Category archives for “Retailers”

California ABC Announces 2016 New License Authorizations

August 15, 2016

It’s that time of year when the ABC announces priority applications, and this year’s numbers are sure to make a lot of retail business owners very happy! Every year the California ABC announces which counties are eligible for new on-sale and off-sale general licenses based on population growth versus existing license ratios within each county. The 2016 figures have been released, and the numbers this year are higher than usual.

What is a Priority application?

General retail licenses authorize the sale of beer, wine, and distilled spirits. They are restricted by county population and must typically be purchased on the open market from an existing licensee, often for a very high premium. Licenses are usually confined to the county in which originally issued, so prices vary drastically across the state. Every year, the ABC announces a ‘priority application period’ when they will accept new license applications. In addition, they announce a number of inter-county transfer allowances – where a business owner in a priority county can purchase a general license from a licensee in any other county and transfer it into the priority county.

If you’re in the market for an Off-Sale General Package Store License (Type 21), an On-Sale General Eating Place License (Type 47), or a Special On-Sale General Club License (Type 57) within a county where licenses are available, you should apply.

Licenses Available by County

The maximum number of priority applications the ABC typically authorizes for each category (new on-sale, new off-sale, inter-county on-sale, inter-county off-sale) is twenty-five. The ABC has authorized the maximum number of priority applications in several counties, including Alameda, Contra Costa, Los Angeles, Orange, Riverside, Sacramento, San Bernardino, and San Diego. For a complete list of license available by county, click here.

2016 Filing Period

ABC District offices will accept priority applications by mail or in person from September 12-23, 2016. If by mail, it must be postmarked on or before September 23rd. If the ABC receives more applications than licenses available, a public drawing will be held at the District office. Successful applicants will have 90 days to complete a formal application for the specific premises.

Fees

Priority application fees are $13,800 for new general licenses and $6,000 for inter-county transfers. A certified check, cashier’s check, or money order must be submitted along with the priority application. Unsuccessful applicants will be refunded the application fee, minus $100 service charge.

Residency Requirements

Every applicant must have been a resident of California for at least 90 days prior to the scheduled drawing. Exact drawing dates vary by District office, but all are in mid-late October. For corporations, limited partnerships, and limited liability companies, the 90-day residency requirement starts ticking upon registration with the California Secretary of State. Individual and general partnership applicants must submit proof of California residency.

If you’re interested in applying for a new or inter-county on- or off-sale general priority license, contact an attorney at Strike & Techel.


(Un)Happy Hour Regulations

February 10, 2016

Several states restrict or ban happy hour promotions, and many people assume that these restrictions are a remnant of Prohibition. However, the practice of “happy hour”—gathering before dinner for cocktails, wine, or beer—did not actually arise until during Prohibition. Because the sale of alcohol was illegal, drinking was a surreptitious activity performed in the privacy of homes or speakeasies. Thus, enthusiastic imbibers would gather in private for a couple of drinks prior to heading out to a public establishment for dinner, where alcohol would not be served. Following the repeal of Prohibition, happy hour specials were popular at restaurants and bars across the nation. However, the 1980s brought an increased focus on preventing drunk driving, which spurred changes to alcohol laws. In 1984, President Reagan signed a bill encouraging the nationwide adoption of 21 as the minimum drinking age, and states that refused to raise the legal drinking age to 21 lost substantial federal highway funds. Also, during this time, several states and municipalities passed laws banning happy hours in an attempt to reduce excessive consumption and drunk driving.

Happy hour regulations can take many forms. Examples of happy hour promotion types that are frequently prohibited or restricted include:

  • Unlimited Drinks — Many states, including New York, prohibit on-premise licensees from offering unlimited drinks for a single price. See N.Y. Alc. Bev. Cont. Law § 117-a.
  • Specials Lasting Only a Portion of the Day —North Carolina is one of several states that disallow on-premises licensees from offering a reduced price drink for only a portion of the day, such as between 4-6pm. See 14B N.C. Admin. Code 15B .0223.
  • Specials Only Available to a Segment of the Population — North Carolina also prohibits drink specials that are only offered to a segment of the population, such as a “Ladies’ Night” special. 14B N.C. Admin. Code 15B .0223. California also prohibits businesses from offering discriminatory price specials, such as specials that are based on a patron’s sex. Cal. Civ. Code § 51.
  • “Two-for-One” or Multiple Drink Specials — Several states, including Virginia, prohibit retail licensees from selling multiple drinks for a single price, such as a “two-for-one” special. See 3 Va. Admin. Code § 5-50-160.
  • Stacking – Massachusetts and Hawaii do not permit retail licensees to deliver more than two drinks to one person at one time, while Connecticut prohibits the delivery of more than one drink to any one person at one time. 204 Mass. Code Regs. 4.03; Honolulu Liquor Comm’n, Rule 3-84-78.52; Conn. Agencies Regs. § 30-6-A24b.
  • Temporal Restrictions — Ohio permits “happy hour” time periods, where drinks may be sold at a reduced price; however, no “happy hour” specials are permitted after 9pm. Ohio Admin. Code 4301:1-1-50.
  • Limit to Amount of Discount – Some states regulate the permissible amount of a discount for drinks for on-premises consumption, such as South Carolina which prohibits discounts greater than 50%, and Tennessee where drink discounts may not result in a price below the licensee’s cost. See S.C. Code Ann. § 61-4-160; Tenn. Code Ann. § 57-4-203.

Although many states have regulations prohibiting happy hour promotions, there have been some permissive changes in the past few years. In 2012, Kansas relaxed its laws regarding on-premises alcohol promotions, and drink specials that last only a portion of the day or apply only to a segment of the population are now permissible. In 2014, Virginia revised its happy hour laws slightly, allowing bars and restaurants to use the phrase “happy hour” via advertisements both on and off the licensed premises. In 2015, happy hour returned to Illinois, which now allows licensees to offer temporary drink specials for up to four hours per day, and not more than fifteen hours per week.

For advice regarding your state’s regulations governing happy hours and other alcohol promotions, contact one of the attorneys at Strike & Techel.


California Brewpub Licenses: What You Need to Know

October 08, 2015

Craft beer continues to be all the rage in California and across the country. With the increase in demand for local craft beers, we’ve been getting a lot of questions about how to get licensed as a brewery in California. The California Department of Alcoholic Beverage Control (“ABC”) issues three primary license types that permit beer production, including Beer Manufacturer licenses (Type 1), Small Beer Manufacturer licenses (Type 23) and the increasingly popular On-Sale General Brewpub license (Type 75). The license privileges of each type of brewery license vary, and the brewpub license is a good choice for brewers that primarily want to operate a brewpub or microbrewery restaurant rather than sell their beers for consumers to drink off the brewery’s premises.

A Type 75 brewpub license authorizes the sale of beer, wine and distilled spirits for consumption at a bona fide eating place, which essentially requires that the facility be a restaurant with its own kitchen that serves meals. The ability to sell distilled spirits as a brewpub is a privilege that many find attractive in deciding between brewery licenses. Type 1 and Type 23 breweries may, but are not required to, operate bona fide eating places, but they are limited to beer and wine, and cannot sell distilled spirits. Additionally, beer, wine, and distilled spirits restaurant licenses (i.e., Type 47 On-Sale General for Bona Fide Public Eating Place) are often extremely expensive as the number of licenses issued is limited per county based on population. There is no cap on the number of Type 75 licenses that can be issued, so the Type 75 license can be an attractive option for businesses that want to sell distilled spirits, although all Type 75 licensees must meet certain brewing requirements.

Brewpubs must produce at least 100 barrels of beer per year and can produce no more than 5,000 barrels of beer per year. That production cap is substantially lower than the production allowances for Small Beer Manufacturers (less than 60,000 barrels per year) and Beer Manufacturers (60,000 barrels per year or more). Additionally, a Type 75 brewpub premises must have brewing equipment that has at least seven-barrel brewing capacity. The ABC has recently been looking into the brewing equipment of Type 75 licensees and enforcing against brewpubs that aren’t actually brewing beer or don’t have the requisite brewing capacity.

Other key features of Type 75 brewpub licenses include the following:

• Cannot make sales from the brewpub premises for off-premises consumption. This means that a brewpub cannot sell bottles, cans, growlers or other containers for consumption away from the brewpub.

• Can sell beer produced by the brewpub to California licensed wholesalers.

• Must buy all wine, distilled spirits, and beer not produced by the brewpub from a licensed wholesaler or winegrower. Note that brewpubs cannot buy or sell beer or other alcoholic beverages from other brewpubs or retailers.

The initial fee for a brewpub license is currently $12,000, which is more expensive than most California license types. The annual fee is determined by the population where the brewpub is located, and varies between approximately $500 and $1,000 per year. Additionally, local rules where the brewpub is located may require additional permitting or other approvals before the brewpub can operate. Lastly, all breweries, including brewpubs, must obtain a brewery basic permit from the Alcohol and Tobacco Tax and Trade bureau, the federal agency that regulates alcoholic beverages. There is no fee for the federal permit, but a bond is required.

Contact one of the attorneys at Strike & Techel if you have any questions about starting a brewery!


New California ABC Advisory on Merchandising Services by Suppliers

January 07, 2015

In December 2014, the California ABC posted a new Industry Advisory about merchandising services. Free services provided by suppliers to retail licensees, such as stocking shelves, pricing inventory, rotating stock, etc., are prohibited things-of-value under California Business & Professions Code sections 25500 and 25502. However, a number of permitted exceptions are separately provided for in Section 25503.2. The Advisory was posted in response to inquiries and complaints about the scope of permissible activity. When ABC receives multiple complaints about impermissible conduct, investigations and license accusations may well follow, so it would be prudent for suppliers to review the scope of permissible merchandising activities.

Permitted activity varies depending on the type of retailer and the products involved so we created a simple chart below to help keep it straight.

Note that in all cases, any merchandising activities can only be done with the retailer’s permission. In no case can a supplier move the inventory of another supplier, except for “incidental touching” to access the space allocated to the licensee providing the merchandising service.

Imbiblog is published for general informational purposes only and is not intended as legal advice. Copyright © 2015 · All Rights Reserved ·


Recent California Statutory Revisions Clarify the Scope of Permissible Retailer Listings by Supplier

April 29, 2013

Effective January 1, 2013, California AB 2349 amended Business and Professions Code Section 25500.1 and repealed Section 25500.2. The two sections (25500.1 and 25500.2) were duplicative in that both permitted suppliers to list the names of two or more restaurants that carry their products. Section 25500.2 included beer, wine and distilled spirits suppliers, while 25500.1 pertained to suppliers of wine and brandy. The newly amended 25500.1 covers suppliers of beer, wine and distilled spirits. In addition to consolidating the two laws, the newly amended Section 25500.1 removes the requirement that the listed on-sale retailers be restaurants - suppliers can now list bars and clubs that do not serve food. The new Section 25500.1 also clarifies that suppliers can list “other electronic media” with the retailers’ names, addresses and websites, which would include the retailers’ twitter accounts, Facebook pages, and other social media forums.

The revised Section 25500.1 parallels the existing and unchanged Section 25502.1, which pertains to supplier listings of off-sale retailers. Section 25502.1 has not been revised to include “other electronic media” as a means to list the retailers’ information, but we believe it is intended to parallel the on-sale provisions of Section 25500.1. Note that the on-sale and off-sale statutes both include restrictions, e.g., the listings may not include retail prices; the supplier must list at least two unaffiliated retailers; and the retailer may not pay for the listing.

For information about these statutes or any other California trade practices questions, please contact any of the attorneys at Strike and Techel.

Imbiblog is published for general informational purposes only and is not intended as legal advice. Copyright © 2013 · All Rights Reserved ·


Arizona Issues Three Wholesaler Trade Practice Advisories

December 06, 2012

The Arizona Department of Liquor Licenses and Control (“DLLC”) issued three Industry Advisories in the last month addressing wholesaler industry practices. The advisories come in the wake of a September 19, 2012wholesaler licensee meeting, which “was held so that laws, rules and industry practices would be reviewed to ensure an open and competitive market in Arizona where no advantage is given to one liquor-licensed business over another.”

On November 6, 2012, the DLLC issued the first advisory, Wholesale Licensee Industry Practices, which provides clarification on numerous trade practices. The advisory is quite detailed, but key points include:

- Channel pricing can be for on-premise or off-premise, but no sub-categories of liquor pricing are permissible.

- Cumulative quantity discounts are prohibited.

- Promotional item limit is $500 per wholesaler per retailer, not per brand or per producer represented by a wholesaler.

- Items useful to the retailer in the conduct of business cannot be provided to retailers under the $500 allowance, even if rendered unusable (e.g. patio umbrellas).

- Third party promotional companies can’t be used to provide items to retailers that the licensee cannot provide directly.

- The advisory also addresses shelf space, product displays, buy backs, signage, and equipment.

The DLLC’s November 30, 2012 advisory, Removal of Unauthorized Signs, sets a deadline of February 1, 2013 for wholesalers to remove unauthorized signs from retail premises. The advisory provides that an authorized sign is one that:

- The wholesale licensee LENDS to the retailer,

- Has a value that does not exceed $400,

- Has no utilitarian value; and,

- Doesn’t mention a particular retailer (e.g. Joe’s Bar) or directional information (e.g. Enter Here).

The DLLC’s most recent advisory, the December 4th Wholesale Licensee Industry Practices #2, addresses three wholesaler practices not covered in the earlier advisories. Specifically,

- Glassware: may be provided to on-sale retailers as part of $500 promotional item allowance and must be supplier-branded.

- Energy drinks may only be sold to retailers at or above the wholesaler’s cost, and may not be given to retailers.

- Inventory for sampling events must be supplied by an off-sale retail licensee for a sampling conducted by that retail licensee, and must be provided by a wholesaler or producer for a sampling conducted by a producer or wholesaler at an off-sale retailer.

Given the breadth of the guidance contained in the advisories, the DLLC will likely be on the lookout for compliance in the coming months.


Still No Certiorari Decision from the Supreme Court on Wine Country Gift Baskets.com Case

February 28, 2011

The pins and needles many in the alcoholic beverage industry were on this morning remain, as the Supreme Court’s orders list issued this morningwas silent on the certiorari decision for Wine Country Gift Baskets.com, et.al., v. John T. Steen, Jr., et.al.Cases are typically distributed among the Supreme Court Justices on Fridays for their conferences, during which they discuss whether or not to grant certiorari. Orders are then typically issued the following Monday. If a case that goes to conference on a Friday is not among the order list published on the following Monday, it usually means the case is being discussed among the Justices, with a few but not a majority, arguing for the grant of certiorari. However, once a case has gone to conference more than once without a subsequent order being issued, it tends to mean that the votes for the certiorari grant are not and will not be there. This is now the second time Wine County Gift Baskets.com, et.al., v. John T. Steen, Jr., et.al. has gone to conference (first on February 18, 2011 and second on February 25, 2011) and not been included in the following Monday’s orders. Thus, it is unlikely that the case will be granted certiorari, although not impossible. If the case is denied certiorari, the Fifth Circuit’s decision will stand. For a summary of the Fifth Circuit’s decision, see our prior post here.

Imbiblog is published for general informational purposes only and is not intended as legal advice. Copyright © 2010-2011 · All Rights Reserved ·


California ABC Stakeholder Meeting

February 08, 2011

Last week, partners Barry Strike and Kristen Techel attended the California ABC’s annual Stakeholder Meeting in Sacramento. The meeting covered everything from furlough status and budget to planned action items for 2011 and 2012. Stakeholder working groups were established to further investigate and provide recommendations to the new ABC Director, Jacob Appelsmith. The four groups will cover issues related to Third Party Providers, Brands and Trademarks and other Things of Value, Licensing Process and Industry Training, and Public Convenience or Necessity.

Interestingly, during the meeting Matt Botting, General Counsel to the ABC, indicated they had not seen many applications for the new tasting permit for off-sale retailers, which we originally discussed here and here. If you’re interested in learning more about or applying for the new instructional tasting license, please feel free to contact any of the attorneys here at Strike & Techel.

Imbiblog is published for general informational purposes only and is not intended as legal advice. Copyright © 2010-2011 · All Rights Reserved ·


ABC VIOLATION ROUND-UP: Failure to Observe License Conditions

January 03, 2011

The California ABC actively enforces the alcoholic beverage laws of the state. We’ve been posting a series of “ABC Violation Round-Up” items discussing some of the violations we have seen in recent enforcement actions.

This week….. failure to observe license conditions.

The Violation: It is common for the ABC to issue a conditional license, particularly when issuing a retail license in an over-concentrated or high-crime area. A conditional license contains restrictions in excess of the rules typically applicable to a license of that type. For example, a conditional license might restrict operating hours, prohibit loitering, or restrict the sale of single cans of beer or malt liquor. If a conditional license is issued, the printed conditions must be available for review upon request by any ABC investigator and all listed conditions must be followed. Failure to comply with any condition is grounds for ABC discipline, which can include license revocation.

How to Avoid It: If you have a conditional license, make sure the printed conditions are kept in a secure place at the licensed premises and are available upon request by the ABC or other law enforcement personnel. Make sure the limitations are reviewed with all of your employees and that they understand the importance of compliance. Take particular time to review the conditions with employees who have worked at an alcoholic beverage licensee in the past. Since conditions are license-specific, they may have worked under different restrictions in their prior employment.

Petition to Remove Condition: If a conditional license has been in place for a year or more, and the grounds that led to imposition of a condition no longer exist, it may be possible to petition the ABC to have the condition removed from the license. Our firm routinely files Petitions to Remove Conditions and any of our attorneys can discuss the process with you.

Statute: California Business and Professions Code § 23804

Standard Penalty: 15 day suspension with 5 days stayed for one year. Penalties vary depending on the specific condition violated.

Imbiblog is published for general informational purposes only and is not intended as legal advice. Copyright © 2010-2011 · All Rights Reserved ·


2011 New Year’s Resolutions: Employee Training on Sales to Minors

December 17, 2010

If it’s not already there, move employee training to the top of the resolution list for 2011. In January, California’s Department of Alcoholic Beverage Control (“ABC”) will begin awarding grants to local law enforcement agencies to continue the implementation of Minor Decoy and Shoulder Tap programs. The operational period for the grants and this round of programs will run from February 1, 2011 through June 30, 2011. California law enforcement has been using the Minor Decoy program since the 1980s. For details on the Minor Decoy program, see our prior post here. The Shoulder Tap program is a newer program where an underage individual working with the police asks adults near alcohol retailers to purchase alcohol for the individual. The grants for this cycle of programming range from $2,500 to $10,000. While employee training is always important, given the likelihood of increased enforcement beginning in February 2011, now is a good time to review, revise, and update policies and make sure employees understand the consequences of selling to minors.

Imbiblog is published for general informational purposes only and is not intended as legal advice. Copyright © 2010 · All Rights Reserved ·


New Year’s Prediction: Geo Location and Alcohol Advertising

December 08, 2010

We’ve posted about alcohol and social media before, but are revisiting the issue to discuss geo location and location-based advertising.

Websites and mobile apps like Foursquare, Shop Kick, and Facebook Places allow advertisers to identify the location of their audience members and then send an offer based on the consumer’s location. The marketing potential for alcoholic beverage suppliers and retailers is epic. Presume a social media savvy consumer, Joe, who checks in everywhere he goes and provides personal information across a variety of web platforms. Joe likes craft beer, and he likes to drink it in San Francisco’s Haight district. These geography-based applications will allow the brewers, bars and restaurants that Joe interacts with online and via the geo apps to know when Joe is in the Haight and send him a coupon for a discounted pint of craft beer, expiring in only a few hours. The opportunities for a personalized call to action are profound.

Though the technology is very cool, there are plentiful legal pitfalls. Leaving aside regulatory acronyms all mobile advertisers should heed (e.g. MMA, FCC, FTC, TCPA, CTIA), there are alcoholic beverage law issues with geo targeting. The rules on alcohol discounts vary by state and by the party selling the alcohol. How will these programs ensure that the underlying offers are legally compliant? How will the geo location sites identify users who are underage or have a chronic drinking problem? What about states where solicitation requires a license, or is prohibited? We expect to see alcohol advertising tiptoe into geo location in 2011, and expect to see regulators follow quickly.

Imbiblog is published for general informational purposes only and is not intended as legal advice. Copyright © 2010 · All Rights Reserved ·


Update on New Sampling Rules at Retail Stores in California

December 07, 2010

A few weeks ago, we wrote about the new permit available to California off-premise consumption retailers that will allow suppliers to come to their premises and conduct instructional consumer tastings. The ABC just released an industry advisory with additional helpful information. The industry advisory is available here.

Imbiblog is published for general informational purposes only and is not intended as legal advice. Copyright © 2010 · All Rights Reserved ·


United States Supreme Court Asked to Hear Case on Retailer Direct Shipping

November 27, 2010

A petition for writ of certiorari was filed with the United States Supreme Court earlier this week asking the court to determine

“Whether, notwithstanding Granholm v. Heald, 544 U.S. 460 (2005), the Twenty-first Amendment overrides the Commerce Clause and allows States to discriminate against out-of-state businesses in the sale of alcoholic beverages.”

In the seminal Granholm case, the Supreme Court ruled that states cannot permit in-state wineries to ship direct to consumers within the state, while prohibiting out of state wineries from doing the same. The question of whether the same rationale applies to retailers remains unresolved. The current petition to the Supreme Court is based on a dispute in Texas as to whether out-of-state alcoholic beverage retailers should be allowed to ship to Texas consumers under the same rules applied to in-state alcoholic beverage retailers. The case was originally brought in 2006 by Siesta Village Market and several other retainers against the Texas Alcoholic Beverage Commission. Siesta Village has dropped its appeal but K& L Wine Merchants and other notable retailers remain. A couple of large Texas distributors (Glazer’s and Republic) joined as intervenors in order to protect their position in the three-tier distribution system. The case was appealed to the Fifth Circuit on various issues and has now worked its way through to the final appeal – the U.S. Supreme Court. The Supreme Court accepts very few cases for review – typically accepting only those cases involving a substantial federal interest or a conflict between two or more Circuit Courts of Appeals. Statistically, the case stands little chance of being accepted, but the scope of the Granholm decision and its applicability to retailers (as opposed to only wineries) may be ripe for further judicial instruction. The State has until December 22 to file its response. The Court will decide whether or not to hear the case within a few months.

Imbiblog is published for general informational purposes only and is not intended as legal advice. Copyright © 2010 · All Rights Reserved ·


California Sampling at Retail Stores

November 22, 2010

Effective January 1, 2011, California off-sale retailers will be eligible for a $300 instructional tasting license that will allow wine, beer and spirits suppliers to conduct free consumer tastings on the retail premises.

The instructional tasting license will be available to most off-sale retailers. Off-sale retailers with a gas station are not eligible unless the retail store is over 10,000 sq. ft. Premises under 5,000 sq. ft. are not eligible unless 75% of gross sales on the premises are alcohol. This will tend to exclude convenience stores and small markets but will enable small wine and liquor stores to obtain the license. Permits may also be denied to retailers in “overconcentrated” areas, i.e., locations with more than the statutorily authorized number of ABC licenses.

Retailers obtaining the permit must separate the tasting area with a barrier and post signage prohibiting minors from entering the tasting area. The retailer is responsible for making sure no minors are in the tasting area and no open containers leave the tasting area. Tastings may only be conducted between the hours of 10:00 a.m. and 9:00 p.m., provided the retail license allows sale of alcohol within that time period.

The tastings must be free, and sample size is limited as follows:

Sample Limitations
Beer 8 oz. per person per day
Wine 3 tastings per person per day, 1 oz. per sample
Spirits 3 tastings per person per day, ¼ oz. per sample

Each tasting event can only involve one class of product and one “authorized licensee” tasting per retailer per day, so a single tasting event may not combine beer and wine tastings or multiple suppliers. “Authorized licensees” who may conduct the tastings are California licensed: winegrowers, winegrower’s agents, beer and wine importer generals, beer and wine wholesalers, wine rectifiers, distilled spirits manufacturers, distilled spirits manufacturer’s agents, distilled spirits importer generals, distilled spirits rectifiers, distilled spirits general rectifiers, rectifiers, out-of-state distilled spirits shipper’s certificate holders, distilled spirits wholesalers, brandy manufacturers, brandy importers, California brandy wholesalers, beer manufacturers, or an out –of-state beer manufacturer certificate holders.

The alcohol tastes are to be served by the “authorized licensee” or her/his agent. The exception is that beer and wine wholesalers, though “authorized licensees”, may not serve tastes unless they hold additional licenses. Wine and spirits for the tasting may be supplied by the “authorized licensee” or bought from the retailer at the original invoiced cost. Beer cannot be provided by an “authorized licensee”, but may be purchased from the retailer at invoice cost. Unused product must be removed at the conclusion of the tasting.

An “authorized licensee” must be present for the tasting, unless the event has been previously advertised and the “authorized licensee” can’t attend. On that note, the “authorized licensee” can advertise the retailer event in advance, subject to restrictions. Retailers are also allowed to advertise the events on their own initiative. Special rules apply if the off-sale retailer already has a Type 42 on-sale license for a tasting bar.

For the complete rules, see Cal. Bus. & Prof. Code §23396.6 and §25503.56.

If you would like assistance in applying for the instructional tasting license, please contact licensing paralegal Lindsay McCarthy at .(JavaScript must be enabled to view this email address).

Imbiblog is published for general informational purposes only and is not intended as legal advice. Copyright © 2010 · All Rights Reserved ·


ABC VIOLATION ROUND-UP: Purchase by True Minor

August 20, 2010

The California ABC actively enforces the alcoholic beverage laws of the state. We’ll be posting a series of “ABC Violation Round-Up” items discussing some of the violations we have seen in recent enforcement actions.

This week….. sale to a true minor.

The Violation: You cannot sell or serve alcohol to anyone under 21 years of age in California. The ABC is constantly visiting retailers to make sure this law is enforced. Violations of the law can occur two ways; via a law enforcement decoy sting or via sale to a “true” minor. We covered decoy stings in an earlier post.

How to Avoid It: Identification must be requested if there is any question regarding the age of a person requesting access to alcohol. Licensees and their staff must be trained in proper review of identification. Any identification presented must be bona fide, and must match the person presenting it. It is common for ABC investigators to stake-out parking lots at off-sale retailers and follow-up with any young-looking people exiting the retailer with alcohol in tow. It is also common for the ABC to visit on-sale retailers or winery tasting rooms and check the identification of young-looking people with alcohol. In college areas, it is not uncommon for investigators to enter a licensed business and request identification from every patron.

Did the Minor Present Bona Fide ID? Reliance on bona fide proof of majority is a defense under Business and Professions Code Section 25660, but it is very difficult to prove in the case of a true minor because the licensee must prove that reliance on the identification was reasonable, and it is difficult to prove reliance on the identification if you don’t have a copy of it. If this is a possible defense for your business, be sure you record every known detail regarding the presented identification.

Will the Minor be Present at the Hearing? The minor must show up at the hearing on the accusation against your license for the accusation to move forward.

Statute: California Business and Professions Code § 25658

Standard Penalty: 15 day suspension for 1st offense, 25 day suspension for 2nd offense within 36 months, license revocation for 3rd offense within 36 months. Fines can typically be paid for the first two “strikes” in lieu of serving a suspension. The fine for the first strike is capped at $3,000, and raised to $20,000 for the second strike.

Imbiblog is published for general informational purposes only and is not intended as legal advice.


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