Liquor Industry News 5-20-13: Memorial Day Sale

Franklin Liquors


Monday May 20th

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Todays Industry News

April, 2013, Control State Results


Source: NABCA

May 17th


During April, nine-liter spirits case sales in the control states were up 3.3% compared to same month last year sales. Rolling-twelve month reported volumes grew at 3.2%, up from March’s 3.0%. Alabama, Idaho, Iowa, Maine, Mississippi, Montana, North Carolina, Ohio, Oregon, Virginia, Vermont, West Virginia, and Wyoming reported monthly growth rates exceeding their twelve month trends.


Control state spirits shelf dollars were up 5.9% during April while trending at 6.1% during the past twelve months. Alabama, Iowa, Idaho, Maine, Mississippi, Montana, Ohio, Oregon, Virginia, Vermont, West Virginia, and Wyoming reported growth rates exceeding their twelve month trends.


Price/Mix for April slipped to 2.6% from March’s 3.2%.


During April, Irish Whiskey, with 0.8% share of the control states spirits market, was the fastest growing category with 18.5% growth reported and a twelve month growth trend of 18.1%. Vodka, with 34% share, grew during the same periods at 2.9% and 4.4%. During April, Canadian Whiskey, Cordials, Domestic Whiskey, Gin, Irish Whiskey, Neutral Grain Spirits, and Tequila grew at rates that exceeded their twelve-month trends.


April’s nine-liter wine case sales growth rate fell 1.4%. Pennsylvania, New Hampshire, Utah, Mississippi, Montgomery County Maryland, and Wyoming reported -3.9%, 0.5%, 2.5%, 3.2%, -0.1%, and 13.1%, respectively. April’s rolling-twelve month wine volume growth, 5.0%, nearly mirrored March’s 5.1%.




Missouri: Liquor bill blocked at session’s end


Source: Post Dispatch

By Elizabeth Crisp

May 18, 2013


A contentious liquor bill that had been the topic of intense lobbying at the Capitol this session didn’t make it to a vote before the session’s end today.


Lawmakers wrapped up at 6 p.m., with the bill aimed at regulating the link between alcohol suppliers and distributors blocked in the Senate.


The proposed legislation would have made it more difficult for alcohol suppliers to sever their relationships with distributors by deeming those relationships as “franchises.”


A 2011 federal court ruling overturned a state law that had been governing the relationship between suppliers and distributors since 1975, prompting some of the country’s largest liquor suppliers to file lawsuits to end their contracts with local distributors.


Opponents of the legislation, modeled from the pre-2011 system, have argued that attempted to insert government into activities that should be left to the free market.


A group of opponents, dubbed Missourians for Fair Competition, praised the bill’s failure today, saying that it would have given the state’s largest liquor distributor “monopoly protections.”


“We will continue to fight for legislators who stand for a free market economy because they understand that competition will help create jobs and move this state forward,” Missourians for Fair Competition spokesman Ed Rhode said.


Meanwhile, proponents argued the bill would have saved jobs and re-established a system that had been in place since Prohibition.


Sue McCollum, CEO of St. Louis-based Major Brands, the state’s largest liquor distributor, said the company, which employs more than 700 people in the state, would now concentrate on rebuilding itself following lawsuits that severed its relationships with its two largest suppliers. The two suppliers – Diageo Americas and Bacardi USA – accounted for 50 percent of its spirits business, she said.


“We had enough support and nearly enough momentum. We just ran out of time,” McCollum said. “Major will continue to fight for Missouri jobs, our customers, and consumers.”


The liquor franchise legislation – proposed in both the House and Senate earlier this year – had stalled in committee for much of the session but it was revived in the final weeks when the House tied it to an unrelated beer bill.


After senators raised objections when the bill hit the floor earlier this week, Sen. Eric Schmitt, R-Glendale, said he tried to address some of the concerns, including a provision that would have made the law retroactive.


“What I heard was go to conference and deal with the retroactivity and we’ll pass it in a day,” he said. “That’s what I did.”


Throughout the session, lawmakers were bombarded with calls and emails from supporters and opponents of the liquor legislation. Online ads urged Missourians to call their local reps and urge action on the bill.


Nearly three dozen lobbyists worked the issue in the halls of the state Capitol. St. Louis Mayor Frances Slay also made several trips to the Capitol to lobby in favor of it.




Ohio: AB-InBev Scoops Up Beer Distributor Ahead Of New Law


Source: Law360

By Karlee Weinmann

May 17, 2013


Beer titan Anheuser-Busch InBev NV will swallow up an Ohio beer distribution company in a deal that is expected to close within the next three months, before a new state law takes effect that would bar brewers from owning booze distributors.


Financial terms of the transaction were not disclosed. Neither Anheuser-Busch Cos. Inc., a subsidiary of AB-InBev, nor the family-owned C&G Distributing Co. Inc. offered up a financing breakdown, staying tight-lipped on details except to say the sale would close in the “near future.”


C&G, operated by the Cecala and Guagenti families for the past six decades, has sold AB-InBev products across a nine-country swath in western and central Ohio since the 1960s. By absorbing the distributor, the brewer adds to an 800-employee Ohio business that already includes a 40-year-old Columbus brewery and sales across a chunk of the state.


“This investment reinforces our commitment to providing local retailers with exemplary service and consumers with a broad portfolio of brands and unique beers,” Anheuser-Busch Sales Vice President Kevin Feehan said in a statement. “We look forward to growing our brands and enhancing competition in this market, which will benefit west-central Ohio retailers and consumers.”


But the purchase is opportunistically timed, squeezing in a few months before a deadline imposed by Ohio lawmakers for stemming brewers’ ownership of distributors. Legislators passed a bill earlier this year that bans brewers from buying beer distributors – a provision AB-InBev had fought, including in meetings with Ohio Gov. John Kasich before he signed the bill.


The legislation favored smaller craft brewers, which have cropped up with increasing frequency in Ohio and around the U.S. Meant to insulate them from their outsize competitors – such as AB-InBev, whose product arsenal includes the Budweiser, Michelob and other popular names – small breweries mounted an effort to support the law. The Ohio Wholesale Wine and Beer Association was also one of its strongest allies.


Representatives for Anheuser-Busch could not immediately be reached for additional comment, but a representative told a local newspaper that the law would not impact the transaction because it would be buttoned up before the law takes effect later this year. Still, the representative said, the provision will stifle business moving forward by blocking off wholesalers from having a distribution business, discouraging new investments.


Similar legislation is working its way through several other state capitols. The restrictions are meant to safeguard competition within the beverage industry by keeping distinct its manufacturing, distribution and retail segments.


AB-InBev preemptively agreed to divest its minority stake in Chicago beer distributor earlier this year after it became increasingly likely that that state’s House and Senate would approve a new law that prohibits brewers from having any direct interest in distribution outfits, a harder stance than Ohio’s legislation.


The Illinois bill cleared the senate earlier this week and is now sitting on the governor’s desk.


Counsel information in the latest deal was not immediately available.




Cognac shipments up +7% in April; exports stabilising       


Source: Barclays

May 17th

Global Cognac shipments rose +7% in April, an encouraging turnaround from the -7% reported in March, and especially against a tough +10% comparable. Exports rose 8% (-6% in March, +14% in April-12), aided by strong shipments into the US. Domestic shipments also rose strongly, up +19%, but was against an easier -29% comparable. 12-month rolling industry volumes are now up +2.2%.

Asian shipments rose +9%, against a very tough +41% comparable. This is a sharp improvement from the -18% reported last month. Chinese volumes fell -21%, following the -29% drop in March, but was cycling a +79% result given the timing shift of Chinese New Year (CNY) shipments. We note this is the final month of tough comparables in China, with May and June 2012 both up c.20%. Singaporean shipments (the largest Asian market) rose +39% vs. the -9% fall in March, but Hong Kong shipments fell -13% following the -40% drop in March. Both are markets where most of the Cognac product ends up moving into China, and if we take both these into account, then we estimate overall exports into China rose +9%, compared to the -21% drop in March. The 12-month trend is now up +4% for China.

The US, the largest global export cognac market (c.30% of exports), reported shipments up a strong +24% (+1% in March), against a -3% comparable. However, the key European markets remained weak with the UK down -25% (+15% in March) and Germany down -1%. Interestingly, Nigeria has entered the dataset and is currently the 14th largest export market for Cognac. The market is already of similar size to Canada, Russia and Taiwan and reported growth of +202%, albeit of a low base.

While volatility persists within the monthly trends from Asia, given the CNY timing impacts, we believe the focus remains on the extent of the price increases taken by the industry in March/April. Given the robust price/mix dynamics of the category and the attractive industry TSRs, we remain fundamentally positive on the major spirits companies and reiterate our Overweight recommendations on Diageo (PT 2400p) and Pernod (PT EUR107). However, given the recent concerns over the future for gifting/banqueting sales and the underlying level of consumer off-take in the region, we accept Pernod may struggle to make significant headway until greater trading clarity is established. Diageo remains our preferred play for now given its leading position in the growing US market, benefits still to come from the United Spirits acquisition and lower relative forward multiple.



During first 4 months of 2013, Craft, Premium Plus, and Ciders continued taking share from Premium Light, Imports, and Premium Regular beers


Source: GuestMetrics

May 20, 2013


According to GuestMetrics, the shifts in consumer preferences that took place in the beer category in full service restaurants and bars during 2012 continued during the first four months of 2013.  


“Similar to what we saw take place in 2012, during the first four months of 2013, Craft, Premium Plus, and Ciders continued to take share from Premium Light, Imports, and Premium Regular beers,” said Bill Pecoriello, CEO of GuestMetrics LLC.  Based on data from GuestMetrics, the unit share trends of the main beer segments during 2011, 2012, and the first 16 weeks of the year through 4/21/13 were as follows:  Craft share of beers purchased increased from 13.7% in 2011 to 15.0% in 2012 to 15.6% in 2013 YTD; Premium Plus increased from 11.1% to 11.6% to 12.1%; Ciders/FMB/PAB increased from 0.5% to 0.6% to 0.8%; Premium Light decreased from 32.1% to 31.0% to 30.4%; Import decreased from 25.6% to 24.8% to 24.4%; and Premium Regular decreased from 6.8% in 2011 to 6.5% in 2012, and has remained at 6.5% in 2013 YTD.


“To account for any type of seasonality that might take place in the category, especially during the January through April period, we also looked at the unit share trends with respect to year-over-year changes for 2012 vs. 2011, and for the first 16 weeks of 2013 vs. the first 16 weeks of 2012, which told a very similar story,” said Peter Reidhead, VP of Strategy and Insights at GuestMetrics.  Based on data from GuestMetrics, in terms of the y/y change in unit share:  Craft’s gain was +1.3 points both in 2012 and 2013 YTD (we note that in the last 4 weeks Craft share was actually up 1.6% vs year ago April); Premium Plus saw a slight acceleration from +0.6 points to +0.7 points; Cider/FMB/PAB also saw a slight acceleration from +0.2 points to +0.3 points (as we’ve noted before Cider is growing at around a 70% clip in on-premise this year); Premium Light’s share loss accelerated from -1.1 points to -1.5 points; Import saw a slight improvement from -0.8 points to -0.7 points; and Premium Regular was at -0.3 points in both periods.


“Looking at the nearly 30 different beer styles we track, the largest share gainers continued to be India Pale Ale, Belgian Wit Ale, and Bitter Pale Ale, coming at the expense of Pale Lagers,” said Pecoriello. “I.P.A. in particular continues to register robust unit growth, which accelerated from 40% in 1Q13 to about 43% during the most recent 4 weeks, so there’s no sign of I.P.A. losing steam.”


“As we are seeing across all the alcohol categories, consumer tastes are rapidly evolving, so we believe it is critical for restaurant operators to have detailed knowledge of these trends in order to carry the optimal menu offerings at the right prices,” said Brian Barrett, President of GuestMetrics.  




Mallya readies platform for 10% preferential allotment to Diageo


Share purchase agreement to follow soon; Whyte & Mackay issue still hanging fire


Source: Business Standard

May 19th


Nearly six months after signing a landmark deal with Diageo, liquor baron Vijay Mallya, is preparing the stage to make the 10% preferential allotment in his flagship United Spirits to global spirits major Diageo.


This move follows the tepid response to the open offer by Diageo to the public shareholders of United Spirits, in which Diageo managed to get hardly 0.44% of the intended 26%. It is understood that the preferential allotment of 10% will happen before May 26 th , 2013, for which Diageo will be paying Rs 2,094 crore.


Post this, Diageo’s move to acquire a further 17.4% stake for Rs 3,632 crore will depend on how the Judge at the Karnataka High Court will deliver his judgement after hearing winding up petitions of UB Holdings, filed by unsecured creditors of Kingfisher Airlines.


As part of the multi-pronged Rs 11,165 crore agreement signed between Diageo and Vijay Mallya during early November 2012, Diageo was supposed to get 12.8% stake from UBHL’s holdings in United Spirits and another 6.5% by buying treasury shares in United Spirits.


“At the end of all arguments at the Karnataka High Court during last week, the Judge has reserved the judgement. We are hoping that the judgement will not be delayed much,” senior advisors for the UB Group told Business Standard.  “There is a strong opinion in the legal circles that UB Holdings is not a fly-by-night operator,” they added.  The share purchase agreement is understood to be valid till six months, post the open offer which concluded on April 26, 2013.  


UB Holdings in an effort to seek Karnataka HC’s nod to sell its shares to Diageo had submitted to furnish a deposit of Rs 100 crore and has said that they will be able to clear the dues towards the unsecured creditors post the transaction with Diageo.


As and when Diageo gets to the 27.4% mark in India’s largest spirits company – United Spirits, the board of United Spirits had earlier signed the agreement that they will be voting in favour of the decisions taken by Diageo, even if they (Diageo) do not get the 50.1% control in United Spirits.


Even as Diageo is waiting in the wings to take charge of managing United Spirits, they along with Mallya are understood to be actively working on how to address the concerns of Office of Fair Trade in London over owning majority control of Whyte & Mackay, the subsidiary of United Spirits in Scotland which has large reserves of scotch. According to industry observers, Diageo may have to offload majority stake in Whyte & Mackay to clear this hurdle and steps are being taken in this regard. Advisors to UB Group however indicated that they have around six months to address that issue post the closure of the deal of the transaction in India.




India close to Scotland in whisky brand race


At the end of calendar 2012, McDowell’s No. 1 from Vijay Mallya’s United Spirits Ltd overtook Johnnie Walker to become the world’s largestselling whisky by volume.


Source: Times of India

Anshul Dhamija

May 18, 2013


India’s battle with Scotland over whisky supremacy has reached a tipping point with its liquor coming very close to dethroning its highbrow Scottish rivals.


A list of 50 millionaire global whisky brands has 19 Scotch blends, 17 of Indian origin and American bourbon coming up a distant third with six millionaire brands. The portfolios of Canada, Japan and Ireland also figure in the list.


Industry observers said India might have had just 5-6 millionaire Indian whisky brands six years ago. The Millionaires’ Club 2013 is a report on the emerging giants in the global spirits industry by Drinks International. It says how Indian whiskys, comprising regional brands manufactured by both domestic and international players, are overtaking their Scotch rivals. At the end of calendar 2012, McDowell’s No. 1 from Vijay Mallya’s United Spirits Ltd overtook Johnnie Walker to become the world’s largestselling whisky by volume, clocking sales of 19.5 million (of nine-litre cases) and logging 21% growth over the previous year. Of the top five millionaire alcoholic beverage brands in the world, four are regional brands.


South Korea’s soju brand Jinro clocked sales volumes of 65.3 million (of nine-litre cases) in calendar 2012. Smirnoff Vodka, manufactured by the world’s largest spirits manufacturer Diageo, is the only global brand to feature in the top five millionaire list at No. 3 with volumes of 25.8 million (of nine-litre cases).


Ginebra San Miguel gin and Emperador brandy, both from the Philippines, are in the top five millionaires’ list with sales volumes of 23.8 million and 31 million (of nine-litre cases), the largest in their categories.


“The growth of scotch could not catch up with that of Indian whisky. So the number of Indian whisky millionaire brands will definitely overtake scotch in three years, if not earlier,” says industry veteran Vijay Rekhi. He adds that besides the domestic demand for Indian whiskeys countries in Africa are now taking to them. In the fiscal 2013, India’s spirits market touched sales volumes of 275 million (of nine-litre cases), of which the whisky segment accounted for over 50% with volumes of 150 million clocking annual growth figures of 12% to 14%.


Fuelling the growth is an increasing consumption of whisky in India with more youngsters and women taking to drink whisky tall: from 60ml to 120ml of spirit, shaken or stirred.


“In India, whisky is now positioned as a contemporary and stylish drink; earlier image was that it’s a drink consumed by 40-plus men sitting beside a fireplace on a leather armchair,” says Sandeep Arora, director of Spiritual Luxury Living, a company that offers whisky experi–ences, apart from dealing in luxury spirits. Last year, in a bid to reach out to the youth Beam Global, makers of the renowned blended Scotch whisky, Teacher’s, had launched a ready-to-drink (RTD) whisky product, a first of its kind in the Indian RTD market- Teacher’s & Cola and Teacher’s & Soda.






Source: NABCA

May 17th


NABCA recognizes and appreciates Edmund J. Schmidt, director of the Wyoming Department of Revenue and Cassandra Skinner, chair of the Oregon Liquor Commission for their service to the Board of Directors. Both have announced they are leaving their respective posts.


Ed was appointed to his position by Governor Dave Freudenthal in February 2003. Prior to joining the Department of Revenue, he served for five years on the State Board of Equalization, a panel of administrative law judges hearing tax appeals from final decisions of the Department of Revenue and county boards of equalization. In 1999 was elected chairman of that board.  He joined the NABCA Board of Directors in 2003 and served as chairman from 2007-2008. Ed was instrumental in forming NABCA’s Public Health Advisory Committee, which counsels the association about various alcohol and public health issues.


Cass was appointed by Oregon Governor John Kitzhaber to her position on the Board of Commissioners on July 5, 2011. She had been a member of the OLCC’s Board of Commissioners since June 2009. She is general counsel and health equity officer for Trillium Community Health Plan in Eugene, Oregon. She joined the NABCA Board of Directors in 2011 and served on several committees during her time at the association.




Leaked report points to LVMH secret operation on Hermès


Source: FT

By Hugh Carnegy and Scheherazade Daneshkhu in Paris

May 19th


LVMH, the luxury goods company headed by Bernard Arnault, undertook a secret operation to build its controversial stake in Hermès, its smaller French rival, according to a leaked report from France’s stock market regulator.


The report, “vigorously contested” by LVMH, added an incendiary new twist to an acrimonious battle between the two companies.


The dispute erupted when LVMH announced in October 2010 that it held 17.1 per cent of family-controlled Hermès, which floated in 1993, in apparent breach of regulatory thresholds to declare stakes of 5, 10 and 15 per cent.


It triggered an inquiry by the regulator AMF and the filing of separate lawsuits by 176-year-old Hermès, famous for its scarves and bags, as it fought to fend off the unwelcome intrusion by LVMH, whose brands include Louis Vuitton, Christian Dior and Dom Pérignon champagne.


LVMH, which now owns 22.6 per cent of Hermès, has always maintained that its intentions were friendly and that it had not intended to acquire the stake, saying it opted to take shares instead of cash to avoid paying a big capital gains tax bill on Hermès equity swap derivatives that it held.


Mr Arnault, chairman and chief executive, told shareholders at LVMH’s annual meeting last month that the group had ended up with the stake “in an unexpected manner”.


But according to a report prepared for the AMF’s sanctions committee, leaked to Le Monde newspaper, LVMH first considered acquiring shares from Hermès family members and on the open market. Instead, it mounted an operation from 2007 under which it used a series of subsidiaries and banks to acquire equity swaps in tranches adding up to 12.2 per cent of Hermès but which did not individually exceed 5 per cent and which were “undetectable by the public”. These were later converted into shares.


The report said the earlier acquisition by LVMH of a 4.9 per cent stake in Hermès in 2001-02 was completed via vehicles in Luxembourg, the US state of Delaware and Panama that were not detailed in the group’s consolidated accounts.


In a statement, LVMH, which has always maintained that it acted within the law in its use of equity swaps, said it intended “to vigorously contest the conclusions contained in this report” when the group appears before the AMF’s sanctions committee on May 31 to defend its actions. It insisted it would prove “the absence of any wrongdoing by LVMH towards the law and [AMF] rules”.


The AMF said in October last year that it had found evidence of “wrongdoing” and asked the sanctions committee to decide whether to impose penalties on LVMH. On Sunday, it said it had “no comment on a file which will shortly be examined by the sanctions committee”. Hermès also declined to comment.


Patrick Thomas, Hermès’ chief executive, said last month that the company had discovered “damning” evidence, leading it to take legal action against LVMH. It filed two suits last year that are independent of the AMF inquiry.


LVMH filed a countersuit alleging “slander, blackmail and unfair competition”.


The Hermès legal action suggests that it does not believe the AMF’s final decision will go far enough in forcing LVMH to give up or slash its shareholding.


The AMF has said that France’s rules on stakebuilding were “badly formulated”, and its recommendation to include equity swaps among instruments that count towards shares had been ignored when France tightened its disclosure rules in 2008.


The LVMH stake has left a free float of less than 7 per cent in Hermès, since the Hermès family controls the company with a 72 per cent share and a corporate structure that makes it virtually impervious to take over – unless the family itself were to disunite.




ABL Announces Policy Seminar: “Drunk Driving: Where are we and what do we need to do?”


Timely Conference Program Will Discuss the Effect of a .05 BAC Change


Source: ABL

May 17th


American Beverage Licensees (ABL) announced today that it will host Drunk Driving: Where are we and what do we need to do?, a seminar on drunk driving policy as part of the ABL Annual Conference on June 10, 2013.  The seminar will be conducted by Bill Georges, President and CEO of The Georges Group, which advises public and private entities on law enforcement and prevention efforts regarding beverage alcohol.


The seminar will take place less than a month after the National Transportation Safety Board (NTSB) recommended that states lower their BAC laws from .08 to .05.  The proposal has been met with tepid support by a number of highway safety groups, but is nonetheless expected to come up in state legislatures in 2014, if not sooner.


“As the public, media, legislators and industry consider the implications of this week’s recommendation by the National Transportation Safety Board that states cut BAC limits nearly in half, we’re excited to have Bill share his insights and thoughts,” said ABL Executive Director John D. Bodnovich.   “I am looking forward to hearing from a former law enforcement officer and expert on responsibility issues speak on how we can all work effectively to continue the fight against drunk driving.”


ABL has long been involved in the policy discussion over alcohol-related traffic safety measures and drunk driving.  In addition to recent developments in this area, the seminar will include an update on current and emerging technology, including ignition interlocks, and other drunk driving policy trends.


Mr. Georges spent nine years as senior vice president of The Century Council, a national, not-for-profit organization headquartered in Washington, D.C., whose mission is to develop programs, strategies and tactics to fight alcohol misuse, drunk driving and underage drinking. He was responsible for overseeing the development, distribution and implementation of the Council’s award-winning programs and was also involved in related government relations and communications efforts.  


A retired twenty-five year veteran of the Albany, New York Police Department, he ultimately achieved the rank of Assistant Chief/Chief of Patrol, and was temporarily assigned to the United States Department of Transportation headquarters in Washington, D.C., where he worked on various national law enforcement initiatives.


For more information about the 2013 ABL Annual Conference or to register, visit us online at




Blurry Line on Pot-DUI Cases


Amid Relaxed Laws, Officials Wrestle With How to Determine Who Is Impaired


Source: WSJ


May 19th


As some states relax laws on pot possession, lawmakers are struggling to create rules for how police officers should identify motorists who are driving under the influence of marijuana.


The problem: Identifying pot impairment isn’t as clear-cut as testing for alcohol. There is no broad agreement over what blood level of THC-marijuana’s psychoactive ingredient-impairs driving. Breathalyzers can’t detect marijuana levels, and only a small percentage of police officers are trained to authoritatively identify pot-DUI cases.


When voters in Washington state legalized recreational pot use last fall, they decreed that drivers with five nanograms or more of THC per milliliter of blood-a level that some studies suggest is associated with increased accident risk-are under the influence. In Colorado, which also last year legalized pot possession, lawmakers passed a bill earlier this month that sets the same limit, but gives drivers a chance to prove that they weren’t impaired. In Montana, where medical marijuana is legal, the governor signed similar legislation last month.


But the correlation between THC levels and impairment isn’t scientifically straightforward, said R. Andrew Sewell, an assistant professor of psychiatry at Yale School of Medicine. He said the compound leaves the blood quickly and that regular pot smokers who have built up a tolerance and maintain higher levels may not be impaired at the new legal limits. Setting these limits “is going to cause a lot of impaired drivers to be missed and it’s going to cause a lot of innocent people to get arrested,” he said.

Washington state trooper James Arnold’s experience illustrates the conundrum. In May 2012, he arrested Danny Linh after pulling him over for speeding in Seattle, after which he smelled a “strong odor of marijuana” and observed “bloodshot/watery eyes,” according to his report. The trooper radioed for a drug-recognition expert, but none was available.


A judge in March threw out the officer’s field-sobriety tests after Mr. Linh’s lawyer argued that they weren’t reliable, and prosecutors dropped the case last month. Blood tests also showed Mr. Linh was below Washington’s new legal limit for THC, although that didn’t have a bearing on this case because the law went into effect after the arrest.


Ian Goodhew, deputy chief of staff for the King County prosecutor’s office, said the case may have turned out differently if a drug-recognition expert had been available, noting that there aren’t “enough to cover every DUI investigation.” Robert Calkins, spokesman for the Washington State Patrol, said troopers are well-equipped to deal with drugged drivers. He declined to make the trooper available for comment.


Mr. Linh, now 22 years old, said he wasn’t high and that the sobriety tests were “stupid because they were meant for alcohol.” His lawyer, Blair Russ, said the case shows that “we cannot hastily apply marijuana DUI laws,” because there is a “lack of sufficient research to make a decision about someone’s innocence or guilt, especially given the current tools available to law enforcement.”


Sobriety tests have been developed for drugged drivers, but just 6,837, or less than 1%, of the nation’s police officers are fully trained, according to the International Association of Chiefs of Police, which coordinates and manages the training program. Oregon State Patrol Sgt. Michael Iwai, who coordinates training for Oregon and works with the association, said officers using a 12-step evaluation specifically designed to identify drugged drivers-including a so-called walk and turn, balancing on one foot and an eye examination-are able to detect marijuana impairment.


In part because of the ambiguities in detecting pot-DUI situations, states like Colorado say they need an analog to the blood-alcohol test. “Without a test a lot turns on everything at the roadside and roadside tests related to marijuana impairment are not as clear-cut as the alcohol tests are,” said Tom Raynes, executive director at the Colorado District Attorneys Council.


The Colorado bill on pot DUI passed after six tries and heated debate over setting the appropriate THC limits. White House drug czar Gil Kerlikowske said that “when the science actually catches up with the law, they’re going to find that five nanograms is too high” a limit to be using. He is urging states to adopt laws that ban any trace of drugs, like a bill now being debated in the California Legislature.


Meanwhile, states are still sorting out punishments for drivers who are found to be high. In Washington, drivers arrested or convicted of DUI offenses, for alcohol or drugs, must install a device that prevents the car from starting if it detects alcohol on the driver’s breath. But the ignition-interlock device doesn’t detect marijuana or any other drug.


Stephen Graham, a Spokane criminal defense attorney, said he was “flabbergasted” when the Washington Department of Licensing wanted a client to install one after an arrest for driving under the influence of marijuana.


Brad Benfield, a spokesman for the Washington Department of Licensing, said the department must follow state rules. Part of the rationale for the law is that alcohol and marijuana are often present together in impaired drivers, said Shelly Baldwin of the Washington Traffic Safety Commission. In the future, she said, “we’re going to see technologies that will make testing for marijuana possible.”




Ireland: Irish Alcohol consumption drops by 20% in 12 years


Source: NewsTalk

Eoin Brennan

19 May 2013


The alcohol consumption in Ireland has fallen by 20% over 12 years, with the idea that all Irish people now drink to excess now believed to be far from the truth.


New figures, from the Revenue Commissioners, show a 4.4% drop in the volume of alcohol consumed in Ireland in the past year, with the consumption of both cider and spirits falling over 13%. Levels of teenagers drinking alcohol has also dropped.


Kathryn D’Arcy, director of The Alcohol Beverage Federation of Ireland, emphasised that Irish levels of alcohol consumption are no longer the aberration, in wider European terms, which they once were.


D’Arcy said: “There is a fall in alcohol consumption and we are fast approaching European norms.


“We have seen recent studies by the Department of Children and Youth Affairs and other studies showing that our teens are consuming less alcohol than they were a number of years ago, while other countries are seeing that they are having an increase in the problem of underage drinking.


“So I think we are doing some things right and I think we need to focus.”




Joe McClain: Beer drinkers paying an invisible tax


Source: LaCrosse Tribune

By Joe McClain

May 19th


American beer drinkers know that the same four simple ingredients have been the building blocks of great-tasting beers for generations: grains, hops, yeast and water.


But what most Americans don’t know is that there is another, more expensive ingredient in beer: taxes.


A recent Beer Institute analysis found that more than 40 percent of what consumers paid for beer went to the tax man. That makes beer one of the most taxed consumer products on the shelf.


We applaud the bipartisan legislation recently introduced into the House of Representatives by Rep. Ron Kind, D-La Crosse, in partnership with Rep. Tom Latham, a Republican from Iowa.


The Brewers Excise and Economic Relief Act of 2013, known as the BEER Act, would reduce the federal excise taxes that beer drinkers pay and serve to prevent others from trying to close the federal budget gap by hiking already-high taxes on everyday beer drinkers.


In talking with beer drinkers across the country, the Beer Institute found that most Americans don’t even know they are paying a federal beer levy called an “excise tax.” You can’t find it on a receipt. It’s invisible and regressive, meaning lower- and middle-income people feel the pinch of these hidden taxes more than those with higher incomes.


But the federal excise tax on beer is hitting beer drinkers – and the network of brewers, beer importers, raw materials suppliers, wholesalers and retailers – at twice the historic rate, due to an unprecedented revenue grab by Congress that raised the excise tax on beer, hardly an elitist luxury, on par with excise taxes on yachts, personal airplanes and luxury automobiles.


There is no reason why beer drinkers, brewers and the dozens of industries that support brewers and beer importers should have to pay more than their fair share of taxes. That is why the BEER Act serves such an important role, and deserves the support of the people of Wisconsin, as well as other members of Congress.


Today’s brewing industry represents an enormous contribution to the nation’s economy. The Beer Institute’s recent analysis of the industry found more than two million Americans are at work today in jobs because of beer – from farmers to factory workers, from brewers to bartenders.


All told, the economic contribution from making, importing and selling beer in America comes to more than $246.5 billion in annual activity, stretching from grain farms to bottle- and can-making factories, from warehouses to grocery stores, stadiums and restaurants.


In fact, for every one job at the brewery or beer importer, there are another 45 jobs in other industries: agriculture, marketing, engineering, manufacturing, warehousing, transportation, concessions and retail, just to name a few.


Here’s what the BEER Act would do: for the vast majority of beer consumed in the United States, it would roll back the federal excise tax from its historic peak of $18 for every 31-gallon barrel to $9 a barrel. For brewers of less than two million barrels annually, the rate would be slashed to $3.50 on the first 60,000 barrels; and for those brewers that produce less than 15,000 barrels, the federal excise tax would be eliminated entirely.


The BEER Act is fair, equitable and comprehensive, meaning it serves every part of the industry, from the start-up brewer to the thousands of workers in good-paying jobs at America’s major breweries.


We know this is a good policy, and that it can work to encourage expansion, reinvestment and further job creation. In 1977, with the support of major brewers, Congress cut the federal excise tax on brewers of less than 2 million barrels annually.


Reducing the federal excise tax was seen as a means of “creating a pathway to the marketplace” for new brewers – and it worked. At the time, there were 49 brewers in business. Today, we count more than 2,700 permitted brewers across the United States.


We have another opportunity to continue to foster a great industry, create more jobs here in this country, and protect taxpayers from having to pay even more in hidden taxes for what should be an affordable, everyday pleasure in a cold beer. That opportunity is the BEER Act, and it deserves your support.




Wells Fargo’s Weekly Economic & Financial Commentary


Source: Wells Fargo

May 17th



.         Mixed economic data this week left economists uncertain on the direction of the economy in 2Q13.

.         Consumers have been resilient, with retail sales strengthening on an improved employment picture.

.         Inflation has been nonexistent, as gasoline prices have fallen and weak economic activity in China and Europe have driven commodity prices lower.

.         Limited inflation should allow the Fed to maintain its accommodative policies.

.         Industrial production and manufacturing are suffering from weaker than expected global growth.

.         Housing permits surged, suggesting strong construction activity in the months ahead, and builder confidence improved in May, as inventories dwindled.



.         The Eurozone continues to struggle, with GDP 3.3% below the 2008 peak.

.         France, Italy, and Spain all experienced declines while Germany expanded a modest 0.1%.

.         Consumer spending and confidence suffered from a weak labor market.

.         Economic indicators suggest business investment also shrank across the continent.

.         Limited monetary involvement and an unlikely probability of fiscal stimulus may keep the Eurozone in contraction for a bit longer.




Chinese investors snapping-up ‘one chateau per month’, say estate agents


Source: Decanter

by Adam Lechmere

Friday 17 May 2013

From the beginning of 2011, a leading Bordeaux real estate agent says, an average of one Bordeaux chateau per month has been sold to a Chinese investor.


Asian-owned properties in Bordeaux now number 40 to 50 – a figure that, given the size of the region, is a mere ‘blip on the radar’, estate agent Maxwell-Storrie-Baynes says.


From 1997, when Taiwanese native Peter Kwok bought Chateau Haut Brisson, there have been some 50 chateaux in the Bordeaux region sold to investors from China, Singapore, Taiwan and Japan.


The market for Bordeaux properties is so bullish that auctioneer Christie’s has seen the opportunity and is launching a vineyards service targetted at the Chinese, as part of Christie’s International Real Estate.


Maxwell-Storrie-Baynes, which acts as Christie’s Bordeaux affiliate, has compiled a table of purchases since the late 1990s and finds at least 40 chateaux are Chinese-owned.


It says the focus has primarily been on Chinese buyers but it is not always possible to discern exactly where buyers are from.


‘This is because business addresses or indeed the geographical sources of the purchase funds are not always the same as the owners’ [location].’


Some purchasers are building considerable portfolios of property. Cheng Qu, for example, owner of the huge oil-to-real estate Haichang Group, and the driving force behind the Dalian wine festival in northeast China, has just added Chateau L’Enclos in Sainte Foy la Grande, near Bergerac, to his holdings.


He is already owner of ten Bordeaux estates including Chateau Baby (also in Sainte Foy), Chateau Chenu-Lafitte and Chateau Branda.


The impetus behind buyers like Cheng – and there are many like him – is the desire to supply increasingly sophisticated Chinese consumers with wine. Within the next five to ten years, it is estimated, the middle class in China will number some 300m and constitute a market larger than the United States.


‘People who are buying Bordeaux chateaux are looking to service that market,’ Maxwell-Storrie-Baynes partner Michael Baynes told’Typically, they want to control the supply chain.’


An early adopter of this policy – controlling supply from vineyard to end user – was Richard Shen Dongjun, owner of the 400-strong jewellery retail chain Tesiro, who bought the Medoc Cru Bourgeois Chateau Laulan Ducos in 2011.


A spokesman for Shen told at the time that the idea was to create a chain of stores under the name of the chateau, in cities with a rising wine-drinking culture, exploiting the existing Tesiro network. They would stop selling the wine in France.


There are compelling financial incentives behind such a move. With the cost of production ?2-3 per bottle, and the ability to mark up to ?30-50 per bottle, ‘it is a nice business prospect,’ Baynes says. ‘One of our clients recouped the price of the vineyard in one year.’


By and large, the Bordelais welcome this influx of investment, although resentment can bubble to the surface. One prominent owner, on selling her estate to a private French buyer said, ‘We wanted it to go to another family. We didn’t want it to go to a faceless insurance company or to a group of Chinese investors. We’re very happy that it is going to a family that we have known for a long time, and that we know will look after the estate.’


In Burgundy, the resentment is palpable: the purchase of Chateau Gevrey-Chambertin by Macau businessman and Burgundy lover Louis Ng last year caused a storm of protest. ‘It is a despoliation. Our heritage is going out of the window,’ Jean-Michel Guillon, president of the union of Gevrey-Chambertin wine producers said, just before the ultra-right Front National added its voice.


But Bordeaux is different, Barnes says, pointing out that there are 120,000ha of vines in Bordeaux and 28,000 in Burgundy, of which only 5,000 are of real interest.


‘There’s a totally different reaction in Bordeaux,’ Baynes says. ‘We’re delighted to have the Chinese here. They couldn’t have come at a better time. This region has a long history of foreign investment, from the Irish to the Belgians, the English, Australian magnates, Americans, Brazilians, Saudi princes. It’s nothing new.’


Baynes also notes that in a region of 8,000 chateaux, Chinese owners represent only 0.5% of ownership. ‘In the grand scheme of things they are a blip on the radar.’




Bordeaux 2012: Montrose, Clinet, Domaine de Chevalier release


Source: Decanter

by Jane Anson in Bordeaux

Friday 17 May 2013


New price releases are being met by an increasingly small pool of buyers in the Bordeaux 2012 campaign.


Among the estates to release yesterday were Chateau Montrose, matching Pichon Comtesse with a 20% price decrease on 2011 to ?57.60 ex-Bordeaux (still above its ?42 ex-Bordeaux in 2008 but significantly down from its ?132 high in 2010). Chateau Tronquoy Lalande, from the same stable, posted a 6.25% drop to ?18 ex-Bordeaux.


The widely-praised Chateau Clinet in Pomerol dropped 11.9% to ?44 (this was at ?33 in 2008), and Chateau Carbonnieux brought both its red and white wines down by around 3% to ?15.5 (red) and ?16.5 (white).


Also in Pessac Léognan, Domaine de Chevalier, decided to keep both its red and white unchanged from the 2011 vintage, so ?30 ex-Bordeaux for the red, and ?58 for the white (in 2008 you’d have paid ?23.50 for the red, and ?45 for the white).


Château Guiraud in Sauternes also kept its 2011 price at ?30 ex-Bordeaux.


As the campaign begins to wind down, it now looks as if even drops of 20% are unlikely to attract the attention of buyers.


Max Lalondrelle at Berry Bros told the problem was that people simply did not think they were getting a good deal any more.


‘En Primeur should be very simple – customers give chateaux cash in advance, and for that they get a deal. They need to be able to look back and think buying in advance was a good thing. That’s not happening any more.’


BBR sold 220 bottles of Montrose yesterday, Lalondrelle said, compared to around 2,000 last year and around 5,500 bottles of the 2010.


‘There are five other vintages of Montrose available in the market in the UK for a cheaper price, so customers know they can pick up the 2012 once they have tasted it for themselves.’




Golden Equity Investments acquires Goosecross Cellars in California


Source: DBR

17 May 2013


Golden Equity Investments (GEI), a Colorado-based private equity firm that provides equity capital to privately-held middle market companies, has acquired boutique winery Goosecross Cellars of California for an undisclosed amount.


The purchase, which is the first for GEI in wine industry, includes 11-acre estate winery and vineyard property, tasting room and a Tudor-style estate home.


Came to existence in 1985, Goosecross uses grapes from on its nine acre vineyard and grapes purchased from local growers to produce luxury-tier Napa Valley wines.


The winery’s vineyard is planted with Bordeaux varietals, including Cabernet Sauvignon, Merlot, Cabernet Franc and Petit Verdot.


GEI manager Christi Coors Ficeli said the company was attracted by Goosecross’ location, vineyard and winery.


“Its direct-to-consumer success and reputation for premium quality wine varietals positions us for ongoing success,” Ficeli added.


“Our focus will be to continue the tradition of producing high-quality wines, as well as growing the brand to gain more national recognition. We will continue to promote the current wines and look to grow the portfolio.


“I look forward to meeting the winery’s loyal customers and also intend to invest in the tasting room, the winemaking facility, and the estate to enhance the experience for our patrons.”




Haute stuff


Source: FT

By Jancis Robinson

May 17th


Wine is one of the most sensitive measures of climate change. A rise in temperature during the growing season can easily result – indeed has resulted – in riper grapes and fuller-bodied wines. Drought in areas such as much of Europe, where irrigation is banned, can leave grapes shrivelled and more like raisins, the resulting wine extremely dry and chewy with a distinct shortage of juice. The exceptional heatwave in 2003 provided European wine growers with a wake-up call but, in many regions, 2005 and 2009 were not so dissimilar.


Higher temperatures and lower rainfall are having a particularly profound effect on the wine industry of Australia, where the economics of wine production in the vast irrigated inland wine regions that once churned out inexpensive wine labelled South-Eastern Australia make less sense now that water rights cost so much. The total area of Australia under vine has shrunk, from 172,676 hectares in 2008 to 148,509 last year.


But climate change can help some wine growers. The quality of wine produced in Canada, England and Germany has improved immeasurably over the past decade. As acid levels plummet to sometimes dangerously low levels in Champagne (tart wine is a prerequisite for fine fizz), in England and Wales they have fallen to just about acceptable levels (although last year was a challenge for many European growers, especially those as far north as the British Isles).


Even within established fine wine regions, the rise in temperatures is changing reality and, more slowly, reputations. In Bordeaux, for example, in years as warm as 2009, the supposedly lean, mean Médoc appellations Listrac and Moulis can produce some attractive, almost fleshy wines. And this is with a palette of varieties as sturdy as Cabernet Sauvignon and Merlot.


The Pinot Noir of Burgundy’s heartland, the Côte d’Or, is even more sensitive, so it is hardly surprising that things have been changing in the rarefied world of red burgundy production. The best (for which read oldest) vines in the most hallowed vineyards (Grand Cru and the best Premiers Crus) have deep enough roots and small enough crops to ensure that in even the driest, hottest of years they can yield top-quality grapes. But some other Pinot vines on the Côte d’Or have suffered in recent hot vintages, and there are few drinks less appetising than soupy Pinot.


For decades the pretty wooded hills west of the famous limestone escarpment that is the Côte d’Or were regarded as a fine source of blackcurrants for the cassis needed in a kir – but beyond the pale by fine wine lovers. They were known as the Arrières Côtes until the locals pushed through a smarter-sounding name, the Hautes Côtes, divided into the Hautes Côtes de Nuits in the north, behind the Côte de Nuits, and the Hautes Côtes de Beaune, to the west of the wine town of Beaune.


Until recently most of the wine grown in the Hautes Côtes was pretty thin stuff but this is changing – partly because summers are getting warmer, and partly because of people like Olivier Jouan, a vigneron in the village of Arcenant who seems even more determined to make great wine than his counterparts downhill on the Côte d’Or.


Arcenant is typical of the villages of the Hautes Côtes. Unlike the prosperous villages of the Côte d’Or, where every ancient stone seems to have been polished and regrouted, Arcenant sprawls in an undisciplined fashion with something even approaching a housing estate above the forbidding church. I’d been warned by the British importer Roy Richards that there was no mobile phone signal in Arcenant and it took me a good 15 minutes and inquiries at several front doors before I found the workmanlike courtyard of Olivier Jouan, who has been making wine here since 1999. The son of a director of Smurfit Kappa packaging, he chose to establish himself in the keenly priced Hautes Côtes on taking over from other family members three hectares of vineyard in the Côte de Nuits, including some excellent vines in La Riotte in Morey-St-Denis planted in 1925. “There is still a Jouan Henri in Morey-St-Denis,” he told me.


He took the decision to vinify all his wines in Arcenant and to add 5.5 hectares of rented Hautes Côtes vineyard. He admits that at this altitude his cellar is so cold that it can be difficult to complete the second, softening malolactic fermentations. They were still proceeding at a painfully stately pace on his 2011s when I visited in November last year. He exports eight in every 10 bottles he fills, to the likes of Raeburn in Edinburgh, Jeff Welburn in Los Angeles and various Asian importers, but admits that it is difficult being so far off the established routes for the container lorries that are so familiar in the backstreets of Gevrey-Chambertin and Vosne-Romanée.


But he is convinced that the future is rosy. “I really think that some of our Hautes Côtes wines can be confused with Côte d’Or wines blind.” He is encouraged by the fact that many of the vines that were planted here in the 1960s when blackcurrants and raspberries were challenged by cheaper imports from Poland are now fully mature. Set against this is what he sees as a very different mentality in the Hautes Côtes where most vignerons are mixed farmers and, typically, deliver their grapes to the local co-op.


He believes that eventually there will be individual village appellations for the likes of Arcenant, Echevronne and Bevy rather than the much less geographically precise Hautes Côtes appellations. He has just one employee on his payroll and does most of the work himself, although he hopes his wife will join him.


He is helped by the fact that he picks relatively late so that he can sometimes hire pickers who have already done the vintage elsewhere. To judge from the wines listed, I too am optimistic about the Hautes Côtes, perhaps even more for the lively whites than the reds.




Court told of £4.5m wine fraud


Source: the drinks business

by Andy Young

17th May, 2013


A court has heard how a group of fraudsters conned hundreds of people out of £4.5 million through bogus wine investments.


Southwark Crown CourtSouthwark Crown Court heard that Daniel Snelling, 38, his sister Dina Snelling, 35, and their cousin, Rebecca McDonald, 42, carried out two frauds over the space of three years, often targeting elderly people’s life savings.


The trio initially set up Nouveau World Wines, which promised to invest in the best Australian wines. Investors would pay on average thousands of pounds each for wine to be bought and sold, but much of the wine was never purchased. When Nouveau investors found out the company was folded, but the jury was told that a second company, Finbow Wines, was then set up.


Prosecutor Julian Christopher QC told the court that Nouveau investors paid an average of £5,000 for 72 bottles of the finest Australian wines. These were due to be stored in Australia for several years to gain in value.


Christopher added that Nouveau did buy wine, but while the investments should have bought 39,000 bottles, the company only ever had a maximum of 11,349 bottles.


He told the court: “The suggestion was that in two or three years’ time they would sell that wine at a huge profit and they (Nouveau) would make their money by taking 10% of the profit.


“Lots of people were attracted by that. Often elderly people investing their savings. After they invested once, they were being targeted again and again.”


The court was told that when suspicious investors started asking questions, Nouveau ceased trading and Finbow was set up.


Sales staff working for Nouveau were told overnight that they were now working for Finbow, the court heard.


Mr Christopher told the court the defendants were in the process of setting up a third firm, M2M, specialising in “fine old world wines” when they were arrested in March 2010.


Mr Christopher added: “Whether Nouveau was always intended as a front from the outset or whether, as time went on, the temptation and opportunity became too much to resist is a question you may want to consider.”


Daniel Snelling’s girlfriend, Kelly Humphreys was the companies’ training director and she is also due to stand trial over her alleged involvement at a later date. All four currently on trial deny all the charges against them. The trial, which continues, is due to last 10 weeks.






Source: TTB

May 17th


Caroline May joined TTB Office of Chief Counsel as an attorney-advisor in June 2008, after spending several years doing part time legal work for a law firm in Cincinnati. She currently serves as the Senior Counsel, Field Operations. Among her many duties she has been the primary legal advisor to the criminal enforcement program since October of 2010. During her tenure, Ms. May has gained a wide range of experience in the regulation and enforcement of the laws and regulations under TTB’s jurisdiction.


From 1997 to 1999, Ms. May was a trial attorney with the United States Department of Justice (DOJ), Tax Division. While at DOJ, she represented the United States in federal district and bankruptcy courts in tax refund and collection matters, summons enforcement matters, Freedom of Information and Privacy Act cases, and matters involving the alleged unlawful disclosure of tax return information under 26 U.S.C. § 6103. Before joining DOJ, Ms. May spent three years as a litigation associate at the Washington, D.C. law firm of Patton Boggs, L.L.P.


Ms. May holds a B.A., magna cum laude, from the University of Louisville and a J.D. from the University of Virginia. She is a member of the Commonwealth of Virginia Bar, the District of Columbia Bar and the Commonwealth of Kentucky Bar.




UK retailer Sainsbury’s to double sales of low-alcohol wines


Source: DBR

17 May 2013


Sainsbury’s, a UK-based firm with chain of supermarkets, plans to double the sales of low-alcohol wines in the country by 2020 to meet the growing demand and to follow government’s Responsibility Deal.


According to Sainsbury’s beers, wines and spirits head Andy Phelps, the firm aims to increase the current range of low-alcohol wines and also expand the number of its single-serve wines to around 25.


The move is to help consumers reduce their alcohol intake levels and make them try new wines, reported Harpers.


Currently, the retail chain is selling only its own-label House wines in single-serve packs of 175ml bottles.


Phelps was quoted by the website as saying that the company has reported increase in sales of lower-alcohol wines by 14% year on year and attributed it to customers’ growing choice of drinking lower-alcohol wines.


The company, therefore, plans to offer new grape varieties such as Gavi and Prosecco in single-serve bottles.


These single-serve wine bottles will be sold along with Sainsbury’s bag-in-box range.




Indiana: Overhaul of alcohol laws a must


Source: Jounal Gazette

May 19th


The latest battle over laws governing Indiana alcohol sales heats ups, coincidentally, just as federal authorities push for a lower threshold for drunken driving. State lawmakers don’t appear to be interested in reducing the legal blood-alcohol level for driving, but they must give a comprehensive review to Indiana’s mishmash of alcohol laws. An overhaul is sorely needed.


Laws governing the sale of alcohol that lawmakers have cobbled together over the years have created an uneven field of competition. The debate is a never-ending issue at the Statehouse, consuming an absurd amount of legislators’ time and attention and fueled by about $1 million a year in lobbying dollars.


The Indiana Petroleum Marketers and Convenience Store Association filed a lawsuit in U.S. District Court over laws restricting convenience shops, grocery stores and pharmacies from selling cold beer. The statewide trade group contends the lawsuit is about fairness.


The complaint says Indiana’s alcohol statutes and regulations “create an irrational and discriminatory regulatory regime.” They suggest the state should not be in the business of picking winners and losers in the alcohol market. The convenience store lobbyists are correct.


But so is the Indiana Association of Beverage Retailers, the trade group representing liquor stores. It argues that regulations placed on liquor stores that don’t apply to grocery or convenience stores also create an unfair market advantage.


Liquor stores are limited to selling only alcohol or alcohol-related products. Liquor store clerks must be at least 21, undergo at least two hours of state certified training, and have a license that costs $45 every three years.


“I think there is a lot of money involved in the liquor lobby, and there are a lot of influential people involved,” said Julia Vaughn, director of Common Cause Indiana. “The politics creates gridlock. It’s a good example of what can happen when there is so much money and influence involved. So much of making legislation is not about policy; it’s about how you feel about the person trying to bend your ear on a certain issue. I think it serves to create this crazy quilt of laws we have.”


Vaughn reasonably suggests that stricter limits on lobbyists’ wining, dining and gift-giving to lawmakers, as well as greater disclosure, might remove some of the politics from the process.


With tighter limits in place, a sound study of Indiana’s current laws is more likely to produce the recommendations needed for a revision yielding less complexity, more fairness and sensible regulation of alcoholic beverages.




Texas: House approves beer bills on second reading


Source: Chron

Friday, May 17, 2013


The Texas House of Representatives just voted to approve a 5-pack of bills that would make significant changes in the way beer is sold across the state.


There was audible applause from the gallery, where Scott Metzger, Rick Donley and other interested parties were watching the proceedings.


If approved on third reading – either later today or Monday – and signed into law by Gov. Rick Perry, Texans could soon buy and drink a beer at their local brewery and purchase brewpub beers at the store.


The package of bills is considered the most significant legislation affecting the beer industry since 1993, when the state authorized brewpubs that could make and sell their own beer on site.


Once formally passed, the bills go to Gov. Rick Perry for his signature or veto. Rick Donley, president of the Beer Alliance of Texas, the state wholesalers group that has supported the bills throughout the session, has said representatives of the governor’s office have attended key meetings during the year-long process of crafting and making compromises on the bills.


Saint Arnold owner Brock Wagner said he was “cautiously optimistic” ahead of Friday’s scheduled vote.


Highlights of the legislation:


Saint Arnold and other breweries that package their beer for off-site sales would be allowed to sell a limited amount of their beer directly to customers for consumption on site. This bill would not allow people to purchase beer to take home, either in packaged form or in growlers.


Brewpubs would be allowed to sell some of their beer to other bars, stores and other retail outlets through wholesalers. They also would be allowed to self-distribute a portion of their production. For Houstonians, this means, for example, that fans of San Antonio’s Freetail Brewing would be able to purchase some of its beers at their local liquor stores or pubs that carry them.


Small brewers would have new limits on how much beer they could distribute on their own.


Some breweries with higher production would be allowed to self-distribute up to this limit.


Breweries would be forbidden from receiving cash payment from wholesalers for exclusive distribution rights, although the wholesalers would be allowed to makes some investments in the breweries they represent. This controversial bill was initially blasted by brewers and business groups, but it was included as part of a compromise to secure the support of the Wholesale Beer Distributors of Texas.




Texas Voters March to Polls to Modernize Liquor Laws


Voters pass 18 out of 22 alcohol wet-dry elections on Saturday


Source: DISCUS

May 17th


The trend of Texas communities voting to allow local alcohol sales picked up steam Saturday after 18 out of 22 local alcohol elections passed, according to the Distilled Spirits Council, which attributed the wins to consumer interest in modern convenience and increased revenue without raising taxes.


“Consumer attitudes have come a long way since Prohibition,” said Dale Szyndrowksi, Council Vice President, noting that states around the country have modernized 1930s-era alcohol laws to keep pace with today’s economy.  “These elections reflect modern demographics, and we expect the trend will continue as voters and policymakers seek convenience and revenue, respectively.”


Szyndrowksi pointed to the Plano election as the most significant victory (65%-35%), noting that Plano is a populous suburb north of Dallas in one of America’s fastest-growing counties.


The Texas Trend

According to the Distilled Spirits Council, 18 out of 22 localities voted on Saturday to allow alcohol sales – going from “dry” areas to “wet” areas (beer, wine and/or spirits; on- and/or off-premise).  After 26 out of 28 successful alcohol elections in November 2012, and 15 out of 15 in May 2012, the tally of victorious wet-dry elections in the last year (May-May) comes to 59 out of 65, for a 91% success rate.  Since 2004 Texans have taken to polling stations to pass 509 out of 641 alcohol elections, for a 79% success rate. Click here to see Saturday’s election results.


“Prohibition-era laws don’t make sense in today’s economy, and that’s why voters across Texas are striking them down for good,” Szyndrowksi said.


Momentum for Sunday Alcohol Sales

Szyndrowksi also noted that wet-dry elections aren’t the only alcohol issue voters care about and pointed to the End Texas Blue Laws social media campaign which has garnered over 20,000 Facebook fans in 2013.  The campaign’s primary goal this year is to pass House Bill 421 – legislation allowing package stores the opportunity to open on Sundays, the second busiest shopping day of the week.  According to Szyndrowksi, 38 states allow Sunday liquor sales, including 16 since 2002.




New York: New York State should lower DWI threshold to a blood alcohol level of .05% from .08%



Sunday, May 19, 2013


The National Transportation Safety Board is calling on states to cut the legal standard for drunken driving almost in half as a certain way to save lives. We’ll drink to that – with a designated driver.


Gov. Cuomo and the Legislature could markedly improve highway safety by reducing the threshold for a criminal charge of driving while intoxicated to a blood alcohol level of .05% from .08%.


The change should be the next important step in the transformation of drinking and driving from a common practice to a cultural taboo.


After decades of progress in reducing drunken driving deaths, the toll has plateaued. Roughly 10,000 Americans die annually in alcohol-related crashes. New York State counts around 360 deaths every year in accidents where a driver was either intoxicated (.08%) or impaired (.06%).


Government statistics show that a person with a .08% blood alcohol level has a 169% greater chance of crashing a car than a sober driver. By comparison, at .05%, drivers are only 38% more likely to crack up a car.


That enormous difference is reflected in the death tally. In 2011, New York had 315 DWI-related fatalities and just 67 deaths involving drivers who had consumed only enough alcohol to be categorized as impaired.


In Australia, the state of Queensland saw the number of fatal crashes decline 18% after imposing the lower limit the NTSB is suggesting. And the Insurance Institute for Highway Safety estimates that the U.S. would have experienced 6,794 fewer deaths in 2011 if all drivers had stayed below the .08% line.


To exceed .05%, a 180-pound man would have to drink on average three glasses of wine or beer in 90 minutes. A 130-pound woman could have two drinks and still be legal, if not safe.


Most industrialized nations already use the .05% benchmark. Joining the rest of world in saving lives is something New Yorkers can toast.




Utah: Drinking drivers


Lower threshold not best deterrent


Source: Salt Lake Tribune

May 18 2013


Despite an avowed aversion to anything coming from the federal government, Utah legislators seemed eager this past week to consider adopting the National Transportation Safety Board’s recommendation that states reduce their drunk-driving blood-alcohol thresholds.


Sen. John Valentine, R-Orem, who is the Utah Legislature’s leader in setting state liquor policy, said he and his colleagues will closely consider the NTSB’s support for prohibiting driving with a blood-alcohol concentration above 0.05 – more than a third lower than the current standard of 0.08.


However, although any policy that further demonizes alcohol consumption is likely to find favor among Utah’s conservative, mostly Mormon, legislators, it would be a mistake for them to believe that simply putting more drivers into the illegal category would reduce the carnage on highways caused by drunken driving.


Better enforcement of existing drunk driving laws and stiffer penalties for first-time offenders would have a greater deterrent effect. All too often the trouble is with lenient sentences and crowded jails, not too few DUI arrests.


Valentine pointed to European nations that have seen fatalities decline after prohibiting driving with a blood-alcohol concentration above 0.05 – more than a third lower than the U.S. standard of 0.08. But many European nations also enforce stringent penalties, including jail time and confiscation of the drinker’s car, even on the first offense. Europeans are more serious about stopping anyone who has consumed any alcohol from driving, and that has created a culture that does not tolerate such behavior.


In its announcement of the new recommendation, the NTSB said people with a blood-alcohol level of 0.05 percent are 38 percent more likely to be involved in a crash than those who have not been drinking. People with a blood-alcohol level of at least 0.08 percent are 169 percent more likely.


All 50 states adopted the current 0.08 percent level faced with a 2000 law that withheld highway construction money from states that did not.


Utah legislators should adopt a lower standard, but not based only on their inherent distrust of alcohol consumption. Their policy to keep alcohol out of sight at restaurants – not where underage or heavy drinkers get their booze – demonstrates this illogical thinking.


A more responsible approach would focus on habitual drunk drivers, those who pose the real danger. Penalties should be tougher for a first offense, swift and unrelenting for a second.




Oklahoma: Oklahoma grocery store wine proposal being renewed


Source: AP


May 19th


Supporters of a plan to permit some grocery stores in Oklahoma’s most populous counties to sell wine plan to launch a new petition drive to put the proposal to a statewide vote.


The plan is promoted by the advocacy group Oklahomans for Modern Laws. The group’s attorney, former Secretary of State Glenn Coffee, says it plans to resubmit the proposal to voters this summer about a year after it was withdrawn following a Supreme Court challenge.


Supporters were forced to withdraw the petition after legal proceedings against the proposed constitutional amendment delayed the start of the 90-day period in which supporters needed to obtain 155,216 signatures to place the issue on the Nov. 6 general election ballot.


Supporters are now hoping for a vote in the November 2014 general election.




Canada: Cheers! Ontario Liquor-Store Strike Averted


Source: WSJ

By Karen Johnson

May 17th


An Ontario liquor-store strike was averted late Thursday,  just in time for the kick off of the Victoria Day long weekend.


The Liquor Control Board of Ontario reached a tentative agreement with its nearly 7,000 unionized workers, ending worry among restaurateurs and consumers – at least for now – about service disruptions at the province’s 630 LCBO stores and warehouses.


The tentative agreement, reached just ahead of the midnight strike deadline, still needs to be ratified by the union’s members, and approved by the LCBO board and the provincial government. Terms of the deal weren’t disclosed.


The LCBO is just about the only place to buy liquor in the province. It’s also by far the biggest seller of wine, though wine – and beer – can be purchased elsewhere.


Warren (Smokey) Thomas, president of the Ontario Public Service Employees Union, which represents liquor board employees across the province, said in a statement that the negotiations were “very tough.”


“Did we get everything we were asking for? No. Did the LCBO get everything they were demanding of our members? No,” he said. The union has been pushing for better wages and better hours, while the deeply indebted provincial government has been looking to rein in spending.


Bob Peter, LCBO president and chief executive, said late Thursday in a statement that the agreement is “fair to employees” and “in the best interest of taxpayers.”


Contract talks have been going on since February, but picked up steam in the lead-up to Thursday night’s strike deadline – as did sales at the retailer’s stores.


LCBO spokeswoman Heather MacGregor said Thursday that store sales in recent days were “brisk,” as people heeded warnings to stock up in advance of the potential walkout. The stores saw 28 million Canadian dollars ($27.5 million) in combined sales Wednesday, compared with C$17 million on a comparable day last year.


That’s still well short of the LCBO’s historic one-day sales record, when the stores had a whopping C$56 million in sales. That was in June 2009 – just ahead of previous strike deadline from the LCBO’s union.

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