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State Supreme Court Ruling Means No Monopoly For Monarch Beverage

By Barbara Brosher

Posted July 21, 2017

The Indiana Supreme Court ruled Friday state regulations designed to prevent unfair monopolies mean Spirited Sales LLC cannot to hold a liquor wholesaler's permit.

In September 2013, Spirited Sales LLC applied for a liquor wholesaler's permit with Indiana's Alcohol and Tobacco Commission. After a public hearing on the request, the commission recommended the application be denied because the parent company of Spirited Sales, E.F. Transit Inc., has the same five shareholders as Monarch Beverage Company, an Indiana company that has a beer and wine wholesaler's permit. Under Indiana's liquor licensing laws, the holder of a beer wholesaler's permit cannot also have a liquor wholesaler's permit.

Spirited Sales took the issue to Marion County Court, where a judge ordered the ATC to issue Spirited a wholesaler's permit, calling the commission's denial of the permit "arbitrary and capricious." The ATC challenged that decision and requested a stay, which the court denied. That forced the ATC to issue a liquor permit to Spirited in September 2016. The ATC then requested an emergency transfer of the case to the Indiana Supreme Court, which was granted.

The Indiana Supreme Court says the ATC properly exercised its authority when denying Spirited the permit.

"There can be no doubt that Indiana is empowered to do what the Commission has urged here – which is to bar companies with same ultimate owners from simultaneously holding both beer and liquor-wholesaler permits," the ruling says. "However, over the years, Indiana's alcohol code has become diluted, reflecting many policy choices and resulting amendments, dating back to the 1930s."

The court says deciding whether Indiana's current liquor regulations are working is up to the general assembly. It reinstated the ATC's decision to deny Spirited a liquor permit.

The decision at the state level comes after a federal appeals court ruled in a similar case involving Monarch Beverage Co. earlier this week. The beer distributor wanted the court to throw out the Indiana law keeping beer and liquor distribution separate.

Indiana legislators will study the state's alcohol laws during a summer committee.

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