Utah State Senator John Valentine (R) (Orem) has introduced a bill (S.B. 261) that may significantly affect alcohol operations if adopted.  S.B. 261 would require that all restaurant patrons must be “seated” to be served or consume a drink. Current law allows a patron to be served and consume a drink while standing at a counter, for instance, while waiting for a table or when proposing a toast. The change would require many restaurants to remodel waiting areas to add seats and frustrate patrons who are denied service if they cannot obtain a seat.

The seating requirement, along with other proposed changes in the bill, also would prevent restaurants from hosting private functions where guests remain standing while drinking, such as during a cocktail party, wedding reception or holiday party. Utah restaurants likely would experience a significant loss of sales as a result. Businesses and individuals who look to restaurants for private functions services also would be negatively affected by the loss of such services.

Additionally, S.B. 261 limits the DABC’s powers to waive or vary the requirements imposed under the statute. Unless expressly authorized under the statute, the DABC no longer would be able to grant variances based on long-standing interpretations of various provisions. For example, the bill would prohibit the change the DABC recently adopted to reverse its position on whether a restaurant patron must place an order for food prior to being served a drink as discussed here. If DABC were required to enforce the express provisions of the statute – a “licensee may not sell, offer for sale, or furnish an alcoholic product except in connection with an order for food” – it would not have been able to reverse course to read this provision as requiring that a patron may be served if an “intent to dine” is demonstrated.

S.B.261 also might eliminate other DABC practices that are not expressly articulated in the statute. For example, DABC currently allows a management agreement between a former owner and a new owner to bridge the gap between a change of ownership and the DABC’s review of the new owner’s license application. Such practice prevents a business from going dry for a short period of time while the new owner’s application is pending. If S.B. 261 passes, it is unclear whether the DABC could continue this practice.Continue Reading Utah Legislature Considers Amendments to Alcohol Beverage Control Act

We are pleased to announce that we have opened a satellite office in Washington, D.C. Our new address, effective immediately:

Stoel Rives LLP
1020 19th Street NW, Suite 375
Washington, DC 20036
Phone: (202) 398-1795 / Fax: (202) 621-6394

The new office is headed by firm partner Greg Jenner, a former Deputy Assistant Secretary

Utah’s liquor control agency has started citing restaurants that serve alcoholic drinks to patrons before they order food.  The agency has shifted policy to now strictly interpret a key provision of Utah’s Alcoholic Beverage Control Act, which provides:

            A full-service restaurant licensee may not sell, offer for sale, or furnish an alcoholic product except in

Litigation concerning the direct shipment of wine has garnered a significant amount of attention in the years since the United States Supreme Court’s seminal decision in Granholm v. Heald. Generally speaking, these disputes have played out in the federal courts, far removed from the typical family winery.

Although direct shipment will remain an important issue both for wineries and for the attorneys who represent them—indeed, it is one of the topics covered in Stoel Rives’ Law of Wine treatise—a winery’s long-term financial success may be just as likely to hinge on the outcomes of lower-profile controversies litigated in front of local government bodies. Depending on the state and locality, these local governments may have the power to prohibit the construction of new tasting rooms or restaurants—a growing source of revenue for many wineries1 —or to regulate the number and character of marketing events held by a winery.Continue Reading As Wine Industry Evolves, Local Regulation Remains King

by Susan Johnson and Claire Mitchell

As we reported last week, Washington Initiative 502 (I-502), a marijuana law reform measure which appeared on the November 2012 general ballot, won the popular vote passing by a margin of approximately 55% to 45%. Now that the initiative has passed, as of December 6, 2012, it will be legal for adults aged 21 years and over to possess up to “one ounce of useable marijuana,” 16 ounces of marijuana-infused product in solid form, 72 ounces of marijuana-infused product in liquid form, or “any combination” of all three.

In addition to legalizing the possession of a limited quantity of marijuana for recreational use by persons 21 and up, the initiative also establishes a licensing system for marijuana producers, processors, and retailers to be administered by the Washington State Liquor Control Board. Over the next year, the Board will be charged with promulgating rules and regulations to fully implement this new licensing structure.

Part III of I-502 establishes the licensing regime over marijuana producers, processors, and retailers and explains the procedures for obtaining a license. All license applicants will first be required to pay an initial application fee of $250. Thereafter, each licensed marijuana producer, processor, and retailer will be required to pay an annual renewal fee of $1,000.Continue Reading Part I: Understanding the License Application Process Under Washington Initiative 502

Co-authored by Susan Johnson and Stephanie Meier

Earlier this week, Washington Initiative 502 (I-502), a marijuana law reform measure which appeared on the November 2012 general ballot, won the popular vote passing by a margin of approximately 55% to 45%. As a result, beginning on December 6, 2012, the initiative that is now law will make it legal for persons aged twenty-one years and over to possess a limited amount of marijuana for recreational use.

Washington State was joined by Colorado in making history this week. On Tuesday night, Colorado voters passed Amendment 64, a measure seeking the legalization of marijuana for recreational use by adults, by 55% to 45%, a margin identical to Washington State’s. A similar measure in Oregon was not as successful. Measure 80, Oregon’s own measure to legalize possession and recreational use of marijuana, was rejected by voters.Continue Reading Washington State Liquor Control Board to Regulate Marijuana Following Passage of Initiative 502

WSLCB adopted a new rule that will allow spirits retail licensees to deliver spirits to customers that place orders in person, through the mail or over the phone, fax or internet.  This rule mirrors the beer and wine delivery privileges currently held by grocery store and beer/wine speciality shop licensees.  The rule will go into effect December 8, 2012

The Washington Supreme Court has upheld I-1183.  Here is a link to the opinion, the concurrence and the dissent

We will follow up with additional analysis, but for now, you can plan your first trip to the grocery store to purchase liquor as early as tomorrow.