed by regulatory agencies.  Kudos to the ABC for eliminating these charges.

RLPS eliminates the need for notaries on questionnaires, declarations and many other documents.  No authentication is required for information submitted in lieu of questionnaires and other documents.

TTB applicants will find RLPS familiar, as it is based on the same system.

The ABC is creating master files for licensees with multiple licenses, which we expect to be particularly helpful for large grocery stores filing WIGS renewals.

The cryptic lyrics to the 1969 hit song "In The Year 2525" come to mind:

In the year 2525, if man is still alive

If woman can survive, they may find

In the year 3535

Ain't gonna need to tell the truth, tell no lie

Everything you think, do and say

Is in the pill you took today

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Leadership at Nashville Beer Board Takes Charge

The Metro Beer Board officially coronated Benton McDonough as Executive Director at its November 2, 2017 meeting.  Could Sainthood be next?

Director McDonough and Board Chair Brian Taylor have certainly been busy rocking the boat with new changes at the Metro Beer Board.

Hold on to your pacemaker for this one: the Metro Beer Board now accepts personal checks and business checks.  This is in addition to authorizing credit cards, which was a huge change earlier this year.

For over two decades, we have been advising folks to take exact change or cashier’s checks to pay application fees, the $100 privilege tax and fines.  No more for brew-slinging Music City businesses.

Check this one out.  The Beer Board Staff now has the authority to issue a temporary beer permit – without Beer Board approval.  Once your beer permit application is complete, you automatically qualify for a temporary beer permit.  No more timing final inspections with Metro Beer Board meeting dates.

If that’s not enough, yesterday the Beer Board announced that staff will expand the hours for taking calls to answer general questions regarding beer permits applications, from 7:30 a.m. until Noon Central Time, Monday through Friday.  The Beer Board can be reached at 615.862.6751.

Nashville favorite Luke Bryan captures the mood in his hit “Drink a Beer”

So I’m gonna sit right here

On the edge of this pier

Watch the sunset disappear

And drink a beer.

In case you have not gotten the message, the Metro Beer Board ditched the daily proration of privilege taxes and now accepts monthly proration of privilege tax.  See the chart to calculate the amount for your new beer permit fee:

Month Amount
January $100.00
February $91.70
March $83.40
April $75.10
May $66.80
June $58.50
July $50.20
August $41.90
September $33.60
October $25.30
November $17.00
December $8.70

Please note that the fee is not due when a temporary beer permit issues. You only pay the fee after the Metro Beer Board has issued you a final beer permit.

Keep in mind that the fee for a renewed beer permit, also known as the annual privilege tax, remains $100.

William T. Cheek III

William T. Cheek III

As the only Tennessee attorney named Best Lawyers in America for Food and Beverage Law, Will Cheek leads firm’s Alcoholic Beverage Team and provides licensing and regulatory compliance advice to restaurants, hotels, bars, clubs, craft distilleries and breweries. Will’s clients range from small chef-owned restaurants to large publicly traded corporations. He is nationally known as the go-to source for Tennessee liquor law and authors the blog Last Call, covering Tennessee alcohol, restaurant and hospitality news.

William T. Cheek III

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Original author: William T. Cheek III
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When is Happy Hour Not so Happy In Tennessee?

The rules on Happy Hour in Tennessee can drive you to drink.  Make that a double.

Nothing good seems to happens after 10 pm, or at least so thinks the Tennessee state legislature. After 10 pm, bars cannot:

sell or serve more than one drink at a time pour more alcohol for the same price

The exceptions to the rules make it fun – for sick folks that like obtuse facts, like lawyers.

First of all, beer is happy, day or night.  Happy hour rules do not apply to beer.

Half price cocktails and other drink discounts are timeless.  Tennessee ditched the old rule that prohibited discounting drinks after 10 pm.

2-4-1 is tricky.  Although you can discount drinks until close, you cannot serve 2 drinks to a customer after 10 pm.

And speaking of doubles, bring it on, as long as the price for a second shot is the same, day or night.  Offering discounted doubles after 10 pm can violate the rule against pouring more alcohol for the same price after 10 pm.

Be careful with drink chips and other free drink promotions.  Tennessee state law prohibits giving away wine or spirits.  You can do 2-4-1 with a drink chip, as long as the chip is redeemed by 10 pm.  Redeem the chip after 10 pm and you violate happy hour laws.  If the customer tries to redeem the chip for a drink on the next day, you are giving away liquor and can be cited.

Beware of bottomless mimosas, bloody mary’s and other cocktails.  Serving too many drinks for a fixed price can violate the rule against giving away liquor.  You can also get folks drunk.  State law prohibits serving alcohol to a visibly intoxicated person.

I know, isn’t that the whole purpose for going to a bar anyway: to get drunk?

We have been quietly humming the Ren & Stimpy oh-so-sarcastic theme song whilst posting this happy hour nonsense:

Happy Happy Joy Joy
Happy Happy Joy Joy Joy
I don’t think you’re happy enough. That’s right! I’ll teach you to be
Happy. I’ll teach your grandmother to suck eggs
Happy Happy Joy Joy…

Original author: William T. Cheek III
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Landlords with Percent Rent from Liquor Get Some Love from Tennessee ABC

By - September 19, 2017 | Alcoholic Beverage Law | Email Will Cheek

Landlords know this problem all too well. The Tennessee Alcoholic Beverage Commission calls a landlord an “indirect owner” if the landlord that receives 5% or more in percentage rent from the sale of alcohol.

The ABC requires that the landlord file an ABC questionnaire for the landlord company.  Recently, the ABC has been requiring that at least one corporate officer of the landlord also file an ABC questionnaire.

Landlords are understandably concerned about having an “indirect interest” in a liquor license.  Landlords generally have nothing to do with the sale of alcohol, other than an arms-length lease to a tenant that holds an alcoholic beverage license.  Filing a questionnaire or otherwise “being on the liquor license” raises concerns that a plaintiff might sue the landlord in a dram shop action for liquor liability.

In addition, ABC questionnaires require officers to divulge confidential personal information, including a social security number.

We are pleased to announce that the ABC recently discontinued ABC questionnaires for landlords having percent rent.  Instead, the ABC published the “Landlord Interest Affidavit.”

The Landlord Interest Affidavit dispatches with personal information and is limited to factors that would disqualify a landlord from receiving rental income from the sale of alcohol.

Snoop Dogg’s classic “Show Me Some Love” seems appropriate:

You don’t show me some love
(show me love, for real, you gets no love, yea)
You gets no loving babe 
(you gets no love, you ain’t gonna miss it till it’s gone) 

We applaud the ABC for responding to this industry concern and showing some love to landlords.

Original author: William T. Cheek III
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Roll Out the Red Tape for Tennessee Retail Liquor and Grocery Stores: Background Checks Now Mandatory

Anyone that has applied for a liquor license for a grocery or retail liquor store in Tennessee understands red tape. We purchase the stuff by the truckload around here. We seem to consume more red tape than oxygen and bourbon – combined.

Starting July 1, 2017, applications for Certificate of Compliance in Tennessee must be filed with national and local background checks. The new Tennessee law requires that:

Each applicant or officer … must obtain and submit with the certificate a local and national criminal history record obtained from a third party using a multistate criminal records locator or similar nationwide database with validation.

The background checks are to prove that the applicant or officer has not been convicted of felony in the last 10 years. Read the full text here PC 357.

Problem is, seems only a handful of folks in Tennessee know about the new requirement. We are advising liquor and food store owners to submit the background checks, even if the city says they are not required. It is, after all, state law.

Questions abound.

Who is required to submit the background checks? Certainly not every corporate officer of a publicly traded company. Do we just pick the people? If so, seems to be a great way to hide your favorite felon.

What is a local background check? For that matter, what is a “national criminal history record?”

We recommend satisfying the local requirement by filing a TBI background check. TBI checks cost $29, can be run online and do not require fingerprints. Results are back in days, if not hours. Start the process here. We can see some cities requiring their own police or other “local” background checks.

National background checks require a little more effort. We had to become qualified to pull them.

Plan in advance. At this juncture, no one knows what each city will want.

The new requirement could be a train wreck for unsuspecting liquor store owners and grocers looking to renew. Certificates of Compliance must be renewed every two years. The weeks leading up to July 1, 2018 will be particularly hectic, with several hundred certificates coming due on the two year anniversary of WIGS – Wine In Grocery Stores.

Not sure why, but we find ourselves humming the Grateful Dead train crash tune:

Driving that train, high on cocaine,
Casey Jones you better watch your speed
Trouble ahead, trouble behind
And you know that notion just crossed my mind

We hope the kinks are resolved long before 2018.

Original author: William T. Cheek III
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