McCarthyism and Eliot Ness This Is Not…The Hysteria Over Beer Raids In Penn…

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I’ve somewhat distantly followed the developing story/drama out of Pennsylvania following police visits/raids (everything has two distinct sides here) to a small number of beer bars in the Philadelphia area. Others are pretty worked up about the situation, which revolved around a report that the bars were selling beers that were not registered with the state, and for some understandable reasons. First, the caveats: I can certainly appreciate the argument that requiring breweries to register their brands with the state liquor board is not a particularly meaningful regulation, but I can also appreciate the role such registration lists play with respect to both taking in taxes and keeping track of products with an eye towards consumer safety. It’s not a particularly unusual practice and breweries certainly have to deal with odder state regulations. I can also understand the concern that these regulations discourage brewer creativity and increase the regulatory burden on them to have their products registered.

But with these points said, most of the accounts I’ve read tend to hit hysterical hyper-speed all while quickly glossing over the underlying facts, few of which appear to be in dispute. The Pennsylvania Liquor Control Board (PLCB) and the police apparently received a report(s) about bars selling beers that were not registered with the state. At least one of these bar owners acknowledged having run afoul of the law by procuring a keg from outside the state and driving it back to their bar and putting it on tap. Now this bar owner, and all others who frequently rotate their products, likely knows that a few of the brands they sell, especially specialty one-off releases, have not been properly registered with the state and that they are therefore violating the law in selling them. Someone, somewhere along the way, could very easily have noticed that a beer such as Pliny the Younger does not appear on the state’s list. Be it the distributor or the bar owner, rules are rules, stupid or not. And these bar owners know how heavily the beverage alcohol business is regulated and they well know the rules in Pennsylvania and they’ve cleared flouted them on occasion.

Now there is certainly another argument that the theatrical nature of the raids, from the undoubtedly one-sided reports we’ve been hearing, was over the top and that governmental (and certainly police) priorities could likely be better placed elsewhere. And there is without question room for criticism where the police confiscated beers whose names are somehow slightly altered from that found on the state’s lists and are actually lawfully registered. The parties, including distributors and breweries, should quickly work with the PLCB and the police to make these determinations, separate the violators from the properly registered, and return the stock

As usual, I don’t mean to be intentionally contrarian here. Instead, I’m just considering the full picture here. This situation will hopefully lead to a fuller discussion about the purposes of particular laws and state agencies and their relevance and responsibilities in a new age of craft beer (and spirits…and wine).

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4 thoughts on “McCarthyism and Eliot Ness This Is Not…The Hysteria Over Beer Raids In Penn…

  1. Couple things. Okay, a few things.

    Pliny the Younger was not seized. It was present at one of the bars — I know, because I drank it there the next morning — but it was not seized. If it was a target, which as far as I know is purely speculation, they missed.

    Is the bar owner responsible for knowing that his beers are registered brands? They are bought from a wholesaler. Is the wholesaler responsible? The state requires that the beers be registered by the manufacturer or importer…so who’s really responsible or at fault here?

    Why is a “raid” necessary? Here’s an option: instead of five armed cops walking in on a lunch crowd and seizing beers, how about one bureaucrat comes by with a clipboard to see if unregistered beers are on the premises? If any resistance is offered, backup is a phone call away, and resistance won’t look good on the complaint. Find the unregistered beers and — here’s another thought — get the wholesaler on the line and arrange for payment of the fee and registration on the spot. Done, under the radar, no business disruption, the beer’s registered, the state’s happy, and it costs so much less than sending five cops (and looking like idiots in the press).

    I don’t believe most of the “hysterical hyper-speed” accounts in the blogs and press I saw glossed over that this was illegal. I know I didn’t on my blog. I did question why it was illegal, but there’s no question that a law was plainly broken: Fourth: this is clearly a violation of PA liquor law. Just take a look, right here, and you’ll see it’s number 9 on the list of UNLAWFUL ACTIVITIES. There’s not even any wiggle room here: “It is unlawful to sell, offer for sale or deliver any brand of malt or brewed beverages unless such brand has been registered by the manufacturer or franchised agent thereof with the PLCB.” Period. If sale or offer of an unregistered beer has taken place, a crime has been committed.

    Don Russell also: By the way, I don’t think this is an over-zealous interpretation of the law by the at the [sic] numbskulls at the Bureau of Liquor Enforcement. The law says the beer you sell must be registered, period.

    The FooBooz blog asked quite responsibly:
    * Who’s responsibility is it to ensure the beer sold is registered in Pennsylvania? The bar or the distributor?
    * How often is the legal list updated?
    * What happens when the registration expires? Is the beer then illegal?
    * How do other states handle beer registration? Do they?
    * Will this effect the likelihood of getting one-off beers in the future?

    Now, if you want to talk about the comments to these reasoned posts, that’s a bit more over the top: no shock there, I’d say.

    Finally, you “gloss over” a few pertinent facts yourself. First, the only three bars that were raided on this violation were all owned by the same couple (and are the only three bars they own), even though beers that were taken are served openly all over Philly: Duvel, for instance. To those of us closer to the incident — geographically, that is — this smacks of abuse. Second, the keg procured out of state was a one-time incident that the bar had already been fined for: the bar owners themselves openly admitted this (and admitted it was stupid) in a release that was quoted in a number of blogs. Third, the raids were initiated because of an anonymous tip, and it’s quite curious what noble-minded citizen would know, or care, about unregistered brands.

    The “hysteria” is all about the abuse of power, and the questionable utility of the brand registration law. If a competitor “dropped a dime” on these bars knowing/hoping that it would cost them thousands of dollars in legal fees and lost inventory, why should that person’s name be kept secret? Why has the Bureau of Liquor Control Enforcement not done something as simple as checking BeerMenus.com to see what other bars in the city might be serving unregistered beers and raid them?

    And how is taxation helped by registration? Wholesalers have to keep paperwork on all purchases and sales. If the beer comes in from a proper manufacturer or importer/agent, there’s a paper trail, and the brand doesn’t matter. The wholesaler pays the state tax on all beer purchased: done, no registration needed. I don’t think anyone is seriously suggesting that taxes were not paid on the beers in question, just whether or not they were registered.

    Tracking products for consumer safety? They can’t even get the names right on their lists!

    A lot’s going to come out of this, I suspect, I hope. One thing I’d like to see is an examination of PA’s beer laws, and a reconsideration of how they’re enforced. None of that will be furthered by glossing over anything.

    1. Hi Lew and sorry for the delay in my response. I’m not sure I said that PTY was seized, although in hearing the reports from others (including the brewer himself) that would be the take away. As to your question of responsibility, it’s a good one that the law does not appear to address. Brewers and distributors are responsible for registering the brands they sell, but bar owners clearly can pay a price for failing to abide by the regulations as well. Without sterner penalties for failing to register, I imagine the situation will continue and have, as we’ve already seen, a chilling effect on one-off events.

      As to the method of carrying this out, you’ll get no argument from me. Except that if you know that you are going to find kegs of beer that you will have to haul away (which the PLCB and cops apparently did, a tip off perhaps to the source of the information), then you avoid the delay by bringing them along. Perhaps it was all for show, but I’m guessing that cops have better things to do unless presented otherwise with persuasive evidence of illegal activity.

      As to the accounts, perhaps I should also have included the word “responses,” including those on the web boards. Not to go point-by-point here, and also with no need to name names, I could also cite a half-dozen or more examples where the illegality point was far from highlighted.

      I don’t doubt that the complaint likely came from a competitor or someone with an axe to grind with the bar owners but the simple point of alcohol regulation and enforcement is, on matters such as this, that the agency is not equipped to police every bar, restaurant, nightclub, and package store in the area. It works off reports and at least one establishment had a history of such action, even be it a single violation. With that said, I don’t know what kind of administrative law procedure underlies the seizure but as is well known, these individuals are likely entitled to some sort of hearing, at which time they may or may not find out the name of the person reporting the violations (and the nature and extent of the report).

      All told, I’m not trying to justify the questionable expenditure of resources on this simple issue (as I made clear in the article). I’m just offering a different view on the situation, about which we can agree that change or at least debate is likely to follow.

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