DABT rules on reimbursement to liquor retailers
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DABT rules on reimbursement to liquor retailers

| Mar 12, 2021 | Alcoholic Beverage Law |

Laws are not always written in clear language, but they do make their point. Such is the case with a Declaratory Statement issued by the Division of Alcoholic Beverages and Tobacco’s Department of Business and Professional Regulation. The issue at hand was petitioner Winn Dixie Store’s request that it could use a contract that stipulates that all the expenses of a recall are paid for by the distributor who recalled the product. Winn Dixie requires the distributors to sign an agreement to this effect to cover its expenses.

The actual costs outlined in the petition include:

  •  Labor costs involved with the recalled products’ removal
  • The shipping costs of returning recalled product
  • The cost of disposing of the distributor’s recalled product

Distributors request intervention

The Wine and Spirits Distributors of Florida, Inc., the Florida Beer Wholesalers Association, Inc. and the Beer Industry of Florida, Inc., filed a motion to intervene, citing the rules regarding “tied house,” which prevents distributors from compensating bars, pubs or saloons by offering low-interest loans, free draft systems or payment for exclusively selling their product from distributors.

The court’s ruling on the Winn Dixie contract includes some complicated language. The bottom line is that distributors’ reimbursement of costs incurred by the retailer in connection with the distributor’s product recall does violate Florida’s beverage laws related to tied house. Moreover, the retailer’s receipt of funds from a distributor as reimbursement for the actual costs incurred in connection with the distributor’s product recall does violate Florida’s beverage law.

Attorneys provide clarity on these issues

Retailers, distributors and others in the alcoholic beverages industry often have to navigate complicated laws. To avoid misunderstandings, it is often wise to consult an attorney that specializes in liquor laws here in Florida. This helps avoid misunderstandings, mistakes and violations with fines.  

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