Austin's Jester King Craft Brewery Sues the TABC, But Is the TABC Really the Bad Guy?

Categories: Brew Blog, News

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Shit just got real.
Jester King, based in Austin, is one of the state's most popular craft breweries. The TABC (or Texas Alcoholic Beverage Commission), also based in Austin, is one of the state's most powerful agencies. And with news that Jester King has just filed a lawsuit against the TABC, our capital could soon become a boxing ring for the ultimate beer battle as the little guys finally take on Big Government.

"We have sued the TABC because we believe that its Code violates our rights under the 1st and 14th Amendments to the Constitution of the United States," wrote Jester King on its website yesterday. "Under the Code, we are not allowed to tell the beer drinking public where our beer is sold. We are also not permitted to use accurate terms to describe our beers. We are often forced to choose either to label them inaccurately or not to make beers that we would like to brew."

The brewery went on to state: "Under the bizarre, antiquated naming system mandated by the TABC Code, we have to call everything we brew over 4% alcohol by weight (ABW) 'Ale' or 'Malt Liquor' and everything we brew at or below 4% ABW 'beer.' This results in nonsensical and somewhat comical situations where we have to call pale ale at or below 4% ABW 'pale beer' and lager that is over 4% ABW 'ale.'"

Jester King -- like other breweries in Texas -- also takes issue with the fact that wineries are allowed to sell their product to the public at their facilities, while breweries aren't. It's the same issue that was brought to the State's attention earlier this year with proposed House Bills 660 and 602, although neither bill passed the Legislature.

The lawsuit itself takes TABC to the woodshed for its bureaucratic dysfunction in a beautifully written argument on page five of the Motion for Summary Judgment:

When questioned at its Rule 30(b)(6) deposition, the TABC could identify no substantial government interest that is advanced by preventing breweries from telling customers where their beer can be bought. The TABC agrees that the ban does not "promote the welfare, health, peace, temperance or safety of the people of Texas," that it does not "promote legal and responsible alcohol consumption," and that it does not "ensure fair competition with the alcohol beverage industry.'' The only government interest the TABC could articulate was to "[e]nsure consistent, predictable and timely enforcement of" the Texas Alcoholic Beverage Code. The TABC frankly recognized that its rationale - "It's the law, and that's the end of it" - circular reasoning that justifies enforcing the Code simply because it is the Code.

Public excitement over the lawsuit ran high, with craft beer fans taking to Twitter in joyous bleets: "This is HUGE," wrote Bill Norris, beverage director at Austin's Alamo Drafthouse. "I hope they win!" added Jodi Bart, an Austin-based food blogger.

But just like the excitement over HB 602 and HB 660, craft beer supporters could be in for more disappointment in the long run.


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36 comments
Steve Ravet
Steve Ravet

Chad, Jeff, and the rest of you guys, GO GET THEM!  three cheers for y'all.

From Steve in CA, where there unfortunately isn't any Jester King.  I'll be back around Christmas though so save me a bottle.

--steve

H_e_x
H_e_x

Too bad the legislature is in the pockets of the big breweries. They claim to support local business, but that's a god damn lie.

Winelush
Winelush

A big problem is each TABC officer or whatever they're called each interpret the laws differently, so it's not you're getting told no, it's the crapshoot who interprets the law to determine if you're breaking it, thats why everyone is so mad at TABC all the time.  It's a case study in Tammany Hall type politics run cray cray.

Tom
Tom

Hey fellows, the TABC doesn't care about following the law, look at Sec 22.04 of the Texas Alcoholic Beverage Code, and then count how many stores the Specs Liquor chain has. TABC Director Alan Steen even admitted to the AG that the TABC has allowed bulk buys of liquor permits despite sec 22.04's limits of 5 liquor store permits.

Chip W.
Chip W.

Just drinking some Boulevard White IPA the other day.. notice and laughed at the small print on back of the bottle "Flavored Ale in TX." Can you imagine how insane labels would look if every state had these laws on the books?!

Erik
Erik

So if we want to indirectly help out the effort, where in Houston is Jester King sold?  I know Flying Saucer usually has some on tap.  Anywhere else?  Any place have it for off-sale?

KClark
KClark

Would be surprised if this succeeds. The 21st amendment gives states broad powers to regulate alcohol in a way that they can't regulate other goods and services. This means the commerce clause and other basic constitutional provisions don't apply with the same force to alcohol laws, so it makes sense that existing amendments (1st and 14th) could be modified in the same way.

hzzgity
hzzgity

For a cheap SJ brief, this is pretty good.  I wouldn't be at all surprised if JK wins, at least on the 1st Amendment claims; these are strong arguments, and unless there's something JK is deliberately not addressing in the motion, it's tought to see what plausible counterargument TABC can come up with.  Their 30(b)(6) guy got taken to the woodshed; I hope, for his sake, that his heart just wasn't in this fight.   And while it's true that summary judgment isn't granted as a matter of course, it's not exactly rare.  Trials are held to resolve disputed issues of material fact, not issues of law.  On my reading of this brief, its tough to imagine what material facts could possibly be in  reasonable dispute.

Benfullelove
Benfullelove

Jeff stuffings, jesterkings co-owner, is a lawyer and I'm pretty sure this isn't costing too much money. If this does nothing more than bring attention to the out dated laws of TABC then it's still a victory for the craft community. These guys have huge balls and should be commended for their bold steps.

Dustin Kalman
Dustin Kalman

I think no matter if Jester King wins this battle or not, they could lose the war. This lawsuit might be very expensive in the long run and a drain on their profits.

doo doo daddie
doo doo daddie

Jester King is clearly not paying off the right people

Terry Alexander
Terry Alexander

I received the e-mail from Jester yesterday announcing this recent step. I read it with high hopes for a positive outcome. I also feel that it is just the first volley of an impending war but feel unless other craft brewers in Texas unite as one the suit hasn't the proverbial snowballs chance in hell to have a favorable outcome for consumers.

KAC
KAC

I haven't yet started the TABC nightmare yet and NOT looking forward to it. Thanks for the article. I'll have to follow it.

Wnorris3
Wnorris3

Bingo. The code is inane, contradictory and impossible to understand for consumers, retailers, bars/restaurants, and the people charged with enforcing it.

Dustin Kalman
Dustin Kalman

I believe that the exception is that it is 5 per person and if you are part of the same family, you can combine them. So, mom has 5, dad has 5, etc. However, it seems like they have gone beyond that rule and I do wonder, if someone in the family dies, what happens to those 5 permits?

Terry Alexander
Terry Alexander

Jester King is available at my HEB and Hubbel and Hudson. I'm sure Spec's carries it also.TA

Erin Nies
Erin Nies

I've purchased bombers of JK at the Spec's mothership in Midtown.

illegal1
illegal1

For the zombies, of course.

Davistucker
Davistucker

It's costing JK, nor the other two entities who sued along with JK anything.  The layer who  filed the suit is bearing all the expense.  He has been involved in craft beer for a very long time.

Dustin Kalman
Dustin Kalman

There is an old saying about the lawyer who represents himself having a fool for a client. However, even if he isn't paying lawyer fees with money, he certainly is paying them with time and energy that could be put to more profitable uses. However, they definitely have balls to go this route and it will be interesting to see how this plays out.

Jstuffings
Jstuffings

Fortunately Austin attorneys Jim Houchins and Peter Kennedy are representing us pro bono.

Jeff StuffingsOwner/Brewer Jester King Craft Brewery

Terry Alexander
Terry Alexander

That was exactly the reason I was thinking that it would be better to enlist as many breweries as they can to keep from having to bear that load themselves. It will only help them all in the long run so why not look like one of the good guys at the outset instead of a coattail rider.TA

Katharine Shilcutt
Katharine Shilcutt

Seriously. I can't imagine how much that motion alone cost to draw up.

Jstuffings
Jstuffings

We tried to get other breweries in Texas to join us in suing TABC, but we were not able to convince them to do so.

Jeff StuffingsOwner/Brewer Jester King Craft Brewery

Katharine Shilcutt
Katharine Shilcutt

"First volley of an impending war" is a great way to put it. It feels a little like the first shot fired at Lexington. In speaking with Leslie, she said that it's likely other craft breweries will wade into the fray, but where it will go from there is anyone's guess...

Katharine Shilcutt
Katharine Shilcutt

I would like for breweries to be able to tell their public at which pubs/restaurants/stores they can purchase their beers. I mean, such simple things...and yet such batshit insane laws preventing them from happening.

Davistucker
Davistucker

Wow!  Where is spell check when you need it?!  That would be "lawyer" not layer, although he could be a layer as well, I suppose.

Terry Alexander
Terry Alexander

This is interesting also because I get monthly e-mails from Saint Arnold and in them they mention where there beers are available at our sports stadiums. And just last month I e-mailed one of the Austin brewers and they sent me a big list of bars that had their beers on tap. Are they breaking the law according to the TABC?

Kyle
Kyle

Exactly. This is why I take issue with not just the law, but with TABC itself. TABC can decide administratively what constitutes a reward or inducement and chooses to do so in the most draconian ways (like prohibiting manufacturers from telling the public where to find their product).

Davistucker
Davistucker

Not a postwhore, it just bothers me to let my own stupidity go unchecked : )

Davistucker
Davistucker

And I should have said it "isn't" costing any of the three entities suing the TABC anything.  Long day, I guess.

Kyle
Kyle

Probably. Check this out:

Your search returned 0 locations within 5 miles of zipcode 77002. Sorry Texans, we've been informed by the Texas Alcohol Beverage Commission that it is illegal to list retail outlets in the Lone Star State on our Fish Finder. Even though we continue to sell Dogfish beers in Texas, we cannot tell you where. So sorry - cheers.  http://www.dogfish.com/brews-s...

Katharine Shilcutt
Katharine Shilcutt

I'm afraid that's how the TABC would interpret it if they knew about it. Thankfully, there are so many breweries now, it has to be increasingly difficult to monitor all of their marketing materials...

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