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Wayne, Richard & Hurwitz Chairs Alcoholic Beverage Licensing MCLE

Until recently, the basics of liquor licensing in Massachusetts remained essentially the same since the repeal of Prohibition in the 1930s. Now, however, the times are a changin’ if you represent a restaurant, hotel, package store, supermarket, golf course, winery, brewer, or wholesaler, this program alerts you to the shifting landscape of alcoholic beverages licensing in Massachusetts.

On Tuesday, April 3, 2012 at 3:00 P.M., Wayne, Richard & Hurwitz is chairing Update on Recent Developments & Trends in Alcoholic Beverage Licensing in Massachusetts, an exciting two-hour program at the MCLE Conference Center.  The panel includes:

Howard J. Wayne, Esq., Chair, Wayne, Richard & Hurwitz LLP, Boston

Gerald J. Caruso, Esq., Rubin and Rudman LLP, Boston

Nicole Murati Ferrer, Esq., Licensing Board, City of Boston, Boston

William A. Kelley, Jr., Esq., Alcoholic Beverages Control Commission, Commonwealth of Massachusetts

The program will also be available via Webcast.  For more information, or to register, click here.

New Bill Could Change Alcohol Licensure at Logan Airport

The Massachusetts Legislature recently heard testimony regarding a bill that would change the liquor licensure procedure for vendors in Logan Airport. House Bill 99 would create a new class of airport alcohol license for vendors in Logan Airport.

Logan Airport currently has thirteen liquor licenses for forty vendors that serve alcoholic beverages. Generally, a single liquor license cannot be used to sell alcohol from more than one location. However, Massachusetts law provides for a special exception to airports and sports stadiums and allows for a single liquor license to be used for multiple vendor locations.

If House Bill 99 passes, each airport vendor will be allowed their own alcoholic beverages license. In turn, the existing thirteen liquor licenses can be made available for transfer within the City of Boston, outside the airport. Massachusetts law restricts the total number of alcoholic beverages licenses via a quota system. The airport alcohol licenses would not be subject to the quota.

Under HB 99, the airport alcohol licenses would be available for vendors within Logan only, and these licenses would not be transferable like a typical liquor license.

Two New Bills Before Governor Patrick Affecting Alcoholic Beverages Law in Massachusetts

Two new bills reached Governor Deval Patrick’s desk yesterday that could impact the way alcoholic beverages are sold and served in Massachusetts.

First, the hotly debated Casino Bill was finally passed by the Massachusetts Senate and House, and now awaits the Governor’s signature. As we mentioned in an earlier posting, a previous version of the legislation would have eliminated the statewide Happy Hour Regulations. Section 26(c) of the Casino Bill, if signed into law by Governor Patrick, will allow casinos to serve free drinks to patrons. In essence, the Happy Hour Regulations will not apply to casinos serving alcohol to patrons under a gaming beverage license. Service of free drinks will only be allowed in actual gaming areas.

To address concerns of the restaurant and bar industries, section 106 of the Bill mandates that the Alcoholic Beverages Control Commission (ABCC) study the impact of such competition between the gaming industry and on-premises alcohol retailers. The restaurant and bar industries are worried that free drinks at casinos may lure customers away from their establishments. At least two public hearings would be held across the Commonwealth, and the ABCC would issue a report no later than June 30, 2013.

The second bill passed by the legislature and awaiting the Governor’s signature expands the maximum number of off-premises (or package store) alcoholic beverages licenses any single entity can hold in Massachusetts. Previously, an individual, corporation, or other business entity was only allowed to have an interest in three alcoholic beverages licenses. If Governor Patrick signs Senate Bill 2033 into law, the maximum number will increase from three to five in 2012, seven in 2016, and nine in 2020.

Governor Patrick is expected to sign both bills into law early next week.

Robert W. Hurwitz and Eugene R. Richard Named Super Lawyers

Wayne, Richard & Hurwitz is proud to announce that Eugene R. Richard and Robert W. Hurwitz have been named Massachusetts Super Lawyers for the year 2011. Lawyers are nominated through a vigorous review process and only the top 5% of lawyers in Massachusetts are named Super Lawyers. Super Lawyers have attained a high level of excellence, peer recognition, and professional achievement.

Bob Hurwitz specializes in construction law, commercial and business litigation. This is Bob’s eighth time being named a Super Lawyer, and he has been recognized every year since 2004.

Gene Richard specializes in a wide range of business and legal issues, including contract negotiation and enforcement, administrative and regulatory law, and corporate law. This is Gene’s eighth time being named a Super Lawyer and has been recognized every year since 2004.

Irving Lara v. Domino’s Pizza, LLC, Domino’s Pizza, Inc., & Deutsche Bank National Trust Company

Wayne, Richard & Hurwitz LLP filed suit last week against Domino’s Pizza, LLC, Domino’s Pizza, Inc., and Deutsche Bank National Trust Company for the death of Richel Nova. The suit is filed on behalf of Irving Lara, the Administrator of Nova’s estate.

Richel Nova was murdered on the night of September 1, 2010 while delivering food to a house in the Hyde Park neighborhood of Boston. Nova worked delivering Domino’s food and was sent by himself to deliver to a house that had been abandoned for over two years. At the caller’s request, Domino’s instructed Nova to deliver food to the back of the house. Upon arrival, Nova was lured into the house, where he was allegedly robbed and stabbed to death by three suspects. The suspects are due to stand trial for Richel Nova’s murder.

In the Complaint, Lara alleges that Domino’s was negligent and is responsible for the wrongful death and conscious pain and suffering of Richel Nova. According to the Complaint, Domino’s placed Nova in a highly dangerous situation by sending him alone to deliver food to the back entrance of an abandoned house, while informing the orderer that Nova would be carrying cash.

In addition, Lara alleges that Deutsche Bank was negligent and is responsible for the wrongful death and conscious pain and suffering of Richel Nova. As holder of legal title to the abandoned property in question, Deutsche Bank had a duty to adequately secure the house to prevent trespassers and those who seek to use the premises for criminal activity. Deutsche Bank made no effort to secure a property that lay abandoned for over two years.

The following media outlets have also reported on the story:

Boston Globe
Boston Herald
Wall Street Journal
CBS Boston

Casinos and Happy Hour Regulations in Massachusetts

There has been much debate over whether Massachusetts should permit the establishment of casinos within the Commonwealth. In an interesting development, the Massachusetts Senate approved an amendment to the pending casino bill that would eliminate the famous (or infamous, as some would say) “happy hour regulations.”

Since 1984, the Massachusetts happy hour regulations have prohibited bars and restaurants from offering free or discounted drinks to their patrons. Specifically, the regulations require bars and restaurants to keep the price of a drink the same throughout the entire calendar week. Thus, no 5 p.m. discounts allowed, unless the bar or restaurant wants to charge the reduced price for the entire week. Bars and restaurants are also prohibited from altering the volume of your drink without proportionally altering the price.

The casino bill, if passed by the Massachusetts legislature, could change all of that. On Tuesday, October 11th, the Senate voted 25 to 13 to amend the pending casino bill. The amendment would essentially rid Massachusetts of the happy hour regulations for bars and restaurants, as well as casinos. The amendment must still be approved by the House and signed by the Governor into law.

The concept of the “free drink” is closely tied to casino gambling, presumably because it keeps gamblers motivated to continue gambling. Connecticut’s Foxwoods and Mohegan Sun casinos have long offered free drinks to its customers. It is thought that if Massachusetts’ casinos are to compete, free drinks are a necessity.

However, if casinos are exempted from the happy hour regulations, many bar and restaurant owners are worried that they will not be able to compete. Thus, the amendment to the casino bill would eliminate the regulations for bars and restaurants and create a level playing field.

It also remains to be seen whether Massachusetts casinos will allow smoking. Connecticut law currently allows gamblers to smoke and Connecticut casinos have set up gambling rooms where smoking is permitted. There is no smoking amendments currently in front of the Legislature.

Supermarkets and Alcohol Permits

Two ballot questions to change the law regarding the sale of alcohol in supermarkets were recently filed with the State Attorney General. The Boston Herald reports that the MA Food Association is attempting to increase the total amount of permits that can be held by any one chain.

Currently, Massachusetts law restricts an individual or corporate entity to holding no more than three alcohol permits. This means that a supermarket chain can only sell alcohol from a maximum of three of its locations, regardless of how many individual stores are in the state. This generally explains why certain supermarkets sell beer and wine from only a few locations and not others. Supermarkets must choose which three stores will sell alcohol, which can create problems in store uniformity and customer expectations.

Supermarkets and many customers have been pushing for this law to be changed for years. Senate Bill 1851, if approved by the legislature, would increase the amount of licenses available to a supermarket chain from three to twenty. The bill would also restrict the number of licenses that could be held by a supermarket chain to one per town and two per city. The local licensing authorities would still have to approve a permit application for each location and all alcohol permit quotas would still apply.

It remains to be seen whether Attorney General Martha Coakley will certify either ballot question or whether the legislature will vote favorably on Senate Bill 1851. Needless to say, change could be coming to a supermarket near you but don’t plan to drink-up just yet.

Farmer-Breweries

The Boston Globe and Boston Herald have reported on a recent change or clarification in policy regarding “farmer-brewery” licenses by the Massachusetts Alcoholic Beverages Control Commission (ABCC).  Farmer-brewery licenses are intended to encourage the development of “domestic farms”, and appear in the regulatory statute alongside similar provisions for licensing of farmer-wineries, pub-breweries, and farmer-distilleries.

In late July, the ABCC denied an application for a famer-brewery license to be located in Everett, Massachusetts.  The ABCC followed up on August 1 with an Advisory, announcing that all farmer-breweries will henceforth need to demonstrate that at least half of the grains or hops needed to produce their malt beverages are grown by the licensee.  In an interesting exception, the ABCC announced that the “grown by the license” requirement could be satisfied if the licensee or applicant merely “contracted exclusively” for the rights to the yield of cereal grains or hops produced from acreage of domestic farmland.

In other words, the ABCC ruled that a farmer-brewer needs to actually grow at least half of the cereal grains or hops needed to produce its malt beverage “unless someone else grows the grains and hops for them, both exclusively and domestically”.

Some remaining confusion stems from whether “domestic” as used in the statute means “from within Massachusetts” versus “from within the United States”.  Most observers think the ABCC interprets “domestic” to mean “from within Massachusetts”, such that “farmer-brewers” would need to obtain their grains and hops largely from within Massachusetts.

That interpretation, however, could well be unconstitutional, under a line of recent court cases from around the country interpreting farmer-winery licenses.  Those cases basically hold that under the Commerce Clause of the US Constitution, a state cannot favor in-state interests over out-of-state entities in its liquor licensing scheme.

Stay tuned, the Globe reports that brewers are meeting next week with state treasurer’s office (which oversees the ABCC).

Zipcar

Wayne, Richard & Hurwitz LLP filed a class action Complaint against Zipcar, Inc. (“Zipcar”) on Wednesday, July 27.  The Complaint was filed in the United States District Court of Massachusetts.

Zipcar is a well-known “car sharing” company. Zipcar members pay an annual fee to obtain the ability to rent Zipcars by the hour or for the day. Zipcar vehicles are kept in parking lots and parking garages in major cities, such as Boston, New York City, and Chicago. Once a member reserves a vehicle online or via phone, they use a Zipcar card to access their chosen car. The member can utilize the vehicle for the selected length of time, after which the vehicle must be returned to the garage or lot from which it was retrieved.

The named plaintiff in this case is a Zipcar member challenging Zipcar’s late fee system. If a vehicle is returned late, Zipcar charges substantial late fees, even if the vehicle is returned merely a minute late. Plaintiff objects to this system, as the penalties imparted upon members exceed any compensation for the harm to Zipcar. Plaintiff seeks restitution for late fees unfairly imparted, as well as a finding that Zipcar’s late fee policy is void and unenforceable.