When Licensing Issues Lead to Litigation: Lessons from the Alcohol Industry

Handling legal matters in the alcoholic beverage industry requires a deep understanding of its regulations. For business owners, a minor licensing error can quickly escalate into a serious legal issue. Seeking guidance from a seasoned alcoholic beverage law attorney is a proactive step to protect your business from disputes and penalties arising from licensing issues.

The H. Glenn Alberich Law Office provides dedicated legal support for these specific challenges. Attorney H. Glenn Alberich brings over 40 years of focused experience in alcoholic beverage law, offering a level of knowledge that sets him apart. His firm serves clients in Boston, Massachusetts, and the surrounding communities. 

Common Licensing Problems That Can Result in Legal Action 

For restaurants, bars, breweries, and distributors, an alcohol license is the foundation of the business. However, the path to obtaining and maintaining this license is filled with potential pitfalls. Seemingly minor administrative errors or misunderstandings of the rules can escalate into litigation. 

One common issue is errors or omissions in the initial license application. Supplying incomplete or inaccurate information, even unintentionally, can result in an application denial. If a business owner decides to appeal this decision, it starts a formal legal process. Similarly, failing to meet renewal deadlines or provide updated information can cause a license to lapse, which may require legal action to reinstate it. 

Another area ripe for conflict is non-compliance with the specific terms of a license. For instance, a restaurant licensed to sell wine and beer that also serves hard liquor is in direct violation. Likewise, serving alcohol after legal hours or to an underage person can trigger severe consequences. These violations often result in fines, license suspensions, or permanent revocation, all of which can be contested in court. 

Disputes can also emerge between business partners or with third parties over licensing matters. A disagreement over who legally controls the license during a business sale or dissolution can lead to litigation.  

Neighbors or community groups may also formally protest a license application or renewal, requiring the business owner to defend their right to operate at a legal hearing. These scenarios demonstrate that licensing is not merely a matter of paperwork, but a central component of a business's legal standing. 

A Look at Massachusetts Alcoholic Beverage Laws 

In Massachusetts, the Alcoholic Beverages Control Commission (ABCC) works with local licensing authorities to regulate the sale and service of alcohol. The laws are detailed and specific, governing everything from who can obtain a license to how an establishment can advertise its products. Understanding these state-specific rules is fundamental for any alcohol-related business operating in the Commonwealth. 

Massachusetts General Laws Chapter 138 is the primary statute governing alcoholic beverages. One key aspect of this law is the quota system, which limits the number of liquor licenses available in each city and town based on population. This makes obtaining a new permit in areas like Boston a highly competitive and often expensive process. Aspiring owners may need to purchase a license from an existing holder, a transaction that carries its own set of legal requirements and potential for disputes. 

The law imposes strict liability for serving intoxicated patrons or minors. Under Section 69, selling or delivering alcohol to an intoxicated individual is prohibited. If a business serves someone who then causes harm, the company can be held liable for damages. This "dram shop" liability makes proper training and diligent oversight essential. An infraction can lead to lawsuits from injured parties and administrative penalties from the ABCC. 

Furthermore, regulations around tied-house evil provisions prevent undue influence among the three tiers of the alcohol industry: manufacturers, wholesalers, and retailers. These rules prohibit certain financial relationships and promotions between tiers to foster fair competition.  

A brewery offering illegal incentives to a bar to carry its products, for example, could face legal challenges from the ABCC and competitors, which could threaten its license and market position. These examples highlight just a fraction of the state regulations that require careful attention and compliance. 

How an Attorney Can Help with Licensing Litigation 

When a licensing issue escalates into a legal dispute, working with an attorney who has direct experience in alcoholic beverage law is a significant advantage. An attorney does more than represent a client in court; they provide strategic guidance through every phase of the conflict.  

They can assess the situation and explain the available legal options. They can analyze the alleged violation, review the evidence, and assess the case's strengths and weaknesses. This initial evaluation helps the business owner make informed decisions about whether to settle, negotiate, or proceed with a formal hearing or lawsuit. 

If the matter goes before the ABCC or a local licensing board, the attorney prepares and presents the case. This includes gathering documents, interviewing witnesses, and crafting legal arguments to defend the business's position. They act as the client's advocate, handling all communications with regulatory bodies and opposing parties. This allows the business owner to focus on running their operations while the legal process unfolds. 

In litigation matters, such as appealing a license denial or defending against a lawsuit, a strategic business attorney can manage all aspects of the court proceedings. They file motions, conduct depositions, and represent clients in court. Their familiarity with the laws and procedural rules governing alcohol sales gives their clients a better chance at a favorable outcome. Ultimately, their role is to protect the business's most valuable asset: its license.

Alcoholic Beverage Law Attorney Serving Boston, Massachusetts 

If you are a part of the alcoholic beverage industry, you know it is a heavily regulated field. Success in this business requires more than a basic understanding of its rules. An alcoholic beverage law attorney can offer you support for all aspects of the industry. Attorney Alberich is committed to safeguarding your rights and business interests.  

With over four decades of experience in alcoholic beverage law, he provides reliable legal representation to clients throughout the Boston, Massachusetts, area. He can help you understand licensing laws, guide you through the license application process, and defend you against claims of noncompliance. Call H. Glenn Alberich Law Office today to protect your business.