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Convenience store association says cold beer ban discriminatory

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Along with the usual reasons including giving consumers more options, providing price competition and sparking new investment in the state, Indiana convenience store owners have added a new argument to their push to sell cold beer – it’s their constitutional right.
 

beer-cooler-15col.jpg Scot Imus (left), executive director of the Indiana Petroleum Marketers and Convenience Store Association, and Jay Ricker of Ricker Oil Co., are advocating that convenience stores be allowed to stock beer in their coolers. (IL Photo/ Perry Reichanadter)

Three gas marts have joined the Indiana Petroleum Marketers and Convenience Store Association to file a complaint in federal court, charging that the state’s current practice of regulating beer by temperature is arbitrary and leads to discriminatory treatment that violates state and federal constitutions.

The complaint, Indiana Petroleum Marketers and Convenience Store Association, Thorntons, Inc., Ricker Oil Company, Inc., Freedom Oil, LLC and Steve Noe v. Alex Huskey, in his official capacity as chairman of the Indiana Alcohol Tobacco Commission, The Indiana Alcohol and Tobacco Commission and The State of Indiana, 1:13-CV-0784, was filed May 14 in the U.S. District Court for the Southern District of Indiana.

For nearly the last five years, the Indiana Petroleum Marketers and Convenience Store Association has lobbied the Legislature unsuccessfully to be able to sell cold beer. Now the organization is turning to the courts.

Changing alcohol laws through means other than the General Assembly is not uncommon, said Scot Imus, the association’s executive director.

As an example, he pointed to the 1963 bulletin issued by the Indiana Alcoholic Beverage Commission that authorized liquor stores to sell cold beer. The Indiana Supreme Court upheld the cold beer sales in 1964, and the Legislature finally followed suit when it incorporated the language of the bulletin into the 1979 Acts.

However, Attorney General Greg Zoeller maintains alcohol laws are the purview of the General Assembly rather than the judiciary. The attorney general’s office is representing the ATC and defending the statute, which as Zoeller pointed out, is the current decision of the elected members of the Legislature.

“This subject has been debated in the legislature for a number of years and it will be the state’s position that the legislature is the proper forum for any changes to our laws and not the courts,” Zoeller stated May 14 in response to the complaint.

Constitutional grounds

In their complaint, the Indiana plaintiffs focus on the single issue of whether the regulation of beer by temperature is constitutional.

“We are the only state in the union regulating who can sell beer based on temperature,” said John Maley, Barnes & Thornburg LLP partner, who represents the plaintiffs. “There is no rational basis for this 50-year-old disparate treatment, particularly when liquor stores adjoining the convenience stores can sell chilled beer and adjoining convenience stores can sell only warm beer but can sell chilled higher-content drinks such as wine.”

The group asserts the state’s limitations on sales of cold beer violate the equal protection clause and the equal privileges clause of the U.S. Constitution. Also, the filing charges Indiana’s practices violate the equal protection clause of the state’s constitution.

Finally, the complaint contends that the law also violates Article 1, Section 1 of the Indiana Constitution.

This section echoes the Declaration of Independence in its provision, noting that all people have the inalienable rights of life, liberty and the pursuit of happiness. The convenience store association then points to the Indiana Supreme Court decision in Herman v. State, 8 Ind. 545, 558 (Ind. 1855), which determined that “the right of liberty and pursuing happiness secured by the constitution, embraces the right, in each compos mentis individual of selecting what he will eat and drink.”

The complaint by the Indiana retailers comes several months after a similar group in Kentucky was successful in making their argument against a state statute. Those plaintiffs charged that barring grocery and convenience stores from selling liquor and wine while permitting drugstores and others to do so is differential treatment that violates the equal protection provisions of the U.S. and Kentucky constitutions.

In Maxwell’s Pic-Pac, Inc. v. Dehner, 887 F.Supp.2d 733 (2012), the U.S. District Court Western District of Kentucky at Louisville agreed.

“Here the attenuated or non-existent relationship between the Statute’s classification and any number of potential legislative goals leaves the Court with no other conclusion than that the Statute offends the Equal Protection Clause and, for that reason, must be struck down as unconstitutional,” Judge John Heyburn II wrote for the court.

The defendants in the Indiana case have until July 5 to respond to the complaint. A pretrial conference has been scheduled for July 24 before U.S. Magistrate Judge Debra McVicker Lynch.

To John Livengood, president and CEO of the Indiana Association of Beverage Retailers, the pivot to the judicial branch is the equivalent of a Hail Mary pass by a team that could not get to the 20-yard line.

States have the right under the 21st Amendment of the U.S. Constitution to make laws regarding how alcohol is sold, Livengood said. Consequently, he believes the convenience stores have an uphill battle ahead.

Legislature will act

Under Indiana law, package liquor stores with a liquor dealer’s permit can sell warm or cold: liquor, beer, wine and malt beverages. Yet, they cannot offer much beyond that other than tobacco products, bar supplies and lottery tickets.

Convenience stores, defined as selling goods that may include milk, bread, soda, snacks and automotive fuel, are allowed to sell alcohol under a beer dealer’s permit. Indiana statute prohibits holders of beer dealer’s permits to offer beer that has been iced or cooled.

Changing the Indiana Code to enable more retailers to sell beer cold always comes back to the basic question of “What is good public policy?” said Sen. Ron Alting.
 

alting Alting

The Lafayette Republican is the current chair of the Senate Public Policy Committee and served in a leadership position on the Interim Study Committee on Alcoholic Beverage Issues during the summers of 2008 and 2009.

In the end, the committee unanimously recommended to the General Assembly that only package liquor stores be allowed to sell beer cold.

“I just don’t buy this that we’re living in prehistoric times here,” Alting said, referring to a criticism of Indiana’s alcohol laws.

In fact, he said the businesses that are complaining do not realize how good they have it under current statute and, he warned, they should be careful what they wish for.

While some legislators have introduced bills easing the limits on cold beer sales, other legislators have floated bills that added restrictions on grocery stores, convenience stores and pharmacies. These attempts would have required the food and drug stores to segregate the alcohol into a separate area where access was restricted to adults 21 and older.

However, Imus said the previous measures proposed in the Statehouse included lifting restrictions on liquor stores. He called it absurd that liquor stores can’t sell limes to go with the Corona beer.

Livengood countered the loss of cold beer sales would be a devastating blow to Hoosier liquor stores. Other states that have a viable package liquor store industry typically provide something to those entities that is not available to the other retailers, he said. While some states may make liquor and wine sales exclusive to liquor stores, Indiana has chosen to make these stores the proprietor of cold beer.

Alting is doubtful the convenience store owners will prevail in their lawsuit. He sees the state as clearly having the right to regulate alcohol but concedes no one can be certain of what the court will decide.

And if the court agrees with the convenience store association, Alting said the Legislature will not just sit back and pop a cold one.

“It would bring a lot of bills drafted by a lot of colleagues in the House and Senate,” he said.•

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  1. It appears the police and prosecutors are allowed to change the rules halfway through the game to suit themselves. I am surprised that the congress has not yet eliminated the right to a trial in cases involving any type of forensic evidence. That would suit their foolish law and order police state views. I say we eliminate the statute of limitations for crimes committed by members of congress and other government employees. Of course they would never do that. They are all corrupt cowards!!!

  2. Poor Judge Brown probably thought that by slavishly serving the godz of the age her violations of 18th century concepts like due process and the rule of law would be overlooked. Mayhaps she was merely a Judge ahead of her time?

  3. in a lawyer discipline case Judge Brown, now removed, was presiding over a hearing about a lawyer accused of the supposedly heinous ethical violation of saying the words "Illegal immigrant." (IN re Barker) http://www.in.gov/judiciary/files/order-discipline-2013-55S00-1008-DI-429.pdf .... I wonder if when we compare the egregious violations of due process by Judge Brown, to her chiding of another lawyer for politically incorrectness, if there are any conclusions to be drawn about what kind of person, what kind of judge, what kind of apparatchik, is busy implementing the agenda of political correctness and making off-limits legit advocacy about an adverse party in a suit whose illegal alien status is relevant? I am just asking the question, the reader can make own conclsuion. Oh wait-- did I use the wrong adjective-- let me rephrase that, um undocumented alien?

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  5. You can put your photos anywhere you like... When someone steals it they know it doesn't belong to them. And, a man getting a divorce is automatically not a nice guy...? That's ridiculous. Since when is need of money a conflict of interest? That would mean that no one should have a job unless they are already financially solvent without a job... A photographer is also under no obligation to use a watermark (again, people know when a photo doesn't belong to them) or provide contact information. Hey, he didn't make it easy for me to pay him so I'll just take it! Well heck, might as well walk out of the grocery store with a cart full of food because the lines are too long and you don't find that convenient. "Only in Indiana." Oh, now you're passing judgement on an entire state... What state do you live in? I need to characterize everyone in your state as ignorant and opinionated. And the final bit of ignorance; assuming a photo anyone would want is lucky and then how much does your camera have to cost to make it a good photo, in your obviously relevant opinion?

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