Thursday, March 11, 2010

Why does beer brand registration exist?

In the wake of the beer registration massacre and fiasco, a question pops to mind: why does Pennsylvania law require beer brand registration? The answer -- as it is many times with The Almighty Liquor Code -- is not so easy to find. It's a lot like the case law: we've been doing it for 78 years, and no one has any real idea why we started.

What will people tell you? Well, how about Francesca Chapman, the PLCB's usual spokeswoman? Don Russell asked her why in his story in the Daily News, and she said that "the registration requirement helps the state assure payment of state beer taxes and helps prosecutors identify alcoholic beverages in drunk-driving cases or any other type of prosecution."

We'll get to the second part down below. For the first part, I don't see how registration helps in tax payment. Because of the three-tier system and PA's other laws about beer, there is a paper trail a mile long on every beer sale in the Commonwealth: beer comes into the wholesaler -- paperwork -- it goes out to the retailer -- paperwork. And the state can demand the paperwork at any time to see if there is beer on premises that did not go through the taxing process; same thing with self-distributing brewers. You can't escape the tax unless both parties are willing to engage in behavior that could very easily leave them without a license -- and therefore without a business. No one has seriously suggested that taxes were being evaded by selling unregistered brands.

Who's next? Unnamed "Harrisburg enforcement officers" in Rick Nichols piece on the raids in today's Inquirer say the reason is to "protect consumers." Nichols ponders, "How else to know whether the beer is from Victory (legit) or a backyard home-brewer (not)?" I hope he's being facetious (and I'm sure he is). Because if it's a bottle, it has to have a federally-approved label; if it's a draft, by law it's supposed to be dispensed from a tap with the name of the beer it's pouring clearly displayed. (and that's a law that I DO wish would be enforced more often...but that's another story). Does registration do anything? Not at all: again, there's already a paper trail in place that shows where the beer came from, and besides...nobody bothers counterfeiting beer labels. This is ridiculous on the face of it.

There's one more. A brewer I was talking to told me he'd attended a meeting where then-PLCB chief counsel Francis X. O'Brien Jr. about 8 years ago. They asked him why there was a need for brand registration (you'd think he'd know, right?), and O'Brien said it was for criminal cases involving drinking: underage drinking, DUI, and the like. If beer cans or bottles were found on the scene, the prosecuting attorney could use the brand's presence on the registered list to prove that the beer was beer, and thus contained alcohol. My first thought: you gotta be kidding! Then I remembered this court case in Reading a few years ago -- the story's funny, but the facts are serious: they actually needed to prove that Miller Genuine Draft was beer. I don't really think we need a whole system of brand registration just to prove that beer is beer. Could we, I don't know, "stipulate" that in the "rules of evidence" somewhere? Not to mention, it does them no good if the drunk was drinking draft!

I see no good reason for a brand registration law, not even the registration fee (it's less than $300,000 for the whole current list, and the BLCE just blew through about half that with these raids anyway). Unless...take a look at the registration form, particularly the second page. Is registration all about making sure what wholesaler has an exclusive on the brand; is this about marking your territory? If it is...I'm sorry, but once again, I do not understand why it is the state's concern. Let the wholesalers worry about enforcing their exclusivity contracts. There are civil courts, are there not? Does any other industry get this kind of enforcement support from the State? Maybe the dairy industry, but milk ain't beer. If this is what brand registration is about, and wholesalers are still caught with unregistered beers (and the registration list isn't worth the electrons it's printed on anyway -- Don, excellent work here!)...

Why are we registering beers at all? I really want to hear tough questioning on that when the hearings on these raids are held next month.


Anonymous said...

A long time (10-15 years?) ago you could defend underage drinking cases if the cops did not keep the actual beer containers (or get it tested) because the labels were hearsay. The LCB then published in the Pa Bulletin all the beers sold in PA so the Court could take judicial notice that Budweiser was a beer. See this

It may sound silly, but it was the law and I used it in a couple of hearings. When the beer list was first printed more than one cop copied it and brought it to my office.

I do not know if this started the registration or if it still the law. I do remember cops dropping off the list and the laughs we had at my office about my "shopping list".


Lew Bryson said...

The current form of the reg dates to 1987, maybe that's it. In your opinion, is this an issue that could be "solved" in the interests of prosecution by means other than brand registration?

Chuck Cowdery said...

Where was the obvious follow-up question: "How does the registration requirement help the state ensure payment of state beer taxes?"

Anonymous said...

The prosecution can prove it is beer by keeping the beer or at least having someone taste it or test it. They never used to keep the beer. They also now take judicial notice of the list

[Attorney for the Commonwealth]: Your Honor, at this time I'd ask you to take judicial notice of the Pennsylvania Bulletin Volume 22 Number 32 August 8th 1992 [at 4146-4155] under the heading Liquor Control Board Products Registered by Manufacturers as Malt or Brewed Beverages. These are malt or brewed beverages that are defined as any beer, lager beer, ale, porter or similar fermented malt beverage containing one half of one percent or more of alcohol by volume. The board intends to publish periodically additions to this list. I would ask you to take judicial notice that the following beers appear on this list, Busch and Busch Light, and I would ask you to take judicial notice that those two beers appear on the list and are on this list because they have been registered with the Liquor Board as having in excess of one-half of one percent of alcohol by volume. Comm v. Harvey 666 A.2d 1108 (Pa Super 1995)

I'd also never had an underage drinking case with Pliny the Elder, usually Busch or Zima


Anonymous said...

Gregg Hartman's case was reversed on appeal by the higher court and he plead "no contest" which means guilty without admitting.