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News & Press: Government Affairs

State Wins Cold Beer Lawsuit

Monday, June 16, 2014  
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Federal Judge Richard L. Young granted summary judgment to dismiss all counts in a challenge to the state’s cold beer law Monday – from federal and state constitutional challenges to an equal protection claim. Most notably, the judge said Indiana law restricting the sale of cold beer to package stores was rational and not unconstitutionally vague.

The 34-page ruling concluded that the plaintiffs, including a Hoosier consumer that lacked standing in the case, “failed to establish a reasonable likelihood of success on the merits of their federal and state claims.”

Judge Young wrote: “The state has a legitimate interest in limiting the sale of alcohol and, more to the point, a legitimate interest in curbing the sale of immediately consumable beer to minors.”

Even citing compliance statistics, as plaintiffs attempted to do a number of times to discredit package stores, was a shaky step in the cold beer lawsuit filed against the state by the Indiana Petroleum Marketers and Convenience Store Association and its members, according to the ruling. Other plaintiffs included Thornton’s, Ricker Oil Company, Freedom Oil and Steven E. Noe.

The judge noted that comparing compliance statistics was “problematic,” “irrelevant” and “misplaced.” He wrote that package stores are subject to much stricter regulations than the plaintiffs and it also costs a package store “far more” to enter the marketplace as a result.

IABR CEO Patrick Tamm said Indiana’s package stores, which must operate under restrictive guidelines and legislatively mandated business models, are a product of a legislature that enacted a sound public policy in restricting sales.

IABR, though not a party in the lawsuit, had filed an amicus brief with the court.

"Many states have reasonable restrictions on the sale of alcohol and Indiana is no different,” said Tamm. “As the judge noted, this is a classic example of ‘legislative line-drawing’ in order to specifically limit the number of retail outlets that sell cold beer.”

Plaintiffs had testified that as many as 80 percent of its 1,500 member stores would sell cold beer immediately if successful in this case – which testimony supported would be a challenge to enforce.

The judge also denied a request for a preliminary injunction. The plaintiffs now have 30 days to notify the court of an appeal.

Read the ruling here.

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