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Beer wholesalers enlist lawmakers in fight against Monarch

Kathleen McLaughlin
January 17, 2014
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The Statehouse is a common battlefield for factions in Indiana's alcoholic beverage industry, and this session, one group of beer wholesalers is firing shots in multiple directions.

Driven by the Indiana Beverage Alliance, Senate Bill 415 seeks to derail federal court cases brought by the group's opponents–including Indianapolis-based Monarch Beverage Co.–who claim Indiana's Prohibition-era alcohol laws are unconstitutional.

The bill also contains a long list of rules on how beer companies can do business with wholesalers, a set of provisions meant to remedy the trade group's ongoing quarrel with Anheuser-Busch InBev.

Indiana Beverage Alliance President Marc Carmichael called the bill “my turd in the punch bowl.”

“We've certainly gotten a lot of attention,” Carmichael said.

Republican Sen. Ron Alting, chairman of the Public Policy Committee, is sponsoring the bill.

Indiana's beer wholesalers split into two camps as Monarch tried to change Indiana law so that it could distribute liquor as well as beer. Liquor wholesalers oppose that change, and so do the beer wholesalers represented by the Indiana Beverage Alliance. Both groups fear that it would help create a distribution monopoly.

Having failed to get bills passed over four sessions, Monarch turned last year to federal court with a lawsuit against the Alcohol and Tobacco Commission, saying Indiana's law violates the equal protection clause of the 14th Amendment.

The convenience store lobby, the Indiana Petroleum Marketers and Convenience Store Association, filed a similar lawsuit in May over the fact that its members aren't allowed to sell cold beer.

SB 415 states that if any portion of the Indiana code on alcohol is found to be invalid, the rest shall be interpreted to limit, rather than expand, commerce in that industry.

Monarch CEO Phil Terry said he's opposing the bill, even though he agrees that Indiana's laws are intended to be restrictive. “We don't necessarily disagree with the policy statement they've got in there,” he said. “It's just, I know why they put it in there, to affect our lawsuit.”

The Indiana Beverage Alliance supports liquor distributors who are trying to intervene in Monarch's lawsuit, but Carmichael said SB 415 isn't aimed at one case or trade group.

He said the goal is to prevent deep-pocketed companies from challenging state alcohol laws in court. “It's been a phenomenon around the country over the last several years as various groups have tried to deregulate alcohol to their advantage.”

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  • RE: Consumer who?
    Molly, I respectfully disagree with one assessment in your comment. The lawsuit action against Monarch, I would agree, is in part a "turf war" and affects someones bottom line. At the same time, it is preventing an extremely well-regulated and lawful business to sell a like product within said industry. It would be akin to telling McDonald's they can't sell a salad because they are a hamburger joint. Food is food, alcohol is alcohol. Both are regulated uniquely in their respective industry. Growing a business is tough. Costs are high and margins are razor thin. This is made even harder when the government steps in and tells you what you can or cannot sell/resell. Thus challenges to legislation are made.
  • Clerks
    Donald Brown, clerks only have to be 19 years old to ring up alcohol sales. IC 7.1-5-7-13(3). If the store is insisting on 21, blame the store's policy, not state law.
  • Indiana is out of touch
    Our state's restrictive laws regarding alcohol are downright stupid. The inability to purchase liquor on Sunday and the requirement that a grocery clerk be at least 21 in order to scan beer are downright insane and make our state look incredibly backward.
  • Time for Change
    Indiana is still home to some very unique regulations concerning the sale of Alcohol. While I agree it's time for change, I disagree that should be to more restriction. Why shouldn't those of legal age be able to purchase on a Sunday or at a convenience store? Also, it's silly that while I can go to a store to purchase Liquor and Beer, the same distributor can't provide both. Even more unique... I cannot purchase alcohol that an in-state distributor choose not to carry/stock. A great wine, a unique bottle of bourbon, a craft beer I'd like to try. Why? Because at the end of the day, both our legislators and distributors are to narrow in their thinking.
  • Alcohol is a Controlled Substance
    Monarch has given millions of dollars over the years to lobbyists and legislators with much success. On this issue they have not been able to buy enough influence to get their way; so, they are now giving their money to attorneys in an attempt to achieve legislation through the courts. It would appear they are teaming up with the c-store lobby group to further deregulate alcohol and sell cold beer in gas stations.
  • Well Stated!
    Your comment is so well stated! The voters of Indiana don't even realize what is going on with our politicians. I often wonder if the voters even care.
  • Pay to Play
    Indiana is where any politician will say anything no matter how ridiculous for the right amount of money. Maybe we should just put everything up for the highest bid! At least we would move these issues along faster and with transparency. And the “gentleman legislatures” go spend the money they made from selling their self-respect.
    • Consumer who?
      Ultimately, none of these actions or efforts are intended to benefit consumers. This is a turf war between middle-men. The purpose for the 3-tier distribution model that we have in Indiana is antiquated and based on the notion that manufacturers can't regulate the quality of their product before it reaches consumers. This is just more of the same legislated racketeering, imho.
      • Huh?
        My turd in the punch bowl? This clown sounds like a real winner....

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