Texas Breweries File Lawsuit Against State Over Distribution Rights
Three Texas Breweries have filed a lawsuit against the state in an attempt to overturn a 2013 law that forces them to give away their territorial distribution rights.
Live Oak Brewing from Austin, Revolver Brewing in Granbury, and Peticolas Brewing Co. in Dallas have cited Senate Bill 639 as the reason their businesses have not expanded, saying the law is "stifling the Texas craft beer renaissance." Senate Bill 639 states that brewers are not allowed to accept payment for the right to deliver in certain areas. Senator John Carona of Dallas was the creator of the bill, who stated at the time,
What happens when the large manufacturers decide to require payment from a distributor for the right to distribute their brand? We could be back where we started from, with those who won’t pay to play getting muscled out of the marketplace.
The lawsuit, which names the Texas Alcoholic Beverage Commission and its leaders as defendants, claims that the law is a violation of the state Constitution, specifically that a person's property can not be taken without consent unless it is for use by the public. The territorial rights are viewed as property that the suit says brewers should be able to sell to generate revenue. According to the law firm representing the brewers,
This law is like the government forcing authors to give the rights to their books to publishers for free. It is unconstitutional for Texas to force brewers to give distributors property that they never earned and don’t deserve.
via News Journal